Asian Citrus boosts profits with supermarket deals

By Dominique Patton

- Last updated on GMT

Related tags: Marketing

Asian Citrus, the Chinese orange plantation owner, said its
full-year pretax profit rose 17 per cent, helped by new direct
supply contracts with supermarket chains in China.

The company said sales to supermarkets accounted for about 16.1 per cent of the company's revenue and that it expects to increase its sales to supermarket chains to around 20 per cent of its production in 2007. Selling to supermarkets rather than wholesalers produces a much higher return, with selling prices up to 65 per cent higher. Asian Citrus posted a full-year pretax profit of CNY193.9 million compared with CNY166.4 million a year earlier. Revenue grew 26 per cent to CNY404.6 million, up from CNY322.3 million, thanks to higher production and better selling prices to both the wholesalers and supermarkets. Chairman Tony Tong said: "In the coming year, we will not only focus on achieving broader sales channels and getting greater market share, but will also look to expand the business into value added products to benefit from the significant market demand."​ The group is also looking to establish its own juicing business in order to meet the needs of the Chinese market. "As with other developed countries in Europe and America, the demand for orange juice in China is increasing as a result of the improving quality of life in China,"​ explained Tong.

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