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China Jo-Jo Drugstores Announces Fiscal Second Quarter 2009 Results

HANGZHOU, CHINA -- (Marketwire) -- 11/16/09 -- China Jo-Jo Drugstores, Inc. (OTCBB: CJJD) ("Jo-Jo Drugstores" or the "Company"), which operates a retail pharmacy chain in China, today announced its financial results for its fiscal second quarter ended September 30, 2009.

Fiscal Second Quarter 2009 Highlights

--  Revenues increased 18.1% period-over-period to $12.3 million
--  Income from operations increased by 13.5% period-over-period to $2.3
    million
--  Number of stores increased period-over-period from 13 to 22 stores
    

"Our revenue increase in the fiscal second quarter ended September 30, 2009 was largely attributable to operating more stores than we did from a year ago," commented Mr. Lei Liu, Chairman and Chief Executive Officer of Jo-Jo Drugstores. "We have grown our chain stores organically from 13 to 22 stores, and expect to grow revenue as our newer stores establish themselves further in their local communities and as we continue to add stores to our retail chain."

For the Three Months Ended September 30, 2009 and 2008

Gross profit for the fiscal second quarter was $3.5 million, up 25.6% from the second quarter of 2008. Gross margin for the quarter was 28.5%, compared with 26.8% in the comparable 2008 period. "We anticipate that our overall gross profit will continue to increase as our sales increase," continued Mr. Liu. "Additionally, as our store number grows, we are confident that our gross margin should increase as we will be able to obtain better pricing terms from our suppliers and achieve further economies of scale."

Total operating expenses for the second fiscal quarter of 2009 were $1.2 million, compared with $0.7 million in the prior period. Selling expenses totaled $0.6 million, or 4.9% of revenues, for the second quarter of 2009 as compared to $0.4 million, or 4.2% of revenues, in the comparable period a year ago. The increase is a result of operating additional stores.

General and administrative expenses increased to $0.6 million, or 4.6% of revenues, in the second quarter of 2009, compared with $0.3 million, or 2.8% of revenues, in the same period of 2008. The increase is primarily a result of stock compensation charges and operating additional stores during the three months ended September 30, 2009. We anticipate general and administrative expenses to increase in future periods as we continue to open new stores and develop our infrastructure, and as the costs associated with being a US public company continue to rise.

Income from operations increased to $2.3 million for the second fiscal quarter of 2009, or 19.1% of revenues, from $2.1 million, or 19.8% of revenues for the same quarter in 2008.

As of September 30, 2009, the Company had approximately $1.1 million in cash and restricted cash, current assets of $16.2 million and total liabilities of $9.5 million.

Business Outlook

"Despite the increasingly competitive environment for drugstores in the Hangzhou area, our stores have continued to perform strongly," stated Mr. Liu. "In the long term, we believe that our customer-centric focus on service and price will continue to enhance our brand recognition and provide a strong base for continued future growth."

Conference Call

The Company will host a conference call to discuss these results on Tuesday, November 17, 2009, at 8:00 a.m. Eastern time. To participate in the conference call, please dial 1-877-485-3104 from the US. Participants dialing in from China can access the call by dialing 1-201-689-8579. Investors may also access a live audio webcast of this conference call under the Investors Relations section of the Company's website at http://www.chinajojodrugstores.com.

A replay of the webcast will be available approximately two hours after the conclusion of the call. The webcast replay will remain available for three months. An audio replay will be made available until November 24, 2009. The audio replay can be accessed by dialing 1-877-660-6853 or 1-201-612-7415 and entering pass-code 337823.

About China Jo-Jo Drugstores, Inc.

China Jo-Jo Drugstores, Inc., through its contractually controlled affiliates Hangzhou Jiuzhou Grand Pharmacy Chain Co., Ltd., Hangzhou Jiuzhou Clinic of Integrated Traditional and Western Medicine General Partnership, and Hangzhou Jiuzhou Medical & Public Health Service Co., Ltd., operates a retail pharmacy chain in China offering both western and traditional Chinese medicine. The chain currently has 22 stores throughout Hangzhou, the provincial capital of Zhejiang Province.

Forward-looking Statements

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Certain of the statements made in the press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the use of forward-looking terminology such as "believe," "expect," "may," "will," "should," "project," "plan," "seek," "intend," or "anticipate" or the negative thereof or comparable terminology. Such statements typically involve risks and uncertainties and may include financial projections or information regarding the progress of new product development. Actual results could differ materially from the expectations reflected in such forward-looking statements as a result of a variety of factors, including the risks associated with the effect of changing economic conditions in The People's Republic of China, variations in cash flow, reliance on collaborative retail partners and on new product development, variations in new product development, risks associated with rapid technological change, and the potential of introduced or undetected flaws and defects in products, and other risk factors detailed in reports filed with the Securities and Exchange Commission from time to time.

                    CHINA JOJO DRUGSTORES, INC AND SUBSIDIARIES
                    (FORMERLY KNOWN AS KERRISDALE MINING CORP)

                          CONSOLIDATED BALANCE SHEETS
                   AS OF SEPTEMBER 30, 2009 AND MARCH 31, 2009

                                               September 30,    March 31,
                                                   2009           2009
                                                -----------    -----------
                                                (Unaudited)
                  ASSETS
CURRENT ASSETS
Cash                                            $   819,800    $   996,302
Restricted cash                                     308,006              -
Accounts receivable, trade                        1,296,309      1,265,110
Inventories                                       3,314,802      2,793,101
Other receivables                                   362,019         67,079
Other receivables - related parties                   3,824          2,432
Advances to suppliers                             6,731,624      5,485,113
Advances to suppliers - related parties           2,388,161      1,797,104
Other current assets                                936,238        564,379
                                                -----------    -----------
Total current assets                             16,160,783     12,970,620
                                                -----------    -----------
EQUIPMENT, net                                      965,750        979,432
                                                -----------    -----------

OTHER ASSETS:
Long term deposit                                 2,574,516      2,015,149
                                                -----------    -----------
Total other assets                                2,574,516      2,015,149
                                                -----------    -----------

Total assets                                    $19,701,049    $15,965,201
                                                ===========    ===========

     LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
Short term loans                                $ 1,467,000    $ 1,465,000
Notes payable                                       308,006              -
Accounts payable, trade                           5,926,743      5,939,237
Other payables                                      223,340        404,731
Other payables - related parties                    327,161        326,715
Taxes payable                                       827,120        811,316
Accrued liabilities                                 439,920        360,655
                                                -----------    -----------
Total liabilities                                 9,519,290      9,307,654
                                                -----------    -----------

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY
Common stock; $0.001 par value; 75,000,000
 shares authorized;  20,000,000 and
 15,800,000 shares issued and outstanding
 as of September 30, 2009 and March 31, 2009,
 respectively                                        20,000         15,800
Paid-in capital                                     867,884        661,800
Statutory reserves                                1,309,109      1,309,109
Retained earnings                                 8,336,032      5,033,275
Accumulated other comprehensive loss               (351,266)      (362,437)
                                                -----------    -----------
Total shareholders' equity                       10,181,759      6,657,547
                                                -----------    -----------

Total liabilities and
 shareholders' equity                           $19,701,049    $15,965,201
                                                ===========    ===========



                    CHINA JOJO DRUGSTORES, INC AND SUBSIDIARIES
                    (FORMERLY KNOWN AS KERRISDALE MINING CORP)

          CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
             FOR THREE AND SIX MONTHS ENDED SEPTEMBER 30, 2009 AND 2008
                                  (Unaudited)

                       Three months ended            Six months ended
                          September 30,               September 30,
                        2009          2008          2009          2008
                    ------------- ------------  ------------- ------------
REVENUES            $  12,258,573 $ 10,383,170  $  23,940,037 $ 21,533,559

COST OF GOODS SOLD      8,759,697    7,598,068     17,417,265   15,901,507
                    ------------- ------------  ------------- ------------

GROSS PROFIT            3,498,876    2,785,102      6,522,772    5,632,052
                    ------------- ------------  ------------- ------------

SELLING EXPENSES          596,382      434,282      1,074,159      793,443
GENERAL &
 ADMINISTRATIVE
 EXPENSES                 565,134      291,147        930,344      503,601
                    ------------- ------------  ------------- ------------
OPERATING EXPENSES      1,161,516      725,429      2,004,503    1,297,044

INCOME FROM
 OPERATIONS             2,337,360    2,059,673      4,518,269    4,335,008

OTHER INCOME
 (EXPENSE), NET             3,608       (6,047)        10,243      (15,638)
                    ------------- ------------  ------------- ------------

INCOME BEFORE
 INCOME TAXES           2,340,968    2,053,626      4,528,512    4,319,370

PROVISION FOR
 INCOME TAXES             637,372      476,709      1,225,755    1,001,634
                    ------------- ------------  ------------- ------------

NET INCOME              1,703,596    1,576,917      3,302,757    3,317,736

OTHER COMPREHENSIVE
 INCOME
Foreign currency
 translation
 adjustments               12,591        1,448         11,171       21,634
                    ------------- ------------  ------------- ------------

COMPREHENSIVE
 INCOME             $   1,716,187 $  1,578,365  $   3,313,928 $  3,339,370
                    ============= ============  ============= ============

BASIC AND DILUTED
 WEIGHTED AVERAGE
 NUMBER OF SHARES      16,400,000   15,800,000     16,100,000   15,800,000
                    ============= ============  ============= ============

BASIC AND DILUTED
 EARNING PER SHARE  $        0.10 $       0.10  $        0.21 $       0.21
                    ============= ============  ============= ============

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