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CHINA Minzhong Food Corporation's net profit for the third quarter ended March 31, 2015, fell 19 per cent to 108 million yuan (S$23.3 million), compared to 133.3 million yuan in the year-ago period. Over the same period, its revenue fell 29.6 per cent to 485.8 million yuan.
Meanwhile, net profit for the nine months ended March 31 fell 38.1 per cent to 237.5 million yuan, while revenue was down 32.5 per cent at 1.51 billion yuan.
The decline was mainly due to the decrease in sales contributions from the processed and cultivation business segments, the group said in a statement.
"On the back of rising urbanisation and declining rural labour, the agriculture industry in China continues to be strongly supported and favoured by the Chinese government, particularly in the use of modern agriculture technology to increase food security," the group said.
It added that the cultivation and processed business segments will continue to face challenges ahead in view of the shortage of rural labour for cultivation activities and rising costs.
While the demand for processed vegetables in South America and the European region remains weak, the rising domestic consumption in China presents many growth opportunities, it said.
"With growing labour shortage in the rural areas, we see our move towards industrialised farming as a step in the right direction to reduce the reliance on labour and increase our raw material self-sufficiency," the group's executive chairman and CEO, Lin Guo Rong, said.
For the three months ended March 31, 2015, earnings per share was 0.36 yuan while net asset value per share was 8.1 yuan. No dividends were declared for the quarter.
On Friday, China Minzhong Food closed trading down 6.863 per cent at S$0.95.