Le Gaga First Half FY 2014 Earnings Release

Le Gaga First Half FY 2014 Earnings Release

HONG KONG, Feb. 20, 2014 (GLOBE NEWSWIRE) -- Le Gaga Holdings Limited
(Nasdaq:GAGA) ("Le Gaga" or "the Company"), a leading greenhouse vegetable
producer in China, today announced its financial results for the first fiscal
half ended December 31, 2013. ^1

Highlights of the Six Months Ended December 31, 2013

  *Revenue decreased by 5.3%, to RMB179.4 million (US$29.6 million) for the
    six months ended December 31, 2013, compared to RMB189.5 million a year
    ago.
    
  *Profit for the period decreased by 41.2%, to RMB98.2 million (US$16.2
    million) for the six months ended December 31, 2013, compared to RMB167.1
    million a year ago.
    
  *Adjusted profit for the period^2 (non-IFRS measure) decreased by 48.5% to
    RMB23.0 million (US$3.8 million) for the six months ended December 31,
    2013, compared to RMB44.6 million a year ago.A reconciliation of the
    adjusted profit for the period to profit for the period determined in
    accordance with IFRS is set forth in Appendix V.
    
  *Adjusted EBITDA^3 (non-IFRS measure) decreased by 5.8% to RMB84.1 million
    (US$13.9 million) for the six months ended December 31,2013, compared to
    RMB89.3 million a year ago.A reconciliation of the adjusted EBITDA to
    profit for the period determined in accordance with IFRS is set forth in
    Appendix VI.

^1 This announcement contains translations of certain Renminbi (RMB) amounts
into U.S. dollars (US$) at specified rates solely for the convenience of the
reader. Unless otherwise noted, all translations from RMB to U.S. dollars are
made at a rate of RMB6.0537 to US$1.00, the effective noon buying rate as of
December 31, 2013 in The City of New York for cable transfers of RMB as set
forth in H.10 weekly statistical release of the Federal Reserve Board.

^2 Defined as profit for the period before the net impact of biological assets
fair value adjustment and further adjusted to exclude, as applicable, the
effects of non-cash share-based compensation, impairment losses on property,
plant and equipment and prepayments, natural disaster loss and offering
expenses charged to the income statement.

^3 Defined as EBITDA (earnings before net finance income (costs), income tax
expense, depreciation and amortization), as further adjusted to exclude, as
applicable, the effects of non-cash share-based compensation, the net impact
of biological assets fair value adjustment, impairment losses on property,
plant and equipment and prepayments, natural disaster loss and offering
expenses charged to the income statement.

  *Basic and diluted earnings per share were RMB4.47 cents (0.74 US cents)
    for the six months ended December 31, 2013.Basic and diluted earnings per
    ADS^4 were RMB223.5 cents (36.92 US cents) for the six months ended
    December 31, 2013.
    
  *Cash generated from operating activities increased by 31.5%, to RMB77.6
    million (US$12.8 million) for the six months ended December 31, 2013,
    compared to RMB59.0 million a year ago.
    
  *Revenue-per-mu decreased to RMB6,950 (US$1,148) for the six months ended
    December 31, 2013, compared to RMB8,609 a year ago.
    
  *Production output increased to 54,884 metric tons for the six months ended
    December 31, 2013, compared to 49,229 metric tons a year ago.
    
  *Our product mix shifted further towards solanaceous vegetables compared to
    last year.Solanaceous vegetables sold to third parties in the PRC
    mainland increased to 71% of total revenue for the six months ended
    December 31, 2013, compared to 42% of total revenue a year ago.
    
  *Average selling price (ASP) of vegetables sold to third parties in the PRC
    mainland decreased by 14.2% to 3.26 RMB/kg for the six months ended
    December 31, 2013, compared to 3.80 RMB/kg a year ago.
    
  *Total arable land as of December 31, 2013 was 29,404 mu (1,960 hectare),
    representing an increase of 22 mu compared to June 30, 2013, and an
    increase of 961 mu compared to December 31, 2012.
    
  *Total greenhouse area as of December 31, 2013 was 11,833 mu (789 hectare),
    representing a decrease of 130 mu compared to June 30, 2013 and an
    increase of 1,223 mu compared to December 31, 2012.

^4 American depositary shares, which are traded on the NASDAQ Global Select
Market, each represents 50 ordinary shares of the Company.

Mr. Shing Yung Ma, the CEO of Le Gaga, commented, "During the months of
August, September and October we have spent substantial efforts preparing for
the upcoming solanaceous season. Planting of solanaceous products commenced at
the end of August in Fujian. Planting in Guangdong was delayed by 20 to 30
days compared to last year due to typhoon "Usagi", which hit our Guangdong
farm bases in September. We have also spent much effort on the conversion of
part of our greenhouse area to soil-less production, which we started in May
2013.As of December 31, 2013, we have completed the conversion of 2,257 mu of
greenhouse area.

Our revenue for the period decreased, primarily as a result of lower market
prices.The shift to soil-less production, which resulted in operational
disruption as well as lower production of leafy vegetables during the summer
months, as our soil-less greenhouses are not suited for leafy production,
further contributed to lower revenue.Lastly, production of cruciferous
products in Hebei was lower due to a shortage of labor in Northern China.

The lower average selling price was primarily due to overall lower market
prices, as a result of relatively mild weather across China between July and
December 2013 as well as lower demand from restaurants.Furthermore, the
growth of solanaceous products in the new soil-less production system was much
faster than expected and as a result we had to harvest earlier in the
off-season when prices were still relatively low."

Mr. Auke Cnossen, the CFO of Le Gaga, added, "Sales were more evenly spread
out during the period as compared to last year when most of our sales revenue
was generated towards the end of the period when prices typically are
higher.This resulted in lower average selling prices, but better operating
cash flow as our trade receivables balance was lower at the end of December
2013 as compared to the previous year.

Our net profit for the period was affected by a loss of RMB62.6 million
recognized as a result of the damage related to typhoon "Usagi" at our
Guangdong farm bases.

We recognized a large positive net impact of biological assets fair value
adjustment. The large net impact was due to the switch from low value leafy
crops growing at our farms at the end of June 2013 to higher value solanaceous
crops growing at our farms at the end of December 2013. Our operating cash
inflow increased compared to last year as a result of more cash received from
sales during the current period."
Summary of Operating Data

                         As of December 31, As of June 30,  As of December
                          2012               2013            31, 2013
Arable land (1)                                            
- Operating land          24,374 mu        25,213 mu     26,405 mu
                         (1,625 hectare)  (1,681         (1,760 hectare)
                                             hectare)
- Land under construction 4,069 mu         4,169 mu      2,999 mu
or reserved
                         (271 hectare)    (278 hectare) (200 hectare)
- Total                   28,443 mu        29,382 mu     29,404 mu
                         (1,896 hectare)  (1,959         (1,960 hectare)
                                             hectare)
                                                          
Greenhouse area (2)                                        
- Total                   10,610 mu        11,963 mu     11,833 mu
                         (707 hectare)    (798 hectare) (789 hectare)
                                                          
Greenhouse area as a                                       
percentage of
- Operating land          43.5%              47.4%           44.8%
- Total arable land       37.3%              40.7%           40.2%

                                                   
                                     Six Months Ended December 31,
                                     2012           2013
                                                   
Total production output (metric tons) 49,229        54,884
Production yield (metric tons per mu) 2.2           2.1
Revenue-per-mu (RMB)                  8,609         6,950

(1) Land under construction or reserved includes (i) newly leased land which
has not yet been put into production and is either under construction or in
reserve for future development, and (ii) land which we plan to return and is
not in operation.

  As of December 31, 2013, we had 2,300 mu of newly leased land and 699 mu of
  land which we plan to return.

(2)As of December 31, 2012, there were 450 mu bamboo-made greenhouses and
10,160 mu steel-made greenhouses.

  As of June 30, 2013, there were 450 mu bamboo-made greenhouses and 11,513 mu
  steel-made greenhouses.

  As of December 31, 2013, there were 450 mu bamboo-made greenhouses and
  11,383 mu steel-made greenhouses.

Financial Results for the Six Months Ended December 31, 2013

Revenue decreased by 5.3%, to RMB179.4 million (US$29.6 million) for the six
months ended December 31, 2013, compared to RMB189.5 million a year ago.The
decrease in revenue was primarily due to (1) lower market prices, (2) our
shift to soil-less production, which resulted in (a) operational disruption
and (b) lower production of leafy vegetables during the summer months, and (3)
lower production of cruciferous products at our farms in Hebei due to a
shortage of labor.

Our average selling price was lower for the six months ended December 31, 2013
when compared with a year ago, primarily due to (1) overall lower market
prices due to (a) relatively mild weather across China between July and
December 2013 and (b) lower demand from restaurants, and (2) the faster than
expected growth of solanaceous products in the new soil-less production system
which resulted in a much earlier start of the harvest in the off-season when
prices were still relatively low.This resulted in a decrease in
revenue-per-mu from RMB8,609 for the six months ended December 31, 2012 to
RMB6,950 (US$1,148) for the six months ended December 31, 2013.

                 Six Months Ended December 31,
                 2012             2013
                 Revenue ASP      Revenue ASP
                  (%)     (RMB/kg) (%)     (RMB/kg)
PRC revenue^5                           
Solanaceous       42%     4.72    71%     3.23
Leafy             35%     3.30    14%     2.84
Cruciferous       17%     3.19    12%     3.74
Others            4%      4.17    3%      5.78
Sub-total         98%     3.80    100%    3.26
Hong Kong revenue 2%              0%      
Total             100%            100%    

Our production volume of leafy vegetables dropped significantly as a result of
(1) our continued specialization towards solanaceous products, (2) the
conversion of a substantial area of greenhouses to the soil-less production
system, which is not suited to leafy production, and (3) the gradual phase out
of leafy production due to the much higher labor cost of leafy vegetable
production.

^5 Defined as revenue from sales of respective products in the PRC mainland to
external customers

Cost of inventories sold decreased by RMB13.6 million, or 8.1%, to RMB155.1
million (US$25.6 million) for the six months ended December 31, 2013, compared
to RMB168.7 million a year ago.

Adjusted cost of inventories sold^6 (non-IFRS measure) increased by RMB10.5
million, or 15.2%, to RMB79.3 million (US$13.1 million) for the six months
ended December 31, 2013, compared to RMB68.8 million a year ago.Adjusted cost
of inventories sold as a percentage of revenue increased from 36.3% for the
six months ended December 31, 2012 to 44.2% for the six months ended December
31, 2013, primarily due to the lower selling prices as well as higher
depreciation.

A reconciliation of adjusted cost of inventories sold to cost of inventories
sold determined in accordance with IFRS is set forth in Appendix IV.

                                              Six Months Ended December 31,
                                              2012      2013                
                                              RMB       RMB       US$
                                                                
Biological assets fair value adjustment        (99,907) (75,776) (12,517)
included in cost of inventories sold
                                                                
Changes in fair value less costs to sell of    227,884  215,109  35,533
biological assets
                                                                
Net impact of biological assets fair value     127,977  139,333  23,016
adjustment

The net impact of the biological assets fair value adjustment represents the
net increase or decrease in gain from fair value less costs to sell of crops
on our farmland at the end of the reporting period compared to the end of the
immediately preceding reporting period.

A net gain of RMB139.3 million was recognized arising from biological assets
fair value adjustment for the six months ended December 31, 2013, as compared
to a net gain of RMB128.0 million recognized a year ago.

The net gain of RMB139.3 million for the six months ended December 31, 2013
primarily arose from the transition from leafy to solanaceous products.As the
leafy season ended and the solanaceous season started during the six months
ended December 31, 2013, most of the crops on our farm land as of December 31,
2013 were higher value solanaceous products, while most of the crops on our
farm land as of June 30, 2013 (the immediately preceding reporting period end)
were lower value leafy products, resulting in a positive net impact. 

^6 Defined as cost of inventories sold before biological assets fair value
adjustment

The larger positive net impact for the six months ended December 31, 2013
compared to that of a year ago was primarily due to the larger area of
solanaceous product planted as of December 31, 2013 compared to a year ago.

Our packing expenses decreased by RMB0.4 million, or 2.9%, to RMB14.1 million
(US$2.3 million) for the six months ended December 31, 2013, compared to
RMB14.5 million a year ago, primarily due to a decrease of RMB1.1 million in
labor costs, which resulted from the shift in product mix from leafy to
solanaceous vegetables.

Our land preparation costs decreased by RMB0.3 million, or 1.3%, to RMB25.9
million (US$4.3 million) for the six months ended December 31, 2013, compared
to RMB26.2 million a year ago, which was primarily due to the increase in the
area of greenhouses in production during the period as compared to the
previous year.

Our research and development costs increased by RMB3.5 million, or 72.6%, to
RMB8.2 million (US$1.3 million) for the six months ended December 31, 2013,
compared to RMB4.7 million a year ago, which was primarily due to the
extensive testing activities of soil-less plantation during the six months
ended December 31, 2013.

Our selling and distribution expenses increased by RMB0.1 million, or 0.9%, to
RMB11.0 million (US$1.8 million) for the six months ended December 31, 2013,
compared to RMB10.9 million a year ago, which was primarily due to the
offsetting effects of (1) an increase in transportation costs of RMB0.4
million and (2) a decrease of RMB0.3 million in salaries, advertising and
loading charge.

Our administrative expenses decreased by RMB4.0 million, or 17.8%, to RMB18.8
million (US$3.1 million) for the six months ended December 31, 2013, compared
to RMB22.8 million a year ago, primarily due to a decrease of RMB4.0 million
in equity-settled share-based compensation.

Natural disaster loss of RMB62.6 million for the six months ended December 31,
2013 represents the loss resulting from the hit by super typhoon "Usagi" in
September 2013.

As a result of the foregoing factors, profit for the six months ended December
31, 2013 decreased by 41.2%, to RMB98.2 million (US$16.2 million), compared to
RMB167.1 million a year ago.

Adjusted profit for the period decreased by 48.5% to RMB23.0 million (US$3.8
million) for the six months ended December 31, 2013, compared to RMB44.6
million a year ago.

Basic and diluted earnings per share were RMB4.47 cents (0.74 US cents) for
the six months ended December 31, 2013.Basic and diluted earnings per ADS
were RMB223.50 cents (36.92 US cents) for the six months ended December 31,
2013.

Our operating cash inflow increased by RMB18.6 million, or 31.5%, to RMB77.6
million (US$12.8 million) for the six months ended December 31, 2013, compared
to RMB59.0 million a year ago, primarily resulting from (1) an increase of
RMB14.1 million in cash received, as a result of the collection of RMB55.3
million in trade receivables outstanding as at June 30, 2013, and (2) a
decrease of RMB4.5 million in cash payment of our operating and production
expenditures.

Cash used in investing activities increased by RMB0.4 million, or 0.2%, to
RMB176.7 million (US$29.2 million) for the six months ended December 31, 2013,
compared to RMB176.3 million a year ago.The net cash outflow of RMB176.7
million for the six months ended December 31, 2013 was primarily due to our
payment for construction in progress and prepayments for construction works
totalling RMB173.2 million, which mainly consisted of (1) payment for
construction of greenhouses of RMB97.1 million, (2) payment of RMB71.0 million
for agricultural infrastructure, and (3) payment for land improvements of
RMB5.1 million.

Recent Developments

As previously announced, super typhoon "Usagi" hit the Company's production
bases in Pingshan and Duozhu, Huidong, Guangdong Province, on September 22,
2013 and caused substantial damage.The Company has completed all demolition
and clean-up works as well as all of the planting of the winter peak season
crops.The planting was delayed by around 20 to 30 days compared to the
original plantation plan.

The two production bases have greenhouses with a total area of 2,002 mu (133
hectares), of which 770 mu (51 hectares) collapsed as a result of the typhoon
and 1,015 mu (68 hectares) of greenhouses experienced various degrees of
damage.The Company recognized that the total loss from the collapsed and
damaged greenhouses amounted to RMB62.6 million for the six months ended
December 31, 2013.More details of the financial impact of the loss will be
reflected in the Company's financial results published in the ordinary course.

Business Outlook for the Fiscal Year Ending June 30, 2014

The Company re-affirms its previous revenue guidance and estimates that its
revenue for the fiscal year ending June 30, 2014 will be between RM585 million
and RMB625 million, representing a year over year growth rate of approximately
1.6% to 8.5% for the fiscal year ending June 30, 2014 from the fiscal year
ended June 30, 2013. This forecast reflects the Company's current and
preliminary estimate, which is subject to change. See "Safe Harbor Statements"
below.

Conference Call

The Company will host a conference call at 8:00 a.m. ET on February 20, 2014
(9:00 p.m. Hong Kong Time) to review the Company's financial results and
answer questions. You may access the live interactive call via:

  *+1 877 679 2987 (U.S. Toll Free)
  *+400 603 9021 (China Toll Free)
  *+852 3060 0227 (International)
  *Pass Code: 517547#

Please dial-in approximately 10 minutes in advance to facilitate an on-time
start.

A replay will be available for two weeks after the call and may be accessed
via:

  *+852 3060 0238
  *Passcode: 212057#

A live and archived webcast of the call, as well as a presentation with the
Company's financial results will be available on the Company's website at
www.legaga.com.hk/html/index.php.

About Le Gaga Holdings Limited (Nasdaq:GAGA)

Le Gaga is a leading greenhouse vegetable producer in China. The Company sells
and markets greenhouse vegetables such as peppers, tomatoes, cucumbers and
eggplants, as well as green leafy vegetables to wholesalers, institutional
customers and supermarkets in China and Hong Kong. The Company has
successfully built a trusted brand among its customers.

The Company currently operates farms in the Chinese provinces of Fujian,
Guangdong and Hebei. Leveraging its large-scale greenhouses, proprietary
horticultural know-how and comprehensive database, the Company specializes in
producing and selling high-quality, off-season vegetables during the winter
months.

Safe Harbor Statements

This press release contains statements of a forward-looking nature. These
statements are made under the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, including certain plans,
expectations, goals, and projections, which are subject to numerous
assumptions, risks, and uncertainties. These forward-looking statements may
include, but are not limited to, statements containing words such as "may,"
"could," "would," "will," "plan," "anticipate," "believe," "estimate,"
"predict," "potential," "expect," "intend" and "future" or similar
expressions. Among other things, the management's quotations and the Business
Outlook section contain forward-looking statements. These forward-looking
statements speak only as of the date of this press release and are subject to
change at any time.These forward-looking statements are based upon
management's current expectations and are subject to a number of risks,
uncertainties and contingencies, many of which are beyond the Company's
control that may cause actual results, levels of activity, performance or
achievements to differ materially from any future results, levels of activity,
performance or achievements expressed or implied by such forward-looking
statements. The Company's actual results could differ materially from those
contained in the forward-looking statements due to a number of factors,
including those described under the heading "Risk Factors" in the Company's
final prospectus, dated October 28, 2010, filed with the Securities and
Exchange Commission, and in documents subsequently filed by the Company from
time to time with the Securities and Exchange Commission. Potential risks and
uncertainties include, but are not limited to: the Company's ability to
continue to lease farmland or forestland; the legality or validity of the
Company's leases of agricultural land; risks associated with extreme weather
conditions, natural disasters, crops diseases, pests and other natural
conditions; fluctuations in market prices and demand for the Company's
products; risks attributable to our growth strategies, including increasing
our greenhouse coverage, increasing our production scale, strengthening our
sales, marketing and distribution efforts, focusing on high quality off-season
products, improving our product mix, and expanding our research and
development capability; risks of product contamination and product liability
claims as well as negative publicity associated with food safety issues in
China; risks of labor shortage and rising labor costs; the Company's ability
to comply with U.S. public accounting reporting requirements, including
maintenance of an effective system of internal controls over financial
reporting; and the Company's susceptibility to adverse changes in political,
economic and other policies of the Chinese government that could materially
harm its business. The Company undertakes no obligation to update or revise
any forward-looking statements, whether as a result of new information, future
events or otherwise. Further information regarding risks and uncertainties
faced by the Company is included in its filings with the U.S. Securities and
Exchange Commission, including its final prospectus, dated October 28, 2010.

Information Related to Certain Non-IFRS measures

This press release contains the following financial measures that differ from
the comparable measures under International Financial Reporting Standards
(IFRS): adjusted cost of inventories sold, adjusted profit for the period and
adjusted EBITDA.Reconciliations between those non-IFRS measures and the
comparable IFRS measures are included elsewhere in this press release.While
we believe these measures are useful for investors to assess our financial
results, these non-IFRS measures should not be considered substitutes for the
most directly comparable IFRS measures.Additional information concerning
non-IFRS measures are included in our filings with the Securities and Exchange
Commission that are available in the "Investors – SEC Filings" section of our
website, www.legaga.com.hk.

Adjusted cost of inventories sold is defined as cost of inventories sold
before biological assets fair value adjustment. We are primarily engaged in
agricultural activities of cultivating, processing and distributing vegetables
and have therefore adopted International Accounting Standard 41 "Agriculture",
or IAS 41, in accounting for biological assets and agricultural produce.
Unlike the historical cost accounting model, IAS 41 requires us to recognize
in our income statements the gain or loss arising from the change in fair
value less costs to sell of biological assets and agricultural produce for
each reporting period. Cost of inventories sold determined under IAS 41
reflects the deemed cost of agricultural produce, which is based on their fair
value (less costs to sell) at the point of harvest.Biological assets fair
value adjustment is the difference between the deemed cost of the agricultural
produce and the plantation expenditure we incurred to cultivate the produce to
the point of harvest. Although an "adjusted" cost of inventories sold
excluding these fair value adjustments is a non-IFRS measure, we believe that
separate analysis of the cost of inventories sold excluding these fair value
adjustments adds clarity to the constituent parts of our cost of inventories
sold and provides additional useful information for investors to assess our
cost structure. A reconciliation of adjusted cost of inventories sold to IFRS
cost of inventories sold is set forth in Appendix IV.

Adjusted profit for the period represents profit for the period before the net
impact of biological assets fair value adjustment and further adjusted to
exclude, as applicable, the effects of non-cash share-based compensation,
natural disaster loss, offering expenses and impairment losses on property,
plant and equipment and prepayments charged to the income statement.We
believe that separate analysis of the net impact of the biological assets fair
value adjustments, non-cash share-based compensation, extraordinary losses
from natural disasters, offering expenses and impairment losses on property,
plant and equipment and prepayments adds clarity to the constituent part of
our results of operations and provides additional useful information for
investors to assess the operating performance of our business. A
reconciliation of adjusted profit for the period is set forth in Appendix V.

Adjusted EBITDA is defined as EBITDA (earnings before net finance income
(costs), income tax expense, depreciation and amortization), as further
adjusted to exclude, as applicable, the effects of non-cash share-based
compensation, the net impact of biological assets fair value adjustment,
natural disaster loss, offering expenses and impairment losses on property,
plant and equipment and prepayments charged to the income statement. We
believe adjusted EBITDA is useful to investors because it is frequently used
by securities analysts, investors and other interested parties in the
evaluation of companies in our industry. You should use adjusted EBITDA as a
supplemental analytical measure to, and in conjunction with, our IFRS
financial data. In addition, we believe that adjusted EBITDA is useful in
evaluating our operating performance compared to that of other companies in
our industry because the calculation of adjusted EBITDA generally eliminates
the effects of financing and income taxes and the accounting effects of
capital spending, which items may vary for different companies for reasons
unrelated to overall operating performance. We use these non-IFRS financial
measures for planning and forecasting and measuring results against the
forecast. Using several measures to evaluate the business allows us and
investors to assess our relative performance against our competitors and
ultimately monitor our capacity to generate returns for our shareholders.A
reconciliation of the adjusted EBITDA to profit for the period is set forth in
Appendix VI.

Appendix I
Le Gaga Holdings Limited
Unaudited Condensed Consolidated Income Statements
For the six months ended December 31, 2012 and 2013

                                      Six Months Ended December 31,
                                      2012           2013
                                      RMB            RMB            US$
                                      (In thousands, except per share data)
                                                                  
Revenue                                189,462       179,437       29,641
Cost of inventories sold               (168,740)     (155,065)     (25,615)
Changes in fair value less costs to                                
sell related to
Crops harvested during the period      78,693        65,974        10,898
Growing crops on the farmland at the   149,191       149,135       24,635
period end
Total changes in fair value less costs 227,884       215,109       35,533
to sell of biological assets
Packing expenses                       (14,502)      (14,088)      (2,327)
Land preparation costs                 (26,227)      (25,892)      (4,277)
Other income                           859           831           137
Research and development expenses      (4,725)       (8,154)       (1,347)
Selling and distribution expenses      (10,886)      (10,988)      (1,815)
Administrative expenses                (22,849)      (18,782)      (3,103)
Natural disaster loss                  --           (62,614)      (10,343)
Other expenses                        (4)           (167)         (28)
Results from operating activities      170,272       99,627        16,456
Finance income                         3,316         2,695         445
Finance costs                          (6,252)       (3,841)       (634)
Net finance costs                      (2,936)       (1,146)       (189)
Profit before taxation                 167,336       98,481        16,267
Income tax expense                     (257)         (249)         (41)
Profit for the period                  167,079       98,232        16,226
Earnings per share (in cents)                                      
Basic                                  7.33          4.47          0.74
Diluted                                7.32          4.47          0.74
Weighted average number of shares                                  
outstanding:
Basic                                  2,278,836,106 2,198,845,700 
Diluted                                2,282,544,964 2,198,845,700 
Earnings per ADS (in cents)                                        
Basic                                  366.50        223.50        36.92
Diluted                                366.00        223.50        36.92
Weighted average number of ADSs                                    
outstanding:
Basic                                  45,576,722    43,976,914    
Diluted                                45,650,899    43,976,914    

                                                         
Appendix II
Le Gaga Holdings Limited
Unaudited Condensed Consolidated Balance Sheets
As of June 30 and December 31, 2013

                                  June 30, 2013 December 31, 2013
                                  RMB           RMB        US$
                                  (In thousands)
Non-current assets                                        
Property, plant and equipment      1,049,311    1,064,951 175,917
Construction in progress           70,508       67,567    11,161
Lease prepayments                  1,171        1,128     186
Long-term deposits and prepayments 166,916      209,353   34,583
Biological assets                  12,439       11,720    1,936
Deferred tax assets                2,321        3,344     552
Total non-current assets           1,302,666    1,358,063 224,335
                                                         
Current assets                                            
Biological assets                  26,268       209,042   34,531
Inventories                        14,941       17,639    2,914
Trade and other receivables        84,558       64,814    10,707
Pledged bank deposits              45,065       --        --
Cash                               305,487      220,136   36,364
Total current assets               476,319      511,631   84,516
                                                         
Total assets                       1,778,985    1,869,694 308,851
                                                         
Equity                                                    
Capital                            644,397      644,397   106,447
Reserves                           908,126      1,006,055 166,188
Total equity                       1,552,523    1,650,452 272,635
                                                         
Current liabilities                                       
Bank loans                         146,110      119,398   19,723
Trade and other payables           75,246       93,452    15,437
Current taxation                   5,106        6,392     1,056
Total current liabilities          226,462      219,242   36,216
                                                         
Total liabilities                  226,462      219,242   36,216
                                                         
Total equity and liabilities       1,778,985    1,869,694 308,851


Appendix III
Le Gaga Holdings Limited
Unaudited Condensed Consolidated Statements of Cash Flow
For the six months ended December 31, 2012 and 2013

                                            Six Months Ended December 31,
                                            2012       2013                 
                                            RMB        RMB        US$
                                            (In thousands)
Operating activities                                             
Profit before taxation                       167,336   98,481    16,267
                                                                
Adjustments for:                                                 
Amortization of lease prepayments            28        28        5
Depreciation                                 41,502    59,684    9,859
Equity settled share-based transactions      5,448     1,439     238
Changes in fair value less costs to sell of  (227,884) (215,109) (35,533)
biological assets
Interest income                              (958)     (455)     (75)
Interest expense                             6,252     3,841     634
Net loss on disposal of property, plant and  2         62,615    10,343
equipment and lease prepayments
Foreign exchange gain                        (1,718)   (2,312)   (381)
                                                                
Changes in working capital:                  (9,992)   8,212     1,357
                                                                
Changes in current biological assets due to  (102,453) (120,573) (19,917)
plantations
Changes in inventories, net of effect of     162,187   151,904   25,093
harvested crops transferred to inventories
(Increase)/decrease in trade and other       (4,118)   19,794    3,270
receivables
Decrease in long-term deposits and           6,410     5,806     959
prepayments
Increase in trade and other payables         6,927     12,409    2,050
                                                                
Cash generated from operations               58,961    77,552    12,812
                                                                
Income tax paid                              --       --       --
                                                                
Net cash generated from operating activities 58,961    77,552    12,812


Appendix III
Le Gaga Holdings Limited
Unaudited Condensed Consolidated Statements of Cash Flow
For the six months ended December 31, 2012 and 2013

                                              Six Months Ended December 31,
                                              2012       2013
                                              RMB        RMB        US$
                                              (In thousands)
Investing activities                                               
Interest received                              958       455       75
Plantations of non-current biological assets   (934)     (975)     (161)
Payment for the purchase of property, plant    (12,646)  (2,977)   (492)
and equipment
Payment for construction in progress and       (128,633) (173,188) (28,609)
prepayments for construction works
Increase in pledged bank deposits related to   (35,000)  --       --
construction works
                                                                  
Net cash used in investing activities          (176,255) (176,685) (29,187)
                                                                  
Financing activities                                               
Interest paid                                  (6,067)   (5,328)   (880)
Proceeds of bank loans                         35,000    66,000    10,902
Repayment of bank loans                        --       (91,775)  (15,160)
Decrease in pledged bank deposits related to a --       45,065    7,444
bank loan
Payment for repurchase of shares               (10,822)  --       --
                                                                  
Net cash generated from financing activities   18,111    13,962    2,306
                                                                  
Net decrease in cash                           (99,183)  (85,171)  (14,069)
                                                                  
Cash at July 1                                 504,506   305,487   50,463
                                                                  
Effect of foreign exchange rate changes        (697)     (180)     (30)
                                                                  
Cash at December 31                            404,626   220,136   36,364


Appendix IV
Le Gaga Holdings Limited
Reconciliation of Non-IFRS adjusted cost of inventories sold to cost of
inventories sold
For the six months ended December 31, 2012 and 2013

                                           Six Months Ended December 31,
                                           2012        2013
                                           RMB         RMB         US$
                                           (In thousands)
Cost of inventories sold                    (168,740)  (155,065)  (25,615)
Less: biological assets fair value          99,907     75,776     12,517
adjustment
                                                                 
Adjusted cost of inventories sold           (68,833)   (79,289)   (13,098)


Appendix V
Le Gaga Holdings Limited
Reconciliation of Non-IFRS adjusted profit for the period to profit for the
period
For the six months ended December 31, 2012 and 2013

                                              Six Months Ended December 31,
                                              2012       2013
                                              RMB        RMB        US$
                                              (In thousands)
Profit for the period                          167,079   98,232    16,226
                                                                  
Add:                                                              
Non-cash share-based compensation              5,448     1,439     238
Natural disaster loss                          --       62,614    10,343
Net impact of biological assets fair value     (127,977) (139,333) (23,016)
adjustment
                                                                  
Adjusted profit for the period                 44,550    22,952    3,791


Appendix VI
Le Gaga Holdings Limited
Reconciliation of Non-IFRS adjusted EBITDA to profit for the period
For the six months ended December 31, 2012 and 2013

                                              Six Months Ended December 31,
                                              2012       2013
                                              RMB        RMB        US$
                                              (In thousands)
Profit for the period                          167,079   98,232    16,226
Add:                                                               
Amortization of lease prepayments              28        28        5
Depreciation                                   41,502    59,684    9,859
Finance costs                                  6,252     3,841     634
Income tax expense                             257       249       41
Non-cash share-based compensation             5,448     1,439     238
Natural disaster loss                          --       62,614    10,343
Biological assets fair value adjustment        99,907    75,776    12,517
included in cost of inventories sold
Less:                                                              
Finance income                                 (3,316)   (2,695)   (445)
Changes in fair value less costs to sell of    (227,884) (215,109) (35,533)
biological assets
                                                                  
Adjusted EBITDA                                89,273    84,059    13,885

CONTACT: For further information, please contact:
         PRChina
         Jane Liu
         Tel: (852) 2522 1838
         Email: jliu@prchina.com.hk
        
         Henry Chik
         Tel: (852) 2522 1368
         Email: hchik@prchina.com.hk

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