TIDMTNCI
RNS Number : 9462N
Tinci Holdings Ltd
13 September 2013
FOR IMMEDIATE RELEASE 13(th.) September 2013
TINCI HOLDINGS LTD
INTERIM RESULTS
FOR THE 6 MONTHS ENDED 30 JUNE 2013
Tinci Holdings Ltd. (the "Company" or "Tinci") (TNCI), the AIM
quoted environmental engineering company, today announces its
unaudited interim results for the six months ended 30 June
2013.
Highlights:
-- Turnover of RMB 30.3 million against RMB 21.8 million in the
first half of 2012.
-- Challenging market environment continues to make it difficult
to win profitable new projects. One major new project won in the
half year.
-- Profit before tax of RMB 2.23 million (2012: Loss before tax
of RMB 0.44 million).
-- Company continues to concentrate on developing Flue Gas
Desulphurisation ("FGD") joint ventures in niche markets, in
particular with China National Petroleum Corporation.
Commenting on the results David Steeds, Chairman, said;
"The results for the first six months of 2013 showed a
substantial improvement on the corresponding period in 2012.
However, it continues to be difficult for Tinci's core FGD business
to win new contracts at reasonable margins. The management team has
worked hard to cut costs to maintain profit margins.
We were delighted to win a contract for RMB 44.2 million with
Wusha Cogeneration in Foshan during the period.
The management continues to work on a number of joint ventures
with our established partners in niche markets, particularly with
China National Petroleum Corporation."
For further information, please visit www.tinciholdings.com or
contact:
Tinci Holdings Ltd
David Steeds Tel: +44 (0)7836 578222
Joshua Cheng Tel: +1 512 577 4613
Westhouse Securities Limited
Martin Davison Tel: +44 (0) 20 7601 6100
Overview of Operating Performance
Trading in the first half of 2013 was considerably stronger than
for the same period in 2012. Costs were also kept under firm
control so that a small profit is being reported in these results
to 30 June 2013.
During the period the Company won one major new contract with
Wusha Cogeneration in Foshan. The contract is for the retrofitting
of two 300MW FGD plants and has a value of RMB44.2 million.
In the difficult market environment the Company again found it
hard to win new customers at sensible profit margins.
As reported previously, the Company's management has concluded
that it is unlikely to expand its business simply by offering FGD
in power plants, where it is in competition with the power
companies' in-house FGD subsidiaries. The Company intends instead
to focus its FGD business in China on the petrochemical sector,
building on its good relations with China National Petroleum
Corporationas well as existing clients with established and
reliable relationships.
The Company's Order Book at 30 June 2013 amounted to RMB 91
million compared to RMB 56 million at 31 December 2012. RMB 44
million of the current order book relates to the new contract in
Foshan.
Future Developments
Early indications are that trading in the second half of 2013
will be satisfactory and the result for the whole year is expected
to show a small profit, although it is too early to provide a clear
prediction of the financial results for the full year. Operating
cash flow is expected to be marginally positive for the full
year.
Meanwhile, the Company will continue to concentrate its
resources on developing its various joint ventures, particularly
its catalytic refinery project with China National Petroleum
Corporation, in the hope of achieving a breakthrough in one of
these new businesses while maintaining a stable income from FGD in
the current year.
Financial Performance
Revenue in the first half of 2013 increased by 39% from RMB 21.8
million in the same period of 2012 to RMB 30.3 million. Profit
before tax was RMB 2.23 million compared with a loss before tax of
RMB 0.44 million for the same period last year.
Operating cash flow was negative in the first six months of 2013
due to a large increase in accounts receivable in the period. The
outflow from operations of RMB 19.4 million compares with an
outflow of RMB 0.7 million in the comparative period.
The Company aims to improve its financial performance by
focusing on collecting receivables, cutting
costs, and improving project management.
Outlook
The Board expects the difficult conditions in the FGD market to
persist through the remainder of 2013 and
into 2014. The Company will continue to concentrate its efforts
on:
-- Developing FGD joint ventures in niche areas with established customers/partners.
-- Developing its investment in JiangSu AnDy in speciality
chemical products, which is meeting its internal targets for its
first year of operation
-- Promoting co-operation with China National Petroleum
Corporation on a catalytic refining project
-- Cutting costs and improving receivables collection.
-- Improving project management with effective budgeting and cost control.
Tinci Holdings Limited
Unaudited Interim Financial Information
For the six months ended 30 June 2013
Tinci Holdings Limited
Condensed consolidated statement of comprehensive
income(Unaudited)
for the six months ended 30 June 2013
Six months Year ended Six months
ended 30 31 December ended 30
Note June 2013 2012 June 2012
(unaudited) (audited) (unaudited)
RMB'000 RMB'000 RMB'000
Turnover 30,289 55,275 21,854
Other revenue 558 1,043 271
Raw material and consumables used -21,991 -41,356 -15,724
Staff costs and benefits expenses -2,653 -8,351 -2,812
Depreciation and amortisation
expenses -570 -1,137 -568
Other operating expenses -4,450 -8,705 -3,470
------------ ------------- ------------
Profit/(loss) from operations 1,183 -3,231 -449
Exchange loss -7 -114 -2
Finance costs -43 -84 -103
Non-operating income 550 - 75
Share of profit of an associate 322 519 228
Share of profit/(losses) of a
jointly controlled entity 225 13 -193
------------ ------------- ------------
Profit/(loss) on ordinary activities
before taxation 2,230 -2,897 -444
Taxation -264 -62 -30
------------ ------------- ------------
Profit/(loss) on ordinary activities
after taxation 1,966 -2,959 -474
============ ============= ============
Profit /(loss) for the period/year 1,966 -2,959 -474
Other comprehensive (loss)/income
Currency translation adjustments -23 6 -20
Total comprehensive income/(loss)
for the period/year 1,943 -2,953 -494
============ ============= ============
Total comprehensive income/(loss)
attributable to:
Shareholders of the company 1,943 -2,953 -494
Profit/(loss) per ordinary share
Basic and diluted profit/(loss)
per share (Renminbi) 6 0.037 -0.06 -0.009
Tinci Holdings Limited
Condensed consolidated statement of financial
position(Unaudited)
asat 30 June 2013
At 30 At 31 At 30
December
June 2013 2012 June 2012
(unaudited) (audited) (unaudited)
RMB'000 RMB'000 RMB'000
Non-current assets
Land use rights 363 369 375
Property, plant and equipment 10,166 10,474 10,904
Intangible assets 1,399 1,555 1,710
Interest in an associate 17,329 17,007 39,256
Interest in a jointly controlled
entity 1,117 892 686
Deferred tax assets 4,965 4,965 4,464
Total non-current assets 35,339 35,262 57,395
------------ ---------- ------------
Current assets
Amount due from customers for contract
work 232 15,802 143
Trade and other receivables, deposits
and prepayment 192,471 160,679 171,341
Derivative financial instrument - 17 -
Restricted bank balances 7,554 13,041 1,706
Cash and bank balances 8,219 22,277 7,132
Total current assets 208,476 211,816 180,322
------------ ---------- ------------
Total assets 243,815 247,078 237,717
Current liabilities
Trade and other payables -89,662 -91,478 -92,090
Bills payable -11,652 -14,705 -2,681
Tax payable 59 -278 130
Total current liabilities -101,255 -106,461 -94,641
------------ ---------- ------------
Net assets 142,560 140,617 143,076
============ ========== ============
Equity
Share capital 7,796 7,796 7,796
Share premium 18,078 18,078 18,078
Reverse acquisition reserve 42,644 42,644 42,644
Share options reserve 802 802 819
Translation reserve -269 -246 -272
Retained earnings 73,509 71,543 74,011
Total shareholders' equity 142,560 140,617 143,076
============ ========== ============
Tinci Holdings Limited
Condensed consolidated statement of changes in shareholders'
equity(Unaudited)
for the six months ended 30 June 2013
Six months Year ended Six months
ended 30 31 December ended 30
June 2013 2012 June 2012
(unaudited) (audited) (unaudited)
RMB'000 RMB'000 RMB'000
Shareholders' equity as at the beginning
of the period/year 140,617 143,570 143,570
------------ ------------- ------------
Profit/(loss) for the period/year 1,966 -2,959 -474
Other comprehensive (loss)/income
for the period/year
Exchange difference arising on consolidation -23 6 -20
------------ ------------- ------------
Total comprehensive income/(loss)
for the period/year 1,943 -2,953 -494
Employee share option benefits 0 0 0
------------ ------------- ------------
Shareholders' equity as at the end
of the period/year 142,560 140,617 143,076
============ ============= ============
Tinci Holdings Limited
Condensed consolidated cash flow statement (Unaudited)
for the six months ended 30 June 2013
Six months Six months
ended Year ended ended
30 31 December 30
June 2013 2012 June 2012
(unaudited) (audited) (unaudited)
RMB'000 RMB'000 RMB'000
Profit/(Loss) before taxation 2,230 -2,897 -444
Interest income -104 -36 -15
Interest expenses 43 84 103
Depreciation and amortisation expense 570 1,137 568
Unrealised gain on derivative financial
instruments 0 28 0
Bad debts written off and provision
for doubtful debts 2,000 2,476 0
Share of profit of an associate -322 -519 -228
Share of (profit)/losses of a jointly
controlled entity -225 -12 193
------------ ------------- ------------
Operating profit before movements
in working capital 4,192 261 177
Decrease in amount due from customers
for contract work 15,570 3,540 19,199
(Increase)/decrease in trade and
other receivables, deposits and prepayment -33,775 4,185 -18,955
Decrease in amount due to customers
for contract work - -57 -57
Decrease in trade and other payables -1,816 -2,071 -1,459
(Decrease)/Increase in bills payable -3,053 12,822 798
------------ ------------- ------------
Cash (used in)/generated from operations -18,882 18,680 -297
Interest received 104 36 15
Interest paid -43 -84 -103
Current income tax paid -601 -466 -341
------------ ------------- ------------
Net cash equivalents (used in)/generated
from operations -19,422 18,166 -726
Cash flow from investing activities
Purchases of property, plant and
equipment -100 0 -22
Investment in an associate 0 15,190 0
Repayment to an associate 0 7,420 70
Amount from a related party 0 -15,000 0
Net cash (used in)/generated from
investing activities -100 7,610 48
Cash flow from financing activities
Movement in restricted bank balances 5,487 -10,734 601
Net cash generated from/(used in)
financing activities 5,487 -10,734 601
------------ ------------- ------------
Net (decrease)/increase in cash and
cash equivalents -14,035 15,042 -77
Cash or cash equivalents at 1 January 22,277 7,229 7,229
Effect of foreign exchange rates
changes-net -23 6 -20
------------ ------------- ------------
Cash or cash equivalents at 30 June/31December 8,219 22,277 7,132
ANALYSIS OF CASH AND CASH EQUIVALENTS
Cash and bank balances 8,219 22,277 7,132
Tinci Holdings Limited
Notes to the condensed consolidated interim financial
statements
for the six months ended 30 June 2013
1. General information
Tinci Holdings Ltd (the "Company") is incorporated in Hong Kong
under the Hong Kong Companies Ordinance. The Company is a public
listed company and its shares are quoted on the AIM market of the
London Stock Exchange. The principal place of business of the
Company and its subsidiaries (collectively "the Group") is
Guangzhou, China.
The interim results for the six months ended 30 June 2013 are
unaudited and do not constitute statutory accounts within the
meaning of s.240 of the Companies Act 1985.
2. Basis of preparation
The Directors are responsible for the preparation of the Group's
unaudited condensed consolidated financial statements. These
unaudited condensed consolidated financial statements should be
read in conjunction with the 2012 annual financial statements.
These condensed consolidated financial statements have been
prepared in accordance with International Accounting Standard
("IAS") 34 "Interim Financial Reporting".
The consolidated financial statements incorporate the financial
statements of the Company and its subsidiary undertakings.
3. Significant Accounting Policies
(a) The condensed consolidated financial statements have been
prepared on the historical cost basis.
The accounting policies used in the condensed consolidated
financial statements are consistent with those followed in the
preparation of the Group's annual consolidated financial statements
for the year ended 31 December 2012 except for those described in
note 3(b) below.
(b) The International Accounting Standards Board has issued a
number of new and revised International Financial Reporting
Standards ("IFRS"). In the current period, the Group initially
applied the following new and revised IFRS :-
IAS 19 Employee Benefits
IFRS 10 Consolidated Financial Statements
IFRS 11 Joint Arrangements
IFRS 12 Disclosure of Interests in Other Entities
IFRS 13 Fair Value Measurement
Amendments to IFRSs Annual Improvements to IFRSs 2009-2011 Cycle
The initial application of these IFRS does not necessitate any
material changes in the Group's accounting policies or
retrospective adjustments of the comparatives presented.
(c) The Group has not early applied the new and revised
standards, amendments or interpretations of IFRS that have been
issued but are not yet effective at 30 June 2013. The directors of
the Company anticipate that the application of these new and
revised standards, amendments or interpretations will have no
material impact on the results and the financial position of the
Group.
Tinci Holdings Limited
Notes to the condensed consolidated interim financial
statements
for the six months ended 30 June 2013
4. Foreign currency
The functional currency of the subsidiary undertakings is
Renminbi ("RMB"), and the presentation currency of the Group is
RMB. Transactions in currencies other than RMB are recorded at
rates of exchange prevailing on the dates of the transactions. At
each balance sheet date, monetary assets and liabilities that are
denominated in foreign currencies are retranslated at the rates
prevailing on the balance sheet date, and gains or losses arising
on retranslation are included in the net profit for period.
Non-monetary assets and liabilities are translated using historical
rates, and exchange rate differences arising are classified as
equity and transferred to foreign currency translation reserve.
On consolidation, the assets and liabilities of foreign
operations are translated at the exchange rate prevailing on the
balance sheet date. Income and expense items are translated at the
average exchange rates for the period/year.
For the six months ended 30 June 2013, the foreign operations'
financial statements have been translated from GBP and HKD to RMB
at the following exchange rates:
Period Period
end Average Year end Average end Average
rate rates rates rates rate rates
as at Period as at Year to as at Period
30 to 31 31 30 to
June 30 June December December June 30 June
2013 2013 2012 2012 2012 2012
RMB:
GBP 9.4213 9.5697 10.1611 10.0336 9.8169 9.9617
RMB:
HKD 0.7966 0.8034 0.8108 0.8136 0.8152 0.8126
5. Turnover
The principal activity of the Company is investment holding. The
principal activities of the Group during the period were
developing, selling and installing large-scale flue gas
desulphurisation equipment to power stations.
Details of the principal activities of the wholly-owned
subsidiaries are as follows:
Subsidiaries Principal activities
World International Investment Investment holding
Limited
Guangzhou Tinci Sanhe Developing, manufacturing and installing
Environmental Engineering Co. Ltd Flue Gas Desulphurisation Systems
Turnover represented the percentage of contract revenue
completed and recognised.
Turnover for the period is wholly attributable to activities
undertaken in China.
Tinci Holdings Limited
Notes to the condensed consolidated interim financial
statements
for the six months ended 30 June 2013
6. (Loss)/profit per ordinary share
Year ended
6 months ended 30
June 31 December
2013 2012 2012
(unaudited) (unaudited) (audited)
Profit/(loss) on ordinary
activities
after taxation (in RMB'000) 1,966 -474 -2,959
=========== =========== ===========
Weighted average number
of ordinary
shares in issue (in thousands) 52,950 52,950 52,950
=========== =========== ===========
Profit/(loss) per ordinary
share
Basic and diluted profit/(loss)
per
share (in Reminbi) 0.037 -0.009 -0.06
=========== =========== ===========
7. Dividend
The Board is not recommending the payment of an interim dividend
for the six months ended 30 June 2013.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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