(Hong Kong, 29 August 2011) – China's largest electric vehicle motive battery supplier, Tianneng Power International Limited ("Tianneng Power" or the "Company"), together with its subsidiaries,　(the "Group") (stock code: 00819.HK), announced its unaudited interim results for the six months　ended 30 June 2011.

In the first half year, market demand for electric bike and electric car motive batteries in China maintained strong growth. During the period under review, the Group's total revenue significantly increased by 46.7% to approximately RMB2,438 million. The increase was mainly due to the implementation of Environmental Rectification within the country which led to a supply shortage in lead-acid motive batteries, pushing up the unit selling price and sales quantities of the Group's products. Gross profit surged 80.5% to approximately RMB548 million while gross profit margin also increased to 22.5% from 18.3% over the same period last year. Profit attributable to equity holders of the Company increased sharply by 94.6% to RMB201 million. Basic earnings per share were RMB18.5 cents. The Board of Directors did not recommend payment of an interim dividend for the six months ended 30 June 2011.

Mr. Zhang Tianren, Chairman of Tianneng Power, said, "With the booming Chinese economy and further advances in the new energy sector, prospects for the motive battery industry in China are promising. Capturing market opportunities, Tianneng Power continued to expand its coverage through a series of initiatives to improve R&D capability and operational efficiency, as well as adopted various strategies for tackling different markets. The Group recorded double-digit growth in sales for both the primary and secondary markets of electric bikes, and in respect of the electric car motive battery business, the Group established cooperative relationships with a number of new energy vehicle enterprises. Our successful business expansion has enabled Tianneng Power to reinforce its industry leadership position and has boosted our confidence that further successes lay ahead."

With further consolidation within the electric bike industry, Tianneng Power further captured premium customers in the primary market, and established strategic alliances with electric bike manufacturers. Sales revenue generated from the primary market increased by 54.6% when compared with the same period last year and accounted for approximately 42.5% of the Group's lead-acid motive battery turnover, up from approximately 39.4% in the same period last year. In the secondary market, increased total number of electric bike owners has resulted in strong demand. Consequently, the Group continued to build ties with exclusive distributors and enlarge its sales network in order to further expand this market. As at 30 June 2011, there were a total of 890 exclusive distributors and the Group’s sales and distribution network covers most parts of China. During the first half of 2011, sales revenue from the secondary market increased by 35.7% when compared with the same period last year and accounted for approximately 57.5% of lead-acid motive battery turnover.

The National Twelfth Five Year Plan has placed emphasis on the development of the pure electric vehicle industry. Drafting of the Plan on Energy Saving and New Energy Vehicles Industry Development by the Ministry of Industry and Information Technology (MIIT) is close to completion. Following the national policy and market trends, the Group launched the Rare-earth Silica-Gel high performance motive battery in 2010, and the electric car motive battery has been commercialized. The Group has gone on to establish cooperative relationships with 73 new energy vehicle enterprises during the period, and generated approximately RMB112 million in revenue from the sale of the product, representing a surge of 155.5% when compared with the same period last year, accounting for approximately 4.6% of the Group’s sales turnover.

The Group has been actively enhancing its R&D capability. During the period, the Post-doctoral Scientific Research Workstation which is at national level launched a number of projects focusing on research into the lithium-ion motive battery, nickel hydride motive battery and Rare-Earth Silicon-Gel motive battery for pure electric cars and hybrid electric cars, storage battery for wind and solar power, and recycling technology for nonferrous scrap metal. These projects drive the sustainable development of the enterprise.

In addition to bolstering its R&D capability, the Group sought to expand capacity. Towards this end, the Group was able to optimize production capacity at its three major production bases located in Zhejiang Changxin, Jiangsu Shuyang and Anhui Wuhu, as well as established a fourth production base in Anhui Jieshou, which is expected to provide additional capacity of 10 million units and 6.6 million units in 2012 and 2013 respectively. Furthermore, both the 100,000 ton lead recycling project and 17 million KVAH motive battery project in Changxing Economic and Technological Development Zone are under construction, and are expected to be completed with trial production commencing by year end.

In March 2011, nine departments of State Council including Ministry of Environmental Protection and National Development and Reform Commission collectively released a notice which indicated that the first priority of Environmental Protection Tasks (“Environmental Rectification”) in 2011 would be Lead Battery Enterprises Rectification. Due to the rectification, Zhejiang Tianneng Battery (Jiangsu) New Energy Co., Ltd., Zhejiang Tianneng Battery (Jiangsu) Co., Ltd. and Tianneng Battery (Wuhu) Co., Ltd. were suspended for a brief period. As production procedures have since met national environmental requirements, all of the companies have quickly resumed production resulting in minimum impact on the Group.

Mr. Zhang concluded, "As an industry leader, we will continue to benefit from fast growing demand for electric bike motive batteries, which is expected to continue in the future. Pure electric cars have been included as a key development target in the Twelfth Five Year Plan, and Tianneng Power is well prepared to help advance the industry. To grasp huge market opportunities, we will continue to focus on R&D, production and sale of electric car motive batteries, electric bike motive batteries, wind and solar energy storage batteries, Ni-MH batteries and lithium batteries. We will also actively expand production capacity by constructing relevant infrastructure or through acquisitions. As a result of Environmental Rectification, a large number of lead-acid battery manufacturers have been eliminated, enabling healthy development of the industry. We intend to take advantage of such consolidation to further enlarge our market share and devise appropriate sales, acquisition and cooperative strategies that enable us to boost business growth and strengthen our leading position in the Chinese motive battery market."