Chai-Na-Ta Corp. Reports 2005 Second Quarter Results.RICHMOND, British Columbia This page is for the city of Richmond, British Columbia. For the federal electoral district in this locality see Richmond (electoral district); for the provincial electoral district see Richmond (provincial electoral district). -- (all amounts are in Canadian dollars) Chai-Na-Ta Corp. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :CC)(OTCBB OTCBB See OTC Bulletin Board (OTCBB). :CCCFF), the world's largest producer of North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. ginseng ginseng (jĭn`sĕng), common name for the Araliaceae, a family of tropical herbs, shrubs, and trees that are often prickly and sometimes grow as climbing forms. , today announced a second quarter 2005 net loss of $1.3 million, or $0.05 per basic share, compared to a net loss of $18,000, or $0.00 per basic share, in the quarter ended June 30, 2004. Revenue decreased to $278,000 in the second quarter of 2005 from $1.4 million in the same period last year. "While ginseng root prices remain volatile, Chai-Na-Ta realized an average selling price The average sales price of goods or commodities. Especially used in the retail sector and technology distribution. of $13 per pound in the first six months of 2005, a decrease of 48% over the average price for the same period last year," said William Zen, Chairman and Chief Executive Officer. "Ginseng buyers remain cautious to buy root, we have committed sales with moderate price reductions in order to stimulate higher sales in the final six months of 2005." The Company took a $1.1 million write-down on inventory in the 2005 second quarter to reduce the carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. to its estimated net realizable value Net realizable value (NRV) is a commonly used method of evaluating an asset's worth in the field of inventory accounting. NRV is part of GAAP rules that apply to valuing inventory, so as to not overstate or understate the value of inventory goods. . Selling, general and administrative expenses improved to $0.4 million in the 2005 second quarter, compared to $0.5 million in the quarter ended June 30, 2004. In the six months ended June 30, 2005, revenue declined to $0.4 million from $3.7 million in the first half of 2004. Net loss in the first half of 2005 was $1.7 million, or $0.07 per basic share, compared to net earnings of $0.5 million, or $0.02 per basic share in the first half of 2004. The cash used in operations was $1.3 million for the six months ended June 30, 2005 compared to a cash surplus from operations of $0.7 million in the same period of 2004. "The decline in cash from operations was due primarily to lower revenue in the first half of this year compared to the same period a year ago. However, with our good banking relationship and the solid financial support of our principal shareholder, we believe that our ability to generate sufficient amounts of cash, both for the short term and the long term, remains essentially the same as it was on December 31, 2004," said Mr. Zen. Chai-Na-Ta Corp., based in Richmond, British Columbia, is the world's largest supplier of North American ginseng. The Company farms, processes and distributes North American ginseng as bulk root, and supplies processed material for the manufacturing of value-added ginseng-based products. This news release contains forward-looking statements that reflect the Company's expectations regarding future events. These forward-looking statements involve risks and uncertainties, and actual events could differ materially from those projected. Such risks and uncertainties include, but are not limited to, the success of the Company's ongoing research programs, general business conditions, and other risks as outlined in the Company's periodic filings, Annual Report, and Form 20-F. |
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