Strategic Adjustments and Financial Outlook
In light of the new regulations in Beijing, the Company has quickly and proactively made some key changes to its expansion strategy for 2011, including (i) adjusting Company’s target of new dealership openings from 6 in Beijing and 4 outside of Beijing, to 3 in Beijing and at least 7 in other cities, (ii) stepping up the proposed pace of merger and acquisition activities in the first quarter of 2011, (iii) continuing to increase the proportion of the contribution of maintenance services to overall revenues and profit, and taking necessary measures to achieve this and (iv) further adjusting the mix of brands sold and models sold to drive more sales of high-end vehicles.
The Company estimates that its revenues for the fourth quarter of 2010 will be approximately RMB1,180 million (US$176 million) to RMB1,220 million (US$182 million), representing a year-over-year growth rate of approximately 81% to 88%.
This guidance is based on the current market conditions and reflects the Company’s current and preliminary estimates of market and operating conditions and customer demand, which are all subject to change.Exchange Rate This announcement contains translations of certain Renminbi amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to U.S. dollars were made at the exchange rate of RMB6.6905 to US$1.00, as set forth in the H.10 statistical release of the Federal Reserve Board on September 30, 2010. About Lentuo International Inc. Lentuo is the largest non-state-owned automobile retailer in Beijing, China as measured by new vehicle sales revenues in 2009, according to the China Automobile Dealers Association (“CADA”). Lentuo operates six franchise dealerships, ten automobile showrooms, one automobile repair shop and one car leasing company in Beijing, the largest new passenger vehicle market among all cities in China. Three of Lentuo’s six dealerships are among the leading dealerships in China for their respective brands, as measured by the volume of new vehicle sales by individual dealership.