SINGAPORE (Feb 28): Sino Grandness Food Industry saw FY16 earnings nearly triple to RMB578.2 million ($118 million) from a year ago on higher revenue and other operating income as well as lower finance costs.
This despite the group registering a 4Q16 loss of RMB106 million on the back of a 36% fall in revenue to RMB548.9 million.
Sino Grandness is the integrated manufacturer and distributor juices, canned fruits and vegetables headquartered in Shenzhen, China.
For the full year, group revenue grew 5.9% to RMB3.5 billion, thanks to higher sales from the beverage segment as well as domestic canned products segment, which saw revenue contributions increase by 9.1% and 5.9% respectively.
The growth in sales across both segments was mainly driven by the group’s expansion of product range and distribution network in the China market.
Distribution and selling expenses grew accordingly by 33.4% to RMB760.7 million from RMB570.2 million in FY15, primarily due to higher advertising and promotion (A&P) expenses and higher transportation costs.
Gross profit margin for Sino Grandness improved marginally to 41.5% in FY16 from 41.4% a year ago, due to higher margins for the overseas canned products segment as a result of higher average selling price – which more than offset the marginal decrease in gross profit margin for beverage and domestic canned products segments.
Cash and cash equivalents for the group increased to RMB297.7 million as at Dec 31 2016 from RMB143.0 million a year ago, mainly due to loans obtained and net cash generated from operating activities in FY16.
“To capitalise on the growth opportunities ahead, the group will continue to invest in various advertising and promotional activities as well as sales and marketing initiatives to enhance its brand visibility and brand recognition,” says Huang Yupeng, chairman and CEO of Sino Grandness.
“Additionally, the group will also continue to invest in product research and development in order to expand our product range and explore various strategic collaborations with operators of both online and offline marketing platforms in order to diversify and expand our distribution network further.”
Shares of Sino Grandness closed 1.9% higher at 26 cents on Tuesday.
