The board of directors of Wuyi International Pharmaceutical Company Ltd. announced that it is expected that the group is likely to record a substantial decrease in the consolidated net profits for the six months period June 30, 2013 as compared with the consolidated net profits for the six months ended June 30, 2012 or even record a loss for the six months period ended June 30, 2013. The Board believes is mainly attributable to the following reasons: facing multiple challenges arising from the related policies, guidelines, quality standard requirements proclaimed by the State and market pressure, the business environment is still difficult, causing for a decline in the overall sales amount of the company's pharmaceutical products; the continuingly increasing pressure on the cost of sales, including labour costs, raw material and packing material costs in the market of the People's Republic of China, hence the gross profit of pharmaceutical enterprises was inevitably be affected. The company's subsidiaries in the PRC increased the advertising and marketing expenses so that to increase the awareness of the brand and products of the Group since the second half of last year, and the management believes that using this marketing strategy can maintain the company's sale competitive in a market.

Management continuously reviews the profitability of fixed assets, e.g. factories and production equipment.