Trading Update

11 May 2015

GTS Chemical Holdings plc

("GTS" or the "Company" or the "Group")

Trading Update

Group Revenue up 40.0%; Maiden Dividend to be Proposed at AGM

GTS Chemical Holdings plc, the specialty chemicals producer and China's largest producer of ammonium sulfite, reports to the market today following a period of strong performance during the first quarter of 2015.

Highlights:

· Unaudited Group revenue up 40.0% to RMB 167.0 million (Q1 2014: RMB 119.3 million)

· Specialty chemicals revenue up 36.7% to RMB 118.9 million

· Lubricating oils revenue up 68.0% to RMB 35.7 million

· Construction of new specialty chemicals production line underway

· Intention to announce a maiden full year dividend

Segmental Sales Analysis

Specialty Chemicals

GTS' core business division continued to perform well in Q1, and the growth in revenues of 36.7% compares favourably with the growth seen of 24.4% in 2014. The growth in sales is not only in the paper industry but increasingly to the food and pharmaceutical sector.

Lubricating Oils

During the quarter, sales in the lubricating oils division continued to grow, accounting for more than 21% of total Group revenue. Growth, driven by accelerated marketing efforts, was 68.0% in Q1 vs Q1 2014, matching the growth seen in H2 2014 of 67%. Marketing included the Group's second annual lubricating oil sales conference, held in March, where the Group signed a total of 92 orders for RMB29 million.

Recarburizer

Following flat sales growth in 2014, the first quarter has demonstrated a growth of 11.8% compared with Q1 2014.

Investment

During the quarter, the Group commenced construction of a new specialty chemicals production line on its existing site. The new production line will enable the Group to produce higher quality specialty chemicals and to control the chemical reactions even more closely. We expect the line to be commissioned during Q3 2015, upon which our production capacity of liquid ammonium sulfite and liquid ammonium bisulfite will be increased from 300,000 tonnes per year to 360,000 tonnes per year, based on an 8 hour shift six days a week.

The construction of a new lubricant oils production line has commenced on the land acquired in December 2014.

Dividend

The Board reiterates its intention to announce a maiden full year dividend for the year ended 31 December 2014. The dividend is expected to be consistent with GTS' stated dividend policy of approximately equal to a 5% yield on the placing price of 36 pence at the time of the Company's IPO. Further announcements relating to dividend payments will be made following the publication of the Company's annual report for 2014.

Mr. Cheng Liu, Chief Executive Officer of GTS Chemical Holdings plc, said:

"I am delighted by the Group's progress in the period, which cemented the strong growth in the last quarter. GTS' main business divisions continue to perform and we look forward to the rest of the year with optimism.

"I would like to thank our employees and shareholders for their continued support and look forward to meeting shareholders at the forthcoming annual general meeting."

Enquiries:

About GTS Chemical Holdings plc

GTS manufactures specialty chemicals for the paper and chemicals industry. The Group is the largest Chinese producer of ammonium sulfite, a chemical used to manufacture paper from straw. GTS has also a rapidly growing lubricant oil division which services the automotive and industrial markets. Trading in recarburizer is its third division, which accounts for less than 10% of Group revenue.

The Group is located in Shandong Province, one of the largest provinces in China, ranked by GDP, and an area rich in downstream industries. GTS' location also means it is close to several chemical plants and paper factories, which gives it a distinct advantage over its competitors.

The Company is exposed to structural growth in the paper industry and chemicals sector, and market research estimates that from 2014 to 2020, China's demand for ammonium sulfite, led by the paper industry, is set to grow at an annual compound growth rate of 12%. GTS stands to gain from the Chinese Government's support of the non-wood paper industry and its drive to restructure the lubricant oil market through increased regulation and higher standards which favour the more modern producer.

The Group has a history of strong profit growth and consistently high operating margins.