23rd Jan 2015 08:34
LONDON (Alliance News) - China-based specialty chemicals company HaiKe Chemical Group Ltd on Friday saw its shares rise in early trade after the company said it expects to post a profit from continuing operations for 2014, as average selling prices and margins improved over the year.
The company said its revenue for the year to December 31 would be slightly lower year-on-year, but said average selling prices and margins have improved over the year and it expects its earnings before income, taxation, depreciation and amortisation to come in broadly in line with 2013, despite a rise in one-off expenses related to the restructuring of the company.
The company reported a loss from continuing operations of CNY11 million in 2013.
HaiKe said it cost of sales rose by 12% over the year owing to more aggressive sales and marketing activities within a sluggish market, but said general and administrative expenses fell by 39% and 44% respectively.
The group said its High-Tech Spring manufacturing arm improved its profitability in the second half against the first as the group refocused its strategy on selling higher margin, higher-end products. Its HaiKe trading arm has made progress over the year by developing new trading opportunities and sourcing alternative, lower-cost financing from outside mainland China, the company said.
"2014 was a transitional year for HaiKe. We completed a major restructuring by stripping out the Group's loss-making assets and a large proportion of our financial liabilities which has provided us with a strong foundation from which to focus on specialty chemicals," said Executive Chairman Xiaohong Yang.
HaiKe shares were up 22% to 14.00 pence on Friday morning, one of the best performers in the AIM All-Share.
By Sam Unsted; [email protected]; @SamUAtAlliance
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