Asian Bamboo AG / Key word(s): Preliminary Results 28.02.2014 10:10 Dissemination of an Ad hoc announcement according to § 15 WpHG, transmitted by DGAP - a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- Asian Bamboo announces preliminary FY 2013 results Hamburg, 28 February 2014 - Asian Bamboo AG ("Asian Bamboo", "the Company", ISIN: DE000A0M6M79, ticker symbol: "5AB", ADR ticker symbol "ASIBY"), a leading integrated company in the bamboo industry, regrets to report that the conditions for running an agriculture business in Fujian Province remained very difficult in FY 2013. The supply of labour needed for harvesting decreased and harvesting pay rates increased, which led to a significantly smaller harvest and a deterioration in operational and financial performance. Moreover, bad weather conditions affected the winter bamboo shoot harvest. The negative operating performance led to a loss in the fair value less estimated costs to sell of biological assets ("FVBA loss") of EUR 47.5 million in the P&L. In addition, impairments of lease prepayments caused a loss of EUR 112.9 million in the P&L. These two items, totalling EUR 160.4 million, are the main reasons for the large net loss of EUR 152.9 million. However, they are non-cash items and therefore do not have any impact on the Company's cash flow. Despite the difficult operating conditions, the Company generated positive operating cash flows before movements in working capital of EUR 5 million and maintained a healthy financial structure. The preliminary results for FY 2013, which are slightly below the previously stated guidance in terms of revenue and above in terms of operating cash flow before movements in working capital, are as follows (percentage numbers are year-on-year comparisons): * Revenue decreased 56% to EUR 32.3 million (2012: EUR 72.9 million) * Loss in FVBA* of EUR 47.5 million (2012: loss of EUR 56.8 million) * Negative gross profit, including FVBA-changes, of EUR 25.7 million (2012: negative EUR 10 million) * Net loss of EUR 152.9 million (2012: net loss EUR 19.8 million) * Operating cash flow before movements in working capital decreased 57% to EUR 5 million (2012: EUR 11.6 million) * Net cash generated from operating activities was negative EUR 1.8 million (2012: positive EUR 17.6 million) mainly due to an increase in account receivables * Cash and cash equivalents decreased to EUR 28.5 million (2012: EUR 38.6 million) mainly as a result of repayments of bank loans during the year * Total bank borrowings decreased to EUR 35.7 million (2012: EUR 46.5 million) after repayments of bank loans during the year * Total equity decreased to EUR 133.7 (2012: EUR 288 million) mainly due to a reduction in biological assets and impairments of lease prepayments Due to the large impairments this year, the possibility of differences between the preliminary results and the final results are higher than in previous years. * FVBA is an abbreviation for gain/(loss) arising from changes in the fair value less estimated costs to sell of biological assets FY 2014 trend information and dividends The conditions in the bamboo industry are likely to remain challenging in 2014. Therefore the Management Board will continue implementing the plan to decentralise the plantation management organisation, search for opportunities to improve the Company's cash flow by leasing out or selling part of the plantations and facilitate the entry into the property industry. Entering the property industry will provide a fresh start for the Company. The Management Board believes that this business will generate very significant revenue and profit contributions in the future, however revenues and profits are not likely to be generated until 2015 at the earliest. The Management Board and Supervisory Board will not propose a dividend for FY 2013 at the next Annual General Meeting. However both the Management Board and Supervisory Board intend to resume dividend payments once the Company's operational and financial performances improve. Following the impairments of lease prepayments, the Company's amortisation costs will decrease which will lead to an improved gross profit and net result in 2014. The lower amortisation costs do not have any impact on cash flows. Changes to the size of the offering and timing of the issue of the convertible bond In order to strengthen the financial situation and prepare for entry to the property business, the Company intends to issue a convertible bond to all shareholders. The prospectus and the details of the issue of the convertible bond are currently being worked out. The Management would like to highlight the following two changes in the plans since the ad hoc announcement made on 17 December 2013: * The offering shall take place after the Annual General Meeting ("AGM"), which will be held on 26 May 2014 * The offering shall be larger than the initial suggested size of 4,627,500 shares and the Management Board and Supervisory Board intend to seek AGM approval for the increase in the size of the offering As announced on 17 December 2013, all shareholders will receive rights, which will be tradeable, in correlation to their shareholding. The Management Board intends to guarantee that all convertible bonds for which subscription rights have not been exercised will either be placed with third parties or will be subscribed for by the Management Board itself. The convertible bond will have a duration of three years and will not offer any interest or any other form of guaranteed return. The securities prospectus will also contain more detailed information about the current situation in the bamboo industry and the plans and outlook for the Company's entry into the property industry. The securities prospectus is likely to be released shortly after the next Annual General Meeting and the offering of the convertible bond will take place soon after the prospectus has been made public. The final terms and conditions of the offering and the convertible bonds will be published in the securities prospectus. For enquiries, please contact: Asian Bamboo AG: Peter Sjovall +852-9385 3868 Chief Financial Officer [email protected] Anja Holst +49-(0)40 37644 798 Investor Relations Director [email protected] 28.02.2014 DGAP's Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------------- Language: English Company: Asian Bamboo AG Stadthausbrücke 1-3 20355 Hamburg Germany Phone: +49 40 37644 798 Fax: +49 40 37644 500 E-mail: [email protected] Internet: www.asian-bamboo.de ISIN: DE000A0M6M79, DE000A0M6M79 WKN: A0M6M7, A0M6M7 Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, Düsseldorf, München, Stuttgart End of Announcement DGAP News-Service ---------------------------------------------------------------------------