Thanks for your questions posted over the past week. I am happy to answer your questions online. I will repost the questions in blue italics followed by my comments in black.
Kenny the fish
Dear Chee Hean, you wrote:
How relevant is your research/discovery on ornamental fish and its feed applicable to the new aquaculture business? If it is a close fit then we should quickly switch focus on aquaculture to expedite the turnround of aquaculture overtaking ornamental in revenue/profit.
Hi Chee Hean,
We are doing separate research and development for both ornamental fish and aquaculture (edible fish and prawn). Different species of fish, whether ornamental fish or aquaculture share some fundamental common parameters because they are all fish. But at the same time, there are different considerations when you go to individual species.
However, there is a close fit for fish feed and we are currently expanding our fish feed to include aquaculture fish feed.
Kenny the fish
Dear Freddy, you wrote:
Your plastics revenue for 1H20 fell S$1.1M because of the lost of a major customer but the profit increased S$0.25M due to better margins. How would you describe the plastic business now in terms of orders backlog and capacity utilisation rate? How long do you think this surge in demand for plastic bags will last?
Hi Freddy,
Our plastic business has always been a stable business. The surge in demand is due to requirement of more clean packaging from various industries. This should last for the duration of the pandemic and beyond. We still have the capacity to increase production if there is further increase in demand.
Kenny the fish
Dear Simon, you wrote:
Do you think the Singapore's government vision to produce 30% of food locally by 2030 is feasible given the high cost of labour and land? Will Qian Hu produce aquaculture locally?
Hi Simon,
It is a very challenging ambition to produce 30% of the food in Singapore no matter how high-tech we can be. But if Singapore companies can engage in high value-added part of the food supply chain such as producing clean and high yield fry and import the produces from contract farming in low cost countries, 30% is achievable. Yes, Qian Hu has begun producing aquaculture locally.
Kenny the fish
Dear Catherine, you wrote:
Other than producing fresh aquaculture like groupers and shrimps exported via air freight will Qian Hu consider exporting frozen or canned sea food via sea freight like frozen dory fish fillet and canned sardines?
Hi Catherine,
Qian Hu still can't find any product differentiation in doing frozen and canned seafood. That business is highly competitive as it doesn't involve much technology. We think by dealing with high value live and fresh aquaculture produces, we can differentiate ourselves from the competitors.
Kenny the fish
Thanks again to all the investors who have posted their questions here. I hope I have answered them to your satisfaction. The next chance for us to correspond again will be the time when we announce our Full Year 2020 results. In the meantime, do feel free to visit our corporate website: http://www.qianhu.com/ and our IR website: http://qianhu.listedcompany.com/ for more information.
Take care and I look forward to our next online Q&A.
Kenny the fish