PRESS

2016-08-03

Announces 2016 Interim Results Remains Growths in Power Generation and Net Profit

Ÿ   The Group’s solar power generation surged 70.10% to 436.07 million kWh

Ÿ   Basic earnings per share grew 14.5% year-on-year

 

Financial Highlights

For the six months ended 30 Jun

1H2016

(000’HK$)

1H2015

(000’HK$)

 Change

Revenue

1,052,071

2,174,462

-51.6%

Profit before income tax

286,426

277,048

+3.4%

Profit attributable to owners of the Company

278,657

253,021

+10.1%

Basic earnings per share

(HK cents)

3.24

2.83

+14.5%

 

(PRC, Hong Kong, 3 August, 2016) Concord New Energy Group Limited (“the Company” and its subsidiaries “the Group,” HK stock code: 182), is pleased to announce its interim results for the six months ended 30 June 2016 (“The Period”).

 

For the six months ended 30 June 2016, the Group’s revenue amounted to HK$1,052,071,000 (1H 2015: HK$2,174,462,000); profit attributable to equity holders of the Group amounted to HK$278,657,000 (1H 2015: HK$253,021,000), increased by 10.13% as compared with the same period last year. The basic earnings per share were 3.24 HK cents (1H 2015: 2.83 HK cents); and the fully diluted earnings per share were 3.22 HK cents (1H 2015: 2.83 HK cents).

 

*for identification purpose only

 

During the reporting period, the Group’s revenue derived from power generation business was significantly improved enabling a growth in our overall profit of the Group. The Group adapts changes from national policy by proactively adjusting business model, expanding the ration of “build and sell” business and cutting the scale of Engineering, Procurement and Construction (“EPC”) business, resulting a substantially decrease in revenue and profit from EPC sector during the reporting period and the Group’s consolidated revenue.

 

As at the end of the reporting period, the Group’s net asset value was HK$5,886,523,000 (31 December 2015: HK$5,755,575,000); the Group’s cash and cash equivalents were HK$1,480,840,000 (31 December 2015: HK$1,905,131,000).

 

Power Plant Investment, Development and Operation Business

The Group’s power plants investment, development and operation segments continued to deliver satisfactory results in the period under review. In terms of project development and resources reserves, the Group signed 1,800MW of wind power and 350MW of solar power exclusive development right agreements during the reporting period. For the six months ended 30 June 2016, the Group’s wind power resources reserve amounted to over 28GW and solar power resources reserve amounted to 8GW, which have provided the assurance of the Group’s sustainable development.

 

During the reporting period, 11 of the Group’s wind power projects with a total capacity of 728MW have been included in the construction programme list “2016 Programme for the Nationwide Development and Construction of Wind Power” issued by National Energy Administration (“NEA”), all of which were located in the regions with good access to the grid and no curtailment.

 

With regards to newly added installed capacity, the total installed capacity of power projects that the Group invested in and held equity interests was 788MW (1H 2015: 563MW), among which there were 6 continued projects with installed capacity of 298MW and 10 new construction projects with installed capacity of 490MW. In particular, 13 were wind farms with capacity of 708MW and attributable capacity of 684MW, and 3 were solely-funded solar power plants with capacity of 80MW.

 

As for the power generation segment, the power plants controlled by the Group achieved revenue amounting to HK$428,750,000 (1H 2015: HK$250,577,000), achieving net profit of HK$207,272,000 (1H 2015: HK$114,617,000) from power generation. The revenue of power plants which were associates and joint ventures of the Group in aggregate amounted to HK$871,206,000 (1H 2015: HK$811,176,000), the net profit in aggregate amounted to HK$189,925,000 (1H 2015: HK$140,371,000), and the Group’s share of results of associates and joint ventures amounted to HK$81,567,000 (1H 2015: HK$65,384,000).

 

During the reporting period, the Group’s power plants generated aggregate electricity output of 1,990.07 million kWh (1H 2015: 1,590.53 million kWh), up 25.12% as compared with the same period last year, of which wind power generation was 1,554 million kWh (1H 2015: 1,334.18 million kWh), up 16.48% as compared with the same period last year and solar power generation was 436.07 million kWh (1H 2015: 256.36 million kWh), up 70.10% as compared with the same period last year.

 

Renewable Energy Service Business

For the first half of 2016, The Group’s company in the EPC sector undertook 20 external and internal EPC projects with a total capacity of 942MW (1H 2015: 909MW), representing an improvement in business scale compared to the same period last year. Given the changes of the Group’s operation policy, the Group transform certain EPC projects provided for external parties into our investment construction, which will be sold at a selected time after its commencement of operation (“build and sell” business model). During the reporting period, there was an increase in the Group’s internal projects and a decrease in external projects, therefore, revenue generated by EPC section show a massive decline. During the reporting period, the Group’s design, procurement and construction companies achieved revenue in aggregate of HK$584,101,000 (1H 2015: HK$1,865,403,000).

 

In addition to providing construction design services for the EPC projects, the Group’s design company, as a member of the integrated EPC group, also provided resources assessment and consulting services for the Group and external renewable energy investors. During the reporting period, the Group completed 98 wind or solar resources assessment and technical advisory reports, 35 feasibility studies, 8 preliminary design and 2 construction designs.

 
The Group’s operation and maintenance (“O&M”) companies jointly undertook the operation and maintenance business for 52 wind farms and solar power plants, entered into contracts with turbine manufacturers for 6 projects in respect of regular inspection service; and signed 5 contracts with power plants in respect of preventive tests, technical renovation and overhaul as well as wind power prediction services. During the reporting period, the business segment contributed a revenue of HK$39,220,000 (1H 2015: HK$58,482,000) for the Group.

 

Looking ahead, Mr. Yu Weizhou, Executive Director and CEO of Concord New Energy, commented: “The Group has entered the field of renewable energy for ten years. For this decade, we have experienced various changes in the macroeconomic environment, went through the continuous advancement of technologies and witnessed the gradual maturity of the wind and solar power business model. Following the implementation of a series of measures including the south-bound development, solar energy development and optimization of capital structure in recent years, the Group’s assets in power plants as well as its proportion of earnings from power generation business have been increasing.”

 

“In the second half of 2016, the Group will persist on the following operational strategies. Including: develop wholly-owned or controlled wind power and solar power projects with good economic benefits in southern China where no curtailment is enforced in order to maintain a steady growth in the Group’s attributable installed capacity; strengthen safety production management in power plants and refined management in production to improve economic efficiency and uplift the technical standards of power plant operation;strengthen the capabilities of companies in the service business segment and continue to expand in external business; continue to optimize and adjust the Group’s capital structure; and continue the implementation of cost control. We believe that renewable energy has a broad space for development, and all employees of the Group, led by management team, will blaze new trails, struggle to forge ahead and create last superior returns for shareholders and for society.”