Haike Chemical Group Regulatory News (HAIK)

HaiKe Chemical Group Ltd

Trading Update

HaiKe Chemical Group Ltd (the "Group"), the AIM quoted (AIM: HAIK) specialty chemical business based in Shandong Province, China, today issues a trading update on the Group's performance, ahead of announcing its half year results for the six month period ended 30 June 2015.

The Group's trading for the first half of 2015 was in line with the Board's expectations. The Group expects to report a profit for the period of CNY95,000 (H1 2014: loss of CNY361,000). For the six-month period ended 30 June 2015, total turnover decreased by 16.2% to CNY385.4 million (H1 2014: CNY460.0 million). The decrease was mainly attributable to price reductions for its principal products. A profit was recorded despite a planned shut down of one of the Group's principal production facilities in June for maintenance. 

As a result of a deteriorating operating environment in China the Group has, since the interim period end, been experiencing downward pressure on revenues and margins for its principal products, in particular DiMethyl Carbonate and Isopropyl Alcohol. As a result, the Directors believe the Group is at risk of not achieving a profit for the full year 2015.

China's difficult macro-economic conditions have made trading challenging for many specialty chemicals businesses in the country. The Group experienced a deterioration of performance in July and August, with both these months recording a loss.

The Board continues to focus on both cost control and product mix improvement, and is considering options to counteract recent economic and market developments in order to optimise performance.

A further announcement will be made in due course.

Indicative exchange rates as at 13 September 2015: £1: CNY 9.82

Source:www.oanda.com

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