PUTIAN FOOD (01699): It is expected that the completion of the Industrial and Commercial Bank debt restructuring and positive business development will gradually improve the net asset status.

PUTIAN FOOD (01699) announced that on January 3, 2025, the company received instructions totaling HK$28 million from Mr. Zhang and Mr. Leung through their respective law firms. According to this, (1) the law firm received instructions from Mr. Zhang and Mr. Leung to hold custody of funds totaling HK$26 million and HK$2 million respectively (referred to as custody funds); and (2) Mr. Zhang and Mr. Leung have given irrevocable instructions to disburse the custody funds to Vandi Investments Limited (a subsidiary of Vandi International Holdings Limited) one business day after the company obtains approval for resumption of trading (regardless of conditions), but if the company fails to obtain approval for resumption of trading by December 30, 2025, or is delisted, the custody funds can be returned to Mr. Zhang and Mr. Leung. Upon disbursement of the custody funds, the Vandi debt restructuring will be completed, and Mr. Zhang will become the sole owner of Vandi debts. Mr. Zhang shall subscribe for no more than 25% of the company's enlarged issued shares at the full amount of Vandi debts. In the audited performance for the year ending 2023, the Vandi debts were recorded as a net liability of HK$680 million as of December 31, 2023, which will no longer be classified as a liability after the completion of Vandi debt restructuring. The company has resumed operations at the SHITI pig farm. The company hereby adds that it is expected to generate revenue from sales of self-reared pigs at the SHITI pig farm in the year 2025. The impairment of the SHITI pig farm, which was suspended in the financial statements for the year 2022, amounted to RMB 328 million. A partial reversal of this impairment is expected upon the resumption of operations at the SHITI pig farm. On January 3, 2025, the company received commitments from Chairman and controlling shareholder Cai Chenyang (who currently holds approximately 47.95% of the company's shares) and three other creditors to extend the repayment period of a total debt amounting to RMB 39.9591 million to January 3, 2028. This debt will no longer be classified as a current liability with immediate effect. In addition to the deferred repayment of the debt, they have agreed in principle to convert their debts into company shares, subject to approval from shareholders and regulatory authorities. On January 3, 2025, in support of the company, six current directors (including Cai Chenyang) and two former directors signed a commitment letter relinquishing their total outstanding compensation of RMB 7.9931 million from the company. As of December 31, 2023, the group received government grants totaling RMB 12.82 million for infrastructure projects that are yet to be operational. These funds are accounted for as deferred income. It is estimated that this deferred income will be recognized as realized income upon the commencement of operations for the infrastructure projects (anticipated in 2025). Based on the latest developments, the company anticipates an improvement in its financial position, transitioning from a net current liability position of RMB 750 million as of December 31, 2023, to a net asset status, driven by the completion of the Vandi debt restructuring and other positive business developments mentioned above. Furthermore, trading of the company's shares remains suspended.