Lansdowne Sec Inc (OTC:HGII)

First Quarter 2011 Financial Highlights:

• Revenue increased 12%, from $15.7 million in Q1 2010 to $17.6 million in Q1 2011;
• Gross profit improved 7%, from $4.6 million in Q1 2010 to $4.9 million in Q1 2011;
• Adjusted net income grew 30%, from $2.0 million in Q1 2010 to $2.6 million in Q1 2011; and
• Cash position rose 750%, from $0.2 million in Q1 2010 to $1.7 million in Q1 2011.

"Overall, we are very pleased with our first quarter financial results," said Ryan Ding, the Company's Chief Executive Officer. "This year, we focused on the development of our Aierda™ brand shoe business and in the first quarter of 2011, we are starting to see the benefits of employing such a strategy. Our net sales of Aierda™ brand shoes reached approximately $13.5 million in the first quarter of 2011, which is a $3.8 million or 39 percent increase when compared to our sales of these products in the first quarter of 2010. Since our Aierda™ brand shoes are becoming increasingly popular in China and are also providing us with a higher profit margin than the sale of shoes parts and accessories, we are looking to further capitalize of these profitable circumstances by maintaining our focus on the expansion of our Aierda™ brand shoe business."

Financial Outlook

Based upon the recent progress of Aierda™ brand shoes, which currently provide a higher gross margin than shoe parts and accessories segment of the Company's business, the Company believes that it has an opportunity to increase its revenues, net income and gross margins in the future. The Company's current growth strategies include maintaining its efforts to enter its Aierda™ brand shoes in more second and third-tier cities in China, which are characterized by quickly growing urban populations with an increasing amount of disposable household income. As of now, the Company is targeting the low to mid-level income consumers in these cities, and is pricing its products significantly lower than many of its larger competitors. With the addition of new sales channels, the Company believes that it will garner a more sizeable customer base that, in effect, will further improve the Company's sales in the future.

Business Outlook

"We are really excited about our future," remarked Mr. Ding. "Our Aierda™ brand shoes are gaining a loyal following in China and we are making every effort to meet our customers' growing demand for these products. In particular, we are working hard to open additional stores throughout China, with the goal of establishing 100 exclusive Aierda™ brand retail locations by 2014. As we strive to expand our sales channels, we are also taking steps to enrich our media and advertising campaigns, as well as our product offerings. We want to be recognized as China's leading provider of quality, affordable shoes and by bolstering our sales network, advertising and market campaigns, and product lines, we believe that we will be heading in the right direction to achieving our goal."