Chiho-Tiande Announces 2011 Interim Results

Net Profit Surges 94.6% to HK$305.3 Million

Through Well Established Overseas Network and Expanding Processing Capacity

Striving to become Pioneer in Mixed Metal Scrap Recycling Industry

HONG KONG, Aug. 17, 2011 /PRNewswire-Asia/ --

Chiho-Tiande Group Limited ("Chiho-Tiande" or the "Company", and together with its subsidiaries, the "Group", stock code: 976), the largest importer of Mixed Metal Scrap in the PRC, announced its unaudited interim results for the six months ended 30 June 2011 (the "period under review").

Benefiting from continuing improvement in the PRC's market conditions, the Group recorded strong growth in revenue and exceptional overall profitability for the period under review as compared to the first half of 2010. For the period under review, revenue increased by 85.1% to approximately HK$4.5 billion. Gross profit increased 63.9% to approximately HK$452.7 million with a gross profit margin of 10.0%. Net profit increased 94.6% to approximately HK$305.3 million with a net profit margin of 6.7%. Basic earnings per share came in at HK$0.30 with an increase of 42.9% as compared to the first half of 2010. The board of directors does not recommend payment of any interim dividend for the period under review.

Commenting on the results, Mr. Fang Ankong, Executive Chairman and Chief Executive Officer of Chiho-Tiande said, "With the increasing support from the PRC Government to develop the recycling industry, especially with reference to the latest PRC Government policies stated in its '12th Five-Year Plan', we are confident that the metal recycling industry is in an advantageous position. During the period under review, the Group continued to follow its usual practices of increasing procurement volume to cater for processing needs through its well established overseas procurement network. The Group sold over a total of 370,000 tonnes of processed products within its three business segments. This represented an increase of 60.9% as compared to the same period of 2010."

During the period under review, the Group's sales from the metal recycling business increased 74.7% to approximately HK$3.7 billion, with foundry business sales increased by 118.4% to approximately HK$593.5 million. Sales from our wholesale business increased by 351.9% to HK$219.6 million.

Seeking to diversify processing capability and to increase coverage, the Group established two joint venture operations in Shanghai and Hong Kong last year in order to expand its processing capacity. Currently, facilities in Hong Kong and Shanghai are at their early phases of development with expected annual processing capacities of 150,000 tonnes of ferrous and non-ferrous scrap metals and 300,000 tonnes of ferrous scrap metal respectively. As for the main facilities in both Taizhou and Ningbo, capacities are expected to increase to 630,000 tonnes and 210,000 tonnes by the end of this year.

Moreover, as announced on 11 August 2011, the Company entered into an investment agreement with Yantai Economic and Technological Development Zone Administration Committee for the purpose of developing and operating an integrated processing facility for recycling, processing and sales of imported mixed metal scrap in Yantai. The project is expected to have an annual processing capacity of 500,000 tonnes.

In future, the Group will continue to increase the procurement of raw materials and further strengthen procurement network and enhance capability of facilities so as to cater for the rapidly increasing demand for scrap raw materials in the PRC. The Group is aiming to procure 55,000 to 65,000 tonnes of Mixed Metal Scrap materials a month to cater for the processing needs.

Commenting on the outlook, Mr. Fang concluded, "With the PRC government's intention to promote environment protection and resources conservation, our business of mixed metal scrap recycling, reuse and processing is benefiting from such national policies. The Group believes that the gross profit margin of imported mixed metal scrap is the highest among all segment of the metal recycling industry. With our extensive purchasing network worldwide, we will continue to increase the processing capacity of mixed metal scrap in the PRC, including expansion of existing processing facilities and establishment of newly built processing facilities. The Group continues to seek potential investment and acquisition opportunities. For the second half of 2011, we expect our output and profitability to continue to grow. We strongly believe in our ability to capitalize on this rapidly growing sector and maximize returns for our shareholders in a sustainable and environmentally responsible manner."

About Chiho-Tiande Group Limited

Listed on the Main Board of The Stock Exchange of Hong Kong Limited on 12 July 2010, Chiho-Tiande is a mixed metal scrap recycler in the PRC and the largest importer of mixed metal scrap in the PRC in terms of total import volume and actual import volume. According to the PRC Customs data, the Group was also the largest importer of copper-based scrap in the PRC in 2010. Its business operations are broadly classified into three categories: metal recycling business, foundry business and wholesale business. The Group specializes in the recycling and processing of imported mixed metal scrap. Chiho-Tiande possesses a well-established procurement network for mixed metal scrap, and operating through its four sizable processing facilities locating in Taizhou, Ningbo, Shanghai and Hong Kong, with an expected annual total processing capacity of over 840,000 tons of mixed metal scrap.

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