Financial Performance - Revenue for the first half of 2022 was HKD 155.6 million, a decrease of 56.8% compared to HKD 359.9 million in the same period of 2021[4] - Gross profit for the first half of 2022 was HKD 11.7 million, down 23.0% from HKD 15.2 million in the previous year[4] - The company reported a net loss of HKD 829.2 million for the first half of 2022, compared to a profit of HKD 506.3 million in the same period of 2021[4] - The group's consolidated revenue decreased by approximately 56.8% to around HKD 155.6 million, down from HKD 359.9 million in 2021[28] - The group recorded a net loss of approximately HKD 829.2 million, compared to a profit of HKD 506.3 million in 2021[30] - The total comprehensive loss for the period was HKD 603,276,000, compared to a total comprehensive income of HKD 446,225,000 for the same period in 2021[104] - Basic and diluted loss per share for the period was HKD 8.8, compared to earnings of HKD 5.7 and HKD 3.9 per share in the same period of 2021[104] - The company reported a loss before tax of HKD 829,241,000 for the six months ended June 30, 2022, compared to a profit of HKD 506,275,000 in the same period of 2021[104] Operational Challenges - The company’s amino acid production facilities remain idle due to upstream supply chain issues, impacting cost-effectiveness[11] - The Shanghai sweetener production facility was temporarily shut down for about two months starting in April 2022 due to COVID-19 lockdowns[11] - The overall economic environment in China remains challenging, with logistics disruptions and rising costs impacting production and business activities[10] - The company anticipates ongoing challenges in the operating environment due to high commodity prices and energy costs, alongside geopolitical uncertainties[26] - The management expects the impact of COVID-19 to continue affecting the operating environment, leading to uncertainty in business operations[83] - The company has gradually resumed operations at its Shanghai production facilities since June 2022 after the lifting of lockdown measures[85] Debt and Financial Restructuring - The company is progressing with its debt restructuring plan, with expectations to complete part of it by the end of the year[15] - The company is actively negotiating with local authorities regarding compensation for land acquisition, which will provide necessary funds for debt repayment and cash flow needs[12] - The company is actively negotiating with banks and creditors regarding a debt restructuring plan to improve its financial situation[130] - The group is actively negotiating a debt restructuring plan with banks and creditors to improve its financial condition, with an expected completion by the end of 2022[134] - The company has received a preservation order from the Shenyang Intermediate Court to secure bank balances equivalent to the outstanding principal and interest owed to Bank of China Jinzhou Branch, totaling RMB 55,518,460.06[91] Market Conditions and Commodity Prices - High corn prices are expected to continue affecting the company's operational efficiency and business performance[14] - International corn prices reached $8.18 per bushel in April 2022, equivalent to RMB 2,129 per ton, and were $7.44 per bushel (RMB 1,962 per ton) by June 30, 2022[20] - China's domestic corn price increased to RMB 2,827 per ton by June 30, 2022, compared to RMB 2,790 per ton a year earlier[20] - The company anticipates significant improvement in its financial condition following the completion of the debt restructuring plan[134] Employee and Governance - As of June 30, 2022, the group employed approximately 3,600 full-time employees, a decrease from 3,700 as of December 31, 2021[64] - Employee benefits expenditure (excluding directors' remuneration) was approximately HKD 116.9 million for the period, down from HKD 153.2 million in 2021[64] - The board did not recommend any dividend distribution for the current period, consistent with the previous period[66] - The company has adhered to all corporate governance codes as outlined in the listing rules during the reporting period[74] Future Plans and Investments - The company plans to maintain competitiveness through internal R&D and diversification of product offerings while implementing a debt restructuring plan[62] - The company is exploring the potential for restructuring its product portfolio to include high-value products in response to market demand changes[24] - The company plans to relocate production facilities to the Xinglongshan area, with adjustments made to the relocation plan due to market conditions and funding availability[86] - The company aims to utilize part of the proceeds from the subscription to partially restore operations at its Xinglongshan plant, which is expected to generate operational cash inflow[87] Financial Position and Liabilities - The company's net liabilities as of June 30, 2022, were HKD (7,304,101,000), an increase from HKD (6,700,825,000) as of December 31, 2021[108] - The company's current liabilities increased to approximately HKD 12.63 billion as of June 30, 2022, compared to HKD 11.44 billion as of December 31, 2021[129] - The total outstanding principal amount for the loans under the Dazheng Biochemical Export-Import Bank Jilin Branch agreement is approximately RMB 648,000,000, along with accrued interest[94] - The total outstanding principal amount owed by the group to the Export-Import Bank is approximately RMB 1,200,000,000, including unpaid interest[95]
大成生化科技(00809) - 2022 - 中期财报