ACHL.L Regulatory News (ACHL)

26 Oct 2005 08:58

Asian Citrus Holdings Ltd26 October 2005 26 October 2005 Asian Citrus Holdings Limited ("Asian Citrus" or "the Group") Signing of supplier contract with a local supermarket chain in China Asian Citrus, the largest orange plantation owner and operator in China, whichwas admitted to trading on AIM on 3 August 2005, announces its first contract tosupply oranges directly to the supermarket sector. On 15 October 2005, Lucky Team Biotech Development (Hepu) Ltd., a wholly-ownedsubsidiary of Asian Citrus, entered into a supplier contract with GuangxiYonghao Supermarket Company Limited ("Yonghao"), a local supermarket chain withmore than 20 outlets in the Guangxi Zhuang Autonomous Region of China. The Groupwill supply Yonghau with 5,000 tonnes of oranges for an initial period from 22October 2005 to 30 June 2006 (which represents approximately 5.2% of the Group'stotal production output for the year ended 30 June 2005). The estimated value ofthis supplier contract is approximately RMB25 million (or £1.75 million) (whichrepresents approximately 7.8% of the Group's turnover for the year ended 30 June2005). Tony Tong, Chairman and CEO, commented; "This move is significant for threereasons. Firstly, it is Asian Citrus' first move to directly supply oranges tosupermarket chains. Secondly, it is an expansion of the Group's business frompurely a "farmer supplier" to a "farmer plus wholesaler supplier", which, it isanticipated will help Asian Citrus achieve a higher profit margin. Finally, thismove represents a horizontal expansion of Asian Citrus's business to create anextra revenue stream. "We produced 96,977 tonnes of oranges for the year ended 30 June 2005. Thesigning of the supplier contract with Yonghao represents a milestone for AsianCitrus to diversify its business into the wholesale arena and underlinesmanagement's commitment to enhance profitability by horizontally expanding thebusiness." About Asian Citrus Holdings Limited Asian Citrus Holdings Limited is the largest orange plantation owner andoperator in China and has two plantations in the Hepu county of the GuangxiZhuang Autonomous Region and the Xinfeng county of the Jiangxi province of China. Its primary goal is to sell quality oranges at an affordable price and inso doing, strengthen its position as a leading, mechanised and industrialisedorange grower and distributor in China. For Further Information Contact: Terry Garrett/ John Moriarty/Helen ThomasWeber Shandwick Square Mile 0207 067 0700 This information is provided by RNS The company news service from the London Stock Exchange