Merdeka Resources Holdings Limited provided preliminary earnings guidance for the year ended December 31, 2012. For the period, based on the preliminary review on the information currently available, the Board would informed the shareholders and potential investors that the loss attributable to the owners of the company for the year ended December 31, 2012 may increase significantly as compared to 2011. The expected increase in loss is mainly attributable to the potential impairment loss in relation to the forest concession that has a book value of approximately HKD 830 million as at December 31, 2011.

The potential impairment loss may arise due to weakened general demand and lower market prices for timber products and likely delay of the project as a result of adverse local political situation in the province of Papua, Indonesia where the forest concession is situated. The impairment loss is non-cash in nature.