New Hope Liuhe Co., China's biggest poultry supplier, said profits will be hurt by a report that some of its chicken wasn't properly inspected. Yum! Brands Inc. and McDonald's Corp. said they stopped buying meat from the company.
Sales and profits will sustain a "certain amount of impact," the company said in a December 29 statement to Shenzhen's stock exchange. China Central Television on December 18 said Liuhe and other suppliers weren't properly inspecting chicken bought from farmers for antibiotics and hormones.
Liuhe stated that it shut the deep-freeze plant in the city of Pingdu that was cited in the CCTV report and is cooperating with a government investigation. It also apologized for the negligence of its workers and said it will "ensure a comprehensive test system is in place."