The Company was incorporated in Western Australia on 6 May 2016 as the vehicle for listing on the ASX of the business carried out by the Chinese subsidiary company Guangdong Tianmei Selenium-Rich Beverage Chain Co. Ltd.
The operating company is Guangdong Tianmei Selenium-Rich Beverage Chain Co. Ltd ("Tianmei China").
In order to IPO on the ASX, a Group restructure, commenced in August 2015 and completed in February 2016, resulted in:
- The establishment of Tianmei International Beverage Co., Ltd. in BVI;
- The establishment of Hong Kong Tianmei International Holdings Co., Ltd (Tianmei HK) by Tianmei BVI;
- The establishment of Shenzhen Tianmei Selenium Enrichment Informational Consulting Co., Ltd (Tianmei Shenzhen) by Tianmei HK; and
- The acquisition of Tianmei China by Tianmei Shenzhen.
This restructuring constitutes a business combination under common control and, therefore, this financial report has been prepared as a continuation of Tianmei China and the financial report includes the half year of operating activities of Tianmei China from 1 December 2016 to 31 May 2017 and the comparatives represent the activities for the half year 1 December 2015 to 31 May 2016.
Commentary on half-year results
Through this report, the board of directors seeks to provide information to its shareholders and the market on the results achieved for the half year ended 31 May 2017.
The Group realized an after-tax profit from continuing operations of $18.9 million for the financial half year ended 31 May 2017 which represented an increase of 416% compared to the half year ended 31 May 2016.
The Group's cash and cash equivalents reserves as at 31 May 2017 were $40.97 million.
Corporate result summary
The Group is engaged in the distribution and promotion of fast moving consumer goods, such as food, beverages and other grocery items in Guangdong province of China.
Tianmei also promotes and distributes its own brand of drinking water products in China. For the reporting period, the Group, through its wholly owned China-based subsidiaries, achieved the following:
- On 23 February 2017 Guangdong Tianmei Selenium-Rich Beverage Chain Co., Ltd, a subsidiary of Tianmei Beverage Group Corporation Limited, acquired 100% of the ordinary shares of Chenzhou Qianlifeng Beverage Co., Ltd ("Qianlifeng") for a total consideration transferred of RMB5,000,000. Qianlifeng has the ownership and control of a water processing plant in Hunan Province, China. The water plant is adjacent to the Yinshan Longwu Water Spring, an area renowned for producing quality drinking water.
- On 11 May 2017 the Group announced the expansion of Qianlifeng to meet increasing demand for Tianmei's bottled drinking water. The expansion will involve constructing a new water plant at a new site which is in close proximity to the existing plant.
- The Group's gross margin increased by 7.81% compared to that of the half year ended 31 May 2016, primarily driven by the increased margins on Tianmei branded water products and the sales through contracted stores.
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About Tianmei Beverage Group Corporation Limited
Tianmei Beverage Group Corporation Limited (ASX:TB8) provides promotional services to producers of FMCG goods as well as its own water products in the Guangdong province in China. Guangdong province is one of China's most developed provinces with a gross domestic product of US$1.1 trillion in 2014 and has as its capital, Guangzhou city, which is China's third largest city with a population of approximately 13 million people.
Tianmei have contracts with over 940 terminal supermarkets and convenience stores in Guangdong. Through this network of stores, the Company promotes fast moving consumer goods, including food, beverage and general grocery products for over 65 FMCG suppliers.
The Company's water products business focuses on the sale of Tianmei-branded water products, including bottled water, infant water and water dispensers through a network of over 500 retail outlets. The Company have a number of patents approved and pending surrounding it's water products and production equipment.
Tianmei Beverage Group Corporation Limited