China Modern Dairy Holdings Ltd. provided preliminary consolidated earnings guidance for six months ended December 31, 2013. For the period, the company said that it expects to record a significant increase in net profit as compared to corresponding period in 2012. The company expects to record for the six months ended December 31, 2013 (i) an increase in total revenue of more than 70% to approximately RMB 1,900 million, (ii) an increase in cash EBITDA (being earnings before interest expanse, taxation, depreciation, amortization and gain/loss arising from changes in fair value less cost of sales of dairy cows) of more than 118% to approximately RMB 590 million, and (iii) an increase in profit attributable to shareholders of more than 80% to more than approximately RMB 310 million, as compared with the corresponding period in 2012.

The company considers that the increase in profit for the six months ended December 31, 2013 was mainly due to (i) the expansion of the number of milkable cows and continuous improvement in the milk yield per milkable cow, (ii) an increase in sales of branded milk, (iii) persistent increase in both of the production volume and unit price of raw milk, and (iv) effective control of costs and expenses.