The board of directors of China Star Entertainment Limited informed the shareholders of the company and potential investors that the Group is expected to record a loss of approximately HKD 320 million to HKD 360 million for the year ended 31 December 2016 as compared to a profit of HKD 107,864,000 for the year ended 31 December 2015. Based on a preliminary review on the unaudited consolidated management accounts of the Group for the year ended 31 December 2016 and information currently available to the Board, the incur of a loss is mainly attributable to the gross profit for the year ended 31 December 2016 decreased by approximately 70% to 80% as compared to HKD 462,722,000 in the previous year due to significant decrease in revenue for service income from gaming operations as a result of the recession in gaming industry in Macau and the loss incurred in the new film released during the year in the amount of approximately HKD 220 million; the recognition of unrealized loss of approximately HKD 19 million arising on change in fair value of financial assets classified as held for trading investments as compared to unrealized gain of HKD 99,638,000 recognized in the previous year which represented the decrease in market values of the Group's equity securities listed in Hong Kong as at 31 December 2016; and the recognition of loss on fair value change of investment properties of approximately HKD 33 million during 2017.