The board of directors of the United Gene High-Tech Group Limited informed the shareholders of the Company and potential investors that, based upon the preliminary review of the unaudited management accounts of the Group for the six months ended 30 September 2014, the Group expects to record a net loss for the six months ended 30 September 2014 in the amount within the range of approximately HKD 360 million to HKD 400 million, representing a significant increase as compared to the corresponding period in 2013. The significant increase in loss was caused primarily due to the effects relating to the accounting treatments of the Group's issued convertible bonds and investment in Extrawell Pharmaceutical Holdings Limited and is primarily caused by: loss on the acquisition of the convertible bonds issued by Extrawell, which represented the excess of the fair value of the convertible bonds of the Company issued as consideration over the fair value of the convertible bonds of Extrawell, pursuant to the very substantial acquisition and
connected transaction as announced on 15 May 2013, adjustments on fair market value loss of the convertible bonds, further impairment of the investment in associates, and effective interest expense on the Company's issued convertible bonds.