KO YO GROUP<08042> - Results Announcement (Q2, 2006, Summary)
Ko Yo Ecological Agrotech (Group) Limited announced on 10/08/2006:
(stock code: 08042 )
Year end date :31/12/2006
Currency :RMB
Auditors' report :N/A
2nd Quarterly Report Reviewed by :Audit Committee
Important Note :
This result announcement form only contains extracted information from
and should be read in conjunction with the detailed results announcement
of the issuer, which can be viewed on the GEM website at
http://www.hkgem.com
Unaudited Unaudited
Current Last Corresponding
Period Period
from 01/01/2006 from 01/01/2005
to 30/06/2006 to 30/06/2005
RMB'000 RMB'000
Turnover : 349,865 314,615
Profit/(Loss) from Operations : 35,314 33,477
Finance cost : (3,457) (3,668)
Share of Profit/(Loss) of Associates : N/A N/A
Share of Profit/(Loss) of Jointly
Controlled Entites : N/A N/A
Profit/(Loss) after Taxation & MI : 28,235 25,148
% Change Over the Last Period : +12.28%
EPS / (LPS)
Basic (in dollar) : RMB 0.0638 RMB 0.0596
Diluted (in dollar) : RMB 0.0636 N/A
Extraordinary (ETD) Gain/(Loss) : N/A N/A
Profit (Loss) after ETD Items : 28,235 25,148
2nd Quarter Dividends per Share : HK 0.5 cent HK 0.5 cent
(specify if with other options) : N/A N/A
B/C Dates for 2nd Quarter Dividends :05/09/2006 to 07/09/2006 bdi.
Payable Date : 27/09/2006
B/C Dates for (-) General Meeting : N/A
Other Distribution for Current Period : NIL
B/C Dates for Other Distribution : N/A
(bdi: both days inclusive)
For and on behalf of
Ko Yo Ecological Agrotech (Group) Limited
Signature :
Name : Man Au Vivian
Title : Director
Responsibility statement
The directors of the Company (the "Directors") as at the date hereof
hereby collectively and individually accept full responsibility for the
accuracy of the information contained in this results announcement form
(the "Information") and confirm, having made all reasonable inquiries,
that to the best of their knowledge and belief the Information are
accurate and complete in all material respects and not misleading and
that there are no other matters the omission of which would make the
Information herein inaccurate or misleading.The Directors acknowledge
that the Stock Exchange has no responsibility whatsoever with regard to
the Information and undertake to indemnify the Exchange against all
liability incurred and all losses suffered by the Exchange in connection
with or relating to the Information.
Remarks:
1. Basis of preparation
The interim financial statements were unaudited, which have
been prepared in accordance with the Hong Kong Accounting
Standard ("HKAS") 34 "Interim Financial Reporting" issued
by the Hong Kong Institute of Certified Public Accountants
("HKICPA") and the disclosure requirements set out in Chapter
18 of the Rules Governing the Listing of the Securities on the
Growth Enterprise Market of The Stock Exchange of Hong Kong
Limited (the "GEM Listing Rules").
2. Principal accounting policies
The HKICPA has undertaken to converge by 1 January 2005 all
Hong Kong Financial Reporting Standards ("HKFRS") with
International Financial Reporting Standards ("IFRSs") issued
by the International Accounting Standards Board. As a result,
the HKICPA had aligned HKFRS with the requirements of IFRSs in
all material respects as at 31 December 2004. The accounts have
been prepared under the historical cost convention.
The adoption of HKFRS 2 has resulted in a change in accounting
policy for employee share options. Prior to this, the provision
of share options to employees did not result in a charge to the
profit and loss account. Following the adoption of HKFRS 2, the
fair value of share options at grant date is amortised over the
relevant vesting periods to the profit and loss account. The
Company has not applied this HKFRS retrospectively as share
options of the Company granted after 7 November 2002 had vested
at 1 January 2005.
The adoption of HKFRS 3 has resulted in a change in the
accounting policy for negative goodwill. Prior to this, negative
goodwill was recognized as income on a straight-line basis in
the profit and loss account over the remaining weighted average
useful life of assets acquired of 30 years. In accordance with
the provision of HKFRS 3, the carrying amount of negative
goodwill as at 1 January 2005 shall be derecognized with a
corresponding adjustment to the opening balance of retained
earnings, which increased the retained earnings by approximately
RMB12,366,000.
The adoption of other new HKFRS does not result in substantial
changes to the Group's accounting policies except certain
presentation and disclosure of the accounts will be affected.
3. Turnover
Turnover represents the net amounts received and receivables for
chemical products and chemical fertilizers sold, less returns and
allowances and value-added taxes, if applicable, during the six
months period. The Group's revenues are primarily generated in the
People's Republic of China (the "PRC").
Turnover consisted of the following products:
Six months ended Six months ended
30 June 2006 30 June 2005
(unaudited) (unaudited)
RMB'000 % RMB'000 %
BB & complex
fertilizers 167,879 48.0% 166,948 53.1%
Sodium carbonate 44,950 12.8% 51,596 16.4%
Ammonium chloride 20,287 5.8% 27,368 8.7%
Urea 110,440 31.6% 52,066 16.5%
Ammonia 3,554 1.0% 6,606 2.1%
Ammonium bicarbonate 2,359 0.7% 10,031 3.2%
Others 396 0.1% ¡Ð ¡Ð
349,865 100% 314,615 100%
4. Taxation
No provision for profits tax in the Cayman Islands, the British
Virgin Islands or Hong Kong has been made, as the Group had no
assessable profit arising in or derived from those jurisdictions
during the six months ended 30 June 2006.
Chengdu Ko Yo Chemical Industry Co., Ltd. ("Chengdu Ko Yo
Chemical"), Chengdu Ko Yo Compound Fertilisers Co., Ltd.
("Chengdu Ko Yo Compound"), Dezhou Ko Yo Compound Fertiliser
Co., Ltd. ("Dezhou Ko Yo Compound"), Dazhou City Dazhu Ko Yo
Chemical Industry Co., Ltd. ("Dazhu Ko Yo Chemical") and Qingdao
Ko Yo Chemical Co., Ltd. ("Qingdao Ko Yo Chemical") were
established as foreign investment enterprises in the PRC. They
are subject to Enterprise Income Tax ("EIT") at the rate of
15%, 15%, 33%, 15% and 15% respectively, and are entitled to
full exemption from EIT in the first two profitable
years and a 50% reduction for the next three years thereafter.
The preferential EIT rate applicable for Chengdu Ko Yo Chemical
in 2006 is 15%. Pursuant to relevant taxation regulations of the
PRC and as approved by the local taxation bureau, Chengdu Ko Yo
Chemical was entitled to deduct from its EIT expenses for an amount
of 40% of cost of certain machinery acquired from the PRC
enterprises, which are local machinery suppliers and unrelated to
the Group. Accordingly, EIT provision made for Chengdu Ko Yo
Chemical for the six months ended 30 June 2006 was RMB2,971,000.
The EIT provision made for and preferential EIT rate applicable to
Chengdu Ko Yo Compound for the six months ended 30 June 2006 are
approximately RMB692,000 and 7.5%.
Dezhou Ko Yo Compound, Dazhu Ko Yo Chemical and Qingdao Ko Yo
Chemical did not have assessable profit for the six months ended
30 June 2006.
The amount of taxation charged to the unaudited condensed
consolidated profit and loss account represents:
Six months ended 30 June
2006 2005
RMB'000 RMB'000
EIT in the PRC 3,663 4,667
Deferred tax (41) (35)
3,622 4,632
5. Earnings per share
The calculation of the basic and diluted earnings per share
for the three months and six months ended 30 June, 2006 and
2005 were based on:
Three months ended Six months ended
30 June 30 June
2006 2005 2006 2005
RMB'000 RMB'000 RMB'000 RMB'000
Profit for the
period 15,742 13,137 28,235 25,148
Weighted average
number of shares
for calculation
of basic earnings
per share 463,358,462 421,820,000 442,703,978 421,820,000
Effect of
dilutive potential
shares on the
outstanding
share options 6,344,544 N/A 1,426,575 N/A
Weighted average
number of shares
for calculation
of diluted earnings
per share 469,703,006 N/A 444,130,553 N/A
6. Dividend
The Board has resolved the payment of an interim dividend at
HK0.5 cent per share to the shareholders whose names appear on the
register of members of the Company as at the close of business on
7 September 2006. The dividend will be payable on 27 September 2006.
The dividend as declared should not be taken as an indication of
the level of profit or dividend for the full year.
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