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HaiKe Chemical Group - Trading Update

RNS Number : 0034C
HaiKe Chemical Group Ltd.
16 January 2018
 

16 January 2018

HaiKe Chemical Group Ltd

 

Trading Update

 

HaiKe Chemical Group Limited ("HaiKe" the "Group" or the "Company"), the AIM quoted (AIM: HAIK) specialty chemical business based in Shandong Province, China, today provides an update on trading ahead of its final results for the year ended 31 December 2017.

 

The Company continues to focus on higher margin chemical products, product innovation and cost controls, and delivered an unaudited profit for the year ended 31 December 2017, despite facing critically difficult market conditions which, together with a reduction in output as a result of planned plant shutdowns for upgrade purposes, as detailed in the half-year results, have had an adverse effect on the results for the year. 

 

In light of this, the Board of Directors are exploring options for the future strategy of the Company, including a cancellation from AIM and continuing as a private company. In such circumstances, the Company would seek to arrange facilities for shareholders to exit their investment at a small premium to current market levels, although there can be no certainty such facilities can be arranged or at what level. A further announcement will be made in due course.

 

•       Unaudited profit for the year was CNY 6.5 million (2016: CNY 16.9 million) 

•       Unaudited total revenues for the year were CNY 850.5 million (2016: CNY 728.3 million)

•       Unaudited gross profit for the year increased to CNY 125.8 million (2016: CNY 114.9 million) as the Company continued to adjust its product mix. Sales of more profitable, high-end products accounted for 26.4% of sales in the year (2016: 11.2%).

•       Unaudited overall sales volumes in the year decreased 10.5% to 112,252 tons due to planned plant shutdowns (2016: 125,395 tons)

•       Unaudited average selling prices in the year increased by 28.9% to CNY 7,133 / ton (2016: CNY 5,533 / ton) due to the increase of raw material price

•       Unaudited selling expenses in the year rose by 24.3% to CNY 50.4 million (2016: CNY 40.5 million) as a result of more aggressive sales and marketing activities to address difficult market conditions

•       Unaudited general and administrative expenses in the year increased by 21.2% to CNY 61.9 million (2016: CNY 51.1 million). This was attributable to plant shutdown costs and start-up expenses  

•       Unaudited interest expenses decreased to CNY 3.9 million (2016: CNY 15.0 million). In 2016 Haike Trading accrued interests for non-practical significance transactions. Total borrowings at 31 December 2017 were CNY 80 million (31 December 2016: CNY 80 million)

•       At 31 December 2017, the Company¡¯s cash and cash equivalent balances were CNY 46.3 million (at 31 December 2016: CNY 55.0 million)

 

Note:  as at 31 December 2017 the GBP/CNY exchange rate was 1:8.7792

 

 

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

 

Further enquiries:

 

HaiKe Chemical Group

Jes Cui, Chief Financial Officer

 

 

+86 546 7787789

[email protected]

[email protected]

Stockdale Securities

Richard Johnson / Elhanan Lee

+44 (0) 20 7601 6100

Cardew Group

Shan Shan Willenbrock /

Joe McGregor

 

+44 (0) 20 7930 0777

[email protected]

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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