EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

For Release November 15, 2010 8:00pm US Eastern Time

3SBio Inc. Announces Unaudited Third Quarter Results

Third quarter revenues grew 24.9% year-over-year to RMB115.6 million (US$17.3 million);

First nine months revenues grew 30.8% year-over-year to RMB317.4 million (US$47.4

million); Company reiterates FY2010 revenue guidance

SHENYANG, CHINA — November 16, 2010 — 3SBio Inc. (NASDAQ: SSRX) (“3SBio” or “the Company”), a leading China-based biotechnology company focused on researching, developing, manufacturing and marketing biopharmaceutical products, today announced its unaudited financial results for the third quarter ended September 30, 2010.

Third Quarter 2010 Financial Highlights:

 

   

Total net revenues increased by 24.9% over the third quarter of 2009 to RMB115.6 million (US$17.3 million).

 

   

Operating income decreased by 6.2% over the third quarter of 2009 to RMB26.8 million (US$4.0 million).

 

   

Net income decreased by 16.7% over the third quarter of 2009 to RMB22.4 million (US$3.4 million).

 

   

Net income per American Depositary Share (“ADS”) on a fully-diluted basis for the third quarter of 2010 was RMB1.01 (US$0.15) compared with RMB1.25 (US$0.18) for the third quarter of 2009.

First Nine Months 2010 Financial Highlights:

 

   

Total net revenues in the first nine months of 2010 increased by 30.8% to RMB317.4 million (US$47.4 million) compared to RMB242.6 million (US$35.5 million) in the first nine months of 2009.

 

   

Operating income increased by 11.4% over the first nine months of 2009 to RMB82.9 million (US$12.4 million).

 

   

Net income increased by 6.9% over the first nine months of 2009 to RMB74.6 million (US$11.1 million).

 

   

Net income per ADS on a fully-diluted basis for the first nine months of 2010 was RMB3.39 (US$0.51) compared with RMB3.24 (US$0.47) for the first nine months of 2009.

Third Quarter 2010 Business Highlights

 

   

EPIAO, the Company’s flagship injectable recombinant human erythropoietin (“EPO”) product, demonstrated strong growth with net revenues from EPIAO in the third quarter of 2010 rising 22.6% to RMB69.4 million (US$10.4 million) compared to RMB56.6 million (US$8.3 million) in the third quarter of 2009. EPIAO accounted for 60.0% of total revenues in the third quarter of 2010, compared to 61.1% in the same period of 2009. According to the latest data from IMS Health China, EPIAO’s market share in terms of value reached 41.1% in the second quarter of 2010.

 

   

Net revenues for TPIAO, the Company’s novel recombinant human thrombopoietin (“TPO”) product, increased by 28.2% to RMB35.8 million (US$5.3 million) in the third quarter of 2010, compared to RMB27.9 million (US$4.1 million) in the third quarter of 2009. TPIAO accounted for 30.9% of total revenues in the third quarter of 2010 compared to 30.1% in the same period of 2009.

 

   

Iron Sucrose sales grew 28.7% in the third quarter to RMB 4.8 million (US$0.7million), accounting for 4.1% of total revenues, compared to 4.0% in the third quarter of 2009. Export sales increased by 49.3% to RMB3.4 million (US$0.5 million) in the third quarter of 2010, compared to RMB2.3 million (US$0.3 million) in the third quarter of 2009.


   

In August, 3SBio announced a licensing, development and commercialization agreement with Isotechnika for voclosporin, a next generation calcineurin inhibitor being developed for use in the prevention of organ rejection following transplantation and the treatment of autoimmune diseases. 3SBio made an up-front license payment of US$1.5 million in addition to a US$4.5 million investment in a note convertible into Isotechnika’s common shares. As of September 30, 2010, 3SBio converted US$1.9 million notes into 13 million common shares.

 

   

China’s State Food and Drug Administration inspected the new plant and granted GMP certification in August 2010.

Dr. Jing Lou, chief executive officer of 3SBio, commented:

“We continue to seek opportunities to introduce innovative products with substantial unmet medical need in the China market. Isotechnika’s voclosporin, a phase II immunosuppressant targeted for use in organ transplant therapy will address the needs of the estimated 10,000 new transplant recipients in China each year, as well as the approximately 100,000 patients who have already benefited from an organ transplant. Based on the phase II results, voclosporin has fewer side effects, including the risk of developing diabetes, a significant advantage over other products in its class. This strategic partnership also reinforces our goal of establishing 3SBio as the partner of choice in China for biopharmaceutical companies around the world. We are also pleased to announce that EPIAO production has commenced at our new plant in Shenyang which will better enable us to satisfy the growing demand in China as well as explore international biosimilar opportunities.”

Three months ended September 30, 2010 Unaudited Financial Results

Net revenues. Net revenues increased by 24.9% to RMB115.6 million (US$17.3 million) for the third quarter of 2010 from RMB 92.6 million (US$13.6 million) for the same period in 2009. This increase was largely due to continued strength from EPIAO and TPIAO products which increased by 22.6% and 28.2%, respectively, over the same period in 2009. TPIAO remained the Company’s second largest revenue contributor in the quarter, accounting for 30.9% of total net revenues. Export sales increased by 49.3% to RMB3.4 million (US$0.5 million), and revenues from our IV Iron Sucrose supplement rose 28.7% to RMB4.8 million (US$0.7 million).

Gross profit. As a result of continued sales growth from key products, gross profit for the third quarter of 2010 increased by 21.0% to RMB103.6 million (US$15.5 million) from RMB85.6 (US$12.5 million) for the same period in 2009. Gross margin decreased by 3.1% to 89.6% for the third quarter of 2010 from 92.5% for the same period in 2009. The decrease in gross margin is mainly due to higher depreciation charges attributable to the new production facilities in Shenyang.

Operating expenses. Operating expenses were RMB76.8 million (US$11.5 million) for the third quarter of 2010, or 66.5% of net revenues, compared to operating expenses of RMB57.1 million (US$8.4 million), or 61.7% of net revenue for the same period in 2009. The increase in operating expenses as a percentage of net revenues was largely driven by higher R&D expenses.

 

   

Research and development (“R&D”) costs. R&D costs for the third quarter of 2010 were RMB11.8 million (US$1.8 million), or 10.2% of net revenues, compared to RMB7.6 million (US$1.1 million), or 8.2% of net revenues for the same period in 2009. RMB17 million (US$2.5 million) prepayment of R&D expense has been made to Ascentage Pharma as of Q3 2010, of which RMB4.8 million (US$0.72 million) was expensed during Q3 2010.

 

   

Sales, marketing and distribution expense. Sales, marketing and distribution expenses for the third quarter of 2010 were RMB52.5 million (US$7.8 million), or 45.4% of net revenues, compared to RMB41.1 million (US$6.0 million), or 44.4% of net revenue, for the same period in 2009. The increase was primarily attributable to higher sales activities in general and continued investment in building the TPIAO and EPIAO brands.

 

2


   

General and administrative expenses. General and administrative expenses for the third quarter of 2010 were RMB12.5 million (US$1.9 million), or 10.8% of net revenues representing an increase of 49.3% from RMB8.4 million (US$1.2 million), or 9.1% of net revenues for the same period in 2009.

Operating income. Operating income was RMB26.8 million (US$4.0 million) for the third quarter of 2010, a decrease of 6.2% from operating income of RMB28.5 million (US$4.2 million) for the same period in 2009. Operating margin for the third quarter of 2010 was 23.2% as compared to 30.8% for the same period in 2009. The decrease was primarily attributable to higher depreciation and R&D expenses.

Interest income. The Company recorded net interest income of RMB3.7 million (US$0.5 million) for the third quarter of 2010, compared to RMB2.5 million (US$0.4 million) for the same period in 2009.

Net income. Net income was RMB22.4 million (US$3.4 million) for the third quarter of 2010, 16.7% lower than net income of RMB26.9 million (US$3.9 million) for the same period in 2009. Net income per ADS on a fully-diluted basis for the third quarter of 2010 decreased to RMB1.01 (US$0.15) from RMB1.25 (US$0.18) for the same period in 2009. Net margin for the third quarter of 2010 was 19.4% as compared to 29.1% for the same period in 2009.

Nine months ended September 30, 2010 Unaudited Financial Results

Net revenues. Net revenues for the first nine months of 2010 increased by 30.8% to RMB317.4 million (US$47.4 million), from RMB242.6 million (US$35.5 million) for the same period in 2009. The increase was primarily attributable to increased sales from our EPIAO and TPIAO products, underpinned by continued strong demand in the oncology and nephrology markets.

Net revenues from EPIAO for the first nine months of 2010 increased by 25.8% to RMB189.4 million (US$28.3 million) from RMB150.5 million (US$22.1 million) for same period in 2009. Net revenues from TPIAO in the first nine months of 2010 increased by 42.2% to RMB97.9 million (US$14.6 million) from RMB68.8 million (US$10.1 million) for the same period in 2009. In addition, revenue from our export business was RMB9.4 million (US$1.4 million), representing an increase of 2.8% over the first nine months of 2009, while revenue from our IV Iron Sucrose supplement was RMB13.3 million (US$2.0 million), representing an increase of 53.4% over the first nine months of 2009.

Gross profit. Gross profit for the first nine months of 2010 increased by 28.9% to RMB286.9 million (US$42.9 million) from RMB222.6 million (US$32.6 million) for the same period in 2009. Gross margin decreased by 1.4% to 90.4% for the first nine months month months of 2010 from 91.7% for the same period in 2009.

Operating income. For the first nine months ended September 30, 2010, operating income increased by 11.4% to RMB82.9 million (US$12.4 million), compared to RMB74.5 million (US$10.9 million) for the same period in 2009. Operating margin for the first nine months ended September 30, 2010 was 26.1% as compared to 30.7% for the nine months ended September 30, 2009.

Net income. Net income for the first nine months of 2010 increased by 6.9% to RMB74.6 million (11.1 million) compared with RMB69.8 million (US$10.2 million) for the same period in 2009. Net margin for the first nine months ended September 30, 2010 was 23.5% as compared to 28.8% for the same period in 2009. Net income per diluted ADS for the first nine months of 2010 increased to RMB3.39 (US$0.51) from RMB3.24 (US$0.47) for the same period in 2009.

Cash and cash equivalents, restricted cash and/time deposits. 3SBio had positive operating cash flows of RMB55.9 million (US$8.4million) for the first nine months of 2010, and as of September 30, 2010 retained a strong balance sheet with cash, cash equivalents, restricted cash and time deposits of RMB731.3 million (US$109.3 million), as compared to RMB740.5 million (US$108.5 million) as of December 31, 2009.

2010 Full Year Guidance

 

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Based on current market conditions and visibility provided during the third quarter, the Company reiterates its total net revenue target for the full year of 2010 of between US$56 million to US$60 million, resulting in a year-over-year increase of approximately 21% to 29%.

Conference Call

Following the earnings announcement, 3SBio’s senior management will host a conference call at 5:00am (Pacific) / 8:00am (Eastern) / 9:00pm (Beijing/Hong Kong) on Tuesday, November 16, 2010 to discuss its 2010 third quarter financial results and recent business activity. The conference call may be accessed using the dial-in numbers below:

Conference ID: 18843960

Local dial-in:

China landline 800-819-0121

China mobile 400-620-8038

Hong Kong 852-2475-0994

International toll-free dial-in:

Hong Kong 800930346

United Kingdom 080-8234-6646

United States 1-866-519-4004

International toll dial-in: 65 6723 9381

Replay- Conference ID: 18843960

A telephone replay will be available two hours after the call until November 22, 2010, at:

International dial-in: 61-2-8235-5000

United States dial-in: 1-866-214-5335

Webcast

A live webcast of the conference will be available on the investor relations page of 3SBio’s website at http://bbs.3sbio.com/en/News/xinvestors.aspx and at http://tinyurl.com/3SBio2010Q3.

A replay of the webcast will be available within one hour after the conclusion of the call.

Non-GAAP Financial Measures: Reconciliation of GAAP to Non-GAAP

To supplement the Company’s financial information presented in accordance with general accepted accounting principles (“GAAP”), the Company has utilized some non-GAAP financial measures to provide investors and management with supplemental measures that facilitate comparisons of operating performance and trends with prior and future operating performance, and that may not otherwise be apparent on a GAAP basis. The non-GAAP financial measure represents non-GAAP net income. The measure may be different from non-GAAP financial measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principals, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the Company’s results of operations as determined in accordance with GAAP. These measures should only be used to evaluate the Company’s results of operations in conjunction with the corresponding GAAP measures. Please see the attached reconciliation of GAAP to non-GAAP for an explanation of the amounts excluded to arrive at non-GAAP financial measures for the three-month periods ended September 30, 2009 and September 30, 2010 and for the nine months month periods ended September 30, 2009 and September 30, 2010.

Statement Regarding Unaudited Financial Information

The unaudited financial information set forth above is preliminary and subject to adjustments and modifications. The audited financial statements and related notes are to be included in our annual report on Form 20-F for the year ending December 31, 2010. Adjustments and modifications to the financial statements may be identified during the course of the audit work, which could result in significant differences from this preliminary unaudited financial information.

Currency Convenience Translation

 

4


For the convenience of readers, certain RMB amounts have been translated into US dollars at the rate of RMB6.7815 to US$1.00, the noon buying rate for US dollars in effect on September 30, 2010 for cable transfers of RMB per US dollar as certified for customs purposes by the Federal Reserve Bank of New York. A rate of 6.8302 was used for comparative purposes as of September 30, 2009.

About 3SBio Inc.

3SBio is a leading, fully integrated, profitable biotechnology company focused on researching, developing, manufacturing and marketing biopharmaceutical products primarily in China. Its focus is on addressing large markets with significant unmet medical needs in nephrology, oncology, supportive cancer care, inflammation and infectious diseases. With headquarters and GMP certified manufacturing facilities in Shenyang, PRC, 3SBio employs over 500 people. Shares trade in the form of American Depositary Shares (ADSs) on the NASDAQ stock market under the ticker symbol “SSRX”. Please see www.3SBio.com for more information.

Safe Harbor Statement

Certain statements in the disclosures of 3SBio, Inc. (the “Company” or “3SBio”) for the third quarter of fiscal 2010 (“Disclosures”) that are not purely historical in nature may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The Disclosures include the press release, the conference call and any accompanying materials, and any other information issued, released or publicized by the Company with respect to fiscal 2010 and the third quarter

These forward-looking statements address activities, events, conditions, or developments that we currently expect or anticipate may occur in the future, and include, but may not be limited to, discussions and statements regarding developments in the government policies and regulation, and regulatory actions related to product pricing; clinical trials progress and success, and related regulatory review progress; revenue guidance; success of partnerships or collaborations; timing in production and operations; forecasts or estimates as to export growth, product demands, market size, production capacity, and capital expense estimate; and future operations and strategies. Forward-looking statements can be identified by such terminology as “believe,” “expect,” “plans,” “strategy,” “potential”, “prospects,” “forecast,” “estimate,” “project,” “anticipate,” “aim,” “will” or “would”, “may” or “might”, and words, phrases, expressions, and usages of similar meaning or substance or the negative of such words, phrases, expressions and usages.

Forward-looking statements are based on management’s current assumptions, beliefs, expectations, and projections, in light of the information currently available to it, and actual results, performances, or achievements could differ materially from those implied or expressed by the forward-looking statements. Among the factors that could cause 3SBio’s actual results to differ from what the Company currently anticipates may include changes in the healthcare industry in PRC, including changes in the healthcare policies, regulations, and regulatory practice, and in the healthcare insurance system; the progress and success of 3SBio’s ongoing clinical trials; receipt and timing of regulatory approvals for 3SBio’s products, and of regulatory certifications; effects of and various factors affecting partnerships and acquisitions; competition from other domestic and foreign pharmaceutical companies; market growth for pharmaceutical products in China; products inclusion in government reimbursement; 3SBio’s ability to expand its production, sales and distribution network and other aspects of its operations; market acceptance of 3SBio products; actual hospital or patient demand for 3SBio products; ability to effectively protect our intellectual properties; and fluctuations in general economic and business conditions in China.

For additional information on factors identified above and other risk factors, uncertainties and assumptions that may affect 3SBio’s business, financial conditions and results of operations, please refer to the Company’s filings with the Securities and Exchange Commission at www.sec.gov, and, in particular, “Introduction – Cautionary Statement concerning Forward Looking Statements”, Item 3.D “Risk Factors”, Item 5. “Operating and Financial Review and Prospects”, and other applicable discussions in 3SBio’s annual report on Form 20-F for the year ended December 31, 2009.

All the statements in the Disclosures speak as of the date of the initial release, even if subsequently made available on the 3SBio website or otherwise. 3SBio undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, subsequent events or otherwise, after the date of this press release.

 

Investor Contacts  

Bo Tan

Chief Financial Officer

3SBio Inc.

Tel: + 86 24 2581-1820

ir@3SBio.com

 

Tom Folinsbee

Director of Investor Relations

3SBio Inc.

Tel: + 852 8191-6991

ir@3SBio.com

 

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LOGO

3SBio Inc.

Consolidated balance sheets

(expressed in thousands)

 

     December  31
2009
    September  30
2010
    September  30
2010
 
     RMB     RMB     US$  
           (unaudited)     (unaudited)  

Assets

      

Current assets

      

Cash and cash equivalents

     262,767        116,923        17,476   

Restricted cash

     9,300        661        99   

Time deposits with financial institutions

     468,451        613,669        91,722   

Notes receivable

     31,265        33,057        4,941   

Accounts receivable, less allowance for doubtful accounts:

      

December 31, 2009 – RMB2,915; September 30, 2010 – RMB2,689 (US$402)

     54,661        89,597        13,392   

Inventories

     15,406        17,387        2,599   

Prepaid expenses and other receivables

     8,705        30,624        4,577   

Available-for-sale securities

     —          46,710        6,982   

Deferred tax assets

     2,079        3,185        476   
                        

Total current assets

     852,634        951,813        142,264   

Available-for-sale securities

     11,407        11,858        1,772   

Investment in a non-consolidated affiliate

     —          1,532        229   

Property, plant and equipment, net

     165,120        184,168        27,527   

Lease prepayments

     8,541        8,276        1,237   

Non-current deposits

     10,067        6,068        907   

Intangible assets, net

     4,125        3,329        498   

Long term receivable

     —          3,156        472   

Deferred tax assets

     1,567        235        35   
                        

Total assets

     1,053,461        1,170,435        174,941   
                        

Liabilities

      

Current liabilities

      

Accounts payable

     2,736        2,846        425   

Deferred grant income

     374        374        56   

Accrued expenses and other payables

     33,421        42,130        6,297   

Income tax payable

     1,914        3,178        475   
                        

Total current liabilities

     38,445        48,528        7,253   

Deferred grant income

     2,778        2,497        373   
                        

Total liabilities

     41,223        51,025        7,626   
                        

Commitments and contingencies

     —          —          —     

Shareholders’ equity

      

Share capital - ordinary shares US$0.0001 par value, 500,000,000 shares authorized, 150,641,461 and 151,306,452 issued and outstanding as of December 31, 2009 and September 30, 2010, respectively

     121        122        18   

Additional paid-in capital

     915,267        936,984        140,047   

Accumulated other comprehensive loss

     (100,608     (89,753     (13,413

Retained earnings

     197,458        272,057        40,663   
                        

To Total shareholders’ equity

     1,012,238        1,119,410        167,315   
                        

Total liabilities and shareholders’ equity

     1,053,461        1,170,435        174,941   
                        

 

6


3SBio Inc.

Unaudited quarterly consolidated statements of income

(expressed in thousands, except per share, per ADS and other share and ADS data)

 

     For the Three Months Ended     For the Three Months Ended  
     September 30,2009     September 30,2010  
     RMB     US$     RMB     US$  
     (unaudited)     (unaudited)     (unaudited)     (unaudited)  

Net Revenues:

        

EPIAO

     56,558        8,285        69,350        10,365   

TPIAO

     27,893        4,086        35,761        5,345   

Intefen

     1,633        239        1,603        240   

Inleusin

     473        69        542        81   

Iron sulcrose

     3,703        542        4,767        713   

Export

     2,282        334        3,408        509   

Others

     21        3        140        21   
                                

Total net revenues

     92,563        13,558        115,571        17,274   

Cost of revenues

     (6,919     (1,014     (11,977     (1,790
                                

Gross profit

     85,644        12,544        103,594        15,484   

Operating expenses

        

Research and development costs

     (7,616     (1,116     (11,793     (1,763

Sales, marketing and distribution expenses

     (41,105     (6,021     (52,500     (7,847

General and administrative expenses

     (8,386     (1,229     (12,520     (1,871
                                

Total operating expenses

     (57,107     (8,366     (76,813     (11,481

Operating income

     28,537        4,178        26,781        4,003   

Other income/(expense), net

        

Interest income

     2,465        361        3,663        547   

Grant income

     94        14        94        14   

Other income/(expense), net

     296        43        (1,843     (275
                                

Total other income/(expense), net

     2,855        418        1,914        286   
                                

Income before income tax expense

     31,392        4,596        28,695        4,289   

Income tax expense

     (4,471     (655     (6,271     (937
                                

Net income

     26,921        3,941        22,424        3,352   
                                

Net income per share:

        

Basic

     0.18        0.03        0.15        0.02   
                                

Diluted

     0.18        0.03        0.14        0.02   
                                

Basic weighted average number of shares outstanding

     150,621,780        150,621,780        151,113,565        151,113,565   
                                

Diluted weighted average number of shares outstanding

     151,230,268        151,230,268        155,139,389        155,139,389   
                                

Net income per ADS:

        

Basic

     1.25        0.18        1.04        0.16   
                                

Diluted

     1.25        0.18        1.01        0.15   
                                

Basic weighted average number of ADSs outstanding

     21,517,397        21,517,397        21,587,652        21,587,652   
                                

Diluted weighted average number of ADSs outstanding

     21,604,324        21,604,324        22,162,770        22,162,770   
                                


3SBio Inc.

Unaudited quarterly consolidated statements of income

(expressed in thousands, except per share, per ADS and other share and ADS data)

 

     For the Nine Months Ended     For the Nine Months Ended  
     September 30,2009     September 30,2010  
     RMB     US$     RMB     US$  
     (unaudited)     (unaudited)     (unaudited)     (unaudited)  

Net Revenues:

        

EPIAO

     150,549        22,055        189,359        28,303   

TPIAO

     68,820        10,082        97,881        14,630   

Intefen

     4,188        614        4,176        624   

Inleusin

     1,166        171        1,575        235   

Iron sulcrose

     8,700        1,275        13,344        1,994   

Export

     9,133        1,338        9,390        1,403   

Others

     88        13        1,714        256   
                                

Total net revenues

     242,644        35,548        317,439        47,445   

Cost of revenues

     (20,090     (2,943     (30,571     (4,569
                                

Gross profit

     222,554        32,605        286,868        42,876   

Operating expenses

        

Research and development costs

     (14,325     (2,099     (22,216     (3,321

Sales, marketing and distribution expenses

     (109,642     (16,062     (142,636     (21,319

General and administrative expenses

     (24,137     (3,536     (39,093     (5,843
                                

Total operating expenses

     (148,104     (21,697     (203,945     (30,483

Operating income

     74,450        10,908        82,923        12,393   

Other income/(expenses), net

        

Interest income

     8,147        1,193        9,162        1,369   

Grant income

     281        41        281        42   

Net realized gain on available-for-sale securities

     1,611        236        —          —     

Impairment loss on available-for-sale securities

     (4,624     (677     —          —     

Other income/(expense), net

     2,479        363        (811     (121
                                

Total other income/(expenses), net

     7,894        1,156        8,632        1,290   
                                

Income before income tax expense

     82,344        12,064        91,555        13,683   

Income tax expense

     (12,559     (1,840     (16,956     (2,534
                                

Net income

     69,785        10,224        74,599        11,149   
                                

Net income per share:

        

Basic

     0.46        0.07        0.49        0.07   
                                

Diluted

     0.46        0.07        0.48        0.07   
                                

Basic weighted average number of shares outstanding

     150,598,359        150,598,359        150,898,177        150,898,177   
                                

Diluted weighted average number of shares outstanding

     150,712,510        150,712,510        153,894,144        153,894,144   
                                

Net income per ADS:

        

Basic

     3.24        0.47        3.46        0.52   
                                

Diluted

     3.24        0.47        3.39        0.51   
                                

Basic weighted average number of ADSs outstanding

     21,514,051        21,514,051        21,556,882        21,556,882   
                                

Diluted weighted average number of ADSs outstanding

     21,530,358        21,530,358        21,984,877        21,984,877   
                                


Reconciliations of GAAP net income to non-GAAP net income for nine months of 2009 and 2010

(in RMB thousands, unaudited)

 

    

Nine months ended

September 30, 2009

    

Nine months ended

September 30, 2010

 
     GAAP      Adjustment      Non-GAAP      GAAP      Adjustment      Non-GAAP  
     RMB      US$      RMB      RMB      US$      RMB      US$      RMB      RMB      US$  

Net income

     69,785         10,2245         3,013         72,798         10,665         74,599         11,149         —           74,599         11,149   

The adjustment for the nine months ended September 30, 2009 is for the exclusion of the impairment loss of RMB 4,624,000 on available-for-sale securities and gain of RMB1, 611,000 on disposal of available-for-sale securities.