Food preservatives supplier Sorbic International says that margins in the year to September 2014 have been hit by the fluctuating selling price of potassium sorbate.
Revenues of the operating subsidiary were slightly lower at £14.3m and profit fall more sharply because of the decline in operating margin from 13% to 10%.
Sorbic is in discussions about starting the process of repayment of loan notes. The legal representative had previously been reluctant to allow cash to be moved out of China. The loan notes are worth £2.69m and there is a 20% redemption premium so the total cost will be £3.23m. The redemption date is 31 December 2014. There was around £7m in cash at the end of September 2014.
The share price fell 0.38p to 4.75p, which values Sorbic at £2.65m. Sorbic is still trying to gain compensation for the Inner Mongolia plant which it was unable to complete.
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