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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Pokphand(HK)Reg | LSE:PKPH | London | Ordinary Share | BMG715071004 | US$0.05(HONG KONG REGD) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.00 | - |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number:4488B
Pokphand (C.P.) Co Ltd
20 September 2002
C.P. POKPHAND CO. LTD.
(Incorporated in Bermuda with limited liability)
ANNOUNCEMENT OF RESULTS FOR THE SIX MONTHS ENDED 30TH JUNE, 2002
The board of directors (the "Directors") announces the unaudited consolidated
results of C.P. Pokphand Co. Ltd. and its subsidiaries (the "Group") for the six
months ended 30th June, 2002 as follows:
Condensed Consolidated Profit and Loss Account
Six months ended 30th June,
2002 2001
(Unaudited) (Unaudited)
Notes US$'000 US$'000
Turnover 2 704,971 678,043
Cost of sales (611,980) (597,892)
-------------- --------------
Gross profit 92,991 80,151
Selling expenses (25,719) (22,799)
General and administrative expenses (45,490) (54,075)
Other income, net 3 49,040 7,999
-------------- --------------
Profit from operating activities 4 70,822 11,276
Finance costs (20,891) (34,819)
Share of profits less losses of jointly controlled
entities 8,351 5,694
Share of profits less losses of associates 1,387 758
-------------- --------------
Profit/(Loss) before tax 2 59,669 (17,091)
Tax 5 (6,500) (4,569)
-------------- --------------
Profit/(Loss) after tax 53,169 (21,660)
Minority interests' share of profits less losses (5,596) (598)
-------------- --------------
Net profit/(loss) from ordinary activities
attributable to shareholders 47,573 (22,258)
Accumulated losses at beginning of period (140,483) (135,918)
-------------- --------------
Accumulated losses (92,910) (158,176)
Transfer to statutory reserves (1,286) (851)
-------------- --------------
Accumulated losses at end of period (94,196) (159,027)
============== ==============
US cents US cents
Earnings/(Loss) per share:
Basic 6 2.204 (1.031)
Diluted N/A N/A
Dividend per share:
Interim: Nil (2001: Nil) - -
Notes:
1. Accounting policies
The condensed consolidated interim financial statements are unaudited and
have been prepared in accordance with the Rules (the "Listing Rules")
Governing the Listing of Securities on The Stock Exchange of Hong
Kong Limited (the "Stock Exchange") and International Accounting Standard
34 "Interim Financial Reporting".
The accounting policies adopted are consistent with those followed in the
Group's annual financial statements for the year ended 31st December, 2001.
2. Segmental information
Turnover represents rental income, dividend income and the net invoiced
value of sales after allowances for goods returned and trade discounts,
and after the elimination of intra-group transactions.
Analyses of turnover and profit/(loss) before tax by activity and
geographical location are as follows:
Turnover:
Six months ended 30th June,
2002 2001
(Unaudited) (Unaudited)
US$'000 US$'000
By activity:
Feedmill and poultry operations 704,889 676,366
Investment properties 82 152
Investment holding - 1,525
-------------- --------------
704,971 678,043
============== ==============
By geographical location:
People's Republic of China ("PRC"):
Hong Kong 82 179
Elsewhere 647,062 633,483
-------------- --------------
647,144 633,662
Turkey 57,827 42,883
Thailand - 1,498
-------------- --------------
704,971 678,043
============== ==============
The above analysis does not include the turnover of the Group's jointly
controlled entities and associates.
Profit/(Loss) before tax:
Six months ended 30th June,
2002 2001
(Unaudited) (Unaudited)
US$'000 US$'000
By activity:
Feedmill and poultry operations 67,057 (13,030)
Industrial operations 3,676 3,794
Investment properties (370) (324)
Investment holding* (10,694) (7,531)
-------------- --------------
59,669 (17,091)
============== ==============
By geographical location:
PRC:
Hong Kong (11,064) (7,855)
Elsewhere 59,081 (6,179)
-------------- --------------
48,017 (14,034)
Turkey 7,279 (7,522)
Indonesia 3,829 -
Thailand 544 4,465
-------------- --------------
59,669 (17,091)
============== ==============
* including Hong Kong headquarters' general expenses
3. Other income, net
Six months ended 30th June,
2002 2001
(Unaudited) (Unaudited)
US$'000 US$'000
The Company and subsidiaries:
Amortisation of deferred restructuring expenses (931) (931)
Gain on disposals of interests in an associate 43,961 -
Gain on disposals of short term investment 544 3,037
Unrealised gain of short term investment 3,829 -
Interest income 1,637 5,893
-------------- --------------
49,040 7,999
============== ==============
4. Profit from operating activities
Six months ended 30th June,
2002 2001
(Unaudited) (Unaudited)
US$'000 US$'000
The Group's profit from operating activities is arrived at
after charging/(crediting):
Dividend income from short term investment - (1,498)
Foreign exchange loss, net 1,008 12,386
Depreciation 24,459 25,015
Loss on disposal of fixed assets, net 153 42
Amortisation of deferred borrowing expenses - 166
5. Tax
Six months ended 30th June,
2002 2001
(Unaudited) (Unaudited)
US$'000 US$'000
The Company and subsidiaries:
Provision for taxation in respect of profit for the period:
PRC:
Hong Kong - -
Elsewhere 4,239 2,882
Overseas - -
-------------- --------------
4,239 2,882
-------------- --------------
Jointly controlled entities:
PRC:
Hong Kong - -
Elsewhere 2,129 1,379
-------------- --------------
2,129 1,379
-------------- --------------
Associates:
PRC:
Hong Kong - -
Elsewhere 132 132
-------------- --------------
132 308
-------------- --------------
Tax charged for the period 6,500 4,569
============== ==============
No provision for Hong Kong taxation has been made as the Group earned no
assessable income in Hong Kong during the period (2001: nil).
No overseas tax has been made as there was no corporation tax required to
be provided in Turkey in respect of income earned in the country during
the period.
6. Earnings/Loss per share are calculated based on the net profit from
ordinary activities attributable to shareholders of US$47,573,000 (six
months ended 30th June, 2001: net loss of US$22,258,000) and the
weighted average of 2,158,480,786 shares (six months ended 30th June,
2001: ,158,480,786 shares) of the Company in issue during the period.
As the exercise price of options outstanding during the period is higher
than the average market price of the Company's shares during the
respective periods, the diluted earnings/loss per share for the periods
ended 30th June, 2002 and 2001 are not presented because the impact of the
options is anti-dilutive.
FINANCIAL REVIEW
The breakdown of net profit/(loss) attributable to shareholders by activity is
as follows:
Six months ended 30th June,
2002 2001
(Unaudited) (Unaudited)
US$'000 US$'000
Agri-business operations
PRC 46,642 (13,499)
Turkey 6,096 (7,033)
Indonesia 3,829 -
Thailand 544 4,465
-------------- --------------
Industrial operations 57,111 (16,067)
Investment properties/investment holding* 1,526 1,664
(11,064) (7,855)
-------------- --------------
Total 47,573 (22,258)
============== ==============
* including Hong Kong headquarters' general expenses
INTERIM DIVIDEND
The Directors do not recommend an interim dividend for the year ending 31st
December, 2002 (2001: nil).
BUSINESS REVIEW
For the six months ended 30th June, 2002, our business operations recorded
improvement in its operating results. Consolidated turnover was US$705.0 million
(2001: US$678.0 million). Consolidated profit from operating activities was
US$70.8 million (2001: US$11.3 million). Net profit from ordinary activities
attributable to shareholders was US$47.6 million (2001: net loss of US$22.3
million).
PRC
Agri-business
Our agri-business operations in the PRC made positive progress during the period
under review. Turnover under management was US$1,082.0 million (2001: US$1,201.3
million). Turnover on a consolidated basis was US$647.1 million (2001 : US$633.5
million), a slight increase by 2.1%, which was attributable to the better
performance of our subsidiaries. Consolidated profit attributable to
shareholders of this division during the period was US$46.6 million (2001: loss
of US$13.5 million). Unit sales of our two main products, complete feed and day-
old chicks, were 2.4 million tonnes (2001: 2.6 million tonnes) and 189.4 million
units (2001: 200.6 million units) respectively.
As compared with the same period last year, the price of raw materials such as
corn and soybean meal was reduced due to good harvest and favourable importing
factors. This has resulted in a better gross profit margin for our products in
the first half of 2002.
In order to cope with the domestic and export market needs, the Group has
extended its focus on poultry products from concentrating on frozen and chilled
products to further processed meat and cooked products. Moreover, it has
established a new plan to change the chicken raising pattern towards large
scale, standardised and fully automated chicken houses such that effective
control on raising of chicken and use of medicine can be achieved. Thus,
production efficiency can be increased and production cost will be reduced.
During the period under review, the Group disposed of 100,935,116 shares in
Shanghai Dajiang (Group) Stock Co., Ltd. ("Shanghai Dajiang") at an average
price of US$0.576 per share and recorded a gain of US$44.0 million. As at 30th
June, 2002, the Group's interest in Shanghai Dajiang was 21.5%.
Industrial business
In the first six months of 2002, the motorcycle business of Ek Chor China
Motorcycle Co. Ltd., our 68.2%-owned New York-listed subsidiary, continued to
face difficult business conditions due to intense price competition. Although
our motorcycle manufacturing venture still reported a loss for the period, its
sales volume was able to grow, which could form the foundation for a turnaround
by year end. Taking into consideration the competitive market environment, the
operating results of our parts manufacturing ventures were satisfactory. Net
income was RMB18.5 million (US$2.2 million) as compared with RMB20.2 million
(US$2.4 million) in 2001.
Turkey
The performance of our Turkish operation has significantly improved and
achieved a profit of US$6.1 million (2001: loss of US$7.0 million). During the
period, our Turkish operation registered an increase in sales of poultry meat
both in terms of volume and unit price. Moreover, it has benefited from the
relatively stable value of Turkish Lira this year when compared with the
exchange loss from free float of Turkish Lira last year.
Thailand
During the period, all the warrants of Charoen Pokphand Foods Public
Company Limited held by the Group were disposed and there was a gain of US$0.5
million on disposal.
LIQUIDITY AND FINANCIAL RESOURCES
As at 30th June, 2002, the Group had total assets of US1,072.3 million, down
0.9% from US$1,081.5 million at the year end of 2001. Total debt and debt to
equity ratio (debt to equity ratio is calculated by dividing the total debt by
the net asset value) were US$684.9 million and 343% respectively, as compared
with US$752.4 million and 508% as at 31st December, 2001.
Most of the borrowings are in U.S. dollars and RMB, and the interest rates
ranged from 2.12% to 7.92% per annum for the period.
The Group had not engaged in any derivative for hedging against both the
interest and exchange rate.
CAPITAL STRUCTURE
The Group finances its working capital requirements through a
combination of funds generated from operations, short term and long term bank
loans, floating rate notes and from the disposal of certain assets and
investments. The Group had cash and cash equivalents of US$86.9 million as at
30th June, 2002 (31st December, 2001: US$88.6 million), a decrease of US$1.7
million.
CHARGES ON GROUP ASSETS
As at 30th June, 2002, out of the total borrowings of US$684.9 million (31st
December, 2001: US$752.4 million) obtained by the Group, only US$112.0 million
(31st December, 2001: US$120.3 million) were secured and accounted for 16.4%
(31st December, 2001: 16.0%) of the total. Certain of the Group's fixed assets
located in the PRC with net book value of US$170.6 million
(31st December, 2001: US$132.6 million) and fixed deposits of US$1.5 million
(31st December, 2001: US$3.2 million) have been pledged as security for various
short and long term bank loans.
CONTINGENT LIABILITIES
As at 30th June, 2002, the guarantees provided by the Group was US$27.4 million
(31st December, 2001: US$33.2 million).
EMPLOYEE AND REMUNERATION POLICIES
As at 30th June, 2002, the Group employed around 60,000 staff (including 30,000
staff from the jointly controlled entities and associates) in the PRC, Hong Kong
and Turkey. The Group remunerates its employees based on their performance,
experience and prevailing market rate while performance bonuses are granted on a
discretionary basis. Other employee benefits include insurance and medical
cover, subsidized educational and training programme as well as share option
scheme.
RESTRUCTURING
The closing date of the Group restructuring was 28th March, 2002.
The Company has made a distribution of US$50.8 million during the period under
review, amounting to an aggregate distribution of US$267.6 million.
OUTLOOK
Faced with keen competition and stringent international trading
regulations, we are confident that by improving our efficiency and focusing on
product development, we are able to cope with the challenges ahead. The
Directors remain optimistic about the prospect of our Group.
PURCHASE, SALE OR REDEMPTION OF LISTED SECURITIES
There was no purchase, sale or redemption of the Company's listed securities by
the Company or any of its subsidiaries during the period under review.
CODE OF BEST PRACTICE
In the opinion of the Directors, the Company complied with the Code of Best
Practice as set out in Appendix 14 of the Listing Rules throughout the
accounting period covered by the interim report.
AUDIT COMMITTEE
The Audit Committee comprises the two independent non-executive
directors of the Company. The Audit Committee has reviewed with management the
accounting principles and practices adopted by the Group and discussed internal
control and financial reporting matters including the review of the unaudited
interim financial statements.
PUBLICATION OF FURTHER INFORMATION
All the information required by paragraphs 46(1) to 46(6) of Appendix 16 of the
Listing Rules will be published on the website of the Stock Exchange.
By Order of the Board
Sumet Jiaravanon
Chairman
Hong Kong, 19th September, 2002
This information is provided by RNS
The company news service from the London Stock Exchange
END
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