The board of directors of The United Laboratories International Holdings Limited informed the shareholders of the Company and the potential investors that, based on the unaudited consolidated management accounts of the Company for the year ended 31 December 2016 prepared in accordance with Hong Kong Financial Reporting Standards, the Group's unaudited annual results for the year ended 31 December 2016 is expected to record a loss of approximately HKD 300 million, while the net profit for the year ended 31 December 2015 is approximately HKD 110 million. The loss for 2016 is mainly attributable to a number of factors: Loss on fair value change on investment properties located in Chengdu, China; Loss on fair value change of embedded derivative components of convertible bonds issued in December 2016 by which the change in the Company's share price from the date of issue to the year-end date as at 31 December 2016 is one of the major factors; and Decrease in turnover of major intermediate products 6-APA and decrease in production lead to higher production costs during the year thus resulting decrease in gross profit.