TIDMZBO

RNS Number : 3190Y

Zibao Metals Recycling Holdings PLC

30 December 2019

30 December 2019

Zibao Metals Recycling Holdings Plc

("Zibao" or "the Company" or "the Group")

Half Year Results

Zibao Metals Recycling Holdings Plc (AIM: ZBO), a Hong Kong based, recyclable metal trader and processor is pleased to announce its unaudited half year results for the six months ended 30 September 2019.

For further information please contact:

 
 Zibao Metals Recycling Holdings PLC             Tel: +852 2769 7662 
  Wenjie "Joe" Zhou, Chairman                     www.zibaometals.com 
  Jianfeng "Eddy" Li, Chief Executive Officer 
 SPARK Advisory Partners Limited (Nominated 
  Adviser) 
  Mark Brady/Neil Baldwin                        +44 203 368 3551 
 

Chairman's Statement

We are pleased to report the Company's unaudited interim results for the six months ended 30 September 2019.

Results

The Group's turnover was HKD 118 million [1H2018 : HKD 139 million], a decrease of approximately 15% on the corresponding period last year, mainly as a result of the continued impact of the change in regulations in the PRC restricting importation of scrap materials. The Group has not been able to secure new and compliant sources of supply, such that normal levels of trading can resume, and there is no visibility if and when this can happen.

Loss before tax during the period was HKD 0.53 million [1H2018 : HKD 2.4 million], as the Group continued with its cost control initiatives following the reduced levels of activity.

Outlook

Trading levels are not anticipated to return to normal or sustainable levels in the foreseeable future, and whilst the Group continues to manage its costs, it also continues to explore other strategies for the Group.

As announced on 12 December 2019, the Board are exploring the disposal of the Group's main trading subsidiary, Masterpiece Enterprises Limited. It is likely that any such disposal, if agreed, would also require shareholders' approval, in general meeting, as required by AIM Rule 15. Should this disposal be approved, the Company would also seek to raise some new equity through a placing of new shares.

We will keep shareholders advised of progress as and when appropriate.

Joe Zhou

Chairman

30 December 2019

Consolidated Statement of Comprehensive Income

 
 
                                                            6 months           6 months 
                                                     to 30 September    to 30 September 
                                                                2019               2018          Year to 
                                                                                                31 March 
                                            Notes                                                   2019 
                                                             HKD'000            HKD'000          HKD'000 
                                                           UNAUDITED          UNAUDITED          AUDITED 
 Continuing operations 
 Revenue                                      3              118,253            138,777          363,228 
 Cost of sales                                             (117,335)          (138,434)        (377,678) 
                                                      --------------     --------------   -------------- 
 Gross profit                                                    918                343         (14,450) 
 
 Other revenues                                                  359                157               23 
 Selling and distribution expenses                             (109)               (29)            (133) 
 
 Administrative expenses                                     (1,702)            (2,826)          (9,071) 
 
 Other Operating expenses                                          -                  -         (20,000) 
 
 Impairment losses                                                 -                  -         (21,134) 
 
                                                      --------------     --------------   -------------- 
 Operating (loss)/ profit                                      (534)            (2,355)         (64,765) 
 
   Finance cost                                                    -                  -                - 
                                                      --------------     --------------   -------------- 
 (Loss)/Profit before tax                                      (534)            (2,355)         (64,765) 
 
 Income tax credit/ (expense)                                     10                 10             (37) 
                                                      --------------     --------------   -------------- 
 (Loss)/profit for the year                                    (524)            (2,345)         (64,802) 
 
 Other Comprehensive income 
 Foreign exchange difference                                       -                  -            (860) 
                                                      --------------     --------------   -------------- 
 (Loss)/Profit and total comprehensive 
  income for the period                                        (524)            (2,345)         (65,662) 
 
 
   (Loss)/Profit and total comprehensive 
   income for the year attributable 
   to the owners of the Company                                (524)            (2,345)         (65,662) 
 
 
 
 (Loss)/Earnings per share                    5                  HKD                HKD              HKD 
 Basic                                                       (0.004)            (0.019)          (0.531) 
 Diluted                                                     (0.004)            (0.019)          (0.531) 
 
 
 
 

Consolidated Statement of Financial Position

 
 
                                       Notes   As at 30 September 2019   As at 30 September 2018   As at 31 March 2019 
                                                               HKD'000                   HKD'000               HKD'000 
                                                             UNAUDITED                 UNAUDITED               AUDITED 
 Assets 
 Non-Current Assets 
 Property, plant and equipment                                  17,398                    39,778                17,658 
 Intangible assets                                                   -                     1,406                     - 
                                                        --------------            --------------        -------------- 
                                                                17,398                    41,184                17,658 
                                                        --------------            --------------        -------------- 
 Current Assets 
 Inventories                                                         -                    22,286                 3,055 
 Trade receivables                                               6,778                     4,548                12,100 
 Prepayments, deposits and other 
  receivables                                                    4,634                    10,019                 7,261 
 Tax recoverable                                                     -                     3,268                     - 
 Cash and cash equivalents               6                       7,463                     5,396                 8,943 
                                                        --------------            --------------        -------------- 
                                                                18,875                    45,517                31,359 
                                                        --------------            --------------        -------------- 
 Total Assets                                                   36,273                    86,701                49,017 
 
 Equity and liabilities 
 Equity attributable to owners of 
 the company 
 Share capital                           7                      15,549                    15,549                15,549 
 Share premium                                                  42,167                    42,167                42,167 
 Group reorganisation reserve                                    (527)                     (527)                 (527) 
 Share based payments reserve                                      662                       662                   662 
 Foreign Exchange reserve                                      (1,770)                     (910)               (1,770) 
 Retained earnings                                            (55,405)                     7,576              (54,881) 
                                                        --------------            --------------        -------------- 
 Total Equity                                                      676                    64,517                 1,200 
                                                        --------------            --------------        -------------- 
 Non-current liabilities 
 Deferred tax                                                      108                       128                   118 
                                                        --------------            --------------        -------------- 
                                                                   108                       128                   118 
                                                        --------------            --------------        -------------- 
 Current liabilities 
 Trade payables                                                  4,454                     8,136                12,958 
 Accrued liabilities and other 
  payables                                                      21,902                     4,746                25,609 
 Tax payable                                                     9,133                     9,174                 9,132 
                                                        --------------            --------------        -------------- 
                                                                35,489                    22,056                47,699 
                                                        --------------            --------------        -------------- 
 Total Liabilities                                              35,597                    22,184                47,817 
                                                        --------------            --------------        -------------- 
 Total Equity and Liabilities                                   36,273                    86,701                49,017 
 
 

Consolidated Statement of Cash Flows

 
 
                                     6 months to 30 September   6 months to 30 September   Year to 31 March 2019 
                             Notes                       2019                       2018 
                                                      HKD'000                    HKD'000                 HKD'000 
                                                    UNAUDITED                  UNAUDITED                 AUDITED 
 Cash flows from operating 
 activities 
 Net cash from operating 
  activities                   1                      (1,740)                    (6,879)                 (3,985) 
 Taxation                                                   -                          -                       - 
                                                   ----------                 ----------              ---------- 
 Net cash (used in)/ 
  generated from operating 
  activities                                          (1,740)                    (6,879)                 (3,985) 
 
 Investing activities 
 Sale/Addition of 
  property, plant and 
  equipment                                               260                          -                    (12) 
                                                   ----------                 ----------              ---------- 
 Net generated from / 
  (cash used) in investing 
  activities                                              260                          -                    (12) 
                                                   ----------                 ----------              ---------- 
 Net cash from / (used in)                                  -                          -                       - 
 in financing activities 
                                                   ----------                 ----------              ---------- 
 
 Taxation                                                   -                          -                       - 
 
 Net decrease in cash and 
  cash equivalents                                    (1,480)                    (6,879)                 (3,997) 
 Cash and cash equivalents 
  at beginning of the 
  period                                                8,943                     12,275                  12,275 
 Effect of foreign 
  exchange rate changes                                     -                          -                     665 
                                                   ----------                 ----------              ---------- 
 Cash and cash equivalents 
  at the end of the period                              7,463                      5,396                   8,943 
 
 Represented by: 
 Bank balances and cash                                 7,463                      5,396                   8,943 
 
 
 
 
 Notes for Consolidated 
 Statement of Cash Flows 
 1. Net cash from operating 
 activities 
                                6 months to 30 September    6 months to 30 September 
                                                    2019                        2018     Year to 31 March 2019 
                                                 HKD'000                     HKD'000                   HKD'000 
                                               UNAUDITED                   UNAUDITED                   AUDITED 
 
 Loss before income tax                            (534)                     (2,355)                  (64,765) 
 Adjustments for: 
 Depreciation on property, 
  plant and equipment                                270                         793                     1,525 
 Interest income                                       -                           -                         - 
 Amortisation                                          -                          50                       101 
 Provision for Obsolete 
  inventories                                          -                           -                    15,722 
 Impairment of Property, 
  plant and equipment                                  -                           -                    19,778 
 Impairment of Goodwill                                -                           -                     1,355 
 (Increase) / decrease in 
  inventories                                      3,055                       3,507                     7,016 
 Decrease/(Increase) in 
  trade receivables                                5,322                       6,893                     (660) 
 Decrease / (Increase) in 
  prepayments, deposits and 
  other receivables                                  433                       (853)                     4,789 
 Increase / (decrease) in 
  trade payables                                 (8,504)                    (10,160)                   (5,338) 
 Increase / (decrease) in 
  accrued liabilities and 
  other payables                                 (1,782)                     (4,754)                    16,492 
                                              ----------                  ----------                  -------- 
 Cash used in operations                         (1,740)                     (6,879)                   (3,985) 
 
 
 

Consolidated Statement of Changes in Equity

 
                             Share        Share        Share              Group    Foreign       Retained        Total 
                           Capital      premium        based    Reorgan-isation    exchange      Earnings 
                                                     payment            Reserve     reserve 
                                                    reserves 
                           HKD'000      HKD'000      HKD'000            HKD'000      HKD'000      HKD'000      HKD'000 
 
 As at 31 March 
  2018                      15,549       42,167          662              (527)        (910)        9,921       66,862 
 
 
 Total comprehensive 
  income for the 
  period                         -            -            -                  -            -      (2,345)      (2,345) 
 Foreign exchange                -            -            -                  -            -            -            - 
  difference 
                        ----------   ----------   ----------         ----------   ----------   ----------   ---------- 
 As at 30 September 
  2018                      15,549       42,167          662              (527)        (910)        7,576       64,517 
 
 Total comprehensive 
  income for the 
  period                         -            -            -                  -            -     (62,457)     (62,457) 
 Foreign exchange 
  difference                     -            -            -                  -        (860)            -        (860) 
                        ----------   ----------   ----------         ----------   ----------   ----------   ---------- 
 As at 31 March 
  2019                      15,549       42,167          662              (527)      (1,770)     (54,881)        1,200 
 
 Total comprehensive 
  income for the 
  period                         -            -            -                  -            -        (524)        (524) 
 Foreign exchange                -            -            -                  -            -            -            - 
  difference 
                        ----------   ----------   ----------         ----------   ----------   ----------   ---------- 
 As at 30 September 
  2019                      15,549       42,167          662              (527)      (1,770)     (55,405)          676 
                        ----------   ----------   ----------         ----------   ----------   ----------   ---------- 
 
 
 
 

Notes to the interim financial information

1. General information

Zibao Metals Recycling Holdings Plc is a company incorporated in England on 9 October 2013 under the Companies Act 2006 but domiciled in Hong Kong. It was listed on the AIM market on 20 June 2014. The Group's principal activity is that of trading and processing scrap metals.

   2.   Basis of preparation and significant accounting policies 

This interim report, which incorporates the financial information of the Company, has been prepared using the historical cost convention, on a going concern basis and in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union, using accounting policies which are consistent with those set out in the financial statements for the year ended 31 March 2019.

Taxes

Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total annual earnings.

Standards and Interpretations adopted with no material effect on financial statements

There are no IFRS or IFRIC interpretations that are effective for the first time in this financial period that would be expected to have a material impact on the Group.

IFRS16 is not material to the Group, therefore no adjustments have been made.

Standards, interpretations and amendments to published standards that are not yet effective.

The following new standards, amendments to standards and interpretations have been issued, but are not effective for the financial period beginning 1 April 2019 and have not been early adopted.

 
 Reference   Title        Summary                       Application date    Application 
                                                         of standard         date of 
                                                                             Group 
----------  -----------  ----------------------------  -------------------  ----------- 
 
 IFRS 17     Insurance    IFRS 17 Insurance Contracts   Periods Commencing  1 April 
              Contracts                                  on or after 1       2021 
                                                         January 2021 
----------  -----------  ----------------------------  -------------------  ----------- 
 

The directors anticipate that the adoption of these standards and the interpretations in future periods will have no material impact on the financial statements of the Group.

   3.   Segmental reporting 

In the opinion of the directors, the Group has one class of business, being the trading of scrap materials. The Group's primary reporting format is determined by the geographical segment according to the location of its establishments. There is currently only one geographic reporting segment, which is China. All revenues and costs are derived from the single segment.

   4.   Directors' remuneration 
 
                             6 months           6 months 
                      to 30 September    to 30 September       Year to 31 
                                 2019               2018       March 2019 
                            Salaries,          Salaries,        Salaries, 
                             fees and           fees and         fees and 
                              options            options          options 
                              HKD'000            HKD'000          HKD'000 
                            UNAUDITED          UNAUDITED          AUDITED 
 Wenjie Zhou                      120                120              240 
 Jianfeng Li                      120                120              240 
 Chor Wei Ong                      31                 66              132 
 Chin Phang Kwok                   31                 66              132 
 Peter Greenhalgh                  31                 66              132 
 Ajay Rajpal                       31                 66              132 
                       --------------     --------------   -------------- 
                                  364                504            1,008 
                            _________          _________        _________ 
 
   5.   Loss per share 

Loss per share data is based on the Group profit for the period and the weighted average number of shares in issue.

 
                                   6 months to 30 September       6 months to 30 September 
                                                       2019                           2018     Year to 31 March 2019 
                                                    HKD'000                        HKD'000                   HKD'000 
                                                  UNAUDITED                      UNAUDITED                   AUDITED 
 
  Loss for the period 
  attributable to owners of 
  Company                                             (524)                        (2,345)                  (65,662) 
 
 
 Weighted average number of 
  ordinary shares for the 
  purposes of basic earnings 
  per share (000's)                                 122,010                        122,010                   122,010 
 Weighted average number of 
  ordinary shares for the 
  purposes of diluted 
  earnings per share 
  (000's)                                           125,453                        125,453                   125,453 
 
 
 
 
                                   6 months to 30 September       6 months to 30 September 
                                                       2019                           2018     Year to 31 March 2019 
                                                    HKD'000                        HKD'000                   HKD'000 
                                                  UNAUDITED                      UNAUDITED                   AUDITED 
 Basic loss per share 
 Total basic losses per share                       (0.004)                        (0.019)                   (0.531) 
 
 
 
 Diluted loss per share 
 Total diluted earnings per share       (0.004)      (0.019)      (0.531) 
                                     ----------   ----------   ---------- 
 
   6.    Cash and cash equivalents Group 
 
                                                              As at 30                            As at 30                            As at 31 
                                                             September                           September                          March 2018 
                                                                  2019                                2018 
                                                               HKD'000                             HKD'000                             HKD'000 
                                                             UNAUDITED                           UNAUDITED                             AUDITED 
                    Cash and bank 
                     balances                                    7,463                               5,396                               8,943 
                                                        --------------                      --------------                      -------------- 
                    Cash and bank 
                     balances 
                     as presented 
                     in balance 
                     sheets                                      7,463                               5,396                               8,943 
                    Add: Pledged                                     -                                   -                                   - 
                    fixed 
                    deposits 
                                                        --------------                      --------------                      -------------- 
                    Cash and cash 
                     equivalents 
                     as presented 
                     in 
                     consolidated 
                     statement of 
                     cash flows                                  7,463                               5,396                               8,943 
                                                             _________                           _________                           _________ 
 
   7.      Share capital 

The issued share capital as at 30 September 2019 was 122,010,000 ordinary shares of GBP0.01 each (30 September 2018: 122,010,000 ordinary shares of GBP0.01, 31 March 2019: 122,010,000 ordinary shares of GBP0.01)

8. The unaudited results for the period ended 30 September 2019 do not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The comparative figures for the period ended 31 March 2019 were extracted from the audited financial statements which contained an unqualified audit report and did not contain statements under Sections 498 to 502 of the Companies Act 2006.

9. This interim financial statement will be, in accordance with the AIM Rules for Companies, available shortly on the Company's website at www.zibaometals.com.

10. The Company is incorporated in the UK but is treated as a Hong Kong resident for tax purposes.

Macau and Hong Kong tax has been provided at a rate of 12% and 16.5% respectively.

There was deferred taxation in respect of the period.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

IR WGGQCPUPBGQU

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December 30, 2019 11:50 ET (16:50 GMT)

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