China Education Alliance, Inc.-Six Months Financial Results

（By freelance Chinese translator li – based in Harbin，China – English to Chinese translation or Chinese to English translation services - website localization）

For the first six month of 2008, total revenue was $8.5 million, up 14.7%, from $7.4 million for the same period of the prior year. Online education revenue was $6.9 million, up 9.4% from $6.3 million for the first six months of 2007. The training center business contributed $1.6 million, up 45.5% from $1.1 million in the first six months of 2007. Cost of sales was $1.6 million for the six months ended June 30, 2008, a decrease of $171,382, or 9.9%, compared to $1.7 million for the same period of the prior year. Gross profit （毛利总额）was $7.0 million, up 22.2% from gross profit of $5.7 million in the comparable period a year ago. Overall gross margin（毛利率） increased to 81.7% from 76.7% for the six months ended June 30, 2007. The Company's net profit during the six months ended June 30, 2008 increased 49% to $3.6 million from $2.4 million for the six months ended June 30, 2007. Fully diluted earnings per share were $0.14 for the six months ended June 30, 2008, compared to $0.12 per share for the six months ended June 30, 2007.

Financial Condition
As of June 30, 2008, China Education Alliance, Inc. had $19.4 million in cash and cash equivalents, $18.8 million in working capital（营运资本，流动资产-流动负债）, and no long-term debt. Shareholders' equity（所有者权益） was $27.1 million up from $18.6 million at December 31, 2007. The company generated $1.7 million in cash flow from operating activities in the second quarter of 2008.