A sharp fall in half-year profit and a large provision at tonic-drinks maker China Apollo Holdings have prompted analysts to slash full-year profit forecasts for it by more than half, to $61 million.
On Monday, China Apollo said attributable profit fell 69.7 per cent to $45.63 million for the half on sales down 24.3 per cent at $306 million.
The company made a provision of $6.5 million to cover doubtful debts and said it was exerting maximum caution over credit to distributors, even though this would have a negative impact in the short-to-medium term.
Its shares yesterday fell three cents to 71 cents, their lowest point since listing at $1.17 in December.
Vickers Ballas Investment research analyst Elvic Ng said the interim results were 'unexpected'. He cut his full-year attributable profit forecast from $150 million to $61 million.
Sean Ho, an analyst at DBS Securities, said he cut his forecast 30 per cent to $84 million from $120 million because of the 'very bad' results. These were against a consensus analysts' forecast of $180 million in the latest edition of the Estimate Directory.