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DaChan Food Continues to Achieve Sustainable Growth for Its Principal Businesses

Hong Kong, 27 October 2011 – DaChan Food (Asia) Limited (“DaChan Food” or the “Company”, SEHK stock code: 3999), China’s leading supplier of chicken meat products, today announced its results for the nine months ended 30 September 2011. In the first nine months of 2011 , the prices of pork and other livestock meat continued to rise as a result of inflationary pressure, while the rise in incomes nationwide has fueled the demand for animal protein products and feeds. Together with the Company’s effort in strengthening its cost control and enhancing its product mix to improve operational efficiency, the Company achieved sustainable growth in its three core business segments, namely chicken meat, feeds to external customers and processed food. Revenue and gross profit also saw significant increases.
During the period under review, DaChan Food’s turnover increased by 16% to approximately RMB8.06 billion compared with the same period last year. Gross profit rose significantly by 45% year-on-year to approximately RMB620 million, and gross profit margin increased to 8 %. Meanwhile, profit attributable to the equity shareholders of the Company surged by 25 3 % year-on-year to approximately RMB140 million.
Building on the Company’s vertically-integrated business model, which spans animal nutrition to ready-to-eat food, as well as on the success of its strategy to invest in and expand its processed food business, the Company’s operating performance and profitability maintained steady growth in the third quarter this year. Furthermore, with growing concerns among Chinese consumers over food safety, the Company’s products under its “Sisters’ Kitchen” brand and its product tracing system have been gained wide recognition in the market. Supported by its vertically-integrated business model, DaChan Food strives to ensure that all its products are safe and of high quality; its success in this endeavor has established Dachan Food to become the preferred choice of safety-guaranteed brands among consumers. To reinforce customer loyalty, DaChan Food has introduced its second-generation safety code. The new code not only allows customers to access information pertaining to feed sources, the locations of farms, food processing plants and test results, but it also includes photographs of farmers who produce the livestock. With growing concerns over food safety, the Company’s new product tracing system provides a solid foundation for the long-term development of its processed foods business segment.

Mr. Han Jia-Hwan, the Chairman of the Board of DaChan Food said, “In the first nine months of 2011, DaChan Food achieved satisfactory operational and financial results due to the improved operation environment and optimized operations. We will continue to strengthen our brand reputation as a provider of safe, high-quality food. Furthermore, we will expand e r operations in different retail and supermarket channels in order to enhance our brand reputation. At the same time, we will step up our efforts in research and development and focus on high value-added products so as to solidify our leading position in the market.”


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