Restructuring at Shanghai Richina

In posting their third quarter results, Richina Pacific chairman, John L Walker, said that for the full year 2005, the company were expected to report net profits exceeding their 2004 record of US$8.2 million. This is despite the small loss of US$234,000 for the third quarter of 2005. Revenues for the quarter were US$133.9 million. However, over at Richina Industries important and far-reaching restructuring and consolidation continues in the Shanghai tanning operations, SRL, which have led to a number of significant personnel changes. Under the new leadership of Ernie Hagen, the upholstery leather tanning division has been stabilised, although there will be a sizeable loss arising from old stock disposal and provisions. The production volumes for auto leather are increasing at a fast pace, while the ovine garment and the bovine shoe operations are both below their quarterly forecast expectations. The remaining manufacturing activities of Shanghai Leather Corporation are performing ahead of forecasts. However, with a traditionally slow fourth quarter, Richina Industries are now forecasting an overall loss for the full year 2005.