Asia Bio-Chem Group Corp. Announces 2012 Fourth Quarter and Fiscal Year End Financial Results

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[{"type":"text","content":"\n\n\n\n\n\nTORONTO, March 28, 2013 /CNW/ - Asia Bio-Chem Group Corp. (TSX: ABC)\n (\"Asia Bio-Chem\" or the \"Company\") announces its financial results for\n the three-month and fiscal year ending December 31, 2012.\n\n\nHighlights\n\n\n\n\nLower products' prices coupled with high corn costs caused gross margin\n to decline to negative 13.0% during the fourth quarter compared with\n 3.3% during the same period in 2011.\n\n\n\n\n\nIn response to negative gross margins, the Company adjusted production\n volume to 63,300 tonnes during the quarter representing 30% of\n capacity.\n\n\n\n\n\nNegative gross margin resulted in a net loss of $14.4 million (-$0.17\n per share) compared with $5.8 million net loss (-$0.07 per share)\n during the fourth quarter of 2011.\n\n\n\n\n\nDuring the fourth quarter, the company increased its total borrowings by\n $15.1 million to $123.2 million at December 31, 2012.\n\n\n\n\n\nThe Company continues to enjoy the strong support of its banking group. \n Since the end of the fourth quarter, the Company has successfully\n renewed two of its short term credit facilities and secured a new short\n term credit facility in the amount of $6.3 million (RMB 40 million).\n\n\n\n\n\nThe Company maintains unrestricted cash balance of $5.0 million at\n December 31, 2012.\n\n\n\n\n\nOn December 22, 2012, the Company entered into a binding agreement to\n acquire 100% of interest in Tieling Wanshunda Starch Company Ltd.\n (\"Tieling\"), a wholly foreign owned enterprise under the laws of the\n PRC.  On January 1, 2013, the Company closed the acquisition for an\n aggregate purchase price of RMB 280 million, RMB 250 million in the\n form of overdue accounts receivable of Asia Bio-Chem, and RMB 30\n million of note payable due 12 months after the completion of all title\n changes and filing approval with the local government in the PRC.\n Tieling is a corn processing plant located in the city of Tieling in\n Liaoning Province of PRC, it has the capacity to process approximately\n 600,000 tonnes of corn per year.  The Company's main reasons for\n completing this acquisition are to acquire additional corn processing\n plant capacity, to ultimately control a larger share of the corn\n processing market in Northern China, to obtain the corn processing and\n sweetener processing licenses held by Tieling, to eli...

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