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Financial year 2020 vs financial year 2019

For the year ended 31 December 2020, the fish and accessories activities continued to be our core business segments, which together accounted for approximately 89.3% of the total revenue. Our overall revenue registered of $75.2 million in FY 2020 was approximately $1.7 million or 2.2% lower than that reported in FY 2019.

On a geographical basis, revenue from Singapore dipped by approximately 7.3%, while overseas increased by approximately 0.3% in FY 2020 as compared to FY 2019.

The Covid-19 outbreak has brought challenging times for many economies. It has caused considerable disruptions to the global supply chain which has affected our exports of ornamental and edible fish, and to a lesser extent, aquarium and pets accessories during the 1st half of the year. Nonetheless, with the lifting of the border restrictions and the gradual resumption of air traffic since July 2020, we saw a retrieval in revenue contribution from our core business segments as customers restocked fish and replenished related accessories products after a prolonged void.

2H 2020 vs 2H 2019

Although the revenue from our plastic activities shrunk in the 2nd half of 2020, the improvement in revenue contribution from the fish and accessories segments have resulted in an increase in overall revenue registered by approximately $3.2 million or 8.1% as compared to its corresponding period in 2019.


Our fish exports are very dependent on the operations and availability of air cargo, and with the extensive reduction of capacity and flight frequencies during the pandemic, our fish export business was severely affected. Similarly, our aquaculture business, revolved around our farms in the Hainan Province in China, was also impacted by the lockdown in China which dampened domestic demand and depressed fish fry prices. As such, our fish revenue dived during the 1st half of 2020 as compared to its corresponding period in 2019 as reported earlier.

Following the lifting of border restrictions and the gradual resumption of air traffic since July 2020, we saw a recuperation of revenue from this business segment with a stable flow of customers’ orders. The resilience in the demand for fish had resulted in the elevation in revenue registered in the 2nd half of 2020, which was approximately $2.1 million or 15.2% higher than its corresponding period in 2019.

Moving ahead, we will look into the expansion and strengthening of the domestic network within each of our export hubs in Singapore, Malaysia, Thailand, Indonesia and China to mitigate the risk of global supply chain disruptions.


The revenue registered by our accessories business increased substantially by approximately $3.5 million or 18.2% in the 2nd half of 2020 as compared to its corresponding period in 2019 mainly due to the increase in revenue from our export business as we continued to leverage on the Group’s existing distribution bases & network and infrastructure available to explore more untapped markets. In addition, the efficiency derived from the consolidation of our China accessories operations, coupled with the newly acquired Guangzhou factory in December 2019 has given rise to the steady growth in accessories revenue during the current reporting period.


Amidst the crisis, our plastics business benefited from the increased demand for plastics products as they were considered essential items used to enhance hygiene protocols, especially for food and beverage packaging, as well as in healthcare products and services. This was in spite of losing a major customer during the current financial year, which drove down the revenue contribution from our plastics segment.

We managed to focus on generating revenue through selling products with sustainable margins instead of entering into price war with our competitors.

Profitability Financial year 2020 vs financial year 2019

Despite the improvement in profit contribution from our accessories and plastics businesses, the plunge in profitability from our fish segment, which was in line with the reduction in its revenue contribution and transhipment business, had resulted in the decline in overall operating profit (before impairment loss) by approximately $0.2 million or 17.0% in FY 2020 as compared to FY 2019.

2H 2020 vs 2H 2019

The significant increase in profit contribution from our accessories segment has fuelled the growth in profitability (before impairment loss) in the 2nd half of 2020 as compared to its corresponding period in 2019.


Despite higher revenue contribution reported in the 2nd half of 2020, the operating profit from our fish segment was approximately $0.3 million or 26.3% lower than its corresponding period in 2019 mainly due to the difference in sales mix. In addition, there was lower handling fees derived from the handling of transhipments in relation to our aquaculture business.

As mentioned on page 3 earlier, the impairment loss on brooder stocks arose from the periodic assessment of recoverable amounts based on expected future cash flows from the brooder stocks held. As the revenue from the sales of certain species of Dragon Fish is expected to be affected by the reduction in production yield and the declining selling prices of that species, an impairment loss on brooder stocks held of $2 million was recognised during the 2nd half of 2020, being the difference between the estimated recoverable value as compared to the carrying amount as at 31 December 2020.


The surge in the operating profit from our accessories business in the 2nd half of 2020 as compared to its corresponding period in 2019 was in line with the noticeable increase in revenue contribution as mentioned above.


Despite the dive in revenue contribution by approximately $2.4 million or 40.6% in the 2nd half of 2020, the profit generated from the plastic activities was approximately $0.1 million or 17.8% lower as compared to its corresponding period in 2019, mainly due to improved profit margins and the difference in sales mix recorded in both periods.

Unallocated corporate expenses

These were staff costs and corporate/administrative expenses incurred in relation to the overseeing of both the Group’s local and overseas operations. The lower unallocated corporate expenses incurred in the 2nd half of 2020 as compared to the corresponding period in 2019 was mainly due to lower finance and salary related costs, as well as the payouts received under the Jobs Support Scheme (JSS) which the government co-funded between 25% to 75% of the first $4,600 of gross monthly salary paid to each local employee through cash subsidies.


There is no variance from the previous prospect statement.


The global supply chain disruptions as a result of the outbreak of Covid-19 has stabilised as the world has increasingly learnt how to manage under a new normal. China and Singapore, as well as some other countries in the region, have also controlled the spread of the virus relative to other countries in the world. As such, we have seen the recovery of our business segments since the 2nd half of 2020.

Aquaculture business

We have successfully developed hatcheries for groupers and shrimps at our Hainan aquaculture farms, and are on track to developing a fully-integrated aquaculture farm facilities in Hainan that is able to capture the entire value chain of edible fish/seafood from breeding to farming to the table.

We have since started to grow our aquaculture footprint beyond China. In July 2020, we embarked on the commercial farming of freshwater shrimps in Desaru, West Malaysia, by engaging a contract farmer who owns 200 acres of land. This initiative followed a successful pilot project of farming mono-sex brooder stocks of freshwater shrimp at our Singapore farm. We expect our freshwater shrimp farming project in Desaru to contribute positively to the Group’s results in Year 2021.

The expansion of our aquaculture business is also in line with the Singapore government’s aim to produce 30% of the country’s nutritional needs by Year 2030. We are in the midst of conducting proprietary research on the viable intensive production of other edible seafood in the near future. This is underpinned by our proprietary HYDROPURE filtration technology and our focus on antibiotic-free nutrition and farming methods.

We believe that the aquaculture business would be many times bigger than our current core ornamental fish segment. We expect it to be a sustainable engine of growth that will further secure Qian Hu’s future.

Ornamental Fish business

Meanwhile, ornamental fish will continue to be the mainstay of the Group, as we grow our export of ornamental fish to more than 80 cities and countries from our export hubs in Singapore, Malaysia, Thailand, Indonesia and China. As these countries together account for between 60% to 70% of the world’s ornamental fish, we believe that Qian Hu is the region’s biggest exporter of ornamental fish, capturing more than 5% of the global market share in terms of ornamental fish export.

We remain committed to our long-term goal to grow our export footprint to more than 100 cities and countries, focusing on high-growth regions such as the Middle East, Eastern Europe, China and India, and to gradually increase our global market share to 10%, thereby securing our vision of being the top ornamental fish exporter in the world.

By staying vested in the latest genomic technology, we will continue to be on the cusp of the market trends, developing new varieties of Dragon Fish (Asian Arowana) as well as other species of ornamental fish with strong market demand. This will gain pace in the near future, and will improve the profitability of our ornamental fish business when launched.

Aquarium and Pet Accessories business

Strong R&D capabilities
Over the years, Qian Hu has established a stronghold in R&D which continues to drive innovation and new product development throughout the Group – whether it is breakthroughs in developing new varieties of fish, in fish nutrition, or in developing cutting-edge accessories products.

Focus on own-brands
Our proprietary brands “Ocean Free” and “OF”, with its extensive range of fish tanks, lighting, filtration systems and other aquarium paraphernalia, have led the growth of our accessories segment, and we are steadfast on expanding our accessories footprint to more than 60 cities and countries globally.

Fish Nutrition & Medications
We are also committed in bringing out the best qualities in ornamental and edible fish/seafood by with nutritious feeds, as well as safe and efficacious medications. We have recently teamed up with researchers in developing yeast-based fish nutritional products on top of our existing antibiotic-free feeds.

Plastics business

Our plastics business continues to benefit from the strong demand from various sectors, particularly from the ornamental fish, food & beverage, waste management, healthcare and pharmaceutical industries. While expanding our existing customer base, we also intend to develop the e-commerce market as we move into FY 2021. These would include providing our plastics products for packing materials used for courier and online deliveries – a sector that has been growing robustly in recent times and has strong potential for further growth.


The full economic impact of the global pandemic, which has caused numerous disruptions to various businesses worldwide, is still unfolding. With the roll-out of vaccines in various countries in December 2020, it would seem that the worst is over for the Covid-19 pandemic, despite calls for continued caution until all countries have gained a handle on the spread of the virus.

As we move into FY 2021, we believe that the economic impact of the pandemic on our business cannot, and should not, be worse than what we have experienced in FY 2020. Qian Hu will resume its expansion plan as we expect to have more normalcy moving forward. We remain focused on our core strengths and the longer term prospects of our business. The key to the Group’s success lies in our continuing ability to seize long-term opportunities and correctly identify the initiatives and investments that bring value to our stakeholders.

Barring unforeseen circumstances, the Group expects to grow its revenue while achieving profitability in FY 2021.