Steel trader Novo Group’s 3Q net loss widened to US$3.5 million from US$83,000 a year ago.
Revenue fell 32.7% to US$45.9 million, owing to a substantial drop in selling price amid poor market conditions in resources industry. Its trading segment accounted for 78.7% of total revenue.
It was also affected by the suspension of its subsidiary that operates a tinplate manufacturing plant. Gross profit margin decreased from 6.2% to 0.9% as tinplate manufacturing operations fetch a much higher gross profit margin than the rest of the business.
Operations of Novowell ETP in China remained suspended in 3Q. The property, plant and equipment of the subsidiary are worth US$58 million, while the carrying amount at the end of January was US$1.2 million. It has yet to resume its operations.
The group expects an improved performance going forward. It reckons that steel export from China will likely remain profitable amid growing international demands.
Its tinplate-manufacturing project is undergoing restructuring of its credit facilities to reduce fixed cost. The group plans to resume operations post-restructuring.
On Oct 5 last year, the executive chairman Zhu Jun completed acquisition of controlling interests in the company through his own company, Golden Star Group.
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Revenue fell 32.7% to US$45.9 million, owing to a substantial drop in selling price amid poor market conditions in resources industry. Its trading segment accounted for 78.7% of total revenue.
It was also affected by the suspension of its subsidiary that operates a tinplate manufacturing plant. Gross profit margin decreased from 6.2% to 0.9% as tinplate manufacturing operations fetch a much higher gross profit margin than the rest of the business.
Operations of Novowell ETP in China remained suspended in 3Q. The property, plant and equipment of the subsidiary are worth US$58 million, while the carrying amount at the end of January was US$1.2 million. It has yet to resume its operations.
The group expects an improved performance going forward. It reckons that steel export from China will likely remain profitable amid growing international demands.
Its tinplate-manufacturing project is undergoing restructuring of its credit facilities to reduce fixed cost. The group plans to resume operations post-restructuring.
On Oct 5 last year, the executive chairman Zhu Jun completed acquisition of controlling interests in the company through his own company, Golden Star Group.
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
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