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Dukang Distillers drops plan to set up Taiwan office
LIQUOR maker Dukang Distillers Holdings says it will not proceed with the setting up of an office in Taiwan. It had previously allocated 9.1 million yuan (S$1.96 million) raised from Taiwan Depositary Receipts to establish a Taiwan office, and had already spent 6.3 million yuan.
The remaining 2.8 million yuan - together with another 658,000 yuan raised that was unutilised from the purchase of land use rights - will be reallocated towards advertising and promotional activities in the Chinese market.
Dukang has been hit by China's ongoing anti-corruption campaign, which affected sales of baijiu (Chinese white liquor). It reported a loss of 29.4 million yuan for its first quarter ended Sept 30, 2014, down from a 30.5 million yuan profit a year ago. Revenue almost halved from 389 million yuan to 207 million yuan.
Shares traded on Friday at 11.7 Singapore cents, up 0.2 cent or 1.7 per cent, before the announcement. Dukang is down 63 per cent compared to a year ago, according to Bloomberg.