China's leading dairy group Mengniu has published a report, stating that according to the unaudited management accounts as of November 30, 2008 and other relevant documents, the group might see a CNY900 million loss in the year 2008.
The group said the great losses were mainly due to the melamine scandal. It brought negative effect to the performance of the group, especially to its sales. Extra costs caused by original milk handling and products promotion also contributed to the losses.
Because the group has not computed its performance statistics for the entire year, the report is just an initial estimation by its board of directors based on the current documents. The estimated result is not the final result made by Mengniu's auditors.
The international investment firm Morgan Stanley previously predicted that Mengniu might lose CNY888 million in 2008, including those caused by products recalls and destructions, while another Chinese dairy giant Yili might lose CNY2.3 billion.