China Minzhong Food Corporation

[l0nEr]

http://info.sgx.com/webcoranncatth.nsf/V...C00352AD8/$file/YMD-Profit_guidance_4Q2012.pdf?openelement

The Board of Directors (the “Board”) of Yamada Green Resources Limited (the “Company” together with its subsidiaries the “Group”) wishes to inform the shareholders of the Company and potential investors that it expects the Company to record a loss for the three months ended 30 June 2012 (“4Q2012”) as compared with a profit for the corresponding three months ended 30 June 2011 (“4Q2011”). Nevertheless, the Company expects to remain profitable for the financial year ended 30 June 2012.
The Group is expected to report a loss for 4Q2012 mainly due to the following reasons:
- Loss from changes in fair value of biological assets;
- Lower gross profit from sales of self-cultivated fungi in this quarter; and
- Higher operating expenses due to payment under Yamada Performance
Share Plan which is recorded in this quarter.

Does this mean Minzhong's Q4 earnings wont look fantastic either?

[ValueBeliever]

http://info.sgx.com/webcoranncatth.nsf/V...C00352AD8/$file/YMD-Profit_guidance_4Q2012.pdf?openelement

The Board of Directors (the “Board”) of Yamada Green Resources Limited (the “Company” together with its subsidiaries the “Group”) wishes to inform the shareholders of the Company and potential investors that it expects the Company to record a loss for the three months ended 30 June 2012 (“4Q2012”) as compared with a profit for the corresponding three months ended 30 June 2011 (“4Q2011”). Nevertheless, the Company expects to remain profitable for the financial year ended 30 June 2012.
The Group is expected to report a loss for 4Q2012 mainly due to the following reasons:
- Loss from changes in fair value of biological assets;
- Lower gross profit from sales of self-cultivated fungi in this quarter; and
- Higher operating expenses due to payment under Yamada Performance
Share Plan which is recorded in this quarter.

Does this mean Minzhong's Q4 earnings wont look fantastic either?

When is SGX going to learnt. NEVER. I think the fact of the matter is that a world power china is NOT READY! Look at the below event:-

Quote " IOC MEDICAL COMMISSION CHAIRMAN ARNE LJUNGQVIST, SAYING:

"Should I have my suspicions I keep them for myself, myself first of all and take any action if so in order to find out whether something is wrong or not. You ask me specifically about this particular swimmer - I say no, I haven't personally any reason to other than applaud what has happened until I have further facts, if so."

China has vehemently rejected suggestions of doping.

China briefly dominated women's swimming in the 1990s but their reign ended as fast as it began, following a series of doping scandals which included seven positive tests at the 1994 Asian Games." UNquote.

The chinese has a saying - if the top of the structure is all bend and twisted, the bottom will be so.

Those who still want to buy Chinese shares, might as well donate your money to the needed cause!!

---

I may also add that the policy is geared towards attracting the rich to Singapore. And SGX and leaders in our country continue to need to lean on this group of people to support growth. Without chinese industrialist listing, an elite group of Sporean will not have high value work, it could be political Kyours!

So those ppl who are not careful with your money will continue panda to such favor!

[Nick]

Kim Eng has written a report titled 'Investing For The Future':

http://www.remisiers.org/cms_images/rese...108121.pdf

China Minzhong has surged 5.2% to 60.0 cents with over 21 million shares traded.

(Not Vested)

[wsreader]

For the second reason, "....Lower gross profit from sales of self-cultivated fungi in this quarter.....", we can watch the result for CMZ for the same quarter to see if it is an industry wide phenomenon or a company specific thingy.
The other reasons seems to be one off.

(Not Vested)

(edited)
Oh wait, I suddenly remember the curious case of the missing abalone from another s-chip, so on second thoughts, not sure if the first reason ".....Loss from changes in fair value of biological assets....."
is one off. How to tell if the biological assets were there in the first place?

[dzwm87]

Key takeaway from KE's latest report:
"Tianjin’s mushroom facilities yield about 34 tonnes per mu/year, compared to 3-4 tonnes per mu/year for open-field farming. Minzhong’s Tianjin factory currently employs 200 workers and produces 20 tonnes of mushrooms per day while its Shanghai factory produces 4 tonnes of mushrooms per day with 100 workers."

From its supplement ppt slides (pg 6):
"For example, a typical 100 mu of open-field farmland will require approx. 30-40 farmers for peak period harvesting, compared to just 10-20 production workers for industrialized farming of similar size."

This further confirms the overstated average salary cost. Tianjin farm is around 210 mu. If it currently employs 200 workers, this means 100 workers per 100 mu and "not just 10-20 of the similar size"

Probably this means that the numbers on the slides are based on a promotional gimmick -> not all workers in the industrialized farm are production workers.

[freedom]

receivable is higher than Q4 revenue, is there channel stuffing like what happened to shoes/sports clothing industries in China a few years ago?

I also feel that the capital structure of China Minzhong is a bit weird. The group has more than RMB 2 billion non-current asset, but correspondingly, non-current liabilities is very little. Why did the company take loans for capex and free up short term capital? That could help lower the short term bank loan, as well as more cash for liquidity, thus easier for the company to declare dividends.

[Musicwhiz]

Oh well GIC is in this one and a PE firm sold down, just like Temasek is in Olam which also suffered a sell-down. Hmmm....

The Straits Times
www.straitstimes.com
Published on Dec 08, 2012
Private equity fund sells stake in China Minzhong
Olympus Capital offloads 57.2 million shares

By jonathan kwok

A PRIVATE equity fund sold its entire 10.3 per cent stake in vegetable grower and processor China Minzhong Food Corp on Thursday.

The company announced that Olympus Capital Holdings Asia offloaded the 57.2 million China Minzhong shares to institutional funds and high net-worth investors at 80 cents per share.

The sale price is around the average level of China Minzhong stock traded over the past year. Bloomberg data shows that the average price was 79.9 cents.

Singapore Exchange filings show China Minzhong executive chairman Lin Guo Rong bought 125,000 of the shares, taking his direct and indirect interest to 6.37 per cent, while chief financial officer Siek Wei Ting picked up 188,000 units, lifting his direct and indirect holding to 5.49 per cent.

There were no other announcements made on increases to holdings of substantial shareholders.

This means the buyers of the rest of the stock each kept their stakes at below 5 per cent and so did not have to disclose their identity or their holdings.

Director Lee Edan Kietchai's indirect stake fell to zero after the sale. He is an executive officer of Olympus, which meant he had been deemed to have an indirect interest in its stake before it was sold off.

Olympus has been invested in China Minzhong since 2006, before the company's listing here in 2010.

"(Olympus) has been supportive of the group's developments over the past six years," said China Minzhong's statement. "However, given the closed end nature of private equity funds, it is a natural progression for private equity firms to liquidate their investments post-IPO (initial public offering) and return capital to their investors."

The firm said the transaction also helped alleviate the share overhang on the stock and brought in new institutional and high net-worth shareholders for its next phase of growth.

Mr Lin said the Olympus investment had been critical to the company establishing its Sichuan and Shanghai subsidiaries and in the ramping up of its champignon mushroom business.

Bloomberg data shows that China Minzhong's largest shareholder is the Government of Singapore Investment Corp, which owns 16.9 per cent through its investment vehicle Tetrad Ventures.

China Minzhong shares rose 3.5 cents or 4.7 per cent to 78.5 cents yesterday.

jonkwok@sph.com.sg

[Nick]

Olympus Leaf average cost of its China Minzhong shares was $0.28 so the latest sale at $0.80 is still pretty good profit. They earlier sold 40 million shares in May 2011 when it was trading > $1.40. A highly profitable investment for the pre-IPO funds !

Interesting to note that the Management added shares even though they are not controlling shareholders.

(Not Vested)

[mrEngineer]

It is typical for PE fund to sell as their investment horizon is 5 years and need to realise returns before fund closing.

[Ray168]

CHINA MINZHONG 2QFY13 PROFIT ROSE 23.6% TO RMB215.8 MILLION

 2QFY13 revenue increased 32.3% to RMB860.9 million, driven by better sales in both
Cultivation and Processed business segments.
 Gross margin remained stable at 36.5%.
 Net operating cash flow jumped from RMB10.4 million in 2QFY12 to RMB352.1 million in
2QFY13.
 Kicks start expansion plans for industrialized farming in Jiangsu province, PRC.

p.s. CMZ requested a Trading Halt today... Will it be positive surprice???