ShiFang warns of loss

An advertisement distribution agreement was terminated.

The board of directors of ShiFang Holding Limited announced that the Group is expected to record a loss for the year ended 31 December 2012 as compared to the profit recorded for the year ended 31 December 2011.

Based on the information currently available to the Group, the anticipated loss was mainly attributable to the following:

1. the PRC government’s continuing adjustment measures on the implementation of the real estate industry which results in the reduced advertising orders from real estate developers and other related industries, consequently the annual business receipts of the Company decreased as compared to 2011;
2. the advertisement distribution agreement entered into with the Shenyang Evening News was terminated in July 2011 due to contractual disputes between the parties;
3. the expiry of the exclusive real estate advertising agreement entered into with the Dalian Daily; and
4. the continuing uncertainty of the recoverability of certain receivables and the continuing need to make provision for bad debts.

Details of the annual result of the Group will be disclosed in March 2013.