Simcere Pharmaceutical Group Reports Third Quarter 20...(/p reporting dates. Recon...),Health

reporting dates.

Reconciliations of non-GAAP results of operations measures to

the nearest comparable GAAP measures (*)

(UNAUDITED, EXPRESSED IN RMB THOUSANDS)

Three months ended Three months ended

September 30, 2006 September 30, 2007

GAAP Adjustment Non-GAAP GAAP Adjustment Non-GAAP

Result Result Result Result

Income from

operations 44,213 -- 44,213 60,241 7,540 67,781

Net income 42,295 -- 42,295 73,120 7,540 80,660

Nine months ended Nine months ended

September 30, 2006 September 30, 2007

GAAP Adjustment Non-GAAP GAAP Adjustment Non-GAAP

Result Result Result Result

Income from

Operations 135,875 -- 135,875 211,231 22,041 233,272

Net income 118,148 -- 118,148 223,189 22,041 245,230

(*) The adjustment is for share-based compensation expenses.

Non-GAAP Disclosure

In addition to the unaudited consolidated financial information presented in accordance with US GAAP, Simcere's management uses a non-GAAP measure of net income excluding non-cash share-based compensation. Simcere's management believes excluding the share-based compensation expenses from non-GAAP financial measures is useful for the investors' understanding of overall current financial performance. Nevertheless, the limitation of using non-GAAP financial measures excluding share-based compensation expenses is that share- based compensation expenses have been and will continue to be a significant recurring expense in the Company's business.

The presentation of the non-GAAP financial measures is n
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