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China Nepstar Chain Drugstore Reports Second Quarter 2011 Financial Results
Date:8/23/2011

ican depositary share ("ADS"). This compares to a net loss of RMB13.4 million, which represented RMB0.12 basic and diluted loss per ADS in the same period in 2010. The total number of outstanding ordinary shares of the Company as of June 30, 2011 was 207.7 million. The weighted average number of ordinary shares in the second quarter of 2011 was 207.8 million. Each ADS represents two ordinary shares of the Company.

As of June 30, 2011, Nepstar's total cash, cash equivalents and bank deposits were RMB1.003 billion (US$155.2 million) and its shareholders' equity was RMB1.377 billion (US$213.0 million).

In the second quarter of 2011, net cash flow from operations was RMB42.6 million (US$6.6 million).

Business Outlook"Entering into the second half of 2011, we typically enjoy some seasonal benefit from higher sales of cold and flu remedies as well as nutritional supplements, heading into the fall and winter. However, government policy remains a challenge. The recently announced price cut by the National Development and Reform Commission over certain pharmaceuticals will become effective on September 1st, affecting a total of 295 medicines including 290 prescription drugs and five OTC drugs Nepstar currently carries in our stores.

"We do believe that the Chinese healthcare sector reform will ultimately reset the competitive landscape of the entire drug supply chain in China. In the meantime, we are doing our best to strategize on ways to optimize our product offerings and sustain the momentum we have achieved to date," concluded Mr. Zhang.

Conference Call InformationThe Company will host a conference call, to be simultaneously webcast, on Tuesday, August 23, 2011 at 8:00 a.m. Eastern Time / 8:00 p.m. Beijing Time. Interested parties may participate in the conference call by dialing +1-877-407-9210 (North America) or +1-201-689-8049 (International) approximately five minutes before the call start time.  A live web cast of t
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SOURCE China Nepstar Chain Drugstore Ltd.
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