The board of directors of Sparkle Roll Group Limited informed shareholders of the company and potential investors that the group is expected to record a loss for the six months ended 30 September 2013 compared with the profit for the six months ended 30 September 2012. Such expected loss was mainly due to (i) significant decrease in gross profit margin of
automobile dealerships business of the group, which generated approximately 96% of total revenues of the Group for the six months ended 30 September 2013, as a result of keen competition of automobile dealerships following new dealers established in cities near Beijing and Tianjin although there was a modest increase in number of automobiles sold by the group; (ii) significant decrease in gross profit margin of watches & jewelries business as a result of sales promotion and (iii) substantial drop in sales of top fine wines although sales of private label wine, Ex-Chateau, recorded improvement.