Kingwell Group Limited — Earnings Release 2016

Feb 17, 2016

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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(formerly known as Guocang Group Limited) (Incorporated in Bermuda with limited liability)

(Stock Code: 559)

PROFIT WARNING

This announcement is made by the Company pursuant to Part XIVA of the SFO and Rule 13.09 of the Listing Rules.

The Board wishes to inform the Shareholders and potential investors that the Group is expected to record an increase in the net loss for the six months ended 31 December 2015 as compared to that for the corresponding period of 2014. The loss was mainly attributable to (i) the substantial decrease of turnover by approximately HK$30 million and gross profit margin of liquor and wine business as compared to the corresponding period of 2014, (ii) share-based payment expenses of approximately HK$43 million, (iii) absence of gain on disposal of subsidiaries of approximately HK$40 million and (iv) impairment loss on goodwill of approximately HK$132 million which partly offset a gain on change in fair value of contingent consideration receivable of approximately HK$62 million.

The information contained in this announcement is only based on the management’s preliminary assessment of the draft consolidated management accounts of the Group for the six months ended 31 December 2015, which have not been finalised nor reviewed by the Company’s audit committee.

Shareholders and potential investors are advised to exercise caution when dealing in the shares of the Company.

This announcement is made by DeTai New Energy Group Limited (the ‘‘Company’’, together with its subsidiaries as the ‘‘Group’’) pursuant to Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) (the ‘‘SFO’’) and Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the ‘‘Listing Rules’’).

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The board (the ‘‘Board’’) of directors (the ‘‘Directors’’) of the Company wishes to inform the shareholders of the Company (the ‘‘Shareholders’’) and potential investors that the Group is expected to record an increase in the net loss for the six months ended 31 December 2015 as compared to that for the corresponding period of 2014. The loss was mainly attributable to (i) the substantial decrease of turnover by approximately HK$30 million and gross profit margin of liquor and wine business as compared to the corresponding period of 2014, (ii) share-based payment expenses of approximately HK$43 million, (iii) absence of gain on disposal of subsidiaries of approximately HK$40 million and (iv) impairment loss on goodwill of approximately HK$132 million which partly offset a gain on change in fair value of contingent consideration receivable of approximately HK$62 million.

As the results of electric cycles business were short of expectation, impairment losses on goodwill of approximately HK$132 million were recognised for the six months ended 31 December 2015. Pursuant to the terms of the sale and purchase agreement dated 26 April 2015 entered into between the Company and the then vendor in relation to the acquisition of the electric cycles business, if the profit of the acquired electric cycles business for the financial year ending 30 June 2016 shall be less than RMB100 million, the then vendor will compensate the Company in cash. As a result, a gain on change in fair value of the contingent consideration receivable of approximately HK$62 million was recognised for the six months ended 31 December 2015.

The information contained in this announcement is only based on the management’s preliminary assessment of the draft consolidated management accounts of the Group for the six months ended 31 December 2015, which have not been finalised nor reviewed by the Company’s audit committee. Details of the Group’s results for the six months ended 31 December 2015 are expected to be announced at the end of February 2016.

Shareholders and potential investors are advised to exercise caution when dealing in the shares of the Company.

By order of the Board DeTai New Energy Group Limited Wong Hin Shek Chairman and Executive Director

Hong Kong, 17 February 2016

As at the date of this announcement, the executive Directors are Mr. Wong Hin Shek and Mr. Chi Chi Hung, Kenneth; the non-executive Director is Mr. Chui Kwong Kau; and the independent non-executive Directors are Mr. Chiu Wai On, Mr. Man Kwok Leung and Dr. Wong Yun Kuen.

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