Capital equipment manufacturer China Wonder is buying a 50% stake in Jinzhou Wonder Packing Carton Co for £171,000.
JWPC designs and manufactures cartons, labels and wooden pallets. It is the largest manufacture of these products in the Jinzhou region of China. The investment will enable the business to increase capacity. The business reported a profit of £6 – yes six pounds – in 2008. The company’s net assets were £232,000 at the end of 2008.
At 8p a share, China Wonder is valued at £1.44m.
Interim revenues increased from £1.74m to £2.11m in the six months to June 2009. Higher admin expenses meant that the pre-tax profit from £254,000 to £220,000. There was a second half loss in 2008.
Net assets were £3.57m at the end of June 2009. Excluding intangibles, the NAV was still £2.13m. Net cash was £840,000 after a strong period of cash generation in the first half of 2009.
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