During 2008, the Group derived management services income of approximately HK$8,287,000 (2007: approximately HK$7,467,000) from its agro-conservation segment. This income was lower than the minimum guaranteed income at the time of the acquisition and the guarantors are liable to pay the Group HK$70,000,000. This will essentially result in a reduction of the acquisition cost for that company. The bioenergy sector generated revenue of approximately HK$45,833,000 (2007: Nil) from sapling sales.
The agro-conservation and bioenergy sectors also contributed biological asset gains of approximately HK$77,802,000 (2007: approximately HK$11,255,000) and operating profits of approximately HK$15,841,000 before impairments (2007: approximately HK$3,023,000).
Although the Group generated a higher turnover for 2008, the overall loss from continuing operations amounted to approximately HK$198,052,000 (2007: approximately HK$41,972,000), primarily as a result of the impairment of goodwill in respect of the acquisitions of the licorice and salix subsidiaries amounting to HK$74,039,000 and of intangible assets of HK$145,823,000. Loss per share from continuing operations was approximately HK115 cents (2007: approximately HK47 cents). The Company did not declare a final dividend.
Mr Tse Michael Nam, Chairman of the Green Global Resources, said: “Through our engagement in green businesses, we seek to satisfy a portion of the world’s increased demand for renewable energy resources and the social goals of sustainability and land management. Our unique public-private partnership model is key to our success and we are pleased to report that our network of partnerships expanded further in 2008 with the signing of several cooperation agreements.”
The primary efforts of the Group’s agro-conservation activities centre on the cultivation of licorice and salix in Inner Mongolia. Both plants are valuable for their anti-desertification properties and extensive range of commercial uses. Every year, China loses over one million acres of arable land to desertification and the country now suffers from a shortfall of 30 billion cubic metres of water for irrigation. This has prompted the Chinese government to encourage private sector anti-desertification projects in Inner Mongolia, one of the driest locations on earth.
The Group’s partner in Inner Mongolia, 內蒙古天蘭科技治沙產業有限公司 (“Tian Lan”), has entered into an agreement with the Municipal Government of Hang Jin Qi (杭錦旗) for the cultivation of licorice and salix under a 5532 Project. The Group has collaborated with the Academy of Forest Inventory and Planning for the overall project design.
During 2008, the Group’s agro-conservation operations completed the planting of 50,000 Chinese mu (~3,300 hectares) of licorice (9 months in 2007: 8,000 Chinese mu (~530 hectares)) bringing the total cultivated area to 58,000 Chinese mu (~3,830 hectares) in Inner Mongolia. It also planted 180,000 Chinese mu (~12,000 hectares) of salix (2007: 200,000 Chinese mu (~13,300 hectares)), bringing the total cultivated area to 380,000 Chinese mu (~25,300 hectares).
The Group’s Jatropha curcas-based bioenergy business includes operations in Hainan and Laos. The Hainan operation completed the plantation of Jatropha nurseries covering an area of 625 Chinese mu (~42 hectares) in 2008 (2007: 150 Chinese mu (~10 hectares)). The saplings had been transplanted and already commenced flowering and bearing fruits during the year.
The Laos operation completed four Jatropha nurseries in three provinces across the country, covering a total area of 825 Chinese mu (~55 hectares) in 2008 (2007: Nil). These nurseries produced over 14,000,000 saplings during the year which were sold to the local partner for transplantation. The young Jatropha trees have been growing well and are already flowering.
Mr Tse concluded: “In 2008 we established important foundations for our bioenergy businesses in Hainan and Laos. We intend to continue to expand our nurseries to ensure a stable and high quality supply of saplings for sale to and cultivation by our local partners. During the year, we also continued the expansion of our plantation of salix and licorice in Inner Mongolia, as we transition from harvesting wild to cultivated crops. We believe the world’s apparently insatiable appetite for petroleum or its replacements, coupled with increasing interest in environmentally friendly and renewable fuel resources, will ensure the long-term growth and sustainability of our business.”
The Group’s net asset value as at December 31, 2008 was approximately HK$332,001,000 (2007: HK$322,795,000). It held cash and bank balances of HK$93,754,000 (2007: HK$72,939,000). As at the year end, the current ratio was 2.53 (2007: 1.47) and gearing ratio was 0.20 (2007: 0.24).
Financial Highlights| Year ended December 31, | ||
| 2008 | 2007 | |
| HK$ '000 | HK$ '000 | |
| Turnover | 109,154 | 66,635 |
 Agro-conservation segment |
Nil | Nil |
| Bioenergy segment |
45,833 | Nil |
| Non-agricultural segment |
63,321 | 66,635 |
| Gross Profit | 9,429 | 12,398 |
| Loss from continuing operations | (198,052) | (41,972) |
| Loss attributable to equity holders of the Company | (197,906) | (37,679) |
| Basic loss per share from continuing operations | HK (114.61) cents | HK (47.46)cents |
| Biological asset gains | 77,802 | 11,255 |
| Agro-conservation segment |
36,930 | 7,690 |
| Bioenergy segment |
40,872 | 3,565 |
About Green Global Resources Limited
Green Global Resources Limited (HKEx: 61) focuses on and invests in agro-conservation and bioenergy businesses with a view to contributing to the world’s ecological needs and requirements for renewable and regenerative energy sources. It currently operates a spread of green businesses in Inner Mongolia, Hainan and Laos. The Company’s name epitomizes its focus and direction: “Green” emphasizes its dedication to environmental protection and conservation; “Global” reflects its commitment to actively engage in businesses in a variety of global locations; and “Resources” evidences its vision to be a leading producer of regenerative or renewable resources.
Background Information
Licorice is a kind of desert vegetation that is also an essential ingredient in many traditional Chinese medicines. The multiplex chemistry of licorice gives it a wide spectrum of properties, for use in a diverse range of food, candy, cosmetics and other health products. The licorice plant penetrates deep into the soil helping to prevent soil erosion.
Salix, or sand willow, is a low growing shrub which spreads widely across the ground. The interlacing roots of the salix plant protect the soil against erosion. Salix is a major raw material for fiber board and paper pulp making, and a biomass fuel for power plants.
Jatropha seeds contain a large concentration of oil with an ideal biodiesel profile. Once extracted, the oil can be used as fuel without further refining, making it an appealing option in the world’s quest for alternative and renewable fuels. Additionally, Jatropha is drought-resistant and can grow on marginal land, making it non-competitive with food crops for arable land.
Issued by : Through :
Green Global Resources Limited
t6.communications limited
Jenny Lee or Angus Ho
email: enquiry@t6pr.com
URL : http://www.t6pr.com