Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

Zhou Hei Ya International Holdings Company Limited

周 黑 鴨 國 際 控 股 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1458) INTERIM RESULTS ANNOUNCEMENT FOR THE SIX MONTHS ENDED JUNE 30, 2017

FINANCIAL HIGHLIGHTS

For the six months

ended June 30,

Period-Over- Period

2017

2016

Change

RMB' 000

RMB' 000

%

Revenue

1,618,306

1,389,135

16.5

Gross profit

985,920

871,031

13.2

Profit before tax

526,795

510,169

3.3

Profit for the period attributable to owners of the Company

401,034

380,739

5.3

Adjusted net profit (1)

409,059

384,087

6.5

Basic and diluted earnings per share (RMB)

0.17

0.20

(15.0)

(1) Adjusted net profit is calculated by deducting listing expenses and/or loss on disposal of property, plant and equipment, representing the disposal of equipment and plant during the process of upgrading the Group's existing Wuhan processing facility in the relevant period. Adjusted net profit is an unaudited non-GAAP item. To supplement the Group's consolidated financial statements which are presented in accordance with HKFRS, the Group has presented this non-GAAP item as an additional measure to evaluate the financial performance of the Group by considering the impact of certain items that the Group believes are frequently used by analysts, investors and other interested parties in the evaluation of companies in the industry within which the Group operates and by eliminating the impact of certain unusual and/or non-recurring items that the Group does not consider indicative of the performance of the Group's business.

OPERATIONAL HIGHLIGHTS

The table below sets forth certain key operational information of the Group's self-operated retail store network for the periods indicated.

Six Months Ended June 30,

2017

2016

Number of self-operated retail stores

892

716

Total sales volume (tons)

19,461

16,078

Average spending per purchase order (RMB)

62.13

58.95

The following table sets forth the revenue contribution in terms of the Group's main product categories for the periods indicated.

Six Months Ended June 30,

2017

2016

RMB'000

%

RMB'000

%

Ducks and duck part products

1,404,075

86.8

1,231,851

88.7

Other products (1)

214,231

13.2

157,284

11.3

Total

1,618,306

100.0

1,389,135

100.0

(1) Other products mainly include braised red meat, braised vegetable products and other braised poultry.

The board of directors (the "Board") of Zhou Hei Ya International Holdings Company Limited (the "Company") is pleased to announce the unaudited consolidated interim results of the Company and its subsidiaries (the "Group") for the six months ended June 30, 2017 (the "Interim Results"). The Interim Results have been prepared in accordance with Hong Kong Financial Reporting Standards (the "HKFRSs"), which include all Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards ("HKASs") and Interpretations issued by the Hong Kong Institute of Certified Public Accountants (the "HKICPA"). In addition, the Interim Results have also been reviewed by the audit committee of the Company (the "Audit Committee").

BUSINESS OVERVIEW AND OUTLOOK Market Overview

In the first half of 2017, China's economy continued to grow and general consumer confidence has been found to reach a highest level in recent years. Consumer spending increased, driven by more affluent population, growing young generation and the continuing deepened combination of online and offline shopping, which has been changing the consumer demands, lifestyle as well as consumption habits. Moreover, established online marketplaces and local ordering and delivery service platforms, supported by logistics and online payment infrastructures, have increased penetration of online shopping nationwide. As a result, retail companies, including casual food companies like us, are urged to constantly innovate their product offerings and improve quality, and to implement product innovation and marketing strategies to timely cater to such changing consumer demands and consumption habits.

Despite the continuing intensified competition in the casual braised food industry in China as well as the pressure of increasing production costs, the Group has achieved stable growth in revenue in the first half of 2017, comparing with the corresponding period in 2016.

Overall Business and Financial Performance Store Network Expansion

In the first half of 2017, the Group continued to carry out its store network expansion plans. The Group newly opened 144 self-operated retail stores and closed 30 stores during the six-month period. As a result, as of June 30, 2017, the total number of the Group's self-operated retail stores reached 892, covering 47 cities in 13 provinces and municipalities in China.

Geographically, central China area remained the major regional market of the Group while its revenue contribution as a percentage of total revenue continued to decrease, and the remaining regions, especially the eastern China area, demonstrated healthy growth with increasing aggregate revenue contribution, mainly due to the expansion of retail store network.

The Group continued to strategically locate its self-operated retail stores in the transport infrastructure, such as airports, railway stations and subway stations, or the ancillary facilities surrounding the transport infrastructure. As of June 30, 2017, among all self-operated retail stores the Group operated, 263 were transport hub stores and revenue derived from such hub stores accounted for approximately 39.8% of total revenue for the six months ended June 30, 2017.

The table below sets forth a breakdown of the number of self-operated retail stores by geographic location for the periods indicated.

Number of Stores

Six Months Ended June 30,

2017

2016

#

%

#

%

Central China (1)

400

44.9

361

50.4

Southern China (2)

177

19.8

157

21.9

Eastern China (3)

156

17.5

79

11.0

Northern China (4)

108

12.1

90

12.6

Southwestern China (5)

51

5.7

29

4.1

Total

892

100.0

716

100.0

Zhou Hei Ya International Holdings Co. Ltd. published this content on 22 August 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 22 August 2017 09:32:01 UTC.

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