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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Pokphand(HK)Reg | LSE:PKPH | London | Ordinary Share | BMG715071004 | US$0.05(HONG KONG REGD) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.00 | - |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number:0526Q
Pokphand (C.P.) Co Ltd
23 September 2003
C.P. Pokphand Co. Ltd.
(Incorporated in Bermuda with limited liability)
ANNOUNCEMENT OF RESULTS FOR THE SIX MONTHS ENDED 30TH JUNE, 2003
The board of directors (the "Directors") announces the unaudited consolidated
results of C.P. Pokphand Co. Ltd. and its subsidiaries (the "Group") for the six
months ended 30th June, 2003 as follows:
Condensed Consolidated Profit and Loss Account
Six months ended 30th June
2003 2002
(Unaudited) (Unaudited)
Notes US$'000 US$'000
Turnover 2 759,000 704,971
Cost of sales (692,036) (611,980
----------- ------------
Gross profit 66,964 92,991
Selling expenses (30,230) (25,719)
General and administrative expenses (46,899) (45,490)
Other income, net 3 4,242 49,040
----------- ------------
Profit/(Loss) from operating activities 4 (5,923) 70,822
Finance costs (16,866) (20,891)
Share of profits less losses of jointly 1,628 8,35
controlled entities
Share of profits less losses of associates (1,060) 1,387
----------- ------------
Profit/(Loss) before tax (22,221) 59,669
Tax 5 (7,446) (6,500
Profit/(Loss) after tax (29,667) 53,169
Minority interests' share of profits less (1,442) (5,596)
losses ----------- ------------
Net profit/(loss) from ordinary activities
attributable to shareholders (31,109) 47,573
Accumulated losses at beginning of period (49,650) (140,483)
----------- ------------
Accumulated losses (80,759) (92,910)
Transfer to statutory reserve (1,369) (1,286)
----------- ------------
Accumulated losses at end of period (82,128) (94,196)
----------- ------------
US cents US cents
Earnings/(Loss) per share: 6
Basic (1.441) 2.204
Diluted N/A N/A
Dividend per share:
Interim - -
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, 2002.
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.
An analysis of turnover by activity and geographical location is as follows:
Turnover:
Six months ended 30th June,
2003 2002
(Unaudited) (Unaudited)
US$'000 US$'000
By activity
Feedmill and poultry operations 758,980 704,889
Investment properties 20 82
----------- ------------
Investment properties 759,000 704,971
----------- ------------
By geographical location:
People's Republic of China ("PRC"):
Hong Kong 20 82
Elsewhere 669,791 647,062
----------- ------------
669,811 647,144
Turkey 89,189 57,827
----------- ------------
759,000 704,971
----------- ------------
The above analysis does not include the turnover of the Group's jointly
controlled entities and associates.
3. Other income, net
Six months ended 30th June,
2003 2002
(Unaudited) (Unaudited)
US$'000 US$'000
Amortisation of deferred restructuring expenses - (930)
Gain on disposal of short term investments 3,754 44,505
Unrealised gain/(loss) of short term investment (604) 3,829
Tax refund in respect of re-investments 46 -
Interest income 1,046 1,637
----------- ------------
4,242 49,040
----------- ------------
4. Profit/(Loss) from operating activities
Six months ended 30th
June,
2003 2002
(Unaudited) (Unaudited)
US$'000 US$'000
The Group's profit/(loss) from operating activities
is arrived at after charging/(crediting):
Foreign exchange loss/(gain), net (1,129) 1,008
Depreciation 29,651 24,459
Staff costs 45,346 42,882
Loss/(Gain) on disposal of fixed assets, net (527) 153
Amortisation of goodwill 121 123
5. Tax
Six months ended 30th June,
2003 2002
(Unaudited) (Unaudited)
US$'000 US$'000
The Company and subsidiaries:
Provision for taxation in respect of profit for the period:
PRC:
Hong Kong - -
Elsewhere 2,545 4,239
Overseas 3,058 -
----------- ------------
5,603 4,239
----------- ------------
Jointly controlled entities:
PRC:
Hong Kong - -
Elsewhere 1,827 2,129
----------- ------------
1,827 2,129
----------- ------------
Associates:
PRC:
Hong Kong - -
Elsewhere 16 132
----------- ------------
Tax charged for the period 7,446 6,500
----------- ------------
No provision for Hong Kong taxation has been made as the Group earned no
assessable income in Hong Kong during the period (2002: nil).
The overseas tax represents corporation tax payable in Turkey in respect of
income earned during the period (2002: nil).
6. Loss per share is calculated based on the net loss from ordinary activities
attributable to shareholders of US$31,109,000 (net profit for the six months
ended 30th June, 2002: US$47,573,000) and the weighted average of 2,158,480,786
shares (2002: 2,158,480,786 shares) of the Company in issue during the period.
As the exercise price of options outstanding during the period is higher than
the average market price of the Company's shares during the respective periods,
the diluted earnings/loss per share for the periods ended 30th June, 2003 and
2002 are not presented because the impact of the options is anti-dilutive.
INTERIM DIVIDEND
The Directors do not recommend an interim dividend for the year ending 31st
December, 2003 (2002: nil).
FINANCIAL REVIEW
The breakdown of net profit/(loss) attributable to shareholders by activity and
geographical location is as follows:
Six months ended 30th June
2003 2002
(Unaudited) (Unaudited)
US$'000 US$'000
By activity:
Feedmill and poultry operations (29,193) 52,738
Industrial operations 3,488 1,526
Investment properties (484) (370)
Investment holding* (4,920) (6,321)
----------- ------------
(31,109) 47,573
----------- ------------
By geographical location:
PRC:
Hong Kong (5,645) (11,064
Elsewhere (31,252) 48,168
----------- ------------
(36,897) 37,104
Turkey 5,547 6,096
Indonesia 241 3,829
Thailand - 544
----------- ------------
(31,109) 47,573
----------- ------------
*including Hong Kong headquarters' general expenses
BUSINESS REVIEW
The first half of 2003 was a period of challenges for our core business and our
operations sustained a loss during the period. Consolidated turnover was
US$759.0 million (2002: US$705.0 million). Consolidated loss from operating
activities was US$5.9 million (2002: profit of US$70.8 million). Net loss from
ordinary activities attributable to shareholders was US$31.1 million (2002: net
profit of US$47.6 million).
PRC
Agri-business
Our agri-business operations in the PRC faced an unfavourable operating
environment during the period under review. Turnover under management was
US$988.2 million (2002: US$1,082.0 million). Turnover on a consolidated basis
was US$669.8 million (2002: US$647.1 million), a slight increase by 3.5%.
Consolidated loss attributable to shareholders of this division during the
period was US$34.7 million (2002: profit of US$46.6 million). Unit sales of our
two main products, complete feed and day-old chicks, were 2.3 million tonnes
(2002: 2.4 million tonnes) and 167.8 million units (2002: 189.4 million units)
respectively.
The outbreak of severe acute respiratory syndrome (SARS) in part of the PRC in
the first half of 2003 had an adverse impact on the Group's agri-businesses
operating across the country. The business-related travelling of our purchasing
and sales staffs, the movement of raw materials required for production and the
delivery of our finished products suffered interruptions at some locations and
sales were retarded due to lowered consumption. These adverse factors had
complicated an already challenging operating environment due to the increased
costs of the raw materials required for feed production since December 2002. As
a result, gross profit margin declined significantly.
In addition, the outburst of a fire in our Qingdao operation in April 2003 and
the re-introduction of an import ban by Japan on poultry products from the PRC
since 12th May, 2003 have adversely affected the Group's chicken meat export as
Japan is our primary market for export.
During the period under review, the Group disposed of 49,562,783 shares (2002:
100,935,116 shares) in Shanghai Dajiang (Group) Stock Co. Ltd. ("Shanghai
Dajiang") and recorded a gain of US$3.4 million (2002: US$44.0 million). As at
30th June, 2003, the Group's interest in Shanghai Dajiang was 1.4% (31st
December, 2002: 8.7%).
Industrial business
Ek Chor China Motorcycle Co. Ltd. ("EKC"), our subsidiary, previously listed on
the New York Stock Exchange, registered improved results. Net income
attributable to the Group was US$3.5 million as compared to US$1.5 million in
the same period of 2002.
On 16th April, 2003, EKC announced its privatization by way of a scheme of
arrangement under Bermuda law. The privatization was duly approved at the Court
Meeting and Special General Meeting both held on 12th June, 2003. With the
satisfaction of all requirements prescribed by the relevant authority, EKC was
privatized and became a wholly-owned subsidiary of the Company on 23rd June,
2003. The listing status of EKC's shares was then withdrawn from the New York
Stock Exchange.
Turkey
Our Turkish operation continued to perform satisfactorily and recorded a profit
attributable to shareholders of US$5.5 million (2002: US$6.1 million).
Indonesia
The Group maintains a 19.75% interest in P.T. Surya Hidup Satwa and a 7.09%
interest in P.T. Central Proteinaprima.
LIQUIDITY AND FINANCIAL RESOURCES
As at 30th June, 2003, the Group had total assets of US$1,064.0 million, down
4.1% from US$1,109.1 million at the year end of 2002. 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$630.0 million and 329.7% respectively, as compared
to US$659.9 million and 283.1% as at 31st December, 2002.
Most of the borrowings by the Group are in U.S. dollars and Renminbi and the
interest rates ranged from 2.22% to 6.90% 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$86.4 million as at 30th June, 2003 (31st
December, 2002: US$95.6 million), a decrease of US$9.2 million.
CHARGES ON GROUP ASSETS
As at 30th June, 2003, out of the total borrowings of US$630.0 million (31st
December, 2002: US$659.9 million) obtained by the Group, only US$146.1 million
(31st December, 2002: US$123.5 million) were secured and accounted for 23.2%
(31st December, 2002: 18.7%) of the total. Certain of the Group's fixed assets
located in the PRC with net book value of US$255.3 million (31st December, 2002:
US$195.4 million) have been pledged as security for various short and long term
bank loans.
CONTINGENT LIABILITIES
As at 30th June, 2003, the guarantees provided by the Group was US$27.2 million
(31st December, 2002: US$27.2 million).
EMPLOYEE AND REMUNERATION POLICIES
As at 30th June, 2003, the Group employed around 53,000 staff (including 21,000
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 training programme as well as share option scheme.
RESTRUCTURING
The Company has made a distribution of US$28.0 million during the period,
amounting to an aggregate distribution of US$333.4 million. Moreover, the
Company's creditors have agreed to an amended debt reduction schedule and an
extension of the period of the restructuring by 12 months to 31st December, 2004
subject to the completion of relevant documentation.
OUTLOOK
The business conditions in the second half of 2003 is expected to remain
challenging. We will endeavour to streamline our business and improve our
operating efficiency.
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 paragraph 46(1) to 46(6) of Appendix 16 of the
Listing Rules will be published on the website of the Stock Exchange in due
course.
By Order of the Board
Dhanin Chearavanont
Chairman and Chief Executive Officer
Hong Kong, 22nd September, 2003
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SEUSUDSDSELU
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