Based on the unaudited consolidated financial statements of China Hanking Holdings Limited, the board of directors of the China Hanking Holdings Limited announced that the company is expected to record a substantial decrease in the profit for the six months ended 30 June 2014 as compared with the profit for the six months ended 30 June 2013. Such decrease in profit is mainly attributable to a decrease of approximately 11% in the average selling price of iron ore concentrates for the six months ended 30 June 2014 as compared with that of the corresponding period of 2013 and an increase in selling cost of iron ore concentrates. Such adverse effects outweighed the positive outcome brought from a substantial increase of approximately 21% in the sales of the iron ore concentrates of the Group.

The board expects that the increased production capacity of the iron ore business of the company will be further released in the second half of 2014, which may result in a substantial growth in the output and sales volume of iron ore concentrates as compared with that of the first half of the year.