PRESS

2017-08-08

Announces 2017 Interim Results Total Profit Increases by 12.9%, Wind Power Generation Output Surges by 38.3%

Financial Highlights

For the six months ended30 Jun
1H2017
(000’RMB)
1H2016
(000’RMB)
 Change
Revenue
594,116
885,518
-32.9%
Profit before income tax
321,442
245,210
+31.1%
Profit attributable to owners of the Company
269,374
238,653
+12.9%
Basic earnings per share
(RMB cents)
3.14
2.77
+13.4%
Ÿ   Power generation output was 1,201.05 million kWh, representing a year-on-year growth of 9.5%, of which wind power generation output was 939,94 million kWh, representing a growth of 38.3%
Ÿ    Profit attributable to equity holders increased by 12.9% to RMB269,374,000
Ÿ    Basic earnings per share grew by 13.4%
 
(PRC, Hong Kong, 8August, 2017) 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 2017 (“the Period”).
 
For the six months ended 30 June 2017, the Group’s revenue amounted to RMB594,116,000 (1H2016:RMB885,518,000), decreased by 32.91% as compared with the same period last year; profit attributable to equity holders of the Group amounted to RMB269,374,000 (1H2016: RMB238,653,000), increased by 12.87% as compared with the same period last year. The basic earnings per share were RMB3.14 cents (1H2016: RMB2.77 cents) increased by 13.36% as compared with the same period last year; and the fully diluted earnings per share were RMB 3.13 cents (1H2016: 2.76 cents).
 
During the Period, the Group continued to implement the “build and sell” business model and reduce the scale of EPC (Engineering Procurement Construction) business, resulting in a significant decrease in EPC segment. The Group’s consolidated revenue largely decreased, yet continuous growth was seen in the profit attributable to equity holders of the Group owing to the substantial increase of profit from project disposal.
 
As at the end of the Period, the net assets of the Group amounted to RMB5,312,611,000 (31 December 2016: RMB5,225,750,000). As at the end of Period, the Group’s cash and cash equivalents were RMB1,817,313,000 (31 December 2016: RMB1,891,277,000).
 
Power Plant Investment, Development and Operation Business
For the six months ended 30 June 2017, power generation output maintained growthwith significant increase in proportion of income from power plants. During the Period, power generation output attributable to the Group was 1,201.05 million kWh(1H 2016: 1,096.85kWh), representing a growth of 9.50% over the same period last year, of which, wind power generation output was 939,94 million kWh(1H 2016: 679.46 million kWh), representing a growth of 38.34% over the same period last year, while solar power generation output was 261.11 million kWh(1H 2016: 417.39 million kWh), representing a decrease of 37.44% over last year.
 
During the Period, the power plants held by the Group delivered a total revenue of RMB350,692,000(1H 2016: RMB360,875,000), which accounted for 59.03%(1H 2016:40.75%) of the Group’s revenue.
 
For the six months ended 30 June 2017, the total installed capacity of power plants invested by the Group was 923MW (1H 2016: 788MW), all of which were solely-funded projects. Among which, there were 7 continued projects with installed capacity of 308MW and 13 new construction projects with installed capacity of 615MW. 17 of these projects were wind farms with installed capacity of 868MW, and 3 were solar power plants with installed capacity of 55MW.
 
The Group added a total of 4 wind power plants and solar power plants, with total installed capacity of 136MW(1H 2016: 146MW), all of which were all solely-funded projects. Among which, there were 2 wind power plants with installed capacity of 96MW and 2 solar power plants with installed capacity of 40MW.
 
During the Period, 12 of the Group’s projects (565MW) have been included in the construction programme list “2017 Programme for the Nationwide Development and Construction ” issued by energy administrations at provincial level, all of which were located in the regions with good access to the grid and no curtailment.
 
During the Period, the Group entered into new agreements in relation to wind power resources of 200MW, and solar power resources of 300MW. As of the end of the Period, the Group’s wind power resources reserve amounted to over 28GW and solar power resources reserve amounted to 8GW, which provided assurance for the Group’s sustainable development.
 
Renewable Energy Service Business
During the first half of 2017, the Group’s own Concord Power Consulting & Design (Beijing) Corp., Ltd. (“Design Company”) has been listed on National Equities Exchange and Quotations since 9 May 2017, with stock name as “Concord Power” and stock code as 871484. The Design Company independently contracted the “Shanxi Wucheng 20MW Photovoltaic Power Stations Poverty Alleviation Project”, providing grid-connection power generation. The capability of the Design Company was immensely enhanced.
 
The Design Company also provided resources assessment and consulting services for the Group and external renewable energy investors. During the Period, the Group completed 94 wind or solar resources assessment and technical advisory reports, 26 feasibility studies, 6 preliminary designs and 4 construction designs.The Group’s Design Company contributed a revenue of RMB40,781,000(1H 2016: RMB9,318,000) to the Group during the Period.
 
Power plant operation and maintenance (O&M) is a business area prioritized by the Group for the development. The Group’s O&M companies provided full O&M services, preventive tests, technical renovation and overhaul, wind power prediction and other services to internal and external power plants, as well as carried out maintenance engineering and regular inspection services for turbine manufacturers during the warranty period. The Group’s O&M companies used big data, cloud computing, internet of things, Internet and other information technology means to actively create new cloud O&M model. By researching and developing big data operation and maintenance platform system, the “Power+” with independent intellectual property rights, the Group’s O&M companies offered customers with personalized and precise operation and maintenance services.During the Period, the Group’s O&M companies jointly undertook the operation and maintenance business for 61 wind farms and solar power plants, entered into contracts with turbine manufacturers for 7 projects in respect of regular inspection service; and signed 25 contracts with power plants in respect of preventive tests, technical renovation and overhaul as well as components sales services.During the Period, the O&M business segment contributed a revenue of RMB38,364,000 (1H2016: RMB32,977,000) for the Group.
 
Looking ahead, Mr. Yu Weizhou, Executive Director and CEO of Concord New Energy*, commented: “Over the years, as the renewable energy industry developed by leaps and bounds, we believe that there is a huge space for advancement of the renewable energy technologies, resulting in a continuous reduction of cost per kWh of renewable energies. With a definite trend of replacing traditional fossil energies, the industry will have a broad space for development. Following the implementation of a series of measures including the Group’s south-bound development, optimization of capital structure and transformation of business model in recent years, the Group’s assets in power plants as well as its proportion of earnings from power generation business have been increasing, representing a sound business and financial performance.
 
“In the second half of 2017, the Group will continue to carry out operating strategies with focus on reduction of cost per kWh while establishing its system, preventing risks and expanding service business, so as to be able to establish a group of wind power and solar power projects with good economic returns by way of sole proprietorship or shareholdings, and to maintain a sustained growth of installed capacity owned by the Group. The strategies include increasing efforts on approval of quality projects in southern area without curtailment to ensure the quality of project resources and consumption of electricity; optimizing the procurement strategy and controlling costs in all aspects; enhancing the research and application of new equipment and processes, reducing cost and improving efficiency to minimise the cost per kWh whilst ensuring safety; reinforcing the safety production management and refined management of the power plants, improving the equivalent utilization hours and reducing the loss of curtailment.We believe that under the leadership of our quality management team, all of our employees will blaze new trails in a pioneering spirit and work hard to make progress, so as to bring about sustained excellent return for our shareholders and the society.”