Sino Grandness Food reports 58% drop in 1H19 earnings to $15.2 mil

SINGAPORE (Sept 15): Sino Grandness Food Industry Group reported 1H19 ended June earnings of RMB78.4 million ($15.2 million), down some 58% from a year ago.

A casualty of trade war between the United States and China, 1H19 revenue decreased by 35.6% to RMB1.44 billion. This was due to the decrease of RMB46 million from sales of beverages, as well as the decrease of RMB71.1 million and RMB91.8 million from sales of canned products in the domestic and overseas markets respectively, as China’s economy saw a slowdown.

Largely in line with the decrease in the group’s sales, gross profit also decreased 19.3% to RMB471.5 million in 1H19.

However, distribution and selling expenses increased 27% to RMB255.6 million while admin expenses increased 57.5% to RMB96.7 million. Finance costs also increased 19.1% to RMB29.8 million.

As at June 30, trade receivables stood at RMB1.49 billion. As at end August, approximately RMB466.8 million of these had been collected.

Cash and cash equivalents stood at RMB545.6 million.

No dividend has been declared for the half year.

In its outlook statement, Sino Grandness said it is optimistic about its FY19 operating performance, barring unforeseen circumstances.

Sino Grandness said it will continue to scale up its strategy of reaching out to engage new customers while strengthening and encouraging consumption through existing and new sales channels.

In May, the group successfully rolled out its products across approximately 1,400 convenience stores within petrol stations operated by PetroChina and Sinopec

Meanwhile, the group continues to work towards the proposed listing of its beverage business -- Garden Fresh Holding Co -- on an international stock exchange. Accordingly, the company in August engaged Maxim Group as joint book runner and investment banker for the possible listing on a stock exchange in the US.

Year to date, shares in Sino Grandness have fallen by 60% to 5.2 cents.