Total operating expenses were RMB 472.5 million ($75.8 million), compared with RMB 534.6 million ($85.8 million) in the third quarter of 2012 and 496.7 million ($79.7 million) in the fourth quarter of 2011. Total operating expenses in the fourth quarter of 2012 included an accounts receivable provision of RMB 134.1 million ($21.5 million), and a long-lived asset impairment of RMB 147.1 million ($23.6 million) related to the retirement of 300 MW of outdated cell production capacity and 300 MW of outdated module production capacity.

Operating loss in the fourth quarter of 2012 was RMB 549.6 million ($88.2 million), compared with an operating loss of RMB 631.3 million ($101.3 million) in the third quarter of 2012 and an operating loss of RMB 487.6 million ($78.3 million) in the fourth quarter of 2011. Operating margin was negative 32.9% in the fourth quarter of 2012, compared with a negative operating margin of 38.5% in the third quarter of 2012 and a negative operating margin of 25.1% in the fourth quarter of 2011.

Other income in the fourth quarter of 2012 was RMB 20.5 million ($3.3 million), compared with other income of RMB 363.7 million ($58.4 million) in the third quarter of 2012 and other income of RMB 208.9 million ($33.5 million) in the fourth quarter of 2011.

Tax expense in the fourth quarter of 2012 was RMB 5.3 million ($0.9 million), compared with tax benefit of RMB 25.4 million ($4.1 million) in the third quarter of 2012 and a tax expense of RMB 33.5 million ($5.4 million) in the fourth quarter of 2011. In June 2012, JA Hebei received a ruling from the local tax bureau of Xingtai City, Hebei Province (the "Local Tax Bureau"), that JA Hebei should not have enjoyed the previously grandfathered tax holiday related to the portion of the taxable income of JA Hebei attributable to a capital injection made in 2008 (the "2008 Capital Injection"). Consequently, the Company recorded tax payable of RMB 81.2 million ($13.0 million) at the end of the second quarter of 2012 and made a subsequent payment in July 2012. However, the Company believes its tax position related to the 2008 Capital Injection has been and is still in compliance with the PRC Corporate Income Tax Law, and therefore appealed in September 2012. In December 2012, the Company received a full refund from the Local Tax Bureau, and recognized a tax benefit of RMB 81.2 million ($13.0 million) offsetting the initial charge. In February 2013, JA Hebei received a notice from the Local Tax Bureau that JA Hebei should not have enjoyed the previously approved tax holiday related to the portion of the taxable income of JA Hebei attributable to a separate capital injection made in 2007 (the "2007 Capital Injection"). Consequently, the Company recorded an additional income tax expense of RMB 82.5 million ($13.3 million) at the end of 2012 with respect to the 2007 Capital Injection.

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