Pan Asia Environmental Protection Group Limited provided consolidated earnings guidance for the full year ended December 31, 2012. The group might record a consolidated net loss for the financial year ended December 31, 2012 as compared to the consolidated net profit for the financial year ended in December 31, 2011. The Board considered that the consolidated net loss for the financial year ended December 31, 2012 was mainly due to the reasons that: there was a decrease in the revenue of the group for the financial year ended December 31, 2012 due to keen competition in the industry; there was a decrease in the gross profit margin of the group for the financial year ended December 31, 2012 due to keen competition in the industry and increase in cost; and the new wood wool cement board business just started generating revenue for the group in the fourth quarter of the financial year 2012, and yet the amount of such revenue was still small as compared to the increasing expenses incurred on development of such business for the whole financial year 2012; however, the Board believes that continuing development of such new business would eventually be rewarding and beneficial to the Group as the revenue is expected to be growing in future.