Interim Results

Sorbic International Plc

("Sorbic" or the "Group" or the "Company")

Interim Results

Sorbic International plc, (AIM:SORB), the third largest sorbates producer in China, today announces its unaudited Interim Results for the six months period ended 31 March 2013.

Summary

John McLean, Non-Executive Chairman of Sorbic, commented: "The Board is pleased to report that demand for the Group's products continues to grow, driven by the widely reported increase in consumption in China and the increasing focus on food safety. Demand for sorbates continues to outweigh supply and we are working to finalise proposals that will enable the Group to increase its production capability to meet more of these high levels of demand.

"The Board is currently exploring the opportunity for Sorbic in relation to a new potential production facility in Linyi, which has been proposed by the Linyi authorities, and will update shareholders once further progress is made on these negotiations."

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Notes to Editors:

Sorbic International's principal activity is the production and sale of the food preservatives Sorbic Acid and Potassium Sorbate from its base in Linyi City, Shandong Province, Peoples Republic of China. Approximately half of Sorbic International's production is sold to overseas markets, across 46 countries and half into the Chinese domestic market.

Sorbic Acid is a naturally occurring organic compound that is used in all kinds of foods for its anti-decomposition and anti-fungus function and also in grains, medicines, cosmetics, toothpaste, tobacco, animal feed, latex, paper-manufacturing and pesticides. Potassium Sorbate is used to inhibit moulds and yeasts in many foods, such as cheese, wine, yogurt, dried meat, baked goods, cosmetics and pharmaceuticals.

Sorbic International operates through its wholly owned subsidiary Linyi Van Science and Technique Co., Ltd ("LVST").

Chairman's statement

Operational overview

During the first half of the year, production at the Liny plant resulted in a total output of 2,933 tonnes (H1 2012: 3,514 tonnes) of sorbates. Although there has been a dip in product sold, due primarily to a longer shut down than was planned for plant maintenance at Chinese New Year in February, there has been an increase of 1.7% in overall margin to 10.7% which has increased the gross profit from £744,000 in 2012 to £754,000 for 2013. In addition, the Company has continued to manage its expenses, which have seen an overall reduction of approximately £70,000; the Board is pleased to report that this has resulted in an improved operating profit of £102,604 compared to £23,497 for 2012.

The margin improvements have been largely driven by a decrease in the unit cost of sales due to lower input costs for both products, together with a small increase in selling price for Potassium Sorbate and a minimal improvement in the acid selling price. The Company is pleased that the trend for the cost of sales reduction has been positively consistent over the period.

The trading relationship with the Group's American distributor, APAC, continues to prosper and the outlook for further demand is positive, once the Company has additional production capacity available.

Sorbic's consolidated balance sheet remains strong with over £6.5 million of cash balances at 31 March 2013 to support the existing operations, which on a net cash basis has shown an improvement over 2012 from £4.039 million to £5.341 million for 2013.

During the period, the RMB has continued to strengthen against the £ and US$, which has resulted in a currency gain of £328,314 (2012: (67,678)) which has been shown in the P&L account as an unrealised gain. Since the period end, the RMB has continued to strengthen and the Board expects further currency gains in the second half.

Capital raised

On 25 March 2013, the Company announced that it had raised £0.7 million (before expenses) through the issue of £125,000 of convertible loan notes (the "New A Loan Notes") and 8,331,429 new ordinary shares of 6 pence each to be issued at 7 pence each ("New Ordinary Shares").

The proceeds of the fundraising will be used to meet the ongoing costs of Sorbic International plc whilst it continues to work towards repatriating funds from the PRC to the UK.

The required majority of holders of A and B loan notes have agreed to amend the terms of the loan note instruments such that the redemption date is now 31 August 2014. The New A Loan Notes have been issued subject to the terms of the A loan note instrument and will have the same terms as the A and B loan notes currently in issue.

Key terms of New A Loan Notes (and the revised A and B loan notes) are:

New production facility

On 23 April 2013, the Company announced that it had signed a compensation agreement in relation to the Group's manufacturing facility in Ulanqab City, Inner Mongolia totaling approximately £5 million. As a result of the development at the Company's Linyi site, the finalisation of the agreement in Inner Mongolia has been put on hold by the Company and as a consequence, no funds have been received under the terms of this agreement relating to Inner Mongolia. As announced on 30 May 2013, the Company has been approached by local authorities in Linyi City with regards to a new, possibly more beneficial opportunity relating to the relocation of the Company's existing original facility in Linyi City, Shandong Province. In light of this approach, the Board has decided to await further detailed information on the new potential Linyi City compensation arrangements that would be offered to the Company prior to concluding on the negotiations relating to the Inner Mongolia compensation package.

An outline of the proposal from Linyi would involve the building of a new factory on an industrial park in Linyi, which, the Board understands, would be funded in entirety by the Linyi authorities. The new site would be approximately 100 mou (16 acres) as opposed to the Group's current site in Linyi of 66 mou (11 acres) and would be able to accommodate 4 lines.

The rationale for the approach by the Linyi authorities is that the current industrial estate is becoming focused more on light commercial (i.e. not heavy industrial) and thus they wish to relocate industrial companies to a new specific area. Accordingly the Company has the opportunity to move the production facilities to a new location which has significantly upgraded infrastructure.

The Board is keen to act in the best interests of its shareholders and as soon as additional details are known, the Company will make a further update to the market.

Board

On 31 March 2013, Ryan Ng, CFO stepped down to take up a new finance role in Singapore. I would like to thank him for all his help and assistance over the years and to wish him well for the future. The Group will be appointing a new CFO in due course, and in the interregnum has appointed an interim manager to oversee the finances.

Outlook

The food sector in China continues to grow rapidly; according to data from the National Bureau of Statistics, the total output of China's food industry in 2012 jumped by 21.7% during the year to US$1.4 trillion. Demand for Sorbates remains strong and once the details are known for the building of the additional production capacity, it will be in a strong position to capitalise on this.

With the growing importance on food safety, the continuing policy of urbanisation, the improved affluence of the consumer and the increased food outlets, the outlook for sorbates remains strong as a key ingredient to prolong shelf-life for a broad range of products including dairy, bakery, fruits, vegetables, low- calorie diet drinks and mayonnaise. The strong demand for the Group's products will continue to increase as food standards become more important to the consumer, thus giving the Board confidence for the future.

John McLean

Non-executive Chairman

14 June 2013

Unaudited condensed consolidated statement of comprehensive income

For the six month period ended 31 March 2013

Unaudited consolidated statement of financial position

As at 31 March 2013

Unaudited condensed statement of cash flows

For the six month period ended 31 March 2013

Unaudited condensed consolidated statement of changes in equity

For the six month period ended 31 March 2013

Basis of Presentation and Summary of Significant Accounting Policies

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Sorbic International, a public limited company ('the Company') was established to seek to acquire a controlling interest in a company located in Europe, North America or Asia. Following the change of name from Ninety plc to Sorbic International plc and the completion of the acquisition of Honour Field International Limited ("HF") and its subsidiary ("Honour Field Group") on 29 September 2008, the Group's principal activities comprise the production and sale of food preservatives, namely Sorbic Acid and Potassium Sorbate. The Group's main operations are in the People's Republic of China.

The Company is the Group's ultimate parent company. It is incorporated and domiciled in the United Kingdom. The address of the Company's registered office is 3rd Floor, 49 Whitehall, London SW1A 2BX. The Company's shares are traded on the AIM market of the London Stock Exchange.

The financial information for the six months ended 31 March 2012 and 31 March 2013 set out in this interim financial information is unaudited and does not constitute statutory financial statements. The financial information for the year ended 30 September 2012 set out in this interim financial information does not comprise the Group's statutory financial statements as defined in Section 435 Companies Act 2006 but has been extracted from those financial statements.

The directors approved the interim financial information for the six months ended 31 March 2013 on 14 June 2013.

Copies of this interim financial information will be available on the Company's website: www.sorbicinternational.com

The interim financial information has been prepared in accordance with the principles of IFRS as adopted by the European Union. The standards have been applied consistently (except as otherwise stated).

The statutory financial statements for the year ended 30 September 2012, which have been filed at Companies House, were prepared under IFRS and IFRIC interpretations as adopted by the European Union and with those parts of the Companies Act 2006 applicable to companies preparing their financial statements under IFRS. The auditors reported on those financial statements; their Audit Report was unqualified, did not contain a statement under either Section 498(2) or 498(3) of the Companies Act 2006 but contained an emphasis of matter in respect of the Group's ability to continue as a going concern

The accounting policies adopted by the Group are consistent with those of the previous financial year except in the current financial year; the Group has adopted all the new and revised standards and Interpretations of IFRS that are effective for annual periods beginning on or after 1 February 2011. The adoption of these standards and interpretations did not have any effect on the financial performance or position of the Group and the Company.

The Group has adopted IFRS 8, Operating Segments for the March 2013 interim reporting. IFRS 8 requires that segments represent the level at which financial information is reported to the Board of directors ("The Board") of the Group, being the chief operating decision maker as defined in IFRS 8. The Board consists of the Chairman, the Chief Executive Officer, the Chief Financial Officer and the independent director. The Board determines the operating segments based on reports reviewed and used by the Board for strategic decision-making and resource allocation.

Segment information is presented in respect of the Group's geographical and operating segments. The Group's operating segments are as follows:

(i) Sorbic acid

(ii) Potassium sorbate

(iii) Head office and other adjustments, which incorporates a measure of assets and liabilities not included in the other segments.

Operating Segments - Six months ended 31 March 2013

Operating Segments - Six months ended 31 March 2012

Operating Segments - Year ended 30 September 2012

The taxation charge for the six months ended 31 March 2013 has been based on the estimated effective rate of 25% from October 2012 to March 2013.

(a) Basic

Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period:

Profit / (loss) attributable to equity holders of the company: £357,905 (2012: £(143,526))

Weighted average number of ordinary shares in issue: 45,126,120 (2012: 39,664,851)

Earnings / (loss) per share: 0.79 pence (2012: (0.36) pence)

(b) Diluted

Diluted earnings per share is calculated by adjusting the weighted number of ordinary shares in issue to assume conversion of all potential dilutive ordinary shares during the period.

Profit / (loss) attributable to equity holders of the Company: £357,905 (2012: £(143,526))

Weighted average number of ordinary shares in issue: 55,103,043 (2012: 39,664,851)

Diluted earnings / (loss) per share: 0.65 pence (2012: (0.36) pence)

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