Yamada Green Resources Limited
Annual Report 2015
CONTENTS
Corporate Profile
Our Products
04 Chairman's Statement 08 主席致辞
Financial Highlights
Operations Review
14 Board of Directors
16 Key Management Personnel
Group Structure
Corporate Information
PROFILE
'Revenue from our bamboo business increased to approximately RMB74.4 million in FY2015 from approximately RMB13.0 million in FY2014, representing more than fivefold increase.'
Yamada is a major grower, manufacturer and supplier of fresh and processed agricultural products in Fujian Province, the People's Republic of China ('PRC'). Our products consist of two major segments: self-cultivation segment and processed food segment. Yamada's self-cultivated products comprise of moso bamboo trees, bamboo shoots and shiitake mushroom. They are mainly sold as fresh produce to wholesalers of agricultural food products in the domestic markets. Our processed food products include processed mushrooms, processed vegetables, water-boiled bamboo shoots and konjac-based dietary fibre food products. They are sold in major cities in PRC through our well established network under our trademarked brands, such as '旺成食品', '研食坊' and '第七庄园', and are exported to overseas markets, mainly Japan, under our customers' brand names.
We also possess upstream resources with sawdust from our eucalyptus plantations which can be utilised for the production of synthetic logs used in the cultivation of shiitake mushrooms and the spring bamboo shoots from our bamboo plantations which can be supplied to our processed food business as raw material for our processed bamboo shoots.
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YAMADA GREEN RESOURCES LIMITED
Annual Report 2015
OUR PRODUCTSSelf-cultivated Shiitake Mushrooms
Most of our self-cultivated shiitake mushrooms are harvested and sold as fresh produce, while the remaining undergo further processing before being sold as dried products. They are sold mainly to wholesalers of agricultural food products in the PRC, who in turn sell our products to restaurants, supermarkets and retailers. The harvesting period is from October to April.
Self-cultivated Moso Bamboo Trees and Bamboo Shoots
We commenced harvesting of moso bamboo trees, winter bamboo shoots and spring bamboo shoots since FY2014. Currently, we own 115,992 mu of bamboo plantations in Fujian Province. The moso bamboo trees and bamboo shoots are sold to wholesalers in the PRC. Part of the spring bamboo shoots are supplied to our processed food business as raw material for our processed bamboo shoots.
Processed Food Products
Our processed food products are manufactured from various types of fresh vegetables and semi-processed food products purchased from our suppliers. We also produce konjac-based dietary fibre food products. They are distributed and sold to the PRC consumers mainly through local supermarket chains in major cities under our own brands, and to overseas markets, mainly Japan, under our customers' brand names.
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Annual Report 2015
NOURIShING GREATER OPPORTUNITIES ChAIRMAN'S STATEMENTCHEN QIuHAI
Executive Chairman and Chief Executive Officer
DEAR SHAREHOLDERS,
On behalf of the Board of Directors, it is my honour to present to you our Annual Report of Yamada Green Resources Limited ('Yamada') for the financial year ended 2015 ('FY2015').
The Group's revenue decreased by 17.6% from RMB611.4 million in the financial year ended 2014 ('FY2014') to RMB503.9 million in FY2015. The decrease was mainly due to the lower sales in the self-cultivation segment. Revenue from self- cultivation segment decreased from RMB419.3 million in FY2014 to RMB315.3 million in FY2015. In line with our strategy, we intend to diversify risk by reducing our reliant on shiitake mushroom business and expand into bamboo business segment. During the financial year, we produced and sold lesser shiitake mushroom as compared to FY2014 due to scaling back in our shiitake mushroom cultivation farmland. During the harvesting season, we operated 3,342 mu of shiitake mushroom cultivation farmland, a decrease from 5,134 mu in the previous year. As a result, sales from shiitake mushrooms decreased from RMB387.9 million, or 37.9% in FY2014 to RMB240.9 million in FY2015.
Since last financial year, our harvest from moso bamboo trees and bamboo shoots have yielded positive results. Moso bamboo trees are used in variety of applications such as building and renovation materials and in furniture, textile and paper and pulp industries. Bamboo shoots are also one of the most popular vegetables in the PRC due to their favourable taste and health benefits. During the FY2015, our harvesting period for bamboo plantation started from September 2014 to April 2015. We believe that the bamboo business will continue to generate stable income in future due to moso bamboo trees and bamboo shoots' higher resilience to fluctuating climatic conditions experienced in recent years in the PRC.
Our focus on growing our bamboo plantation holdings has resulted in a significant expansion of our moso bamboo plantations from 33,845 mu to 115,992 mu in FY2015. This resulted in more than five-fold increase in revenue from sales of moso bamboo trees and bamboo shoots, from RMB13.0 million in FY2014 to RMB74.4 million in FY2015.
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Annual Report 2015
'In terms of profitability, as we realise the benefits of an expansion of our bamboo holdings, we expect the higher profit margin from this bamboo business to continue to contribute positively to our overall Group results. Moreover, part of the spring bamboo shoots harvested from our bamboo plantations will continue to be supplied to our processed food business segment as raw materials used in the production of processed bamboo shoots.'
Sale from our processed food segment decreased approximately RMB3.5 million or 1.8% from RMB192.1 million in FY2014 to RMB188.6 million in FY2015. This was mainly due to the lower domestic sales of processed mushrooms as a result of increased supplies of processed mushrooms in the local market. In addition, we produced smaller quantities of the existing konjac-based dietary fibre food products subsequent to the changes in our production and sales strategy in the domestic market. In the near future, we are planning to launch new konjac-based convenience food products following our continuous effort in the research and development of them.
The Group's gross profit decreased by approximately RMB24.5 million or 16.7% from RMB146.9 million in FY2014 to RMB122.4 million in FY2015. However, our overall gross profit margin remained constant at 24.3% in FY2015 compared to 24.0% in FY2014.
Outlook and Strategy
As we enter into a new financial year, we believe our existing business strategy will continue to ripe good performance amid the slowdown in China economy. Our long-term strong customer relationship also set us apart from competitors to stay ahead. We are also confident that our products are well-positioned to leverage on the health-conscious middle and upper- income consumers with our healthy edible fungi and bamboo shoots products as well as existing konjac- based convenience food products. Additionally, we will enhance our own branded product positioning and extend the sales and distribution network in this business segment.
In terms of profitability, as we realise the benefits of an expansion of our bamboo holdings, we expect the higher profit margin from this bamboo business to continue to contribute positively to our overall Group results. Moreover, part of the spring bamboo shoots harvested from our bamboo plantations will continue to be supplied to our processed food business segment as raw materials used in the production of processed bamboo shoots.
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ChAIRMAN'S STATEMENTIn FY2016, we will commence harvesting moso bamboo trees from our newly-leased 67,000 mu of bamboo plantations in Jiangle. We will also commence operations in another newly-leased 15,147 mu of bamboo plantations in Pucheng. As such, the total yield of our moso bamboo trees and bamboo shoots will likely increase on a year-on-year basis.
In terms of our physical assets, we have almost completed the construction of our new processing plants in Tie Ling Economic and Technological Development Zone. In July 2015, our production lines of processed food products were relocated to the new processing plants from our premises in the Houyu Food Industry Zone. Consequently, the annual production capacity of our processed food products is slated to increase.
Fundamental market trends have not changed much. In fact, they continue to augur well for our business. Trends such as greater health consciousness among consumers and growing urbanisation create ripe opportunities and developing demand for our products.
Strategic acquisition
In September 2014, we announced a proposed acquisition of a 10-year lease of 67,000 mu of bamboo plantations from Jiangle Shanfeng Bamboo Co., Ltd for a consideration of RMB234.5 million. We commenced operating these plantations in November 2014. In June 2015, to further expand our bamboo plantations, we entered into a 10-year lease agreement with Pu Cheng County Min Pu Osmanthus Seedling Plants Cooperative to increase our bamboo plantations by 15,147 mu for a consideration of RMB48.5 million.
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Proposed dividend
In recognition of our valued shareholders' support, the Board has recommended a first and final tax- exempt dividend of RMB0.006 per ordinary share for FY2015 to be approved at the upcoming Annual General Meeting of the Company.
Strengthening our Capital Base
As we forge forward, executing our corporate growth strategy, we require a solid capital base. Towards that end, we have undertaken some fund raising activities during the financial year 2015. In August 2014, we completed a placement of 35 million new ordinary shares, raising a total fund of about S$5.7 million. Further to that, in September 2015, we successfully issued and allotted approximately
270.3 million new rights shares, raising a gross proceed of approximately S$18.9 million.
Conclusion
At this juncture, allow me to express my sincere appreciation to our directors, management and staff for their advice and effort over an eventful year. Let us continue to work together to bring forth the huge potential in our evolving Group. I would also like to thank our shareholders for keeping the faith. Together, we look forward to the future.
Chen Qiuhai
Executive Chairman and Chief Executive Officer.
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主席致辞
'我们有信心集团的的食用菌、竹笋以及魔芋膳食纤维 方便食品是健康意识较强的中高收入群体的主要食品选 项之一。此外，我们也会加强自身品牌产品定位，并 且，扩展主营业务的分销网络。'
尊敬的各位股东，
在此，我谨代表山田绿色资源有限公司 （以下简 称山田）董事会，向各位汇报截止2015年6月30日
（'2015财年'）的集团年报。
集团的营业额较2014财年下降17.6%，从2014财年 的6亿1140万人民币减少至2015财年的5亿390万人民 币。这主要是来自自种业务销售额的减少。自种业务 的销售额从2014财年的4亿1930万人民币减少至3亿 1530万人民币。根据集团策略，为了分散营业风险， 我们逐步扩展毛竹林业务来减少对香菇业务的依赖。 与2014财年相比，我们在2015财年的香菇种植地缩 小了，香菇的产量和销售额也随之减少。在2015财年 香菇收成期间，我们经营3,342亩香菇种植基地，而 2014财年则是5,134亩。因此，香菇的销售额从2014 财年的3亿8790万人民币减少至2015财年的2亿4090 万人民币（或下降37.9%）。
从上个财年起，我们的毛竹林业务取得了良好的业 绩。竹子的用途广泛，可用在建筑、材料、家具、纺 织和纸浆等行业。同时，竹笋因为其美味和保健的功 效，使它成为中国最受欢迎的使用蔬菜之一。在2015 财年，竹子和竹笋的收成期是从2014年9月至2015年 4月。竹林的收成受到显著气候变化的负面影响相对 较小，我们相信竹林业务在未来会继续成为集团稳定 的收入来源之一。
在2015财年，我们的毛竹林面积从33,845亩扩充至 115,992亩，竹子和竹笋的营业额从2014财年的1300 万增加至7440万，相当于增加了5倍以上。
食品加工业务的销售额从2014财年的1亿9210万人民 币减少至2015财年的1亿8860万人民币，共减少了 350万人民币（或下降1.8%）。这主要是由于国内市 场加工香菇供应量增加导致我们加工香菇的内销减少 了。此外，随着我们在国内市场的产品和销售策略的 调整，现有的魔芋膳食纤维食品产量也随之减少。经 过对魔芋产品不断的深入研发之后，我们计划在近期 推出以魔芋为主的新方便食品。
集团的毛利减少了2450万人民币（或下降了16.7%）， 从2014财年的1亿4690万人民币减少至2015财年的1 亿2240万人民币。然而，与2014财年相比，集团在 2015财年的整体毛利率仍维持在24.3%。
远景和战略 迈入新的财年，尽管中国经济有放缓趋势，我们相信 根据集团现有的经营战略能够在新的财年有所斩获。 凭借和客户的长期紧密合作关系也让我们在众多竞争 者中站稳脚步。我们有信心集团的的食用菌、竹笋以 及魔芋膳食纤维方便食品是健康意识较强的中高收入 群体的主要食品选项之一。此外，我们也会加强自身 品牌产品定位，并且，扩展主营业务的分销网络。
在2016财年，我们将开始从新租赁的67,000亩毛竹 林中收成竹子。同时，我们也会开始经营新租赁的 15,147亩毛竹林。因此，我们的毛竹和竹笋总产量也 会逐年增加。
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我们在铁岭经济技术开发区的新加工厂房基本已完成 建设。2015年7月，我们的食品加工生产线已从厚屿 食品工业园搬迁至新的加工厂房。这么一来，我们加 工食品的年产能也将会增加。
基本的市场趋势没有显著改变。随着日益增加的消费 者健康意识以及城镇化发展的趋势为集团带来源源不 断的商机。
战略收购 2014年9月，我们宣布计划和将乐山丰竹业有限公司 签订租赁67,000亩为期10年的协议，租金总额为2亿 3450万人民币。2014年11月，我们开始经营这些竹 林。2015年6月，我们进一步扩充了毛竹林，与浦城 闽浦桂花苗圃合作社签订了15,147亩毛竹林为期10年 的协议，租金总额为4850万人民币。
拟派股息 为了回馈我们股东支持，董事会将会在即将到来的股 东大会上提议2015财年拟派发每股免税股息0.006人 民币。
加强资本基础 随着集团的不断发展，为了实施公司的发展战略，我 们在2015财年，进行了一些融资活动。2014年8月， 我们完成增发35,000,000股普通新股，融资总额约为 570万新币。此外，2015年9月，我们成功配售和发行 和了270,333,587股普通新股，融资总额约为1890万 新币。
总结 我在此谨向我们的董事、管理层以及全体员工在这一 年中做出的贡献表示感谢，我们会继续共同努力，发 挥集团的无限潜力，让山田更上一层楼。同时，我也 要感谢股东对我们的支持，让我们一同展望未来。
陈秋海
执行主席兼首席执行官
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FINANCIAL hIGhLIGhTS(RMB'mil) | FY2011* | FY2012 | FY2013 | FY2014 | FY2015 |
Revenue | 216.3 | 553.3 | 509.2 | 611.4 | 503.9 |
Gross Profit | 90.2 | 208.3 | 113.2 | 146.9 | 122.4 |
Gross Profit Margin (%) | 41.7 | 37.6 | 22.2 | 24.0 | 24.3 |
Net Profit | 69.6 | 139.5 | 69.2 | 102.6 | 86.2 |
Net Profit Margin (%) | 32.2 | 25.2 | 13.6 | 16.8 | 17.1 |
REvENuE, GROSS PROFIT AND NET PROFIT
RMB'mil
600
500
400
553.3
509.2
611.4
503.9
300
200
100
216.3
90.2
69.6
208.3
139.5
113.2
69.2
146.9
102.6
122.4
86.2
0
FY2011*
FY2012
FY2013
FY2014 FY2015
Revenue Gross Profit Net Profit
* Refer to 6-month period from 1 January 2011 to 30 June 2011.
REvENuE BREAKDOWN FOR FY2015
26.3%
PRC
Japan
37.4%
Self-cultivation segment
Processed food segment
73.7%
62.6%
Geographical Segments Product Segments
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Annual Report 2015
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