BEIJING, Jan. 15 /Xinhua-PRNewswire-FirstCall/ -- NextMart, Inc. (OTC:NXMR) (BULLETIN BOARD: NXMR) , a Chinese direct sales company, today reported its audited financial results for the six-month period ended September 30, 2007. This period was a transition period for the company as a result of its recent change of fiscal year end from March 31 to September 30. For the six-month transition period ended September 30, 2007, NextMart reported gross revenue of US$3,525,506, of which US$3,482,646 or 98.8% was generated by the Company's transactional services and US$42,860 or 1.2% was generated by the Company's marketing and information services. The Company's gross profit for the six-month period was US$814,461 and its operating loss was US$33,946,726. After other one-time losses for the transition period ended September 30, 2007, the Company reported a net loss after-tax of US$33,751,124 or US$0.39 per outstanding share. After currency exchange adjustments and minority interests, the Company reported a comprehensive loss of US$33,864,099 or US$0.39 per outstanding share. For more detailed information on the Company's results of operations, please refer to the Company's Form 10-KSB filing, which includes its audited financial statements, for the transition period ended September 30, 2007 which has been filed today, and can be found at http://www.sec.gov/ . Mr. Ren Huiliang, Chief Executive Officer of NextMart, Inc. commented, "We experienced a loss for the transition period ended September 30 2007 due largely to certain one-time adjustments of non-performing assets and goodwill relating to acquisitions in the fiscal years ended March 31, 2006 and 2007. Now that we have settled our historical issues related to previous acquisitions of the Company, we believe we are well positioned for strong growth in 2008. We maintain a profitable women's apparel business based in Shanghai and are leveraging its capabilities among other assets of the Company to develop our direct sales operations." NextMart's Enhanced Direct Sales Strategy for Fiscal 2008 In 2008, NextMart's business strategy will be to enhance its focus on developing an integrated online-offline direct sales platform for its women's apparel business. The key initiatives of this direct sales strategy include: (1) Expanding the company's sales channels to include offline mail-order catalogues and TV-shopping; (2) Launching sales of the Company's private label apparel brand Peeress; and (3) Partnering with offline shopping malls in China to create online shopping sites that will carry numerous leading domestic/global fashion brands. NextMart's rationale for pursuing an integrated direct sales strategy is two-fold. First, the Company can achieve higher profit margins by selling women's apparel directly to consumers rather than selling through high cost, inefficient third-party distribution channels. Second, NextMart already has the operational assets and marketing partnerships necessary to realize its direct sales vision. The Company has mature apparel design and production management operations, with a database of several thousand women's clothing designs. The company has has a strategic marketing and sales partnership with Her Village, China's leading multimedia women's community with over 40 million E-Magazine downloads and web visits, which includes 10 million unique visitors, per month. It also has a sales partnership with Shanghai Guifuren Garment, a well-known women's apparel chain with 49 retail points in China. NextMart plans to execute its direct sales strategy by reorganizing its operations into the following three enhanced business units: (1) Integrated Direct Sales. This division will focus on selling women's apparel to urban female consumers through three online and offline direct sales channels: (a) Digital E-catalogues/E-Magazines; (b) Print Mail-Order Catalogues; and (c) TV shopping programs. For (a) Digital E-catalogues/E-Magazines, the company will leverage its existing marketing and sales partnership with Her Village. This marketing/sales partnership gives NextMart marketing space within Her Village's e-magazine properties in exchange for a 10% commission on sales paid to Her Village. In addition to selling product through Her Village's media products, NextMart is developing its own NextMart E-Shopping Catalogues to sell apparel to Her Village's online consumer community. For (b) Print Mail-Order Catalogues and (c) TV-Shopping, the Company intends to partner with leading mail-order catalogue and TV-shopping partners in Mainland China. The Company is currently in discussions with partners for strategic partnership or acquisition. Strategic partnerships would entail NextMart providing low-cost women's wear to its partners in exchange for ongoing marketing and sales access to Chinese female customers. The parties would split revenue according to a pre-negotiated rate. (2) Private Labels. This division will leverage the Company's existing apparel design and production capabilities to launch private labels for sale in China and abroad. The Company's first brand, Peeress, targets mature professional women inChina's leading cities. Peeress already has several thousand women's apparel designs, which include dresses, business suits, evening wear and lingerie. The Company has already begun to sell its Peeress clothing domestically and abroad through limited channels and plans to expand these sales considerably in 2008. Internationally, the Company will work with its existing partners and clients of its wholesale operations to sell Peeress product in retail chains such as Sears. Domestically, the Company will sell Peeress product through its direct sales channels (see above) and two leading Chinese retail chains - Shanghai Guifuren Garment Co., a leading women's apparel chain with 49 stores in Mainland China, and Shanghai 1st Department stores, one of China's leading department store chains. Both partnerships have already been secured. (3) E-Commerce Partnerships. This division plans to partner with leading offline shopping malls to create e-commerce sites that sell women's clothing of several well-known domestic and international fashion brands. The division will provide e-commerce and technical services in exchange for a commission on e-commerce sales. The division will focus mainly on large-scale projects in order to best utilize its resources and capture scalable business opportunities. About NextMart, Inc. NextMart is a China-based women's apparel enterprise that aims to develop China's largest shopping community for wholesale distribution and retail shopping, primarily in the areas of women's fashion and apparel. The Company has core business operations in apparel fashion design, production, sourcing and wholesale distribution in China and internationally. It has supporting operations in electronic parts and components distribution. Since April 2007, NextMart has centered its operations around William's Brand, its Shanghai- based apparel subsidiary. The Company has focused its efforts on expanding its business client base for outsourced wholesale production. The Company also has launched initiatives to create its own private label brands to sell women's apparel to urban consumers nationwide, using an integrated offline/online direct sales model. Learn more at http://corporate.nextmart.net/ . This press release includes statements that may constitute 'forward- looking' statements, usually containing the word 'believe,' 'estimate,' 'project,' 'expect,' 'plan,' 'anticipate' or similar expressions. Forward- looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, continued acceptance ofNextMart's product and services in the marketplace, competitive factors and changes in regulatory environments. These and other risks relating to NextMart's business are set forth in NextMart's Annual Report on Form 10-KSB for the period ended March 31, 2007 filed with the Securities and Exchange Commission on July 16, 2007, and other reports filed from time to time with the Securities and Exchange Commission. By making these forward-looking statements, NextMart disclaims any obligation to update these statements for revisions or changes after the date of this release. For more information, please contact: Phoebe Wang Tel: +86-10-85189669 DATASOURCE: NextMart, Inc. CONTACT: Phoebe Wang for NextMart, Inc., +86-10-85189669 Web site: http://corporate.nextmart.net/

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