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Jatenergy Limited (ASX:JAT) is a Chatswood, Australia based consumer discretionary company having a strong export market towards China. It is focused on selling Australian goods like oats, cosmetics, biscuits, cleaning products, etc. to China
On 20th March 2019, the company released an update regarding its meeting with Orient International (Holding) Company.
The senior leadership team at Jatenergy met with a six-person delegation from Orient International in Melbourne. Orient International is a large comprehensive trading group, which is led by the Shanghai State-owned Assets Supervision and Administration Committee. It has registered capital of over RMB800 million, total assets of RMB12.3 billion, and net assets of RMB3.7 billion. It has 117 wholly owned and share controlled subsidiaries, including one public traded company. The massive business of the company has placed it in one of 500 Largest Chinese Trading Enterprises, Top 500 Chinese Business Groups, and Top 100 Shanghai Business Groups for many years.
Therefore, the Jatenergy considers this meeting to be very significant for itself and Australia (being an exporter, it helps the economy as well).
Mr. Yong Zhu, President of Orient International and Wilton Yao, Managing Director of Jatenergy discussed many exciting, and new trading ideas between the two countries on this first visit by Orient International, focused on trade with Jatenergy.
Following the meeting outcome, Shanghai Dragon Corporation, which is a subsidiary of Orient International placed the following substantial orders for Australian products:
- Goats Milk Soap â one 20-foot container
- Food and wine â one 20-foot container
- Golden Koala full cream high calcium milk powder â one 20-foot container
Another deal to purchase fresh fruit off the farm as well as household products is currently in negotiation.
Orient Internationalâs visit means a strengthening relationship between the two companies, Jatenergy and Orient International and their respective countries. Jatenergy is delighted to build this vital connection and anticipates a significant strengthening of this connection in the future.
On 1st March 2019, the company announced its half-year results ended 31st December 2018. It reported revenue from ordinary activities at $30.47 million in 1H FY19 compared to the previously reported revenue of just $1.57 million in 1H FY18, thatâs an increase of almost 1834%. However, the net loss from ordinary operating activities after tax massively increased from $273,312 in 1H FY18 to $21.21 million in 1H FY19, an increase in the loss by almost 7662%. This major loss was due to the group impaired goodwill of $22,712,572 relating to Golden Koala Group Pty Ltd. Due to delay in registration and licensing of the infant milk product formulation from the Chinese Food and Drug Administration (CFDA), the Board of Directors have decided to fully impair goodwill of $22,712,572 relating to Golden Koala.
On the balance sheet side, the total assets increased from $31.65 million on 30th June 2018 to $44 million on 31st December 2018. The total liabilities grew more significantly from $4.48 million to $12.34 million in the same period.
On the technical front, the stock price increased by 3.5% on ASX and closed at A$0.058 as of 20th March 2019, compared to the previous closing of A$0.056. In the last six months, the stock has given a rally of 40%, while YTD return stands at negative 17.6%.
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