Asia Power's Net Profit a Record-high For 1st Half FY2006 of 17m SGD
+ Operating Cash flow increased 60 %
+ Gained 11,3 million SGD from sale of a high-tech subsidiary
+ Consolidated financial results with a new subsidiary
+ Refocus its core businesses into environmentally friendly and renewable energy power plants
SINGAPORE – 3 August 2006 – Mainboard-listed Asia Power Corporation Limited ('Asia Power' or 'the Group'), which is principally involved in the ownership, management and operation of renewable energy power plants in the People's Republic of China ('PRC'), is pleased to announce a record net profit of 17 million SGD for the first half of the financial year ending 31 December 2006 as compared to the 2,1 million SGD for the 1HFY2005. This comes at the back of the management's decision to refocus its core businesses into environmentally friendly and renewable energy power plants.
As part of the company's efforts to refocus its business, Asia Power has increased its equity interest in Sichuan Anning River Energy Development Co., Ltd. ('Anning River') which Asia Power's Net Profit a Record-high For 1st Half of 17m SGD became a subsidiary of the Company at the end of FY2005 and sold Shenzhen NARI Technologies Co., Ltd. ('Shenzhen Nari'), an associate of the Company in the first half of FY2006. Also, the group has acquired equity interests in a number of hydropower plants in Chongqing and Sichuan
Performance Review
Operating Revenue
The group's operating revenue increased by 25,7 % to 61.8 million SGD for the first half of the financial year ending 31 December 2006, from 49,2 million SGD for the same period. This significant increase was due to the consolidation of the financial results of Sichuan Anning River Energy Development Co. Ltd ('Anning River'), which has become a subsidiary of the Company at the end of FY2005. The increase in operating revenue was also attributed by a 13 % increase in revenue from Heilongjiang Asiapower Xinbao Heating & Power Co., Ltd. Asia Power (Neijiang) Hydroelectricity Co. Ltd has however reported a decrease in revenue by 11 % during the current period as compared to the same period last year. Apart from the increase in contribution from the acquisition of several key hydropower plants late last year, the gain of 11,3 million SGD in the sale of Shenzhen Nari has also played a significant impact to the increase in net profit for the current period. Net operating cash flow remains strong with a 60 % increase to 3,5 million SGD in 1HFY2006, as compared to 2,2 million SGD in 1HFY2005.
Expenses
Increase in administrative expenses by 2,8 million SGD during the current period was attributable to the setting up of Asia Power (Shenzhen) Management Consulting Co. Ltd and consolidation of the Anning River. The expansion plan of Xinbao via acquisition of heat pipes during late last year also contributed to the increase in administrative expenses.
Share of Profits of Associates
In 1HFY06, the Group's share of profit of associates increased by 23,7 % to 3,2 million SGD from 2,6 million SGD for the same period last year. This increase is mainly contributed by Chongqing Yujiankou Hydroelectricity Co., Ltd. ('Chongqing'), which was acquired last year and 27 % increase in profit contribution from the power plants in Changzhou.
The group also acquired additional 5,69 % equity interest in Chongqing, increasing its effective equity interest to 31,6 %. Also, the group incorporated Asia Power (Leibo) hydroelectricity Co., Ltd. ('Leibo') with 67 % equity interest, to develop and operate hydropower plants in Sichuan. The group also acquired 9,3 % equity interest in Sichuan Jiajiang Qianfo Yan Hydroelectricity Co., Ltd. for RMB 15,9 million and 24,9 % equity interest in Tian Quan River Energy Development Co., Ltd. for RMB 24,1 million.
'The management is very pleased with the overall performance for the 1st half this year. In anticipation to the continuous price hikes of raw materials and fossil fuels, our decision to shift our focus to renewable energy power generation plants, especially hydropower electricity generation plants, has paid off for the Group. We have achieved a profit margin of 30 % for the first half as compared to 16 % achieved the same period last year.'
'We anticipate the demand for electricity to increase, along with the continued growth of the PRC economy expected. Going forward, we will continue our relentless pursuit to focus on renewable energy power generated plants as out main engine of growth. Barring any unforeseen circumstances, the Group expects to remain profitable for the next financial year.' commented Mr Zhang Gang Zhu, Executive Director and Chief Executive Officer of Asia Power Corporation Limited.
About Asia Power Corporation Limited
Listed on the Mainboard Singapore Exchange since October 1999, Asia Power Corporation Limited is principally involved in the ownership, management and operation of power plants in China.
Incorporated in March 1997, Asia Power's three core businesses are power generation, power-related technology and the provision of consultation to and management of power and power-related activities. To date, the Company has invested in a total of eight power plants with a total installation capacity of more than 550MW, two power-related technology companies and two power business consulting companies in strategic cities across China.
In tandem with China government's environmental protection policy in the production of energy, efforts have been channelled to reduce the reliance on coal through increasing the usage of renewable energies. As a strategic move, Asia Power started investing in power plants which make use of environmentally-friendly and renewable energies especially hydropower as early as 1998. Its efforts to focus on hydropower electricity generation plants have yielded very positive results. Currently, four out of Asia Power's eight power plants are driven by hydropower.
Led by a strong management team which consists of experienced veterans who have held senior positions in China's provincial power bureaus and listed companies, Asia Power was rated as the top 1000 most outstanding companies in Singapore between year 2002 and 2005. In 2005, it was also conferred as the most independent power producer in Singapore by Asian Power.
+ Operating Cash flow increased 60 %
+ Gained 11,3 million SGD from sale of a high-tech subsidiary
+ Consolidated financial results with a new subsidiary
+ Refocus its core businesses into environmentally friendly and renewable energy power plants
SINGAPORE – 3 August 2006 – Mainboard-listed Asia Power Corporation Limited ('Asia Power' or 'the Group'), which is principally involved in the ownership, management and operation of renewable energy power plants in the People's Republic of China ('PRC'), is pleased to announce a record net profit of 17 million SGD for the first half of the financial year ending 31 December 2006 as compared to the 2,1 million SGD for the 1HFY2005. This comes at the back of the management's decision to refocus its core businesses into environmentally friendly and renewable energy power plants.
As part of the company's efforts to refocus its business, Asia Power has increased its equity interest in Sichuan Anning River Energy Development Co., Ltd. ('Anning River') which Asia Power's Net Profit a Record-high For 1st Half of 17m SGD became a subsidiary of the Company at the end of FY2005 and sold Shenzhen NARI Technologies Co., Ltd. ('Shenzhen Nari'), an associate of the Company in the first half of FY2006. Also, the group has acquired equity interests in a number of hydropower plants in Chongqing and Sichuan
Performance Review
Operating Revenue
The group's operating revenue increased by 25,7 % to 61.8 million SGD for the first half of the financial year ending 31 December 2006, from 49,2 million SGD for the same period. This significant increase was due to the consolidation of the financial results of Sichuan Anning River Energy Development Co. Ltd ('Anning River'), which has become a subsidiary of the Company at the end of FY2005. The increase in operating revenue was also attributed by a 13 % increase in revenue from Heilongjiang Asiapower Xinbao Heating & Power Co., Ltd. Asia Power (Neijiang) Hydroelectricity Co. Ltd has however reported a decrease in revenue by 11 % during the current period as compared to the same period last year. Apart from the increase in contribution from the acquisition of several key hydropower plants late last year, the gain of 11,3 million SGD in the sale of Shenzhen Nari has also played a significant impact to the increase in net profit for the current period. Net operating cash flow remains strong with a 60 % increase to 3,5 million SGD in 1HFY2006, as compared to 2,2 million SGD in 1HFY2005.
Expenses
Increase in administrative expenses by 2,8 million SGD during the current period was attributable to the setting up of Asia Power (Shenzhen) Management Consulting Co. Ltd and consolidation of the Anning River. The expansion plan of Xinbao via acquisition of heat pipes during late last year also contributed to the increase in administrative expenses.
Share of Profits of Associates
In 1HFY06, the Group's share of profit of associates increased by 23,7 % to 3,2 million SGD from 2,6 million SGD for the same period last year. This increase is mainly contributed by Chongqing Yujiankou Hydroelectricity Co., Ltd. ('Chongqing'), which was acquired last year and 27 % increase in profit contribution from the power plants in Changzhou.
The group also acquired additional 5,69 % equity interest in Chongqing, increasing its effective equity interest to 31,6 %. Also, the group incorporated Asia Power (Leibo) hydroelectricity Co., Ltd. ('Leibo') with 67 % equity interest, to develop and operate hydropower plants in Sichuan. The group also acquired 9,3 % equity interest in Sichuan Jiajiang Qianfo Yan Hydroelectricity Co., Ltd. for RMB 15,9 million and 24,9 % equity interest in Tian Quan River Energy Development Co., Ltd. for RMB 24,1 million.
'The management is very pleased with the overall performance for the 1st half this year. In anticipation to the continuous price hikes of raw materials and fossil fuels, our decision to shift our focus to renewable energy power generation plants, especially hydropower electricity generation plants, has paid off for the Group. We have achieved a profit margin of 30 % for the first half as compared to 16 % achieved the same period last year.'
'We anticipate the demand for electricity to increase, along with the continued growth of the PRC economy expected. Going forward, we will continue our relentless pursuit to focus on renewable energy power generated plants as out main engine of growth. Barring any unforeseen circumstances, the Group expects to remain profitable for the next financial year.' commented Mr Zhang Gang Zhu, Executive Director and Chief Executive Officer of Asia Power Corporation Limited.
About Asia Power Corporation Limited
Listed on the Mainboard Singapore Exchange since October 1999, Asia Power Corporation Limited is principally involved in the ownership, management and operation of power plants in China.
Incorporated in March 1997, Asia Power's three core businesses are power generation, power-related technology and the provision of consultation to and management of power and power-related activities. To date, the Company has invested in a total of eight power plants with a total installation capacity of more than 550MW, two power-related technology companies and two power business consulting companies in strategic cities across China.
In tandem with China government's environmental protection policy in the production of energy, efforts have been channelled to reduce the reliance on coal through increasing the usage of renewable energies. As a strategic move, Asia Power started investing in power plants which make use of environmentally-friendly and renewable energies especially hydropower as early as 1998. Its efforts to focus on hydropower electricity generation plants have yielded very positive results. Currently, four out of Asia Power's eight power plants are driven by hydropower.
Led by a strong management team which consists of experienced veterans who have held senior positions in China's provincial power bureaus and listed companies, Asia Power was rated as the top 1000 most outstanding companies in Singapore between year 2002 and 2005. In 2005, it was also conferred as the most independent power producer in Singapore by Asian Power.