CHINA FISHERY GROUP LIMITED Annual Report 2010

CHINA FISHERY GROUP LIMITED

Rooms 3312-14, Hong Kong Plaza,
188 Connaught Road West, Hong Kong
www.chinafisherygroup.com
 OUR PROFILE
Listed on the mainboard of the singapore exchange
in 2006, china fishery is a global, integrated industrial
fishing company with rights to fish in some of the
world’s most important fishing grounds.

Employing state-of-the-art technology on-board its

vessels, china fishery harvests, processes and delivers
high quality catch to consumers the world over.

In 2006, china fishery established fishmeal

processing operations in peru, where it has fishmeal
processing plants and purse-seine fishing vessels
deployed strategically along peru’s coastal areas.

Riding on an ever-growing global demand for fish,

china fishery is committed to continually securing
access to under-utilised and abundant ocean
resources, and fulfilling the needs of health and
value-conscious consumers through sustainable
fishing practices.
OUR MISSION
AS A LEADING GLOBAL INDUSTRIAL FISHING
COMPANY, CHINA FISHERY GROUP LIMITED (“CHINA
FISHERY”) IS COMMITTED TO SECURING ACCESS TO
UNDER-UTILISED AND ABUNDANT OCEAN RESOURCES
TO MEET THE GROWING NEEDS OF HEALTH AND
VALUE-CONSCIOUS CONSUMERS WORLDWIDE. WE
WILL CONTINUE TO OFFER RESPONSIBLY-DERIVED
RANGE OF QUALITY STAPLE FOOD PRODUCTS VIA OUR
FISHING, ON-BOARD PROCESSING AND FISHMEAL
PRODUCTION OPERATIONS.

01 About Us

04 Message to Investors

06 Key Management

07 Financial Highlights

10 Directors Profile

14 Message to Investors

15 Key Management

16 Corporate Infromation

CHINA FISHERY GROUP LIMITED - ANNUAL REPORT 2010 01

 We understand the importance in striking a
balance between consumer demand and the
conservation of stock for future generations.
Our constant innovation and awareness in
fishing practices delivers greater value for our
customers while ensuring sustainable fishing
sources for the future.

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MESSAGE TO INVESTORS FINANCIAL HIGHLIGHTS
DEAR VALUED INVESTORS, As a result of the change in
On behalf of your board of directors financial year end date of the
(“board”), I am pleased to deliver Group, the current financial period
the annual report of China fishery for the Group covers the nine-
group limited (“china fishery” or month period from January 1, 2009 05 90,585

“the company”) and its subsidiaries to September 28, 2009 (“9M2009”). 06 156,041
(collectively “china fishery group” or “the Accordingly, the comparative 07 406,369
group”) for the financial period ended figures for the corresponding period 08 460,054
september 28, 2010 (“9m2010”). of the immediately preceding year 9M09 355,299
for the nine-month period ended
9M10 383,449
September 30, 2008 (“9M2008”) are
On August 26, 2009, the Group changed its financial year OPERATIONAL REVIEW
presented in the diagrams below. REVENUE (US$’000)
end date from December 31 to September 28. The Board In 9M2009, the Group’s focus was on improving our fleet
of Directors considered that the change of financial year utilisation to enhance fleet efficiency and margins. The
end date not only can align the Group’s business cycle Group also ensured that building blocks are in place for West Africa 2%
Other 1.2%
with that of its business activities, it would also enable the our South Pacific operations in order for the Group to be in
SEA 3.8%
Singapore-listed parent company, Pacific Andes Resources the best-possible position to capitalise on increasing globa
23.8% Fishmeal and
Development Limited and its subsidiaries (“Pacific Adnes demand for fish protein.
Fishoil EUROPE 11.1%
Group”) to have a co-terminous year end date, thereby
facilitating the preparation of the consolidated financial TRAWLING OPERATIONS 9M10 9M10 66.1%
statements and saving audit costs accordingly. As a result In 9M2009, we adopted a flexible approach in our North
Japan & Korea 15.8%
of the change of financial year end date, this report covers Pacific operations and adjusted our fishing plan to improve
a 9-month period from January 1, 2009 to September 28, fleet efficiency and margins. This entailed deferring part of 76.2% Trawling
2009. In 9M2009, the Group continued to achieve strategic our fishing activities to the fourth quarter of the calendar
PRC
growth despite the global economic downturn. year, which enabled us to significantly reduce costs while
still utilising our full calendar year catch volume entitlement. REVENUE BY BUSINESS SEGMENT REVENUE BY GEOGRAPHICAL SEGMENT
We have successfully improved our fleet efficiency and Notwithstanding this deferment in fishing activity, the
expanded our South Pacific fishing fleet while maintaining Group recorded a revenue growth of 8.8% in our trawling
gross profit margin during the period. The Board believes operations in 9M2009 on the back of increased catch
that the Group’s sustainable gross profit margin against volume and better fish prices. 05 90,585 05 90,585
the backdrop of a challenging global macro-economic 06 156,041 06 156,041
environment is a true reflection of the resilient nature of Besides improving fleet efficiency and margins, the
the fishing industry, and in particular, the Group’s proven Group’s strategic move to change our fishing plan in the 07 406,369 07 406,369
business model. North Pacific had allowed us to re-deploy excess vessel 08 460,054 08 460,054
requirements in the North Pacific to our South Pacific
In line with the Group’s continued strong performance in operations. The Group also added seven catcher vessels
9M09 355,299 9M09 355,299
9M2009, the Board has recommended a first and final and a factory trawler to our South Pacific operations, 9M10 383,449 9M10 383,449
dividend of Singapore 4.2 cents (S$0.042) per ordinary bringing the total number of vessels in the South Pacific
share in respect of 9M2009, subject to shareholders’ Ocean to 13. NET BENEFIT (US$’000) BASIC EARNING PER SHARE (US cents)
approval at the forthcoming Annual General Meeting.
This dividend will be payable in cash with an option for Trial fishing operations in the South Pacific Ocean, which
shareholders entitled to the said dividend to elect to commenced in the second quarter of 2009, contributed
receive their distributions in the form of fully paid shares a maiden revenue of US$7.8 million. The Chilean Jack 05 90,585 05 90,585
through the China Fishery Group Limited Scrip Dividend Mackerel, a target catch in the South Pacific Ocean, is
06 156,041 06 156,041
Scheme (the “Scrip Dividend Scheme”) adopted by the one of the top 10 marine harvested fish species globally.
Board. The Scrip Dividend Scheme allows shareholders The Chilean Jack Mackerel has been used increasingly 07 406,369 07 406,369
to receive their dividend entitlement wholly in cash or fully for human consumption, and demand for this fish is 08 460,054 08 460,054
paid shares or through a combination of cash and fully paid particularly strong in Africa. Generally, as a fish specie is
shares. The Board believes that the implementation of the used increasingly for human consumption, its value will 9M09 355,299 9M09 355,299
Scrip Dividend Scheme offers shareholders an opportunity also increase. With the Group’s strong presence in the 9M10 383,449 9M10 383,449
to increase their shareholding in the Company and to South Pacific Ocean, we are well-positioned to benefit
participate in the future growth potential of the Group. from the continued strong demand for fish protein. EBITDA (US$’000) EBITDA MARGIN (US$’000)

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 As we continue to maximize the results in today’s
operations, we also plan for the Group’s growth and
expansion globally.
Our recent acquisition, Deep Sea Fishing S.A.C in
Peru will increase the Group’s Peruvian Anchovy
fishing quota share of annual total allowable catch to
7% in North and South Peru.
In turn, the Group will be able to increase its Peruvian
Anchovy harvest volumes and further consolidate the
Group’s position in the Peruvian fishing industry and
enable the Group to further benefit from the increasing
demand for fishmeal in China.

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 Following our Peruvian acquisition, The Carlyle Group
made a strategic investment in China Fishery Group
which in turn, strengthens our shareholder base, client
network and capital.
We look forward to optimizing this additional capital to
bring China Fishery to greater heights and delivering
sustainable growth in shareholder value.

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