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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Haike Chemical | LSE:HAIK | London | Ordinary Share | KYG423181083 | ORD USD0.002 (DI) |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 38.00 | 1.00 | 75.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMHAIK
RNS Number : 8715K
HaiKe Chemical Group Ltd.
27 September 2016
HAIKE CHEMICAL GROUP LIMITED
INTERIM CONSOLIDATED RESULTS FOR THE SIX MONTHSED 30 JUNE 2016
(UNAUDITED)
HaiKe Chemical Group Ltd. ("HaiKe" or "the Company" or "the Group"), the AIM quoted (AIM: HAIK) specialty chemical company based in Shandong Province, China, today announces its unaudited consolidated results for the six months ended 30 June 2016.
In order to better position the business in a fiercely competitive market, the Board in Q3 of 2015 took the decision to focus on higher margin speciality chemical products, product innovation and cost controls. These actions began to have a positive impact in Q4 2015 and have enabled the Group to deliver a satisfactory, profitable performance for the first half of 2016.
Financial highlights
-- Total revenues decreased by 9.0% to CNY350.7million (H1 2015: CNY385.4 million) -- Gross profit increased by 47.6% to CNY61.2million (H1 2015: profit of CNY41.5 million)
-- Profit for the period from continuing operations was CNY11.4 million (H1 2015: profit of CNY95,000)
-- Cash and cash equivalents balance as at 30 June 2016 was CNY73.5 million (31 December 2015: CNY CNY35.4 million)
-- Total borrowings as at 30 June 2016 were CNY80.0 million (31 December 2015: CNY80.0 million)
Operational highlights
-- Move to focus on higher-end specialty chemical products has enhanced business performance
-- Significant rise in gross margins enhanced by increased sales of higher margin product mix and decline in prices of raw materials
-- Stringent cost controls and a reduction in the average balance of loans outstanding reduced interest expenses by 68.0% year-on-year to CNY1.9 million for H1 2016 (H1 2015: CNY5.9 million)
Outlook
-- Trading conditions expected to remain challenging
-- Optimization of product mix and new product development continues to be a core focus to drive business performance
-- Focus on domestic and international marketing campaigns to grow revenue
-- Trading in July has continued to be profitable, however an expected loss was recorded in August due to a planned shutdown of its DiMethyl Carbonate ("DMC") facility for routine annual maintenance
Mr. Xiaohong Yang, Executive Chairman, said:
"I am pleased to report the satisfactory performance for the Group over the first half of 2016, especially given the challenging trading environment. The improvement in profitability was driven by the decisive actions taken by the Board last year to better position the business in the current environment and improve performance. We are pleased these are starting to bear fruit and we will continue our efforts in this area. The Group has entered the second half of the year in a strong position and while we believe market conditions will remain difficult, we are well-positioned and look to the future with confidence."
For further information, please contact:
HaiKe Chemical Yolanda Zhang Group yolanda.zhang@haikegroup.com +86 158 0546 2695 Richard Johnson / Stockdale Securities Antonio Bossi +44 (0) 20 7601 6100 Shan Shan Willenbrock / Emma Crawshaw Cardew Group HaiKe@cardewgroup.com +44 (0) 20 7930 0777
CHAIRMAN'S STATEMENT
1. Review of operating results
In H1 2016, the Group sold 68,000 tons of specialty chemicals, representing a volume gain of 10.2% when compared to the same period in the previous year. Sales of high-end specialty chemicals accounted for 3.4% of total sales in H1 2016, compared to 2.7% in H1 2015. While both overall sales volumes and the proportion of high-end speciality chemicals sold in H1 2016 increased, when compared to the prior year period, the fall in crude oil prices over the same period had a negative effect on selling prices, as detailed below. This contributed to lower average realized prices for the period.
The price of crude oil fell significantly in H1 2016, achieving an average barrel price of $41.2 over the period, 30.6% lower than in H1 2015. This decline affected Group selling prices in two ways: depressing selling prices of downstream derivative products, which affected our specialty chemical products; and, by benefitting rival manufacturers of Isopropyl alcohol, who adopt a different production process which is more sensitive to oil price fluctuations. These rival manufacturers initiated a price war during 2015, as the oil price began to fall, and this continued into the first half of 2016 in an attempt to gain market share in what had become an oversupplied market of mid to lower-end specialty chemicals, chiefly due to the slowing Chinese economy.
In order to maintain market share we continued to suppress our selling prices over the period, with the shift towards more high-end speciality chemicals to address the oversupply of the mid to lower-end speciality chemicals market.
Average Realized Sales Volume Price ('000 ton) (CNY/ton) 6 months 6 months Change 6 months 6 months Change ended ended y-o-y ended ended y-o-y 30-Jun-16 30-Jun-15 (%) 30-Jun-16 30-Jun-15 (%) DiMethyl Carbonate 24 23 +4.4% 3,782 3,872 -2.3% Propylene glycol 19 17 +7.5% 6,618 8,496 -22.1% Isopropyl alcohol 24 19 +23.7% 4,705 5,726 -17.8% Diisopropyl ether 1 2 -30.0% 9,688 11,319 -14.4% ----------- ----------- ------- ----------- ----------- ------- Total 68 62 +10.2% 5,013 6,008 -16.6% 2. Financial Analysis
Turnover
The Group's turnover decreased by 9.0% to CNY350.7 million for the first half of 2016 (H1 2015: CNY385.4 million) as a result of a reduction in selling prices. Trading revenues from HaiKe Trading, the trading arm of the Company, decreased to CNY1.8 million in the period (H1 2015: CNY21.7 million).
Gross Profit
Gross profit was CNY61.2 million for H1 2016, up 47.6% compared with the same period in 2015 (H1 2015: CNY41.5 million). The growth in gross profit was mainly attributable to increased sales of higher margin product mix and a decline in sales cost. Sales of high-end specialty chemicals accounted for 3.4% of total sales in H1 2016, compared to 2.7% in H1 2015. The cost of sales decreased 15.8% compared to the same period in the previous year. Cost of materials accounted for 81% of total cost. The Company correctly judged price trends through analysis of the raw material market, reducing inventory when the price of raw materials was high and taking advantage of lower prices to increase stock. The price of Propylene Oxide and Propylene, the two main raw materials, deceased 24.7% and 31.6% respectively in the period under review.
Selling, General and Administrative Expenses
Selling and distribution expenses increased by 19.0% to CNY20.8 million in H1 2016 (H1 2015: CNY17.5 million) as we continued with aggressive sales and marketing efforts to counteract sluggish market conditions. General and administrative expenses increased to CNY25.2 million (H1 2015: CNY20.4 million) which was mainly attributable to an increase in labour cost as a result of an increase in domestic inflation.
Net Interest Expenses
Interest income decreased by 68.4% year-on-year to CNY0.9 million for H1 2016 (H1 2015: CNY2.9 million) due to exchange rate gains.
Interest expenses decreased by 68.0% year-on-year to CNY1.9 million for H1 2016 (H1 2015: CNY5.9million). This was mainly due to a decrease in the average balance of loans outstanding.
Profit Before Taxation
Profit before taxation was CNY13.8 million for H1 2016 (H1 2015: CNY666,000). In order to maintain market share the Company increased its sales volume. The Company improved earnings although the average realized price decreased. Interest expenses decreased as a result of a decrease in the average balance of loans outstanding compared with the same period in 2015.
Income Tax
Income tax charge was CNY2.4 million for H1 2016, as compared to CNY571,000 for the same period in the previous year.
Profit from Continuing Operations
Profit for the half year was CNY11.4 million (H1 2015: profit of CNY95,000).
Cash and Cash Equivalents
Cash and cash equivalents increased to CNY73.5 million as at 30 June 2016 compared to CNY35.4 million as at 31 December 2015. The increase in cash and cash equivalents was due to the decline of working capital and profit improvement.
Bank Loans
Bank loans were CNY80.0 million as at 30 June 2016, unchanged from31 December 2015 (CNY 80.0 million).
Cash Flow from Continuing Operations
Cash flow from operating activities was CNY68.0 million for the six months ended 30 June 2016, compared to CNY531.9 million for the same period in 2015. In H1 2015 working capital was used to repay a net loan of CNY 520.5 million.
3. Outlook
The Group recorded an unaudited profit of CNY1.4 million and loss of CNY3.0 million for July and August 2016 respectively. The expected loss incurred in August was due to a planned one-month shutdown of a production facility which manufactures DMC for routine annual maintenance, however we expect the improvement in product mix and cost saving initiatives will continue to drive profitability from September. We expect market conditions to remain challenging. The collapse in the crude oil price has made conditions difficult for the specialty chemicals industry in China and the domestic economy has had a negative impact on demand. At the industry level we are facing increasing competition, particularly at the mid to lower end of the market, and we believe companies will increasingly have to develop their own niche through technological innovation to deliver growth. To ensure the Group is well positioned to continue to deliver a profitable performance in a tough operating environment, management efforts will remain focused on:
-- improving the product mix towards higher margin speciality chemical products -- continued stringent cost controls -- strengthen sales efforts to speed up product inventory turnover
-- developing and introducing new products to the domestic market to diversify our product offering
4. People
On behalf of the Board, I would like to sincerely thank Mr. George Zeng for his commitment and outstanding contribution to the business over the last five years. The Board has initiated a comprehensive search for a new Chief Financial Officer, who would be expected to join the Board, and a further announcement will be made in due course.
Xiaohong Yang
Executive Chairman
Condensed consolidated statement of comprehensive income
For the six months ended 30 June 2016
6 months 6 months ended Year ended ended 30-Jun-16 30-Jun-15 31-Dec-15 Note (Unaudited) (Unaudited) (Audited) CNY'000 CNY'000 CNY'000 ------------ --------------- ----------- Revenue 350,706 385,427 727,521 Cost of sales (289,521) (343,960) (643,092) ------------ --------------- ----------- Gross profit 61,185 41,467 84,429 Other operating income (387) 112 485 Administrative expenses (25,160) (20,392) (41,175) Selling and distribution expenses (20,843) (17,514) (34,749) ------------ --------------- ----------- Profit from operations 14,795 3,673 8,990 Finance expenses (1,877) (5,872) (20,742) Finance income 906 2,865 17,529 ------------ --------------- ----------- Profit / (loss) before tax 13,824 666 5,777 Tax expense 7 (2,435) (571) (1,709) Profit/(Loss) for the period 11,389 95 4,068 ------------ --------------- ----------- Other comprehensive profit, net of tax Items that will be reclassified subsequently to profit or loss Exchange difference arising from consolidation - - - ------------ --------------- ----------- Total comprehensive profit for the period, net of tax 11,389 95 4,068 ------------ --------------- ----------- Profit / (loss) for the period attributable to: Owners of parent 11,372 94 4,059 Non-controlling interest 17 1 9 ------------ --------------- ----------- 11,389 95 4,068 ------------ --------------- ----------- Total comprehensive profit for the period attributable to: 11,372 94 4,059 Owners of parent 17 1 9 ------------ --------------- ----------- Non-controlling interests 11,389 95 4,068 ------------ --------------- ----------- Earnings per share for profit attributable to the ordinary equity holders of the parent during the period Basic CNY0.297 CNY0.002 CNY0.106 Diluted CNY0.297 CNY0.002 CNY0.106 ------------ --------------- -----------
Condensed consolidated Statement of Financial Position
As at 30 June 2016
6 months 6 months Year ended ended ended 30-Jun-16 30-Jun-15 31-Dec-15 Notes (Unaudited) (Unaudited) (Audited) CNY'000 CNY'000 CNY'000 --------------------------------- --------------------------------- ------------ ASSETS Non-current assets Property, plant and equipment 148,632 136,533 135,164 Intangible assets 11,465 12,111 Investments in equity-accounted associates Deferred tax assets 7 160,097 136,533 147,275 --------------------------------- --------------------------------- ------------ Current assets Inventories 33,296 41,296 28,595 Trade and other receivables 105,941 174,598 101,307 Amounts due from related parties 580,931 364,803 402,535 Income tax receivable - Restricted cash 7,612 24,471 13,259 Cash and cash equivalents 73,541 43,628 35,405 --------------------------------- 801,321 648,796 581,101 --------------------------------- --------------------------------- ------------ Total assets 961,418 785,329 728.376 --------------------------------- --------------------------------- ------------ LIABILITIES Current liabilities Short-term loan 80,000 182,362 80,000 Trade and other payables 180,202 343,058 89,182 Income tax payable 6,749 4,668 --------------------------------- --------------------------------- ------------ Amounts due to related parties 568,654 158,778 440,029 --------------------------------- --------------------------------- 835,605 684,198 613,879 --------------------------------- --------------------------------- ------------ Non-current liabilities Long-term loan Deferred income 2,192 1,200 2,250 --------------------------------- --------------------------------- 2,192 1,200 2,250 --------------------------------- --------------------------------- ------------ Total liabilities 837,797 685,398 616,129 --------------------------------- --------------------------------- ------------ CAPITAL AND RESERVES Share capital 598 598 598
Share premium 1,564,667 1,564,686 1,564,667 Other reserves 1,818 1,818 1,818 Foreign currency translation reserve (587) (587) (587) Statutory reserves 32,268 31,575 32,268 Accumulated losses (1,475,228) (1,498,208) (1,486,585) --------------------------------- --------------------------------- ------------ Equity attributable to equity holders of the parent 123,536 99,882 112,179 Non-controlling interest 85 49 68 --------------------------------- --------------------------------- Total equity 123,621 99,931 112,247 --------------------------------- --------------------------------- ------------ Total liabilities and equity 961,418 785,329 728,376 --------------------------------- --------------------------------- ------------
Condensed consolidated Statement of Changes in Equity
For the 6 months ended 30 June 2016
Attributable to equity holders of the parent For the 6 months Foreign ended 30 June 2016 Share Share Other currency Statutory Accumulated Non-controlling Total Unaudited capital premium reserves translation reserves losses Total interest equity CNY'000 CNY'000 CNY'000 reserve CNY'000 CNY'000 CNY'000 CNY'000 CNY'000 --------- -------------- ---------- --------------- ----------- --------------------- ---------------- --------------------- ---------- Balance as at 1 January 2016 598 1,564,667 1,818 (587) 32,268 (1,486,585) 112,179 68 112,247 Transfer to statutory reserves Previous year adjustment (15) (15) (15) Transactions with owners - - - - (15) (15) - (15) Profit for the year 11,372 11,372 17 11,389 Other comprehensive profit - - - - - - Foreign currency translation - - - Total comprehensive profit for the year - - - - - 11,372 11,372 17 11,389 Balance as at 30 June 2016 598 1,564,667 1,818 (587) 32,268 (1,475,228) 123,536 85 123,621 --------- -------------- ---------- --------------- ----------- --------------------- ---------------- --------------------- ---------- Attributable to equity holders of the parent For the 6 months Foreign ended 30 June 2015 Share Share Other currency Statutory Accumulated Non-controlling Total Unaudited capital premium reserves translation reserves losses Total interest equity CNY'000 CNY'000 CNY'000 reserve CNY'000 CNY'000 CNY'000 CNY'000 CNY'000 --------- -------------- ---------- --------------- ----------- --------------------- ---------------- --------------------- ---------- Balance as at 1 January 2015 598 1,564,686 1,818 (587) 31,575 (1,498,313) 99,777 48 99,825 Transfer to statutory reserves - Transactions with owners - - - - - - - Profit for the year 94 94 1 95 Other comprehensive profit 11 11 - 11 - Foreign currency translation - - - - - - - Total comprehensive profit for the year - - - - - 105 105 1 106 Balance as at 30 June 2015 598 1,564,686 1,818 (587) 31,575 (1,498,208) 99,882 49 99,931 --------- -------------- ---------- --------------- ----------- --------------------- ---------------- --------------------- ---------- For the year ended Attributable to equity holders of 31 December 2015 the parent Audited Foreign Share Share Other currency Statutory Accumulated Non-controlling Total capital premium reserves translation reserves losses Total interest equity CNY'000 CNY'000 CNY'000 reserve CNY'000 CNY'000 CNY'000 CNY'000 CNY'000 --------- -------------- ---------- --------------- ----------- --------------------- ---------------- --------------------- ---------- Balance as at 1 January 2015 598 1,564,686 1,818 (587) 31,575 (1,498,313) 99,777 48 99,825 Transfer to statutory reserves - (19) - 693 (674) - 11 11 Previous year adjustment 8,343 8,343 8,354 Transactions with
owners - (19) - - 693 7,669 8,343 11 8,354 Profit for the year 4,059 4,059 9 4,068 Other comprehensive profit - - - - - 0 - Foreign currency translation - - - - - (64) Total comprehensive profit for the year - - - - - 4,059 4,059 9 4,068 Balance as at 31 December 2015 598 1,564,667 1,818 (587) 32,268 (1,486,585) 112,179 68 112,247 --------- -------------- ---------- --------------- ----------- --------------------- ---------------- --------------------- ----------
Condensed consolidated Statement of Cash Flow
For the 6 months ended 30 June 2016
6 months 6 months Year ended ended ended ------------ ------------ ---------- 30-Jun-16 30-Jun-15 31-Dec-15 ------------ ------------ ---------- (Unaudited) (Unaudited) (Audited) ------------ ------------ ---------- CNY'000 CNY'000 CNY'000 ------------ ------------ ---------- Profit /(loss) before tax 13,824 666 5,777 ------------ ------------ ---------- Adjustments for: - - ------------ ------------ ---------- Amortisation of intangible assets 646 201 802 ------------ ------------ ---------- Provisions for doubtful debts 136 136 ------------ ------------ ---------- Depreciation of property, plant and equipment 12,860 12,104 24,413 ------------ ------------ ---------- Loss on disposal of property, plant and equipment (472) (28) (51) ------------ ------------ ---------- Amortisation of deferred capital grants 250 1,000 ------------ ------------ ---------- Interest income (114) (284) (12,790) ------------ ------------ ---------- Finance expense 953 5,906 20,742 ------------ ------------ ---------- Operating cash flows before working capital changes 28,083 18,565 40,029 ------------ ------------ ---------- Working capital changes: ------------ ------------ ---------- (Increase)/decrease in: ------------ ------------ ---------- Inventories (4,701) (10,098) 2,603 ------------ ------------ ---------- Trade and other receivables (4,634) (50,945) 22,346 ------------ ------------ ---------- Movement in related parties' balances (49,803) 577,234 809,285 ------------ ------------ ---------- Restricted cash 5,647 (7,851) 3,361 ------------ ------------ ---------- Increase/(decrease) in: ------------ ------------ ---------- Trade and other payables 91,020 5,025 (238,707) ------------ ------------ ---------- Cash generated from operations 65,612 531,930 638,917 ------------ ------------ ---------- Income tax paid 2,388 - 283 ------------ ------------ ---------- Net cash generated from operating activities 68,000 531,930 639,200 ------------ ------------ ---------- 6 months 6 months Year ended ended ended ------------ ------------ ---------- 30-Jun-16 30-Jun-15 31-Dec-15 ------------ ------------ ---------- (Unaudited) (Unaudited) (Audited) ------------ ------------ ---------- Notes CNY'000 CNY'000 CNY'000 ------------ ------------ ---------- Cash flow generated from operating activities 68,000 531,930 639,200 ------------ ------------ ---------- Cash flow from investing activities ------------ ------------ ---------- Purchase of property, plant and equipment (29,085) (1,971) (12,818) ------------ ------------ ---------- Purchase of intangible assets - ------------ ------------ ---------- Interest received 114 284 12,790 ------------ ------------ ---------- Government grant received 60 414 459 ------------ ------------ ---------- Purchase of shares in subsidiary from minorities - ------------ ------------ ---------- Cash flow (used in) / generated from investing activities (28,911) (1,273) 431 ------------ ------------ ---------- Cash flow from financing activities ------------ ------------ ---------- Capital injection from minority shareholders in subsidiaires ------------ ------------ ---------- Proceeds from bank borrowings 80,000 40,000 80,000 ------------ ------------ ---------- Repayment of bank borrowings (80,000) (560,526) (702,888) ------------ ------------ ---------- Loans(from)/to related parties ------------ ------------ ---------- Interest paid (953) (5,906) (20,742) ------------ ------------ ---------- Dividends paid to non-controlling interest - - ------------ ------------ ---------- Cash flow (used in) /generated from financing activities (953) (526,432) (643,630) ------------ ------------ ---------- Net (decrease) /increase in cash and cash equivalents 38,136 4,225 (3,999) ------------ ------------ ----------
Cash at beginning of period 35,405 39,404 39,404 ------------ ------------ ---------- Foreign currency translation differences ------------ ------------ ---------- Cash at end of year 73,541 43,628 35,405 ------------ ------------ ----------
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL INFORMATION
FOR SIX MONTHSED 30 JUNE 2016
(UNAUDITED)
1. General information
HaiKe Chemical Group Ltd. ("the Company") is a public limited company, incorporated in the Cayman Islands on 20 June 2006, and is quoted on AIM. The address of the registered office is Scotia Center 4th Floor, P.O. Box 2804, George Town, Grand Cayman, Cayman Islands.
The Company's ultimate parent company is HiTech Chemical Investment Ltd, a company incorporated in the British Virgin Islands.
The principal activities of the Company are manufacturing of specialty chemical products.
The principal place of business of the Company is Shengli Industrial Park, Dongying City, Shandong Province, China.
The interim consolidated financial information of the Company for the six months ended 30 June 2016 comprises the Company and its subsidiary undertakings ("the Group").
2. Accounting policies
The consolidated financial statements of the Company have been prepared in accordance with those International Financial Reporting Standards and Interpretations in force ("IFRS"), as adopted by the European Union.
The principal accounting policies adopted in the preparation of the interim financial statements have been consistently applied in the Company's latest annual audited consolidated financial statements and are expected to be used for Company's annual consolidated financial statements for the year ending 31 December 2016.
Financial information for the six months ended 30 June 2016 and 30 June 2015 is unaudited and does not constitute the Company's financial statements for these periods.
Comparative financial information for the full year ended 31 December 2015 has been derived from the audited financial statements for that period. The Board of Directors approved the interim statements on 19 September 2015.
3. Related Party Transactions
The Company undertook a restructuring in 2014 which resulted in the divestment of the Group's refinery and biochemical assets to leave a smaller, more focused specialty chemicals business. The disposed companies and HaiKe are members of the group controlled by HiTech Chemical Investment Ltd. Therefore, in accordance with IAS24, the disposed companies and Haike are related parties.
On 20 July 2016 the Company announced an unaudited revenue figure of CNY 526.9 million for H1 2016, which did not incorporate a net-off of transactions between Haike and two companies, Shandong Hi-Tech Chemical Group Ltd. and Haiyuan Trading Pte. Ltd., which were disposed companies in the restructuring. Revenue recognition is applied in line with IAS 18 - transactions between Haike and related parties, where Haike acts in a capacity as an agent and gross inflows do not result in increases in equity are not recognised as revenue. The Company made a corrective announcement on 6 September 2016.
The immediate and ultimate parent company is HiTech Chemical Investment Ltd., a company incorporated in British Virgin Islands. Related parties include companies that fall under the common control provisions of IAS24. Details of transactions with related parties are as follows:
Sales, purchase of goods and loans
In H1 2016, the Group made the following sales, purchase and funds transfer with related parties:
Sales Purchase Loan from Loan to Loan repayment Total ---------------------------------------------- -------- --------- ---------- -------- --------------- ---------- 30-06-2016 CNY'000 CNY'000 CNY'000 CNY'000 CNY'000 CNY'000 ---------------------------------------------- -------- --------- ---------- -------- --------------- ---------- Shareholder - - - 8 - 8 Bright Century Global Holdings Limited - - 189,704 - - 189,704 Haike Holding Hongkong Limited - - 10 87,250 - 87,260 Haike International Holding Limited - - - 10 - 10 Haiyuan Trading Pte.Ltd - - - 173,513 - 173,513 HiTech Chemical Investment Ltd. - - - 396 - 396 Jumbo Light Hong Kong Limited - - - 211,660 - 211,660 Dongying Hi-tech Qifen Co., Ltd - 71,576 - 101,068 - 172,644 Shandong Hi-tech Ruilin Chemical Co., Ltd 284 8,821 59,069 - - 68,174 Dongying He-bang Chemical Co., Ltd - 587 40,392 - - 40,979 Dongying Tiandong Biochemical Co., Ltd - - 7,344 3,209 - 10,553 Shandong Hi-tech Chemical Group Ltd - 3,810 266,500 3,477 - 273,787 Shanghai Yuanchuan Chemical Ltd - - 5,552 - - 5,552 Dongying Hi-tech Transport Co.,Ltd. - 554 83 - - 637 Shandong Hi-Tech Shengli Electrochemical Co., Ltd - - - 340 - 340 ---------------------------------------------- -------- --------- ---------- -------- --------------- ---------- 284 85,348 568,654 580,931 - 1,235,217 ---------------------------------------------- -------- --------- ---------- -------- --------------- ----------
The sales of goods to the related parties are based on the market price.
4. Subsequent Event
No subsequent event occurred after the reporting period.
5. Capital commitments
Capital expenditure contracted for property, plant and equipment in continuing operations as at 30 June 2016, but not recognized in the financial statements, was CNY10.2 million (31 December 2015: CNY3.5 million).
6. Acquisitions and disposals of items of property, plant and equipment
Acquisitions of items of property, plant and equipment were CNY29.1 million (H1 2015: CNY2.0 million). Loss on disposals of items of property, plant and equipment was CNY472,000 (H1 2015: CNY28,000).
7. Taxation
Major components of income tax expense/(credit)
The major components of income tax expense are as follows:
6 months 6 months Year ended ended ended 30-Jun-16 30-Jun-15 31-Dec-15 (Unaudited) (Unaudited) (Audited) CNY'000 CNY'000 CNY'000 ------------ ------------ ----------- Current income tax 2,435 571 1,709 Deferred tax: Originating and reversal - - - of temporary differences ------------ ------------ Income tax recognised in income statement 2,435 571 1,709 ------------ ------------ -----------
Relationship between tax expense and accounting (loss)/profit
Reconciliation between tax expense and the accounting profit multiplied by the applicable corporate tax rate is as follows:
6 months 6 months Year ended ended ended 30-Jun-16 30-Jun-15 31-Dec-15 (Unaudited) (Unaudited) (Audited) CNY'000 CNY'000 CNY'000 --------------------------- ------------ ----------- Accounting profit before income tax 13,824 666 5,777 Tax at respective companies' domestic income tax rate 3,456 167 1,444 Nondeductible expenses (1,021) 405 265 Income tax expense recognized in income statement 2,435 572 1,709 --------------------------- ------------ ----------- 8. Profit per share from continuing operations
Earnings for the purpose of basic and diluted earnings per share are the net profit for six months ended 30 June 2016 attributable to equity holders of the parent of CNY11,372,000 (for the six months ended 30 June 2015: profit of CNY94,000; for the year ended 31 December 2015: profit of CNY4,059,000).
The profit from continuing operations for the financial periods attributable to equity holders of the parent was as follows:
profit per share from continuing operations 6 months 6 months Year ended ended ended 30-Jun-16 30-Jun-15 31-Dec-15 (Unaudited) (Unaudited) (Audited) CNY'000 CNY'000 CNY'000 ------------ ------------ ----------- profit per share from continuing operations attributable to equity holders of the parent 11,372 94 4,059 ------------ ------------ ----------- Number of ordinary shares 6 months 6 months Year ended ended ended 30-Jun-16 30-Jun-15 31-Dec-15 (Unaudited) (Unaudited) (Audited) '000 '000 '000 ------------ ------------ ----------- Weighted average number of ordinary shares - basic & diluted 38,354 38,354 38,354 ------------ ------------ -----------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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