Based on a preliminary assessment on the unaudited consolidated management accounts of the Group, the board of directors of Jiu Rong Holdings Limited informed the shareholders of the Company and potential investors that it is expected to record a loss for the six months ended 30 June 2015 as compared with the profit for the six months ended 30 June 2014. The loss is caused by decrease in sale of water meters, television and set-top box of approximately 30% and increase in administrative expenses of approximately 80% for the six months ended 30 June 2015 compared with the corresponding period ended 30 June 2014.