Zhongzhi Pharmaceutical Holdings Limited provided consolidated earnings guidance for the year ended December 31, 2021. The Board informed the shareholders of the company and potential investors that based on the preliminary review of the unaudited consolidated management accounts of the Group for the year ended 31 December 2021, it is expected that the Group will record a profit of around RMB 90.0 million (before fair value adjustment on unlisted wealth management product) for the year ended 31 December 2021 as compared to the net profit of RMB 138.6 million the year ended 31 December 2020. Notwithstanding an increase in revenue of the Group, the expected material reduction in net profit is mainly attributable to (i) an increase in overall production costs due to the global increase in raw material prices including metals and Chinese medicinal herbs; (ii) increase in selling and distribution expenses incurred due to the increase in advertising expenses for promoting the Company's products and brand name; and (iii) increase in salary expenses as a result of the increase of headcounts for the expansion of operations in the first half of 2021.