Le Gaga Holdings Limited (Nasdaq:GAGA) ("Le Gaga" or "the
Company"), a leading greenhouse vegetable producer in China, today
announced its financial results for the second fiscal quarter ended
December 31, 2012.1
Highlights of the Quarter Ended December 31,
2012
- Revenue decreased by 31.9%, to RMB102.7 million (US$16.5
million) for Q2 FY2013, compared to RMB150.8 million a year ago.
- Profit for the period decreased by 1.6%, to RMB65.7 million
(US$10.5 million) for Q2 FY2013, compared to RMB66.8 million a year
ago.
- Adjusted profit for the period2 (non-IFRS measure)
decreased by 49.1% to RMB32.8 million (US$5.3 million) for Q2
FY2013, compared to RMB64.5 million a year ago. A reconciliation of
the adjusted profit for the period to profit for the period
determined in accordance with IFRS is set forth in Appendix V.
- Adjusted EBITDA3 (non-IFRS measure) decreased by 36.0% to
RMB54.5 million (US$8.7 million) for Q2 FY2013, compared to RMB85.1
million a year ago. A reconciliation of the adjusted EBITDA to
profit for the period determined in accordance with IFRS is set
forth in Appendix VI.
- Basic and diluted earnings per share was RMB2.89 cents (0.46 US
cents) and RMB2.88 cents (0.46 US cents), respectively, for Q2
FY2013. Basic and diluted earnings per ADS4 was RMB144.5 cents
(23.19 US cents) and RMB144.0 cents (23.11 US cents), respectively,
for Q2 FY2013.
- Cash generated from operating activities decreased by 2.2%, to
RMB50.7 million (US$8.1 million) for Q2 FY2013, compared to RMB51.9
million a year ago.
- Revenue-per-mu decreased to RMB4,382 (US$703) for Q2 FY2013,
compared to RMB7,247 a year ago.
- Production output decreased to 22,419 metric tons for Q2
FY2013, compared to 36,536 metric tons a year ago.
- Our product mix planted in our fields shifted further towards
solanaceous products. However, there was no significant change in
our mix of products sold during the quarter as compared to last
year, as we postponed part of the solanaceous products harvest from
December 2012 to January 2013 in anticipation of further rising
market prices. As a result, solanaceous vegetables sold to third
parties in the PRC mainland represented 70% of total revenue for Q2
FY2013, compared to 69% of total revenue a year ago.
- Average selling price (ASP) of vegetables sold to third parties
in the PRC mainland increased by 10.9% to 4.46 RMB/kg for Q2
FY2013, compared to 4.02 RMB/kg a year ago.
- Total arable land as of December 31, 2012 was 28,443 mu (1,896
hectare), representing an increase of 2,400 mu compared to
September 30, 2012, and an increase of 2,825 mu compared to
December 31, 2011.
- Total greenhouse area as of December 31, 2012 was 10,610 mu
(707 hectare), representing an increase of 622 mu compared to
September 30, 2012 and an increase of 2,151 mu compared to December
31, 2011.
Mr. Shing Yung Ma, the CEO of Le Gaga, commented, "In October we
completed the planting of solanaceous products in our farm bases.
Harvesting of solanaceous products commenced from the end of
November. Market prices rose steadily in November and December.
Volumes and quality of products in our greenhouses were in line
with our expectations. However, we postponed part of our harvest
originally scheduled for December until January in anticipation of
a further increase in market prices leading up to the Chinese New
Year holiday, which fell in the second week of February. In
contrast, during the previous winter season we accelerated our
harvest activities towards the end of the December quarter as
prices rose rapidly in the month of December in anticipation of the
Chinese New Year holiday, which fell in the third week of January
last year. A stronger focus on off-season solanaceous production
also means that we have reduced the area of short-cycle leafy and
cruciferous vegetables, planted and harvested during the period.
This reduces leafy and cruciferous revenue in the second quarter
but increases expected revenue from solanaceous vegetables during
the entire winter season.
We are spending much effort to further develop our greenhouse
production system. This includes upgrading existing greenhouses,
constructing additional nursery greenhouses and trials with
soil-less production techniques for peppers and tomatoes. Favorable
weather allowed us to make good progress on our greenhouse
construction projects, as we added over 600 mu of greenhouses
during the quarter. We have also added a substantial area of new
arable land during the quarter in line with our land expansion
plans." Mr. Auke Cnossen, the CFO of Le Gaga, added, "Annual
revenue per mu and profit continue to be our key performance
indicators. This means continued specialization in off-season
production of greenhouse vegetables such as peppers and
tomatoes. While production during the summer months would
result in higher volumes but lower prices, production during the
winter months results in lower volumes but significantly higher
prices. Four of our major expenses, including labor, fertilizer,
packing and transportation, are all directly correlated to
production volume. Utilizing our production capacity for off-season
(winter months) production, would maximize both revenue and profit
margins.
A large positive net impact of biological assets fair value
adjustment was recorded for the period. The large net impact was
due to an increase in area planted with high value solanaceous
crops in our greenhouses at the end of December as compared to the
end of September. Despite lower revenue, our operating cash
flow was strong as a result of a lower receivables balance on
December 31 as compared to September 30. Although market
prices were lower in December 2012, as compared to December 2011,
our average selling prices improved due to a more favorable product
mix and better quality. The use of better packing materials
further increased average selling prices."
Summary of Operating
Data |
|
|
|
|
As of Dec 31,
2011 |
As of Sep 30,
2012 |
As of Dec 31,
2012 |
Arable land |
|
|
|
- Operating land |
20,013 mu |
21,425 mu |
24,374 mu |
|
(1,334 hectare) |
(1,428 hectare) |
(1,625 hectare) |
- Land under construction or reserved
(1) |
5,605 mu |
4,618 mu |
4,069 mu |
|
(374 hectare) |
(308 hectare) |
(271 hectare) |
- Total |
25,618 mu |
26,043 mu |
28,443 mu |
|
(1,708 hectare) |
(1,736 hectare) |
(1,896 hectare) |
|
|
|
|
Greenhouse area (2) |
|
|
|
- Total |
8,459 mu |
9,988 mu |
10,610 mu |
|
(564 hectare) |
(666 hectare) |
(707 hectare) |
|
|
|
|
Greenhouse area as a percentage
of |
|
|
|
- Operating land |
42.3% |
46.6% |
43.5% |
- Total arable land |
33.0% |
38.4% |
37.3% |
|
|
|
|
|
Three Months Ended
December 31, |
Six Months Ended December
31, |
|
2011 |
2012 |
2011 |
2012 |
|
|
|
|
|
Total production output (metric tons) |
36,536 |
22,419 |
72,530 |
49,229 |
Production yield (metric tons per mu) |
1.8 |
1.0 |
3.5 |
2.2 |
Revenue-per-mu (RMB) |
7,247 |
4,382 |
12,417 |
8,609 |
|
|
|
|
|
(1) Land under construction
or reserved includes (i) newly leased land which has not yet been
put into production and is either under construction or in reserve
for future development, and (ii) land which we plan to return and
is not in operation. |
As of December 31, 2012, we had
3,370 mu of newly leased land and 699 mu of land which we plan to
return. |
|
|
|
|
|
(2) As of December 31, 2011,
there were 630 mu bamboo-made greenhouses and 7,829 mu steel-made
greenhouses. |
As of September 30, 2012, there
were 450 mu bamboo-made greenhouses and 9,538 mu steel-made
greenhouses. |
As of December 31, 2012, there
were 450 mu bamboo-made greenhouses and 10,160 mu steel-made
greenhouses. |
Financial Results for the Three Months Ended December
31, 2012
Revenue decreased by 31.9%, to RMB102.7 million (US$16.5
million) for Q2 FY2013, compared to RMB150.8 million a year
ago. The decrease in revenue was due to more pronounced
seasonality of our annual revenue. Although market prices of
solanaceous vegetables increased steadily during the months of
November and December, we postponed part of our harvesting activity
from December to January in anticipation of further increasing
market prices. Furthermore, we planted more solanaceous
vegetables (to be harvested during the entire winter season) and
thus planted and harvested fewer short cycle leafy and cruciferous
vegetables during the period as compared to a year ago. The
decrease in revenue was partially offset by a more favorable
product mix and better product quality of those products harvested
during the period, resulting in higher average selling
prices. The more pronounced seasonality of our annual revenue
resulted in a decrease in revenue-per-mu from RMB7,247 for the
three months ended December 31, 2011 to RMB4,382 (US$703) for the
three months ended December 31, 2012.
|
Three Months Ended
December 31, |
Six Months Ended December
31, |
|
2011 |
2012 |
2011 |
2012 |
|
Revenue (%) |
ASP (RMB/kg) |
Revenue (%) |
ASP (RMB/kg) |
Revenue (%) |
ASP (RMB/kg) |
Revenue (%) |
ASP (RMB/kg) |
PRC revenue5 |
|
|
|
|
|
|
|
|
Solanaceous |
69% |
4.54 |
70% |
5.04 |
45% |
4.31 |
42% |
4.72 |
Leafy |
16% |
3.41 |
11% |
3.62 |
35% |
2.75 |
35% |
3.30 |
Cruciferous |
9% |
2.71 |
16% |
3.41 |
13% |
2.84 |
17% |
3.19 |
Others |
3% |
3.10 |
2% |
3.49 |
2% |
3.07 |
4% |
4.17 |
Sub-total |
97% |
4.02 |
99% |
4.46 |
95% |
3.35 |
98% |
3.80 |
Hong Kong revenue |
3% |
|
1% |
|
5% |
|
2% |
|
Total |
100% |
|
100% |
|
100% |
|
100% |
|
|
|
|
|
|
|
|
|
|
We primarily grow solanaceous vegetables (mostly peppers and
tomatoes) during the second fiscal quarter. Solanaceous vegetables
generally have a higher selling price compared to leafy
vegetables. Due to increased greenhouse area, our overall
product quality improved in Q2 FY2013 compared to a year
ago. Better harvest timing in the current fiscal quarter
further lead to higher selling prices. The production volume
of leafy and other vegetables declined in Q2 FY2013 compared to a
year ago as our product mix shifted towards solanaceous
products.
Cost of inventories sold decreased by RMB43.2 million, or 32.4%,
to RMB90.1 million (US$14.5 million) for Q2 FY2013, compared to
RMB133.3 million a year ago.
Adjusted cost of inventories sold6 (non-IFRS measure) decreased
by RMB11.7 million, or 25.5%, to RMB34.1 million (US$5.5 million)
for Q2 FY2013, compared to RMB45.8 million a year
ago. Adjusted cost of inventories sold as a percentage of
revenue increased from 30.4% for the three months ended December
31, 2011 to 33.2% for the three months ended December 31, 2012,
primarily due to increased direct materials costs as well as higher
depreciation charges, as a percentage of revenue.
A reconciliation of adjusted cost of inventories sold to cost of
inventories sold determined in accordance with IFRS is set forth in
Appendix IV.
|
Three Months Ended
December 31, |
Six Months Ended December
31, |
|
2011 |
2012 |
2011 |
2012 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|
|
|
|
|
|
|
Biological assets fair value adjustment
included in cost of inventories sold |
(87,444) |
(55,943) |
(8,979) |
(138,675) |
(99,907) |
(16,036) |
|
|
|
|
|
|
|
Changes in fair value less costs to sell of
biological assets |
95,423 |
91,287 |
14,653 |
214,874 |
227,884 |
36,578 |
|
|
|
|
|
|
|
Net impact of biological assets fair value
adjustment |
7,979 |
35,344 |
5,674 |
76,199 |
127,977 |
20,542 |
The net impact of the biological assets fair value adjustment
represents the net increase or decrease in gain from fair value
less costs to sell of crops on our farmland at the end of the
reporting period compared to the end of the immediately preceding
reporting period.
A net gain of RMB35.3 million was recognized arising from
biological assets fair value adjustment for Q2 FY2013, as compared
to a net gain of RMB8.0 million recognized a year ago.
The net gain of RMB35.3 million for Q2 FY2013 primarily arose
from a further increase in area planted with solanaceous products
as compared to September 30, 2012 (the immediately preceding
reporting period end), resulting in a positive net impact.
The larger positive net impact for Q2 FY2013 compared to that of
a year ago was primarily due to (1) a larger area of solanaceous
products planted during Q2 FY2013 compared to a year ago, and (2)
higher expected selling prices for products on our land as of
December 31, 2012 compared to December 31, 2011 due to a more
favorable product mix within the solanaceous category and better
quality.
Our packing expenses decreased by RMB0.7 million, or 8.5%, to
RMB8.1 million (US$1.3 million) for Q2 FY2013, compared to RMB8.8
million a year ago, primarily due to a decrease of RMB0.6 million
in packing materials consumed, as a result of lower sales volume.
This was partially off-set by better packing material used, which
translated into higher average selling prices.
Our land preparation costs increased by RMB1.0 million, or
13.2%, to RMB9.3 million (US$1.5 million) for Q2 FY2013, compared
to RMB8.3 million a year ago, which was primarily due to an
increase in greenhouse coverage which increased the unit land
preparation cost, partially offset by a decrease in the amount of
land in reserve or under construction as newly constructed farm
bases went into production during the quarter.
Our selling and distribution expenses decreased by RMB2.7
million, or 29.0%, to RMB6.5 million (US$1.0 million) for Q2
FY2013, compared to RMB9.2 million a year ago, which was in line
with the decrease in sales during the period.
Our administrative expenses decreased by RMB2.4 million, or
16.7%, to RMB12.0 million (US$1.9 million) for Q2 FY2013, compared
to RMB14.4 million a year ago, primarily due to a decrease of
RMB3.2 million in equity-settled share-based compensation.
As a result of the foregoing factors, profit for Q2 FY2013
decreased by 1.6%, to RMB65.7 million (US$10.5 million) for Q2
FY2013, compared to RMB66.8 million a year ago.
Adjusted profit for the period decreased by 49.1% to RMB32.8
million (US$5.3 million) for Q2 FY2013, compared to RMB64.5 million
a year ago.
Basic and diluted earnings per share was RMB2.89 cents (0.46 US
cents) and RMB2.88 cents (0.46 US cents), respectively, for Q2
FY2013. Basic and diluted earnings per ADS was RMB144.5 cents
(23.19 US cents) and RMB144.0 cents (23.11 US cents), respectively,
for Q2 FY2013.
Our operating cash inflow decreased by RMB1.2 million, or 2.2%,
to RMB50.7 million (US$8.1 million) for Q2 FY2013, compared to
RMB51.9 million a year ago. Although our revenue decreased,
there was no material change in cash received due to faster
collection of trade receivables during the quarter.
Furthermore, cash paid for our operating expenses
decreased.
Cash used in investing activities decreased by RMB0.8 million to
RMB99.8 million (US$16.0 million) for Q2 FY2013, compared to
RMB100.6 million a year ago. The net cash outflow of RMB99.8
million for Q2 FY2013 was primarily due to (1) our payment for
construction in progress and prepayments for construction works
totalling RMB86.1 million, which mainly consisted of (a) payment of
RMB50.1 million for agricultural infrastructure, (b) payment for
land improvements of RMB19.0 million, and (c) payment for
construction of greenhouses of RMB17.0 million, and (2) the
increase in pledged bank deposits related to construction work of
RMB10.0 million.
Business Outlook for the Fiscal Year Ending June 30,
2013
The Company continues to estimate that its revenue for the
fiscal year ending June 30, 2013 will be between RM600 million and
RMB630 million, representing a year over year growth rate for the
12 months ending June 30, 2013 compared to the 12 months ended June
30, 2012 of approximately 15.5% to 21.3%. This forecast
reflects the Company's current and preliminary view, which is
subject to change.
Conference Call
The Company will host a conference call at 8:00 a.m. ET on
February 22, 2013 (9:00 p.m. Hong Kong Time) to review the
Company's financial results and answer questions. You may access
the live interactive call via:
- +1 866 549 1292 (U.S. Toll Free)
- +400 681 6949 (China Toll Free)
- +852 3005 2050 (International)
- Pass Code: 534242#
Please dial-in approximately 10 minutes in advance to facilitate
an on-time start.
A replay will be available for two weeks after the call and may
be accessed via:
- +852 3005 2020
- Passcode: 135415#
A live and archived webcast of the call, as well as a
presentation with the Company's financial results will be available
on the Company's website at www.legaga.com.hk/html/index.php.
About Le Gaga Holdings Limited
(Nasdaq:GAGA)
Le Gaga is a leading greenhouse vegetable producer in China. The
Company sells and markets greenhouse vegetables such as peppers,
tomatoes, cucumbers and eggplants, as well as green leafy
vegetables to wholesalers, institutional customers and supermarkets
in China and Hong Kong. The Company has successfully built a
trusted brand among its customers.
The Company currently operates farms in the Chinese provinces of
Fujian, Guangdong and Hebei. Leveraging its large-scale
greenhouses, proprietary horticultural know-how and comprehensive
database, the Company specializes in producing and selling
high-quality, off-season vegetables during the winter months.
The Le Gaga Holdings Limited logo is available at:
http://www.globenewswire.com/newsroom/prs/?pkgid=8233
Safe Harbor Statements
This press release contains statements of a forward-looking
nature. These statements are made under the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995,
including certain plans, expectations, goals, and projections,
which are subject to numerous assumptions, risks, and
uncertainties. Forward-looking statements typically are identified
by the use of terms such as "may," "could," "would," "will,"
"plan," "anticipate," "believe," "estimate," "predict," "outlook,"
"on track," "potential," "expect," "intend" and "future" or similar
expressions, although some forward-looking statements are expressed
differently. You should consider statements that contain these
words carefully because they describe our expectations, plans,
strategies and goals and our beliefs concerning future business
conditions, our results of operations, financial position, and our
business outlook or they state other ''forward-looking''
information based on currently available
information. Assumptions and other important factors could
cause our actual results to differ materially from those
anticipated in our forward-looking statements include, but not
limited to: our ability to continue to lease farmland or
forestland; the legality or validity of our leases of agricultural
land; risks associated with extreme weather conditions, natural
disasters, crops diseases, pests and other natural conditions;
fluctuations in market prices and demand for our products; risks
attributable to our growth strategies, including increasing our
greenhouse coverage, increasing our production scale, strengthening
our sales, marketing and distribution efforts, focusing on
off-season products, increasingly shifting our product mix to
solanaceous products, and expanding our research and development
capability; risks of product contamination and product liability
claims as well as negative publicity associated with food safety
issues in China; risks of labor shortage and rising labor costs;
regulatory compliance, changes or action, including environmental
and trade regulation, our ability to comply with U.S. public
accounting reporting requirements, including maintenance of an
effective system of internal controls over financial reporting; our
susceptibility to adverse changes in political, economic and other
policies of the Chinese government that could materially harm its
business; the risk factors or uncertainties are listed from time to
time in our filings with the Securities and Exchange Commission.
Other factors and assumptions not identified above are also
relevant to the forward-looking statements, and if they prove
incorrect, could also cause actual results to differ materially
from those projected. All forward-looking statements are
expressly qualified in their entirety by the foregoing cautionary
statements. Our forward-looking statements speak only as of
the date made. We assume no obligation to update or to
publicly announce the results of any revisions to any of the
forward-looking statements to reflect actual results, future events
or developments, changes in assumptions or changes in other factors
affecting the forward-looking statements.
Information Related to Certain Non-IFRS
measures
This press release contains the following financial measures
that differ from the comparable measures under International
Financial Reporting Standards (IFRS): adjusted cost of inventories
sold, adjusted profit for the period and adjusted
EBITDA. Reconciliations between those non-IFRS measures and
the comparable IFRS measures are included elsewhere in this press
release. While we believe these measures are useful for
investors to assess our financial results, these non-IFRS measures
should not be considered substitutes for the most directly
comparable IFRS measures. Additional information concerning
non-IFRS measures are included in our filings with the Securities
and Exchange Commission that are available in the "Investors – SEC
Filings" section of our website, www.legaga.com.hk.
Adjusted cost of inventories sold is defined as
cost of inventories sold before biological assets fair value
adjustment. We are primarily engaged in agricultural activities of
cultivating, processing and distributing vegetables and have
therefore adopted International Accounting Standard 41
"Agriculture", or IAS 41, in accounting for biological assets and
agricultural produce. Unlike the historical cost accounting model,
IAS 41 requires us to recognize in our income statements the gain
or loss arising from the change in fair value less costs to sell of
biological assets and agricultural produce for each reporting
period. Cost of inventories sold determined under IAS 41 reflects
the deemed cost of agricultural produce, which is based on their
fair value (less costs to sell) at the point of
harvest. Biological assets fair value adjustment is the
difference between the deemed cost of the agricultural produce and
the plantation expenditure we incurred to cultivate the produce to
the point of harvest. Although an "adjusted" cost of inventories
sold excluding these fair value adjustments is a non-IFRS measure,
we believe that separate analysis of the cost of inventories sold
excluding these fair value adjustments adds clarity to the
constituent parts of our cost of inventories sold and provides
additional useful information for investors to assess our cost
structure. A reconciliation of adjusted cost of inventories sold to
IFRS cost of inventories sold is set forth in Appendix IV.
Adjusted profit for the period represents
profit for the period before the net impact of biological assets
fair value adjustment and further adjusted to exclude, as
applicable, the effects of non-cash share-based compensation,
offering expenses and impairment losses on property, plant and
equipment and prepayments charged to the income statement. We
believe that separate analysis of the net impact of the biological
assets fair value adjustments, non-cash share-based compensation,
offering expenses and impairment losses on property, plant and
equipment and prepayments adds clarity to the constituent part of
our results of operations and provides additional useful
information for investors to assess the operating performance of
our business. A reconciliation of adjusted profit for the period is
set forth in Appendix V.
Adjusted EBITDA is defined as EBITDA (earnings
before net finance income (costs), income tax expense, depreciation
and amortization), as further adjusted to exclude, as applicable,
the effects of non-cash share-based compensation, the net impact of
biological assets fair value adjustment, offering expenses and
impairment losses on property, plant and equipment and prepayments
charged to the income statement. We believe adjusted EBITDA is
useful to investors because it is frequently used by securities
analysts, investors and other interested parties in the evaluation
of companies in our industry. You should use adjusted EBITDA as a
supplemental analytical measure to, and in conjunction with, our
IFRS financial data. In addition, we believe that adjusted EBITDA
is useful in evaluating our operating performance compared to that
of other companies in our industry because the calculation of
adjusted EBITDA generally eliminates the effects of financing and
income taxes and the accounting effects of capital spending, which
items may vary for different companies for reasons unrelated to
overall operating performance. We use these non-IFRS financial
measures for planning and forecasting and measuring results against
the forecast. Using several measures to evaluate the business
allows us and investors to assess our relative performance against
our competitors and ultimately monitor our capacity to generate
returns for our shareholders. A reconciliation of the adjusted
EBITDA to profit for the period is set forth in Appendix VI.
1 This announcement contains translations of certain Renminbi
(RMB) amounts into U.S. dollars (US$) at specified rates solely for
the convenience of the reader. Unless otherwise noted, all
translations from RMB to U.S. dollars are made at a rate of
RMB6.2301 to US$1.00, the effective noon buying rate as of December
31, 2012 in The City of New York for cable transfers of RMB as set
forth in H.10 weekly statistical release of the Federal Reserve
Board.
2 Defined as profit for the period before the net impact of
biological assets fair value adjustment and further adjusted to
exclude, as applicable, the effects of non-cash share-based
compensation, impairment losses on property, plant and equipment
and prepayments and offering expenses charged to the income
statement.
3 Defined as EBITDA (earnings before net finance income (costs),
income tax expense, depreciation and amortization), as further
adjusted to exclude, as applicable, the effects of non-cash
share-based compensation, the net impact of biological assets fair
value adjustment, impairment losses on property, plant and
equipment and prepayments and offering expenses charged to the
income statement.
4 American depositary shares, which are traded on the NASDAQ
Global Select Market, each represents 50 ordinary shares of the
Company.
5 Defined as revenue from sales of respective products in the
PRC mainland to external customers
6 Defined as cost of inventories sold before biological assets
fair value adjustment
Appendix I |
Le Gaga Holdings Limited |
Unaudited Condensed
Consolidated Income Statements |
For the three months and
six months ended December 31, 2011 and 2012 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December
31, |
Six Months Ended December
31, |
|
2011 |
2012 |
2011 |
2012 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|
(In thousands,
except per share data) |
|
|
|
|
|
|
|
Revenue |
150,797 |
102,673 |
16,480 |
253,893 |
189,462 |
30,411 |
Cost of inventories sold |
(133,276) |
(90,069) |
(14,457) |
(226,234) |
(168,740) |
(27,085) |
Changes in fair value less costs to sell
related to |
|
|
|
|
|
|
Crops harvested during the
period |
41,284 |
25,750 |
4,133 |
107,085 |
78,693 |
12,631 |
Growing crops on the farmland
at the period end |
54,139 |
65,537 |
10,519 |
107,789 |
149,191 |
23,947 |
Total changes in fair value less costs to
sell of biological assets |
95,423 |
91,287 |
14,652 |
214,874 |
227,884 |
36,578 |
Packing expenses |
(8,837) |
(8,083) |
(1,297) |
(14,296) |
(14,502) |
(2,328) |
Land preparation costs |
(8,252) |
(9,338) |
(1,499) |
(19,461) |
(26,227) |
(4,210) |
Other income |
695 |
430 |
69 |
1,460 |
859 |
138 |
Research and development expenses |
(2,557) |
(2,860) |
(459) |
(4,369) |
(4,725) |
(758) |
Selling and distribution expenses |
(9,194) |
(6,531) |
(1,048) |
(14,082) |
(10,886) |
(1,747) |
Administrative expenses |
(14,359) |
(11,962) |
(1,920) |
(29,176) |
(22,849) |
(3,668) |
Impairment losses on property, plant and
equipment and prepayments |
-- |
-- |
-- |
(6,416) |
-- |
-- |
Other expenses |
(592) |
(2) |
-- |
(2,008) |
(4) |
(1) |
Results from operating
activities |
69,848 |
65,545 |
10,521 |
154,185 |
170,272 |
27,330 |
Finance income |
2,443 |
3,502 |
562 |
8,322 |
3,316 |
532 |
Finance costs |
(2,653) |
(3,235) |
(519) |
(5,314) |
(6,252) |
(1,004) |
Net finance
(costs)/income |
(210) |
267 |
43 |
3,008 |
(2,936) |
(472) |
Profit before taxation |
69,638 |
65,812 |
10,564 |
157,193 |
167,336 |
26,858 |
Income tax expense |
(2,878) |
(128) |
(21) |
(3,135) |
(257) |
(41) |
Profit for the period |
66,760 |
65,684 |
10,543 |
154,058 |
167,079 |
26,817 |
Earnings per share (in
cents) |
|
|
|
|
|
|
Basic |
2.92 |
2.89 |
0.46 |
6.73 |
7.33 |
1.18 |
Diluted |
2.91 |
2.88 |
0.46 |
6.62 |
7.32 |
1.17 |
Weighted average number of shares
outstanding: |
|
|
|
|
|
|
Basic |
2,284,569,944 |
2,276,478,133 |
|
2,289,126,783 |
2,278,836,106 |
|
Diluted |
2,293,789,826 |
2,280,030,880 |
|
2,325,795,987 |
2,282,544,964 |
|
Earnings per ADS (in
cents) |
|
|
|
|
|
|
Basic |
146.00 |
144.50 |
23.19 |
336.50 |
366.50 |
58.83 |
Diluted |
145.50 |
144.00 |
23.11 |
331.00 |
366.00 |
58.75 |
Weighted average number of ADSs
outstanding: |
|
|
|
|
|
|
Basic |
45,691,399 |
45,529,563 |
|
45,782,536 |
45,576,722 |
|
Diluted |
45,875,797 |
45,600,618 |
|
46,515,920 |
45,650,899 |
|
|
Appendix II |
Le Gaga Holdings Limited |
Unaudited Condensed
Consolidated Balance Sheets |
As of June 30 and
December 31, 2012 |
|
|
|
|
|
June 30, 2012 |
December 31, 2012 |
|
RMB |
RMB |
US$ |
|
(In thousands) |
Non-current assets |
|
|
|
Property, plant and equipment |
700,245 |
886,051 |
142,221 |
Construction in progress |
68,627 |
43,817 |
7,033 |
Lease prepayments |
1,256 |
1,221 |
196 |
Long-term deposits and prepayments |
163,494 |
139,719 |
22,426 |
Biological assets |
7,833 |
8,064 |
1,294 |
Deferred tax assets |
1,943 |
1,677 |
269 |
Total non-current
assets |
943,398 |
1,080,549 |
173,439 |
|
|
|
|
Current assets |
|
|
|
Biological assets |
30,709 |
198,171 |
31,809 |
Inventories |
16,427 |
17,818 |
2,860 |
Trade and other receivables |
64,566 |
68,710 |
11,029 |
Pledged bank deposits |
-- |
35,000 |
5,618 |
Cash |
504,506 |
404,626 |
64,947 |
Total current assets |
616,208 |
724,325 |
116,263 |
|
|
|
|
Total assets |
1,559,606 |
1,804,874 |
289,702 |
|
|
|
|
Equity |
|
|
|
Capital |
692,833 |
682,320 |
109,520 |
Reserves |
742,820 |
912,128 |
146,407 |
Total equity |
1,435,653 |
1,594,448 |
255,927 |
|
|
|
|
Non-current liabilities |
|
|
|
Bank loans |
61,998 |
-- |
-- |
|
|
|
|
Current liabilities |
|
|
|
Bank loans |
24,307 |
120,895 |
19,405 |
Trade and other payables |
31,111 |
82,993 |
13,321 |
Current taxation |
6,537 |
6,538 |
1,049 |
Total current
liabilities |
61,955 |
210,426 |
33,775 |
|
|
|
|
Total liabilities |
123,953 |
210,426 |
33,775 |
|
|
|
|
Total equity and
liabilities |
1,559,606 |
1,804,874 |
289,702 |
|
Appendix III |
Le Gaga Holdings Limited |
Unaudited Condensed
Consolidated Statements of Cash Flow |
For the three months and
six months ended December 31, 2011 and 2012 |
|
|
|
|
|
|
|
|
Three Months Ended December
31, |
Six Months Ended December
31, |
|
2011 |
2012 |
2011 |
2012 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|
(In thousands) |
Operating activities |
|
|
|
|
|
|
Profit before taxation |
69,638 |
65,812 |
10,564 |
157,193 |
167,336 |
26,858 |
|
|
|
|
|
|
|
Adjustments for: |
|
|
|
|
|
|
Amortization of lease prepayments |
24 |
14 |
2 |
47 |
28 |
4 |
Depreciation |
17,509 |
21,801 |
3,499 |
33,719 |
41,502 |
6,662 |
Equity settled share-based transactions |
5,717 |
2,479 |
398 |
12,864 |
5,448 |
874 |
Changes in fair value less costs to sell of
biological assets |
(95,423) |
(91,287) |
(14,653) |
(214,874) |
(227,884) |
(36,578) |
Interest income |
(380) |
(329) |
(53) |
(435) |
(958) |
(154) |
Interest expense |
2,646 |
3,235 |
519 |
5,314 |
6,252 |
1,004 |
Net loss on disposal of property, plant and
equipment |
514 |
1 |
-- |
1,868 |
2 |
-- |
Impairment losses: |
|
|
|
|
|
|
- Property, plant and equipment |
-- |
-- |
-- |
4,364 |
-- |
-- |
- Prepayments |
-- |
-- |
-- |
2,052 |
-- |
-- |
Foreign exchange gain |
(1,709) |
(2,377) |
(382) |
(6,280) |
(1,718) |
(274) |
|
|
|
|
|
|
|
|
(1,464) |
(651) |
(106) |
(4,168) |
(9,992) |
(1,604) |
|
|
|
|
|
|
|
Changes in current biological assets due to
plantations |
(44,848) |
(54,726) |
(8,784) |
(82,703) |
(102,453) |
(16,445) |
Changes in inventories, net of effect of
harvested crops transferred to inventories |
131,619 |
93,589 |
15,022 |
219,413 |
162,187 |
26,033 |
(Increase)/decrease in trade and other
receivables |
(39,950) |
7,558 |
1,213 |
(39,486) |
(4,118) |
(661) |
Decrease in long-term deposits and
prepayments |
2,685 |
3,950 |
634 |
3,678 |
6,410 |
1,029 |
Increase in trade and other payables |
4,371 |
1,004 |
161 |
10,409 |
6,927 |
1,112 |
|
|
|
|
|
|
|
Cash generated from
operations |
52,413 |
50,724 |
8,140 |
107,143 |
58,961 |
9,464 |
|
|
|
|
|
|
|
Income tax paid |
(561) |
-- |
-- |
(2,917) |
-- |
-- |
|
|
|
|
|
|
|
Net cash generated from operating
activities |
51,852 |
50,724 |
8,140 |
104,226 |
58,961 |
9,464 |
|
Appendix III |
Le Gaga Holdings Limited |
Unaudited Condensed
Consolidated Statements of Cash Flow |
For the three months and
six months ended December 31, 2011 and 2012 |
|
|
|
|
|
|
|
|
Three Months Ended December
31, |
Six Months Ended December
31, |
|
2011 |
2012 |
2011 |
2012 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|
(In thousands) |
Investing activities |
|
|
|
|
|
|
Interest received |
380 |
329 |
53 |
435 |
958 |
154 |
Plantations of non-current biological
assets |
(448) |
(417) |
(67) |
(804) |
(934) |
(150) |
Payment for the purchase of property, plant
and equipment |
(1,082) |
(3,537) |
(568) |
(2,390) |
(12,646) |
(2,030) |
Payment for construction in progress |
(100,010) |
(86,145) |
(13,827) |
(159,387) |
(128,633) |
(20,647) |
Proceeds from disposal of property, plant and
equipment |
570 |
-- |
-- |
4,331 |
-- |
-- |
Increase in pledged bank deposits related to
construction work |
-- |
(10,000) |
(1,605) |
-- |
(35,000) |
(5,618) |
|
|
|
|
|
|
|
Net cash used in investing
activities |
(100,590) |
(99,770) |
(16,014) |
(157,815) |
(176,255) |
(28,291) |
|
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
|
Interest paid |
(5,072) |
(5,706) |
(916) |
(5,072) |
(6,067) |
(974) |
Proceeds of bank loans |
-- |
15,000 |
2,408 |
-- |
35,000 |
5,618 |
Proceeds from exercise of share options |
157 |
-- |
-- |
676 |
-- |
-- |
Payment for repurchase of shares |
(10,185) |
(10,245) |
(1,644) |
(10,185) |
(10,822) |
(1,737) |
|
|
|
|
|
|
|
Net cash generated from financing
activities |
(15,100) |
(951) |
(152) |
(14,581) |
18,111 |
2,907 |
|
|
|
|
|
|
|
Net decrease in cash |
(63,838) |
(49,997) |
(8,026) |
(68,170) |
(99,183) |
(15,920) |
|
|
|
|
|
|
|
Cash at beginning of the
period |
540,451 |
455,872 |
73,173 |
551,491 |
504,506 |
80,979 |
|
|
|
|
|
|
|
Effect of foreign exchange rate
changes |
(1,414) |
(1,249) |
(200) |
(8,122) |
(697) |
(112) |
|
|
|
|
|
|
|
Cash at December 31 |
475,199 |
404,626 |
64,947 |
475,199 |
404,626 |
64,947 |
|
Appendix IV |
Le Gaga Holdings Limited |
Reconciliation of Non-IFRS
adjusted cost of inventories sold to cost of inventories sold |
For the three months and
six months ended December 31, 2011 and 2012 |
|
|
|
|
|
|
|
|
Three Months Ended
December 31, |
Six Months Ended December
31, |
|
2011 |
2012 |
2011 |
2012 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|
(In thousands) |
Cost of inventories sold |
(133,276) |
(90,069) |
(14,457) |
(226,234) |
(168,740) |
(27,085) |
Less: biological assets fair value
adjustment |
87,444 |
55,943 |
8,979 |
138,675 |
99,907 |
16,036 |
|
|
|
|
|
|
|
Adjusted cost of inventories sold |
(45,832) |
(34,126) |
(5,478) |
(87,559) |
(68,833) |
(11,049) |
|
Appendix V |
Le Gaga Holdings Limited |
Reconciliation of Non-IFRS
adjusted profit for the period to profit for the period |
For the three months and
six months ended December 31, 2011 and 2012 |
|
|
|
|
|
|
|
|
Three Months Ended
December 31, |
Six Months Ended December
31, |
|
2011 |
2012 |
2011 |
2012 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|
(In thousands) |
Profit for the period |
66,760 |
65,684 |
10,543 |
154,058 |
167,079 |
26,817 |
|
|
|
|
|
|
|
Add: |
|
|
|
|
|
|
Non-cash share-based compensation |
5,717 |
2,479 |
398 |
12,864 |
5,448 |
874 |
Impairment losses from property, plant
and equipment and prepayments |
-- |
-- |
-- |
6,416 |
-- |
-- |
Net impact of biological assets fair
value adjustment |
(7,979) |
(35,344) |
(5,674) |
(76,199) |
(127,977) |
(20,542) |
|
|
|
|
|
|
|
Adjusted profit for the period |
64,498 |
32,819 |
5,267 |
97,139 |
44,550 |
7,149 |
|
Appendix VI |
Le Gaga Holdings Limited |
Reconciliation of Non-IFRS
adjusted EBITDA to profit for the period |
For the three months and
six months ended December 31, 2011 and 2012 |
|
|
|
|
|
|
|
|
Three Months Ended
December 31, |
Six Months Ended December
31, |
|
2011 |
2012 |
2011 |
2012 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
|
(In thousands) |
|
|
|
|
|
|
|
Profit for the period |
66,760 |
65,684 |
10,543 |
154,058 |
167,079 |
26,817 |
Add: |
|
|
|
|
|
|
Amortization of lease
prepayments |
24 |
14 |
2 |
47 |
28 |
4 |
Depreciation |
17,509 |
21,801 |
3,499 |
33,719 |
41,502 |
6,662 |
Finance costs |
2,653 |
3,235 |
519 |
5,314 |
6,252 |
1,004 |
Income tax expense |
2,878 |
128 |
21 |
3,135 |
257 |
41 |
Non-cash share-based
compensation |
5,717 |
2,479 |
398 |
12,864 |
5,448 |
874 |
Impairment losses from
property, plant and equipment and prepayments |
-- |
-- |
-- |
6,416 |
-- |
-- |
Biological assets fair value adjustment
included in cost of inventories sold |
87,444 |
55,943 |
8,979 |
138,675 |
99,907 |
16,036 |
Less: |
|
|
|
|
|
|
Finance income |
(2,443) |
(3,502) |
(562) |
(8,322) |
(3,316) |
(532) |
Changes in fair value less
costs to sell of biological assets |
(95,423) |
(91,287) |
(14,653) |
(214,874) |
(227,884) |
(36,578) |
|
|
|
|
|
|
|
Adjusted EBITDA |
85,119 |
54,495 |
8,746 |
131,032 |
89,273 |
14,328 |
CONTACT: PRChina
Jane Liu
Tel: (852) 2522 1838
Email: jliu@prchina.com.hk
Henry Chik
Tel: (852) 2522 1368
Email: hchik@prchina.com.hk
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