China-based capital equipment manufacturer Qihang Equipment Company Ltd fell into loss in the first half of 2013 as revenues slumped.
In the six months to June 2013, revenues were 56% lower at RMB52m and a profit of RMB1.5m was turned into a loss of RMB3.2m even though overheads were cut. On the positive side, there was cash generated from operations. Net debt was just over RMB177m.
Management admits that stocks of basic machinery are too high, but it will take some time to unwind the position. Sales of larger machines have held up well and there is potential export business.
At 6.38p a share, Qihang is valued at £3.7m.
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