Zhejiang Yonglong Enterprises Co. Ltd. announced that after preliminary assessment on the unaudited management accounts of the company, announced to the shareholders of the company and potential investors that it is anticipated that the company may record a significant decline of turnover and incur a gross loss for the three months ended March 31, 2013 when compared to that of the corresponding period in 2012. Based on the information currently available, it is considered that such decline of turnover and incur of gross loss is mainly caused by the dropping of sales orders and rising of raw material cost and the labour cost in China as compared to that of the same period in 2012.

The Board considers that the financial position of the company remains solid.