(Yicai Global) April 2 -- Chinese aquaculture firm Dalian Zoneco Group lost CNY399 million (USD56.2 million) last year after yet another mass die-off of its scallops, the company said in a statement yesterday, adding it plans to sell its equity in subsidiary Dalian Zhangzidao Chuo Cold Logistics for CNY116 million.

The event caused CNY290 million more in losses to the company based in China's northeastern Liaoning province, bringing its profits down over 14-fold compared to its CNY32.1 million profit in 2018. Its revenue fell 2.67 percent to CNY2.7 billion last year, per the statement.

Zoneco's shares [SHE:002069] were trading 5.12 percent down in mid-morning at CNY2.78 (39 US cents).

This is not the first time that the firm's scallops have run into heavy seas.

The company announced the first anomaly with its mollusk stocks in October 2014 and was forced to write these off to the tune of almost CNY800 million (USD115 million).

Zoneco again declared an irregularity in January last year, this time scrapping CNY630 million in stocks. It cited a shortage of food that starved the fan-shelled bivalves to death as the cause. The firm announced that this scallop apocalypse caused it net-profit losses of CNY43.14 million in its first-quarter report.

In July, Wu Hougang, chairman of Zoneco, was fined CNY600,000 by the China Securities Regulatory Commission for alleged information disclosure violations and slapped with a life-long market ban.

Poached Parastichopus

Zoneco was also charged with harvesting sea cucumbers during the no-fishing period in August, though the company denied these allegations.

It once again reported the mass death of scallops worth over CNY300 million last year, which posed a risk of inventory impairment. The cause of this mass mortality is as yet unknown.

Zoneco continued to sell assets to cover its operating losses. The divestment of the company's stake in Dalian Zhangzidao Chuo Cold Logistics is also one of its recovery plans.

The company will transfer three-quarters of its stake in Dalian Zhangzidao Chuo Cold Logistics to Global Logistic Properties Cold International Logistics Shanghai, with a tentative transaction price of CNY136.5 million. It also plans to acquire an 11.25 percent stake in the unit from minority shareholders for CNY20.5 million. The company will hold 25 percent shares in it post-transaction.

Zoneco will use the proceeds to replenish its liquidity and repay bank loans, which will positively impact its future financial operations and results, per the statement.

Zhangzidao Chuo Cold Logistics' net funds were CNY71.1 million as of Dec. 31 last year. Its net losses were CNY44.5 million as of Sept. 30.

Zoneco currently holds 88.75 percent of equity in the unit, while Japanese seafood seller Chou Gyorui and its Hohsui unit each hold a 5.625 percent stake.

Editor: Ben Armour