The Group is mainly engaged in energy and natural resources (including precious metals) related projects, provision of loan financing and investment and management consultation services in the PRC and provision of advising on securities and securities dealing and brokerage services in Hong Kong.
The Group's loss attributable to shareholders for the 6 months ended 30-09-2019 amounted to HKD 0.81 million. Basic loss per share was HKD 0.0005. No dividend declared. Turnover amounted to HKD 16.73 million, an increase of 11.5% over the same period last year. (Announcement Date: 28 Nov 2019)
Business Review - For the six months ended September 30, 2019
Investment in energy and natural resources (including precious metals) related projects
a. The Aohan Qi Mine
The Group maintains the Aohan Qi Mine in Inner Mongolia which is undergoing maintenance works on its production facilities, and the Group is making relevant preparations for the mining and production of the mine in the future.
b. Consultancy business in mining industry
The current business scope of the consultancy business in mining industry included mining exploration advice, technical advice, economic and information consultancy services. The Group continues to develop new customers on its existing business base.
To the best knowledge of the Directors, the People’s Republic of China (“PRC”) government is implementing an indirect supervision and establishing a self-disciplinary norm on the mining consulting industry. Besides, most of the small and medium-sized enterprises engaged in mining business in PRC have weak professional skills and insufficient understanding of the relevant regulatory requirements. There is an increasing demand from these enterprises seeking professional advice and technical support.
Meanwhile, the PRC government has strengthened its governance in environmental protection and implemented more strict standards and policies in relation to environmental protection. The small and medium-sized enterprises engaged in the mining business need guidance from professional experts in order to comply with the tight requirement from the PRC government. Therefore, the Directors consider that there will be an increasing demand in the professional mining consultancy services in coming future.
c. Fluorite processing and sales business
The Directors consider that the demand for fluorite, as a national strategic resource, is increasing in the PRC, the Group has developed fluorite processing and sales business since the first half of this year. From the perspective of consumption trend, as worldwide fluorine chemical technology improves constantly, fluorine chemical industry’s demand for hydrofluoric acid as well as acid grade fluorite continues to increase. Currently, more than half of the world’s fluorite production is used to extract hydrofluoric acid. Fluorite is a non-renewable resource. Extracting fluorine from apatite is one of the important ways to obtain fluorine element. The future development direction of global fluorite industry will lean toward elaboration-oriented, compounding-oriented, lightweight-oriented, and environmentally-friendly circular economy development and serve the application, research and development of high and new technology.
Fluorite is an indispensable upstream base raw material for the fluorine chemical industry chain. Fluorite and its downstream products are widely used in traditional areas such as metallurgy, chemical engineering, building materials and optics, and have been initially applied in strategically emerging industries such as new energy and new materials in recent years. The main types of fluorite products are acid fluorite fine powder, high grade fluorite lump ore, metallurgical fluorite fine powder and ordinary fluorite raw ore. Of which, acid fluorite fine powder mainly reacts with sulfuric acid to produce hydrofluoric acid, providing raw materials for the manufacture of fluorine chemical downstream products.
In addition, the Group has ordered a batch of fluorite, and relevant processing and manufacturing facilities. Business license has also been obtained. The Directors believe that the fluorite business can generate revenue and profit for the Group in the second half of the financial year.
Money lending business
Small and medium-sized enterprises in Jilin, the PRC have a strong demand for capital due to their business development. The Group will continue to monitor the risks while increasing Money lending business, so as to improve the financial performance of the Money lending business.
Business Outlook - For the six months ended September 30, 2019
Due to the influence of Sino-U.S. trade war relations, the business of the Group’s customers may also be affected to varying degrees and there may be uncertain factors in the commodity price market. The Group will review the business development of its project companies from time to time.
Meanwhile, the Company will keep pace with the trends by proactively seeking opportunities to invest in business with greater returns for shareholders of the Company (the “Shareholders”).
Source: Sino Prosper Group (00766) Interim Results Announcement