Christis: Six-month results 2004 – Expects improvement in final results
10/8/2004 10:22
The turnover of the Group for the first half of 2004 stood at £11,229.209 compared to £11,682.754 in the corresponding period of 2003 (-3.9%).
The drop in the turnover is mostly attributable to the drop in exports since the local sales remained at the same levels as the corresponding period of 2003. For the past few months before May 1, 2004, customers from the European countries did not proceed to purchases, anticipating the abolition of the import duties after that date.
The increase in the price of fresh milk and the special conditions in the transitional period of March and April 2004 were the major reasons that led to the drop in sales and the rate of gross profit. The Company has showed losses before taxation of £120,920 against a profit before taxation of £257,602.
From April 1, 2004, the Company buys fresh milk in a significantly higher price, which led to the increase in the production cost.
The Company was unable to readjust the sale price of cheese-dairy products to its customers abroad, due to a commitment in certain orders. Also in April 2004, the Cyprus Dairy Industry Organization decided not to subsidize the exports and the Company has lost significant revenues.
PROSPECTS FOR THE SECOND HALF
The prices of the Company’s products in the Cyprus market increased from June 1, 2004 and were adjusted to the new cost data. The Company is also promoting a new tariff on its exports and expects to have an additional profit from the subsidies from exports to third countries.
These will contribute to the increase in the rate of gross profit for the second half of 2004 and together with the effort to reduce the operating expenses, the Company is expected to show profit in 2004.
The drop in the turnover is mostly attributable to the drop in exports since the local sales remained at the same levels as the corresponding period of 2003. For the past few months before May 1, 2004, customers from the European countries did not proceed to purchases, anticipating the abolition of the import duties after that date.
The increase in the price of fresh milk and the special conditions in the transitional period of March and April 2004 were the major reasons that led to the drop in sales and the rate of gross profit. The Company has showed losses before taxation of £120,920 against a profit before taxation of £257,602.
From April 1, 2004, the Company buys fresh milk in a significantly higher price, which led to the increase in the production cost.
The Company was unable to readjust the sale price of cheese-dairy products to its customers abroad, due to a commitment in certain orders. Also in April 2004, the Cyprus Dairy Industry Organization decided not to subsidize the exports and the Company has lost significant revenues.
PROSPECTS FOR THE SECOND HALF
The prices of the Company’s products in the Cyprus market increased from June 1, 2004 and were adjusted to the new cost data. The Company is also promoting a new tariff on its exports and expects to have an additional profit from the subsidies from exports to third countries.
These will contribute to the increase in the rate of gross profit for the second half of 2004 and together with the effort to reduce the operating expenses, the Company is expected to show profit in 2004.
