Matthew Larson's questions to Future FinTech Group (FTFT) leadership • Q2 2015
Question
Matthew Larson of Morgan Stanley questioned the recent decline in SkyPeople's stock price following what appeared to be a strong quarter, and also inquired about the significant shift in the product mix, specifically the dramatic decrease in apple concentrate sales and the large increase in pear concentrate sales.
Answer
CFO Xin Ma, translating for CEO Yongke Xue and providing his own insights, suggested the stock price may have been impacted by investor concerns over potential dilution from a recently filed S-3 shelf registration for a $100 million financing. He reassured that there are no immediate plans for a large offering. Regarding the product mix, Ma explained that the highly competitive, low-margin apple concentrate business is no longer a strategic focus. The company is prioritizing its fruit juice beverage segment, which now accounts for over 90% of revenue, making the decline in apple concentrate sales a non-critical issue for management.