Gx Cleantech Regulatory News (CTEK)

31 October 2012

China Chaintek United Co., Ltd

("ChainTek" or the "Group")

Trading Update

China ChainTek United Holdings Co., Ltd (AIM: CTEK), the provider of logistics services to manufacturers of fast moving consumer goods in China, is pleased to give the following trading update for the nine month period ended 30 September 2012. Financial information contained in this announcement for the nine month period is unaudited.

Trading since the Group's admission to AIM in August 2012 has exceeded management's expectations and results for the full year ended 31 December 2012 are now anticipated to be materially ahead of current market expectations.

For the nine month period to 30 September 2012, revenue was RMB260.3 million (approximately £26.0 million). This performance has been driven primarily by the continued strength of ChainTek's logistic service operations, representing 86.0% of the period's revenues, and the Group is pleased to announce that it has secured additional clients in further sectors including food, building materials, toiletries and paper industries.

EBITDA for the period was RMB 202.4 million (approximately £20.2 million), Gross Profit was RMB221.0 million (approximately £22.1 million) and PBT was RMB199.6 million (approximately £20.0 million).

Overall trading remains robust, and the Board is confident that its complementary and growing inventory solutions business will increase customers' reliance on ChainTek and allow it to move further up the customer value chain.

As at 30 September 2012, the Group had a net cash position of RMB286.4 million (approximately £28.6 million). The Group stated at the time of IPO that it would seek debt funding to complete funding for new distribution centres and investment in developing the Group's IT systems. Discussions regarding this funding are progressing and the Group will update the market in due course.

Commenting on the trading update, Shufang Zhuang, Executive Director and the Group's founder, commented:

"Since the Group's admission to AIM in August this year, we have continued to trade very strongly and are pleased to report that we now expect our full year results to be materially ahead of current market expectations.

"We are continuing to see a growing demand for both our logistics services and inventory solutions businesses. ChainTek has the scale, customer base and service offering to deliver consistent growth in future years and we look forward to continuing our development to become the leading provider of logistics services in China."

ENQUIRIES:

Notes to editors

ChainTek is one of the largest providers of logistics services to domestic sports shoes and apparel manufacturers in China. The Group's main business operation is located at Jinjiang City, Fujian Province. Jinjiang City is a key manufacturing region in China for sports shoes and apparel in China. Manufacturers in Jinjiang City account for approximately 70 per cent. of the entire production volume of sports shoes and apparel in China.

The Group has a long-standing client base of over 60 manufacturers based in Fujian Province and six of its top ten clients by revenue in 2011 are publicly listed in Hong Kong, USA, Malaysia or Singapore. The Group has two business divisions:

Logistics Services Business

This division is focussed on providing logistics connections between the Group's manufacturer client base and their retail markets in the PRC using a network of eight independent Transport Agents. Efficiencies are achieved for both the Transport Agents and the manufacturers by consolidating the goods of several manufacturers to be delivered to similar destinations at the same time thereby increasing the loading rate on the Transport Agents' trucks and reducing the per unit transportation cost.

Inventory Solutions Business

This division is focussed on providing outsourced inventory storage and management services including sorting, packing, labelling and short term storage. This Inventory Solutions Business was launched in 2010 as the Directors perceived a demand from the Group's existing clients for the provision of the above services which would otherwise be conducted in-house by manufacturers. Manufacturers in China acknowledge that managing logistics and warehousing continues to be not only a complex, but also a relatively costly, part of operations. Performance can also be hampered by the availability of experienced staff, especially at a managerial level with increasing wages. As a result, the Directors believe these services will reduce warehousing costs of the manufacturers and will assist in retaining excellent relationships with the Group's key clients.

For more information please visit www.chaintek-united.com