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China Nepstar Chain Drugstore Reports 92.1% Year-on-Year Increase in Operating Income for Third Quarter 2009
Date:12/1/2009

ial cash dividend was paid out to shareholders of record as of the close of business on September 25, 2009.

Latest Developments and Business Outlook

In July 2009, Nepstar entered into a definitive agreement with Beijing Ze Run Tang Drugstore, to acquire its five drugstores in Beijing. This acquisition represents Nepstar's first retail presence in Beijing. The five stores have an average store size of 170 square meters, and are located in densely populated residential areas in Beijing. The acquisition was completed and the stores have been transferred to Nepstar by end of November and are serviced by the Company's regional logistics center in Tianjin, where Nepstar has over 100 stores.

In October 2009, Nepstar entered into a definitive agreement with Wenzhou Ren Ren Hao Chain Drugstore Ltd. ("Ren Ren Hao") to acquire the operations of all of its eight drugstores in Wenzhou City. This acquisition represents China Nepstar's first retail presence in Wenzhou, one of the most affluent markets in Zhejiang province in terms of consumption power. The eight Ren Ren Hao drugstores have an average store size of 250 square meters and are located in the city center or in prime locations in nearby major townships. The transaction is expected to be completed by the end of 2009.

In November 2009, Nepstar entered into a strategic cooperation agreement with ATMU (China) Technology Co., Ltd., a subsidiary of ATMU Inc., one of the largest ATM operators in China, to install ATMs in Nepstar stores. This cooperation is not only designed to provide convenience to customers and generate rental revenue for Nepstar, but will also help increase store traffic and accelerate the development of electronic payment services at Nepstar stores. ATMU plans to complete the initial 1,000 ATM installations in Nepstar's existing stores by end of 2010.

Mr. Wade commented, "Our strategy to increase overall revenues includes open
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SOURCE China Nepstar Chain Drugstore Ltd.
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