The board of directors of Grace Wine Holdings Limited informed the shareholders of the company and potential investors that, based on the preliminary review of the unaudited consolidated management accounts of the Group (the Management Accounts) for the first quarter ended 31 March 2019, the Group is expected to record a net loss of approximately RMB 3.2 million in first quarter of 2019, as compared to a net profit of approximately RMB 0.2 million for the three months ended 31 March 2018, mainly attributable to an increase in administrative expenses which comprise share-based payments as remuneration to certain management personnel and a decrease in revenue due to the drop in sales volume of the Group's wine products as a result of the lower market demand in Shanxi province during first quarter of 2019.