Asia Distribution Solutions Ltd says that poor weather in China means its first quarter results are marginally below budget.
China had the worst snow fall for 50 years but the China-based food and drink distributor achieved an operating profit of £70,000 in the first quarter of 2008. The recent earthquake in China should “only impact modestly” on the full year figures.
ADSL has more than 2,000 on-trade and retail outlets in China. It mainly distributes branded products but it has its own label drinks. ADSL has revised the joint venture with the bottling plant that produces the own label drinks. The capital investment it has to put into the venture has been cut substantially. It will contribute $810,000 for 60% of the joint venture with Vitality Tianjin.
ADSL is waiting to complete the RMB7m (£520,000) acquisition of RunKe. The cash part of the consideration should be paid in June. It is also paying RMB2m (£146,000) for wine stock owned by Shi Xuan Trading (Shanghai ) Co Ltd. Shi Xuan will also promote ADSL products to its customer base.
The shares were unchanged at 17.5p – the bid/offer spread is 15p-20p.
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