The Board advised the shareholders of the Fountain Set Holdings Ltd. and potential investors that based on the preliminary review of the unaudited consolidated management accounts of the Group for the six months and twelve months ended 31 August 2012 respectively, it is expected that the Group's results for the six months and twelve months ended 31 August 2012 may record losses as compared with profits for the corresponding periods ended 31 August 2011. The Board considers that the losses for the six months and twelve months ended 31 August 2012 are mainly attributable to the decrease in the overall gross profit margin of the Group caused by continuous deterioration in the textile market conditions as well as the unusually high price premium of cotton in the Mainland China over that of the rest of the world. Nevertheless, the Board considers that the Group maintains sufficient liquidity to support its ongoing operations.