HK’s C.P. Pokphand Expects Lower Poultry-Swine Price to Significantly Impact 9M Earnings

C.P. Pokphand Co. Ltd.  (C.P. Pokphand) announced a profit warning statement in pursuant to Rule 13.09(2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the Listing Rules) and the Inside Information Provisions (as defined in the Listing Rules) under Part XIVA of the Securities and Future Ordinance (Chapter 571, Law of Hong Kong).

The board of directors of the company, through the statement, informed shareholders of the company and potential investors that, based on the unaudited management accounts prepared for the nine months period ended 30 September 2021, C.P. Pokphand is expected to record a consolidated loss attributable to Shareholders in the range of US$15 million to US$20 million for the period, as compared to a profit of US$496 million for the corresponding period in 2020.

The Board refers to the previous profit warning announcement of the company published on 30 September 2021, in which the company disclosed that, based on the unaudited management accounts prepared for the eight months ended 31 August 2021, C.P. Pokphand had recorded a consolidated unaudited profit attributable to shareholders of approximately US$112 million, a decrease of 75% as compared to that of US$441 million for the corresponding period in 2020.

The Board also stated in the 30 September announcement that the Board was anticipating that, for the month of September 2021, (1) poultry and swine prices in China and swine prices in Vietnam would have fallen further (from their already lower prices before September 2021), and (2) a significant negative net change in fair value of biological assets, estimated to be in the range of US$125 million to US$130 million, would accordingly have to be recorded, so that the consolidated profit attributable to shareholders for the nine month period ended 30 September 2021 would be significantly lower than that of US$496 million recorded for the corresponding period in 2020.

 

In addition, C.P. Pokphand stated that the company expects the business operations for the rest of the year to continue to be negatively impacted by the low poultry and swine prices in China and low swine prices in Vietnam, which may or may not fall further.

Lastly, C.P. Pokphand stated that the company is in the process of finalising the results of the company and its subsidiaries for the nine months ended 30 September 2021. The information contained in this announcement is only based on the preliminary assessment by the Board with reference to the unaudited management accounts of C.P. Pokphand for the nine months ended 30 September 2021 and the information currently available to the Board, which have not been reviewed or audited by the company’s auditors. Shareholders and potential investors are advised to refer to details in C.P. Pokphand’s results announcement for the nine months ended 30 September 2021 which is expected to be published in mid-November 2021.