Investors continue their rollercoaster ride with leading Chinese seafood firm Zoneco (Zhangzidao) after the firm flagged big losses for the first quarter of 2019.
After a record rally this spring, the share price of the Dalian-based firm has slumped after it projecting losses of CNY 40 million to 45 million (USD 6 million to 6.7 million, EUR 5.3 million to 6 million). That’s up significantly on the CNY 8.9 million (USD 1.3 million, EUR 1.2 million) loss booked by the firm in the same period last year.
The company’s share price rose from CNY 3.30 (USD 0.49, EUR 0.44) on 1 February to CNY 5.64 (USD 0.84, EUR 0.75) on 13 March – a rise of 70.9 percent and a 16-month high, but have slipped back to CNY 4.70 (USD 0.70, EUR 0.62) as of 8 April compared to CNY 4.18 (USD 0.62, EUR 0.55) on the same day in 2018.
Zoneco shocked investors in 2014 with a full-year loss of CNY 1.2 billion (USD 178.6 million, EUR 158.5 million), attributed to losses of scallop stocks in the northern part of the East China Sea.
That catastrophic loss jolted the faith of investors in the entire Chinese aquaculture sector, but according to the company’s filings, Zoneco gets only 17.8 percent of its revenues from aquaculture, as opposed to 39.4 percent from processing and 40.7 percent from its trading and distribution business.
Company revenues have risen from CNY 2.72 billion (USD 404.8 million, EUR 359.2 million) in 2015 to CNY 3.05 billion (USD 453.9 million, EUR 403 million) in 2016 and CNY 3.20 billion (USD, EUR 422.5 million) in 2017. Exports and overseas business accounted for 52.4 percent of the company’s CNY 1.41 billion (USD 209.8 million, EUR 186.3 million) in revenues booked in the first half of 2018.
