CHNS -3x Short China

 

TIDMCHNS 
 
RNS Number : 1123R 
China Shoto plc 
16 August 2010 
 

                                China Shoto plc 
 
                        ("China Shoto" or "the Company") 
 
                        Factory Closure & Trading Update 
 
China Shoto plc, a leading Chinese battery producer and the largest supplier of 
back-up battery to China's telecommunication operators makes the following 
trading statement. 
 
Factory closure of Yangzhou Zhenghe Power Supply Co. Ltd 
 
The Board of the Company announces the closure of the factory operated by the 
Yangzhou Zhenghe Power Supply Co. Ltd ("Yangzhou Zhenghe"), in which the Company 
has a 59% interest. The factory accounts for approximately 3% of total 
production capacity. Human resources have been redeployed to minimize the 
decrease in battery production capacity. The Board have voluntarily made this 
decision as part of wider cost control measures and also to fulfill the 
Company's commitments to energy conservation and emission reduction as a 
National Environmentally Friendly Enterprise. The Company acquired Yangzhou 
Zhenghe in 2006 for a total consideration of GBP216,000. Following the cessation 
of production, the Company intends to sell the factory. 
 
Current Trading 
 
Since the statement made at the Company's AGM, trading conditions have remained 
challenging. The effect of lower levels of investment in infrastructure by 
China's major telecoms operators has been felt across the battery manufacturing 
industry. Consequently the Board anticipates the results for the 6 months ended 
30 June to indicate a decline in revenue of approximately 11% and profitably of 
approximately 12% when compared against the same period in the previous 
financial year. The Board has implemented some successful cost control measures 
but has seen previously low taxation rates granted as a Foreign Investment 
Enterprise materially increase. The Company is actively seeking new markets for 
its products such as electric power, railways and electric bicycles. The Company 
also notes that in previous financial years, performance in the second half of 
the year has been betterthan that of the first six months. 
 
The Company expects to release its Interim Results for the period ended 30 June 
2010 by the end of September 2010. 
                                     -Ends- 
 
+-------------------------------+---------------------------------+ 
| For further information:      |                                 | 
+-------------------------------+---------------------------------+ 
| China Shoto plc               | Tel: +44 (0) 20 7242 2666 / +86 | 
| Yang Shanji, Executive        | 159 6108 0515                   | 
| Chairman                      | www.chinashoto.com              | 
|                               |                                 | 
+-------------------------------+---------------------------------+ 
| Seymour Pierce Limited        | Tel: +44 (0) 20 7107 8000       | 
| Stewart Dickson               | www.seymourpierce.com           | 
|                               |                                 | 
+-------------------------------+---------------------------------+ 
| Media enquiries:              |                                 | 
| Allan Piper/ Jiang Lei        | Tel: +44 (0) 20 7242 2666 /     | 
| lei@firstcitypr.com           | +852 2854 2666                  | 
|                               | www.firstcitypr.cn              | 
+-------------------------------+---------------------------------+ 
 
Forward looking statements 
 
This announcement includes statements that are, or may be deemed to be, "forward 
looking statements". These forward looking statements can be identified by the 
use of forward looking terminology, including, but not limited to, the terms 
"believes", "estimates", "anticipates", "expects", "may", "will", "would", 
"could" or "should" or, in each case, their negative or other variations or 
comparable terminology. These forward looking statements include matters that 
are not historical facts. 
 
By their nature, forward looking statements involve risks and uncertainties 
because they relate to events and depend on circumstances that may or may not 
occur in the future. Forward looking statements are not guarantees of future 
performance. The Company's actual results of operations, financial condition and 
liquidity may differ materially from the impression created by the forward 
looking statements contained in this announcement. In addition, even if the 
results of operations, financial condition, and liquidity are consistent with 
the forward looking statements contained in this announcement, those results or 
developments may not be indicative of results or developments in subsequent 
periods. Important factors that could cause these differences include, but are 
not limited to: changes in the competitive framework in which the Company 
operates and its ability to retain market share; the Company's ability to 
generate growth or profitable growth; the Company's ability to generate 
sufficient cash to service its debt; the Company's ability to control its 
capital expenditure and other costs; significant changes in exchange rates, 
interest rates and tax rates; significant technological and market changes; 
future business combinations or dispositions; and general local and global 
economic, political, business, and market conditions. In light of these risks, 
uncertainties and assumptions, the events described in the forward-looking 
statements in this announcement may not occur. 
 
Other than in accordance with their legal or regulatory obligations, the Company 
does not undertake any obligation to update or revise publicly any forward 
looking statement, whether as a result of new information, future events or 
otherwise. 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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