Asian Citrus Holding squeezed in orange output

Asian Citrus Holding shares were down three per cent after the orange plantation operator projected rotten half year results.

The company expects to record a decrease in core net profit for the six months to December 31st, following a squeeze on winter orange production, according to a trading update Tuesday.

The group was hit by a 26.9% decrease of output from its Hepu plantation in Guangxi, an autonomous region of southern China, during the period.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

Poor weather conditions and heavy rainfall in 2012 meant the company consumed a higher volume of fertilisers.

Results were also impacted by high labour costs following general wage inflation in the People's Republic of China.

The firm's tropical fruit juice business Beihai Perfuming Garden Juice Company, was slammed by lower average selling price of its pineapple juice concentrates as a result of the destocking by Thai and Philippine producers.

Asian Citrus said it was "too early in the financial year" to judge its full-year performance but it will reflect the price achieved for the group's summer orange crop, the selling price of pineapple juice concentrates and the impact of weather on the volume of fertilisers and pesticides used by the group.

The group cultivates and sells Navel, Hamlin, Pineapple and Hong Jiang and Valencia oranges to supermarket chains, corporate customers, wholesalers and sole proprietors in China.

RD