KO YO GROUP<08042> - Results Announcement (Q3, 2006, Summary)
Ko Yo Ecological Agrotech (Group) Limited announced on 10/11/2006:
(stock code: 08042 )
Year end date :31/12/2006
Currency :RMB
Auditors' report :N/A
3rd 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 30/09/2006 to 30/09/2005
RMB'000 RMB'000
Turnover : 488,896 478,039
Profit/(Loss) from Operations : 81,923 103,928
Finance cost : (5,919) (5,797)
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 : 35,134 38,185
% Change Over the Last Period : -7.99%
EPS / (LPS)
Basic (in dollar) : RMB 0.0757 RMB 0.0905
Diluted (in dollar) : RMB 0.0755 N/A
Extraordinary (ETD) Gain/(Loss) : N/A N/A
Profit (Loss) after ETD Items : 35,134 38,185
3rd Quarter Dividends per Share : NIL NIL
(specify if with other options) : N/A N/A
B/C Dates for 3rd Quarter Dividends : N/A
Payable Date : N/A
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 Hong Kong Institute of Certified Public Accountant ("HKICPA"
) has undertaken to converge by 1 January 2005 all Hong Kong
Financial Reporting Standards ("HKFRSs") with International
Financial Reporting Standards ("IFRSs") issued by the International
Accounting Standards Board. As a result, the HKICPA had aligned HKFRSs
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 HKFRSs does not result in substantial
changes to the Group's accounting policies except certain presentation
and disclosure of the accounts will be affected.
2. Turnover
Turnover represents the net amounts received and receivable for
chemical products and chemical fertilizers sold, less returns and
allowances and value-added taxes, if applicable, during the nine months
period. The Group's revenues are primarily generated in the People's
Republic of China (the "PRC").
Turnover consisted the following products:
(unaudited)
For the three months ended
30 September
2006 2005
RMB'000 % RMB'000 %
BB & complex
fertilizers 47,982 34.5 58,917 36.0
Sodium carbonate 25,199 18.1 25,274 15.5
Ammonium chloride 8,419 6.0 14,592 8.9
Urea 53,362 38.4 57,786 35.4
Ammonia 2,598 1.9 1,985 1.2
Ammonium bicarbonate 222 0.2 4,870 3.0
Others 1,249 0.9 - -
139,031 100 163,424 100
(unaudited)
For the nine months ended
30 September
2006 2005
RMB'000 % RMB'000 %
BB & complex
fertilizers 215,861 44.1 225,865 47.2
Sodium carbonate 70,149 14.4 76,870 16.1
Ammonium chloride 28,706 5.9 41,960 8.8
Urea 163,802 33.5 109,852 23.0
Ammonia 6,152 1.3 8,591 1.8
Ammonium bicarbonate 2,581 0.5 14,901 3.1
Others 1,645 0.3 - -
488,896 100 478,039 100
3. 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 nine months ended 30 September 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 Industry 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 nine months
ended 30 September 2006 was approximately RMB4,243,000.
The EIT provision made for and preferential EIT rate applicable to
Chengdu Ko Yo Compound for the nine months ended 30 September 2006
are approximately RMB620,000 and 7.5% respectively.
Dezhou Ko Yo Compound, Dazhu Ko Yo Chemical and Qingdao Ko Yo
Chemical did not have taxable profit for the nine months ended 30
September 2006.
Taxation in income statements represents the provision for EIT and
net movement of deferred tax liabilities.
4. Earnings per share
The calculation of the basic earnings per share for the three months
and nine months ended 30 September 2006 were based on the unaudited
consolidated profit attributable to shareholders of the Company of
approximately RMB6,899,000 and RMB35,134,000 for the relevant periods
(2005: RMB13,037,000 and RMB38,185,000) and on the weighted average
number of shares of approximately 505,820,000 and 463,974,000
ordinary shares in issue during the relevant periods (2005: 421,820,000
for three months and nine months). Diluted earning per share for the
three months and nine months ended 30 September 2006 is based on
the weighted average number of shares together with the effect of
dilutive potential shares on the outstanding share options of
approximately 507,878,000 and 465,628,000 for the relevant periods.
In year 2005, diluted earning per share was not presented as there
was no dilutive potential share.
5. Dividend
The Board does not recommend the payment of interim dividend for
the three months ended 30 September 2006 (30 September 2005: Nil).
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