TIDMACHL
RNS Number : 2838Q
Asian Citrus Holdings Ltd
26 February 2016
Hong Kong Exchanges and Clearing Limited and The Stock Exchange
of Hong Kong Limited take no responsibility for the contents of
this announcement, make no representation as to its accuracy or
completeness and expressly disclaim any liability whatsoever for
any loss howsoever arising from or in reliance upon the whole or
any part of the contents of this announcement.
ASIAN CITRUS HOLDINGS LIMITED
*
(Incorporated in Bermuda with limited liability)
(Stock Code: HKSE: 73; AIM: ACHL)
ANNOUNCEMENT OF THE INTERIM RESULTS
FoR THE SIX MONTHS ENDED 31 DECEMBER 2015
The board of directors (the "Board") of Asian Citrus Holdings
Limited (the "Company" or "Asian Citrus") announces the unaudited
consolidated results of the Company and its subsidiaries
(collectively, the "Group") for the six months ended 31 December
2015 together with its comparative figures for the six months ended
31 December 2014.
Results Highlights
For illustration
Six months ended only
31 December Six months ended
31 December
2015 2014 2015 2014
(RMB m) (RMB m) (GBP (GBP m**)
m**)
Reported financial information
Revenue 387.2 584.4 39.9 60.5
Gross loss -440.7 -132.9 -45.4 -13.8
EBITDA -1,515.8 -152.6 -156.1 -15.8
Loss attributable to shareholders -1,616.3 -236.4 -166.5 -24.5
Basic loss per share -RMB1.29 -RMB0.19 -13.3p -2.0p
Adjusted core financial information#
EBITDA -421.7 -109.2 -43.4 -11.3
Loss before tax -527.8 -191.9 -54.4 -19.9
Loss attributable to shareholders -522.1 -193.0 -53.8 -20.0
Basic loss per share -RMB0.42 -RMB0.15 -4.3p -1.6p
(*) For identification purpose only
** Conversion at GBP1 = RMB9.71 and RMB9.66 for the six months
ended 31 December 2015 and 2014 respectively for reference
only.
# Adjusted core financial information refers to activities for
the period excluding change in fair value of biological assets,
impairment of biological assets, impairment of property, plant and
equipment, impairment of intangible assets and share-based
payments.
RESULTS HIGHLIGHTS (Continued)
l Results of operations for the first half year are as
follows:
- Total orange production decreased by 86.0% to 15,565 tonnes
due to (i) the dramatic impact of the Huanglongbing disease
infection at Xinfeng Plantation; and (ii) the impact of poor
weather in Hepu area (six months ended 31 December 2014: 110,993
tonnes).
- Revenue down by 33.7% to RMB387.2 million (six months ended 31
December 2014: RMB584.4 million).
- Adjusted core loss attributable to shareholders of RMB522.1
million (six months ended 31 December 2014: RMB193.0 million)
reflecting (i) the reduction in production volume and average
selling price of winter oranges; (ii) the additional cost of
pesticides to prevent the spread of the Huanglongbing disease and
protect the unaffected orange trees; and (iii) the reduction in
profit margin of the processed fruit business.
- Net operating activities cash outflow of RMB223.8 million (six
months ended 31 December 2014: RMB70.5 million) and cash and cash
equivalents of RMB521.4 million as at 31 December 2015 (31 December
2014: RMB1,528.2 million).
l Xinfeng Plantation is no longer economically productive due to
the massive infection of Huanglongbing disease and the present
uncertainties over the effectiveness of the control measures to
prevent the spread of Huanglongbing disease. It ceased operations
permanently after completion of the winter orange harvest in
December 2015.
l In view of the Group's net loss for the period, the Board does
not recommend the payment of any interim dividend for the six
months ended 31 December 2015 (six months ended 31 December 2014:
Nil).
For further enquiries please contact:
Asian Citrus +852 3951 0000
Emma Ng (Chief Financial Officer and Company
Secretary)
+44 (0) 20 7894
Cantor Fitzgerald Europe (NOMAD and Broker) 7000
Rick Thompson / David Foreman / Michael
Reynolds (Corporate Finance)
+44 (0) 20 7067
Weber Shandwick Financial 0700
Nick Oborne, Tom Jenkins
CHAIRMAN'S STATEMENT
On behalf of the Board, I wish to report to you the developments
of the Group for the six months ended 31 December 2015, as well as
our plan and outlook for the year ending 30 June 2016 and
beyond.
The operating environment of the Group has been difficult in the
past few years with adverse weather conditions and the devastating
effects of Huanglongbing disease posing significant challenges to
the business and financial operations of the Group. We suffered
significant losses resulting from decreasing production yields and
increasing margin pressures in our Hepu Plantation and Xinfeng
Plantation during the six months ended 31 December 2015. Xinfeng
Plantation was shut down after the winter harvest in December 2015
as a consequence of the widespread Huanglongbing disease suffered
at the plantation leading to substantial impairment losses and
provisions relating to the cessation of operation.
The processed fruit business, which involves the manufacture and
sale of fruit juice concentrates, purees and frozen fruit and
vegetables also reported a loss for the first half year as a result
of lower utilisation rates and the increased cost of materials.
While it is still early in the financial year to fully judge the
full impact of the challenges highlighted above on the Group's
likely full year performance, we anticipate that conditions in the
second half will continue to be demanding.
With that in view, we have promptly adjusted our business
strategies and will actively consolidate our business. We shall
focus on improving efficiency and utilisation of all our assets as
well as the implementation of the cost control program to reduce
the operating costs of the Group. All these measures will enable
the Group to reallocate its resources to strengthen its core
operations and improve its operational efficiency and
profitability.
Moving forward, the Group will seek to identify attractive
investment and acquisition opportunities, so as to enhance
profitability and maximise our shareholders' value. We keep an open
mind when exploring new opportunities, but will only invest in high
potential projects on a selective and prudent basis, without
compromising the financial stability of the Group.
Given the result of the first half year, the Board has decided
not to pay an interim dividend. Our existing dividend policy, which
stipulates a dividend of not less than 30% of our adjusted core net
profit, remains unchanged.
Finally, I would like to take this opportunity to express my
heartfelt gratitude to my fellow directors, management and all
staff for the hard work and dedication in supporting the
development of the Group, and the shareholders for their continuing
support and confidence in the Group.
Ng Ong Nee
Chairman
26 February 2016
MANAGEMENT DISCUSSION AND ANALYSIS
OPERATING PERFORMANCE
Revenue
The breakdown of revenue by type is as follows:
For the six months ended 31 December
2015 2014
% of % of
RMB'000 total revenue RMB'000 total revenue
Hepu Plantation 10,783 2.8% 16,165 2.8%
Xinfeng Plantation 25,996 6.7% 324,834 55.6%
-------- ------------- ------- ---------------
Sales of oranges 36,779 9.5% 340,999 58.4%
Sales of processed fruit 331,160 85.5% 243,398 41.6%
Sales of bananas 18,656 4.8% - -
Sales of self-bred
saplings 564 0.2% - -
Total revenue 387,159 100.0% 584,397 100.0%
-------- ------------- ------- ---------------
Sales of oranges
Revenue from the sale of oranges decreased by approximately
89.2% to RMB36.8 million for the six months ended 31 December 2015.
This was mainly due to a decrease of approximately 86.0% in the
production yield to 15,565 tonnes (six months ended 31 December
2014: 110,993 tonnes) and an approximate decrease in average
selling price of 23.0%.
The production yield from Hepu Plantation decreased by
approximately 34.6% from 7,146 tonnes for the corresponding period
of last year to 4,671 tonnes for the six months ended 31 December
2015. The decrease in production was mainly due to the impact of
poor weather.
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