australian securities exchange announcement for personal ... · 5/30/2014 · 2014 agm...

NOVARISE RENEWABLE RESOURCES INTERNATIONAL LTD

NOVARISE RENEWABLE RESOURCES INTERNATIONAL LTD ACN 138 537 596

Australian Office: Suite 5, Level 1, 325 Pitt Street , Sydney, NSW 2000 Chinese Office: No 2-16A Qingmeng Park, Quanzhou Economy & Technology Development Zone, Quanzhou, Fujian Province, The People's Republic of China www.novarise.com.au

Australian Securities Exchange Announcement

30 May 2014 The Manager Company Announcement Officer Australian Securities Exchange Electronic Lodgement

2014 AGM Chairman's Report & Power Point Presentation attached

Ladies and Gentlemen,

On behalf of the Directors of Novarise Renewable Resources International Ltd, it gives me great pleasure to welcome you all to our Fourth Annual General Meeting.

I would like to first welcome all my fellow directors who are here today. They have been very supportive of the company through the past four years of developments and achievements.

I especially would like to welcome all shareholders and visitors who are here today. I want to acknowledge that our success and future success is the result of the support and trust of the shareholders.

As a public company and a growing international business, Novarise sees maximising shareholders interests as an important corporate value. I hope at the conclusion of today's meeting, everyone will have a better understanding of the company, its performance and where it is heading in the future.

The Company continuously quickened its steps in the improvement of the existing technology and the construction of new factory during 2013. Whilst the financial performance was impacted in 2013 by the relocation of our operations, we are confident that the 2014 figures will improve again as the eight new production lines are put into full production. The delays in the construction of the Nan'an plant were disappointing for the Board but it is good to see that the plant construction and commissioning delays are now largely behind us and we can move forward with our growth plans.

With the continued recovery in the global economy and growing market demand for green products, Novarise will continue to be presented with great opportunities for development. In our 2013 Financial Year, the Company achieved AUD9.1 million of net profit after tax.

Influenced by the “Green Fence” action, Chinese government's efforts to better control the import of waste material into China, the supply for PP waste and feedstock was temporarily stopped during the year. During this period, the group purchased locally sourced polypropylene as replacement feedstock. This increased input costs for the business and consequently impacted the annual profit. This situation has now been remedied as the company has complied with the new required import standards and is now able to import feedstock once again. Although the “Green Fence” policy seriously impacted our profitability for a short period, it has also limited the supply of our competitors and, in a long run, we believe that this will strengthen the Company's competitive advantage. The Company fully supports this Government initiative to ensure that Chinese recyclers act at a very high standard as this fits well with our existing operating philosophy.

In July 2013, Novarise announced that it had entered into an implementation and funding agreement with its majority shareholder, Great Rises International Investment Ltd, Great Rises New Resources Technology Co., Ltd and Great Rises International Group Investment Ltd (together, GRII) regarding a proposal for the privatisation of Novarise.

The pending proposal was to privatise Novarise through a selective reduction of capital involving the cancellation of all shares in Novarise other than those held by GRII. The Independent Directors consider that the Capital Reduction is in the best interests of Exiting Shareholders The Privatisation, if approved, is forecast to be completed in the third quarter of 2014. The independent directors of Novarise will provide further updates to shareholders as the process continues.

We look forward to further development and expansion during the 2014 financial year, and to the continued growth of Novarise.

Again, thank you all for coming today and I will now hand back to Mr John O'Brien to lead the formal part of the meeting.

Qingyue Su

Chairman

australian securities exchange announcement for personal ... · 5/30/2014 · 2014 agm...

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