Changmao Biochemical Engineering Co. Ltd. announced that having assessed the currently available information, although there is an estimated increase in the company's turnover for the first quarter ended March 31, 2012, the company to record a decline in the consolidated net profits for the three months ended March 31, 2012 as compared to the consolidated net profits for the three months ended March 31, 2011. The company believes that financial performance has been affected mainly by the decline in gross profit margin as a result of the increase in raw material cost and the deterioration of the results of the associate company of the group for the quarter ended March 31, 2012. Despite the lower consolidated net profits for the three months ended March 31, 2012 the board considers that the Group's overall financial position is still healthy and the Board remains positive on the long term prospect of the group.