Our outlooks turn bright as the industry resumes its normality after destocking from apparel brands ended in the second half of 2009. The 2008 Beijing Olympic Games have heightened concept of healthy lifestyle and promoted brand awareness. The mainland China’s consumers are increasingly demanding for quality sportswear and casual wear using performance fabrics. The upcoming FIFA World Cup and Guangzhou Asian Games in 2010 should continue to bolster such a demand.

The flows of order have improved since the last quarter of 2009. The end of destocking process and the acceptance of our new products by customers are the two key drivers resulting to the improved order books and sales.

We are capable of ramping up our production of performance fabrics to meet the increased orders since the production of performance fabrics took up only about 44.3% of our production capacity in 2009. We believed that we can grow our revenue without restriction from our production capacity in the near future.

The Group is looking for merger and acquisitions opportunities in its down-streams. We believe that synergies would be derived by becoming vertically-integrated as we could have an edge over our competitors by being capable of providing much integrated services to the brands.

China Taisan will continue to foster stronger ties with the end apparel brands in terms of R&D, fabric functionalities and design processes. In particular, we will build on our relationship with leading domestic brands such as Anta and Metersbonwe, to expand our market-share within the PRC, which is seeing a surge in demand for high quality products that are produced locally.

Our mid to long term plans include:

1. Expanding the range of our product offerings
2. Improving our fabric finishing capabilities
3. Evaluating possible merger & acquisition opportunities