Kaisun Energy Group Limited provided earnings guidance for the year ended December 31, 2011. The board of directors of the company informed the shareholders of the company and potential investors that it expects to record an increase in loss for the period compared to that of the same period last year. As disclosed in the company's circular dated October 6, 2011, the sale of equity interest in Mengxi Minerals is expected to record an estimated loss of approximately HKD 800 million (after relevant expenses and subject to audit) for the group, which was arrived at by subtracting the consideration from the net asset value. Such loss has been recognized in the group's consolidated account for the year ended December 31, 2011. The estimated loss was mainly attributable to the substantial increase in net asset value of Mengxi Minerals at the time of acquisition arising from different accounting treatment between the Hong Kong Financial Reporting Standards and the relevant PRC accounting standards. This estimated loss is expected to be non-cash in nature.