News

Qian Hu's 1Q2002 Net Profit Up 74% to $1.04M On A 34% Rise In Turnover To $12.5M

SINGAPORE – 29 April 2002 - Qian Hu Corporation Limited, an integrated ornamental fish service provider, reported sterling first-quarter results in spite of global economic uncertainties.

For the first quarter ended 31 March 2002, the Group reported a 73.7% surge in net profit to $1.04 million on the back of a 33.6% increase in turnover to $12.5 million compared to the previous corresponding first quarter.

Ornamental fish grew by 26% from the previous corresponding first quarter mainly due to increased sales to local fish retailers, direct sales through its in-house retail outlet, the commencement of Thai Qian Hu’s operations, as well as the export of Dragon Fish to Taiwan since its government relaxed restrictions on the import of licensed Dragon Fish in January this year.

Qian Hu’s accessories business experienced a 52% growth compared to the same period last year mainly due to the market share gained by its Malaysia and Thailand subsidiaries which together contributed approximately 60% of the turnover of accessories as well as expanded distributed network of local retailers and supermarkets in Singapore.

The Group’s plastics business, which experienced a 10% growth, by focusing on more high-value items and an expansion of its distribution channel outside Singapore.

Last year, Qian Hu had managed to swim against the currents of recession by posting an increase of 22% in turnover to $41.2 million, and a 14.6% rise in net profit to $3.6 million for the full-year ended 31 December 2001.

Based on the latest results, earnings per share (on a fully diluted basis) increased from 0.72 cents in 1Q2001 to 1.23 cents in 1Q2002. Net tangible asset backing per ordinary share rose from 16.84 to 19.64 cents.

On the Group’s growth prospects for FY2002, Kenny said, “While we continue to grow healthily in Singapore due to the growing domestic market, we expect the bulk of our growth to be from our overseas operations, such as our newly-formed subsidiary in Thailand, Thai Qian Hu, and our new fish division in Malaysian subsidiary, Guan Guan.”

“We also intend to increase our investment in our Guangzhou-based associate company, Wan Jiang, a joint venture with a Taiwanese company specialising in the manufacture of accessories, by raising the stake from 50% to 60%. We are currently in the process of undertaking the necessary filings with the relevant regulatory authorities in the PRC. Upon receiving the requisite approval, Wan Jiang will then become a subsidiary of the Group, which will enable us to recognise its turnover and increase our profit share in the Group’s consolidated financial performance,” Kenny added.

“Overall, we expect positive contributions from our Group’s overseas subsidiaries in Malaysia, Thailand and China as we do not expect to carry further restructuring and start-up costs. We envisage our Group’s turnover and profit will continue to increase in FY2002,” he said.

Qian Hu has also entered a joint venture agreement for a 50% stake in Jin Jien Hsing Enterprise Co., Ltd which distributes pet food and accessories.

About Qian Hu

Incorporated in 1998 to take over the partnership businesses of Qian Hu Fish Farm Trading, Wan Hu Fish Farm Trading and Yi Hu Fish Farm Trading, Qian Hu is primarily engaged in the import and export, farming and distribution of ornamental fish as well as the distribution of aquarium and pet accessories. In addition, it started the breeding and sale of Dragon Fish for commercial sale in the second half of 2000.

With Kenny Yap, winner of the 1998 Singapore Youth Award for excellence in agrotechnological farming and recipient of the inaugural International Management Action Award in November 2000, at the helm at Qian Hu (which means “Thousand Lakes” in Chinese), the Group has achieved a number of “firsts” in the ornamental fish industry:

· the first integrated ornamental fish service provider in Singapore to be awarded the ISO 9002 certification for its quality management system;

· the first in the ornamental fish industry to obtain ISO 14001 certification for its environmental management system;

· one of the first ornmental fish operations in Singapore to have successfully bred the Dragon Fish for commercial sale; and

· the first company in the ornamental fish industry in Singapore to seek a public listing in Singapore.

· The first integrated ornamental fish service provider to achieve Singapore Quality Circle status.