The board of directors of Climax International Company Limited informed the shareholders that the group are expected to record a net profit for the year ended March 31, 2013 as compared to a net loss for the corresponding year ended March 31, 2012. The expected net profit is mainly attributable to the operating profit contributed by the paper business acquired during the year. The forecasted consolidated net profit of the Enlarged Group attributable to the shareholders for the year ended March 31, 2013 would be approximately HKD 10.5 million and the forecasted consolidated net profit of the target group for the year ended March 31, 2013 would be approximately HKD 17.8 million.

The Board believes that the shortfall was mainly attributable to the facts that the consumer market and the demand of the products was adversely affected by the impacts of recent European debt crisis and the economic down turn in the United States of America.