Lingbao Gold Group Company Ltd. provided that the unaudited loss from the continuing operations for the year ended 31 December 2019 of the Group is expected to be approximately RMB 260,000,000, representing a decrease as compared to the year ended 31 December 2018, of which the loss from the continuing operations of the Group was approximately RMB 1,179,000,000. As compared to the Fiscal Year 2018, the unaudited results of the Group for the Fiscal Year 2019 were relatively better, due to the fact that (i) the Group increased its investments in safety and environmental protection, expanded gold production, implemented cost reduction and efficiency improvement measures as well as optimized financial and administrative costs in the Fiscal Year 2019; and (ii) the Group's gold production during Fiscal Year 2019 increased significantly and the gross profit margin was also improved. The losses incurred by the Group during the Fiscal Year 2019 were due to (i) impairment provision of approximately RMB 120,000,000, which included an impairment on an investment deposit, an impairment provision in respect of certain fixed assets and impairment provisions on other receivables; (ii) the special action on non-rule violations in the field of non-coal mine safety production which has, to certain extent, impacted a portion of suppliers and their supply volume of raw material; and (iii) unutilized productivity and negative impact on the operating results of the Group affected by mandatory sewage and emission reduction measures introduced by the local government authorities.