30th Sep 2014 10:47
LONDON (Alliance News) - China-based specialty chemicals company HaiKe Chemical Group Ltd Tuesday said its pretax profit fell in the half-year on a fall in revenue and restructuring expenses.
The company said its pretax profit in the six months to June 30 was CNY1.4 million, down from CNY4.7 million a year earlier.
The fall in profit came on the back of a drop in revenue in the period to CNY460 million from CNY469 million last year.
In addition, the group saw its administrative costs rise to CNY13.9 million from CNY9.6 million a year earlier due to one-off restructuring costs. The restructuring resulted in the sale of the group's refinery and biochemical assets.
The group said its outlook remains challenging given the oversupply of specialty chemicals products in the domestic Chinese market. It said it is focusing on continuing to try and diversify its revenue mix and will focus on high-end products in order to boost profitability.
"Despite making good progress in our long-term strategy of focusing on the higher margin, profitable specialty chemicals business, challenging market conditions, including oversupply of specialty chemicals in the domestic market, resulted in a difficult first half for the group," said Executive Chairman Xiaohong Yang.
"Encouragingly, the group's performance improved in July and August, recording a positive operating profit for both months and we continue to work hard to improve the overall performance of the business," Yang added.
Haike shares were down 7.7% to 18 pence on Tuesday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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