Huiyuan Juice Group said at a press conference in Hong Kong that its net profit had decreased by 7.2% to CNY367.34 million in the first half of 2008.
According the Huiyuan's half year report, by the end of June 2008, its total sales had decreased by 5.2% year-on-year to CNY1.29 billion and its gross profit had decreased from 36.9% in the same period of 2007 to 30.2%. The company said that it was affected by the severe snowstorms and the earthquake in Sichuan during the first half of 2008, and that the sales of its pure juices and nectars, which accounted for 58% of its total sales, decreased by 6% and 15% respectively. At the same time, Huiyuan's performance was also pressured by the growth of costs, which increased by 4.8% to CNY903 million.
However, Huiyuan Juice said that it maintained its leading position in China's fruit juice beverage market with a 43.8% share in the pure juice market and 42.4% share in the nectars market, according to statistics from the marketing research company AC Nielsen.
At the same time, Wu Yuqiang, CFO of Huiyuan Juice, said that Coca Cola's proposed acquisition of Huiyuan had been referred to the relevant departments for approval.
Coca Cola has offered to acquire Huiyuan Juice for HKD17.92 billion. If the transaction is completed, Huiyuan will become a wholly-owned subsidiary of Coca Cola and Huiyuan Juice chairman Zhu Xinli has agreed to be honorary chairman of the group following completion of Coca Cola's takeover.
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