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Monday, 26 June 2017, 13:33 HKT/SGT
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Source: Great Harvest Maeta Group Holdings Limited
Great Harvest Announces FY2017 Annual Results
Develop Business Diversity; Maintain Steady Operation

HONG KONG, June 26, 2017 - (ACN Newswire) - Great Harvest Maeta Group Holdings Limited ("Great Harvest", the "Company"; stock code: 3683.HK) announces its annual results for the year ended 31 March 2017 ("FY2017").

Following the depressed market condition of the previous year, the market condition continued being depressed in the dry bulk marine transportation industry, the freight rate has long been fluctuated and hovered a low levels in 2016. The freight market of panamax vessels did not further increase until the fourth quarter of 2016 and after the Spring Festival of 2017 when there was increase in seasonal demand for marine transportation of bulk grains. Within the year under review, the average Baltic Dry Index for panamax vessels was 858 points, rising by 216 points as compared to the corresponding period of 2016. The corresponding average daily charter rate was US$6,867, which represented an increase of US$1,737 as compared to the corresponding period of 2016. Although with an overall increasing tendency, the contradiction of demand-supply imbalance of vessels remained unresolved. The increase in demand for marine transportation is smaller than the growth in the carrying capacities of dry bulk fleet. The freight rate for spot market continued to be under pressure because of the oversupply of vessels. There was only 1% growth in the demand for marine transportation of dry bulk cargoes in 2016 globally, but there was a larger substantial growth in China's import volume of dry bulk cargo, of which the import volume of iron ore and coal exceeded 1 billion tons and 0.2 billion tons, representing an annual growth of approximately 7% and 23%, respectively. The price for various types of second-hand dry bulk vessels saw a larger rebound as well. It is expected that the import volume growth of the dry bulk cargoes in China will still be able to maintain, which would be a drive to the stability and rebound of the spot freight rate. We hope the increase in vessel price will give an impetus to the further rebound of the freight market, and will eventually improve the supply and demand dynamics of the spot freight market.

For the year ended 31 March 2017, the Company's fleet size is 319,923 dwt, including four panamax dry bulk vessels, namely GH FORTUNE, GH POWER, GH GLORY and GH HARMONY. The average age of the Company's fleet is 11 years with the fleet charter-out percentage at approximately 96.69%.

For the year ended 31 March 2017, the revenue of the Group decrease from approximately US$9.1million to approximately US$8.1million, representing a decrease of 11.4%. This was mainly attributable to the decrease in voyage charter income and dry docking maintenance of two vessels during the year. The average Daily TCE of the Group's fleet increased from approximately US$4,967 for the year ended 31 March 2016 to approximately US$5,554 for the year ended 31 March 2017, which represented an increase of approximately 11.8% as compared to last year. The Group recorded gross loss of approximately US$0.8 million for the year ended 31 March 2017 as compared with gross loss of approximately US$5.9 million for the year ended 31 March 2016, representing a difference of approximately US$5.1 million, while the gross loss margin improved from approximately 64.2% for the year ended 31 March 2016 to approximately 9.5% for the year ended 31 March 2017. The improvement in gross loss margin of the Group was mainly attributable to the slight improvement in average Daily TCE of the Group's fleet, the decrease in depreciation after impairment of vessels recognized and reduce in bunker cost.

Mr. Yan Kim Po, The Chairman of Great Harvest Maeta Group Holdings Limited said, 'The dry bulk marine transportation industry recorded a slow growth in the FY2017, and it is still suffering from the unresolved contradiction of demand-supply imbalance of vessels. The Group's fleet achieved a record of safe operation with zero adverse incident, and all vessels were operating in the spot market this year and maintained a high operational level with an occupancy rate of 96.69%. Moreover, all freight and rental were basically received with no receivable of significant amount. The Group was able to exert stringent control over costs and expenses in the course of vessel management and strived to minimise voyage expenses to maintain the management expenses of vessels within budget.'

Moreover, the Group also acquired two parcels of land at Haikou, Hainan Province on 10th May 2016. According to the preliminary development proposal of the Lands, the development of the Lands will comprise (i) a trading centre and exhibition facilities for trading in tree seedlings and other nursery stocks; (ii) services apartments; and (iii) office, retail, car parking and other ancillary facilities.

The PRC's flower and plant market had grown substantially in the past five years. Moreover, according to the 12th-five-year plan of the PRC government, Hongqi Town, where the Land is located, is regarded as one of the national core development towns of the PRC with a view to developing Hongqi Town into a key tourist spot within the region. Based on the available information, the latest development plan of Hongqi Town will comprise of, among other things, a hi-technology business zone for plantation of tropical flowers and tree saplings, a floral exhibition theme park, and areas for hotel and conference facilities. We do believe that the acquisition not only diversifies the Group's business and increase the Group's income streams, but also brings a long term and stable income to improve the Group's financial performance.

Looking forward, Mr. Yan concludes that, 'The spot freight rate in this year will be higher than those of last year, especially China's iron, coal and dry bulk food, and it is going to bring positive influence to the market. The Group will maintain its prudent operating strategies by enhancing the daily management of vessels, providing better transportation services to customers and seeking for more reputable and reliable charterers at higher rates, thus generating more operational revenue for the Group. Meanwhile, the Group will strictly control operating costs and reduce all unnecessary expenses. The Group will also continue to identify new development opportunities and/or expand its scope of business and diversify its income streams by expanding more operations other than the shipping business.'

Great Harvest Maeta Group Holdings Limited
Great Harvest Maeta Group Holdings Limited (the "Company") and its subsidiaries (together, the "Group") are principally engaged in chartering of dry bulk vessels and property investment and development. For the year ended 31 March 2017, the Company's fleet size is 319,923 dwt, including four panamax dry bulk vessels, namely GH FORTUNE, GH POWER, GH GLORY and GH HARMONY. The average age of the Company's fleet is 11 years with the fleet charter-out percentage at approximately 96.69%.


Topic: Press release summary
Sectors: Daily Finance, Daily News
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