The board of directors of the Sany Heavy Equipment International Holdings Company Ltd. expected that the net profit of the Group for the six months ended 30 June 2015 will record a significant decrease ranging from approximately 70% to 80% as compared to the six months ended 30 June 2014. Such expected decrease was primarily attributable to the coal industry kept adjusting. Though the demand for coal has been stabilizing, there has been no obvious increase in demand for coal machineries in the first half of this year.

At present, since coal enterprise capital chain is generally tight, the Group adheres to the principle of prudence, therefore decides to increase the proportion of bad debt provision made for the trade receivables for the six months ended 30 June 2015, leading to a significant decrease in the net profit. In view of this, the Group has adopted enhanced control measures for the receivables and it is expected that the bad debt losses attributable to the receivables will decrease.