Prosperous Outlook with Expansion through Proposed Acquisition
HONG KONG, Aug. 30, 2013 /PRNewswire/ --
Financial Highlights
| HK$ million | For six months ended 30 June | ||
| 2013 | 2012 | Change | |
| Turnover | 144.954 | 151.450 | -4.3% |
| Gross Profit | 80.927 | 69.026 | +17.2% |
| Gross Profit Margin | 55.8% | 45.6% | +10.2 percentage point |
| Profit attributable to Owners of the Company |
11.310 | 11.018 | +2.7% |
| Earnings per share (HK cent) | 0.68 | 0.66 | +3.0% |
JLF Investment Company Limited (JLF Investment or the "Company"; SEHK: 472) today announced its 2013 interim results. For the six months ended 30 June 2013, the Company recorded turnover of approximately HK$145.0 million. The Company's gross profit climbed 17.2% to approximately HK$80.9 million as a result of the continuous improvement of its product mix and better control of production costs. Profit attributable to owners of the Company amounted to approximately HK$11.3 million, representing a year-on-year increase of 2.7%, with earnings per share of HK0.68 cent.
Despite the tightening of entertainment expenditures by the PRC government, sales of wine products and Chinese baijiu products was HK$81.5 million and HK$63.5 million respectively, remaining essentially flat over the same period in 2012. In view of the rising manufacturing and labour costs in China, the Company continued to enhance production efficiency through measures such as streamlining manufacturing processes and tightening control over manufacturing overheads. Moreover, the Company has adjusted its product mix by phasing out low-margin products. As such, gross profit margin in the first half of 2013 improved to 55.8% from 45.6% in the same period of last year.
Mr. WU Xiang Dong, Chairman of JLF Investment, said, "After the turbulence in China's baijiu industry last year, the market began to show signs of recovery. We are cautiously optimistic about the market developments to come and intend to capture the opportunities in the turnaround in the industry to lead the recovery of the baijiu market. With our aim to become the industry leader, we keep an eye open to acquisition opportunities for expansion, to extend our geographic footprint and enrich our product offerings."
On 25 July 2013, JLF Investment entered into an agreement regarding the proposed acquisition of the entire equity interest in a group of companies principally engaged in the sale and distribution of baijiu and health liquor in the PRC involving issue of securities of the Company. The Company believes that this acquisition represents a unique and milestone opportunity to realize its strategic goal. Further details of the acquisition will be announced by the Company as soon as practicable.
"We have confidence in the commitment by the China's leaders to stabilize the country's annual GDP growth rate at 7.5%, which will pave the way for a mild recovery in the second half of 2013. The Company will devote considerable effort into managing the overall profitability of its products, adjusting its product mix, driving down manufacturing costs, enhancing production efficiency and tightening control over manufacturing overheads in the next several quarters. We had previously overcome a number of global economic crises in previous years, and the financial strength of the Company continues to improve. By strictly adhering to our development strategy and goal, we are well positioned to lead the industry in the years to come," Mr. WU Xiang Dong concluded.
