08:53:23 EDT Fri 29 Mar 2024
Enter Symbol
or Name
USA
CA



Changfeng Energy Inc
Symbol CFY
Shares Issued 65,188,155
Close 2018-08-29 C$ 1.00
Market Cap C$ 65,188,155
Recent Sedar Documents

Changfeng Energy earns 34.4 million renminbi in H1 2018

2018-08-29 12:12 ET - News Release

Mr. Huajun Lin reports

CHANGFENG ENERGY ANNOUNCES 2018 INTERIM RESULTS

Changfeng Energy Inc. has released its interim results for the six months ended June 30, 2018 (H1 2018).

Financial highlights:

  • Revenue increased by 20 per cent to 204.9 million renminbi (approximately $41.1-million), compared with 170.2 million renminbi (approximately $34.2-million) in H1 2017.
  • Gross profit grew by 14 per cent to 89.2 million renminbi ($17.9-million), compared with 78.3 million renminbi ($15.7-million) in H1 2017.
  • Profit attributable to shareholders from continuing operations increased by 73 per cent to 34.4 million renminbi ($6.9-million), compared with 19.8 million renminbi ($4-million) in H1 2017.
  • Total gas volume sold was up by 19 per cent.
  • Basic earnings per share from continuing operations were 0.53 renminbi (11 cents), compared with 0.3 renminbi (six cents) in H1 2017.

For H1 2018, the company recorded total revenue of 204.9 million renminbi ($41.1-million), compared with 170.2 million renminbi ($32.4-million) in H1 2017, up by 20 per cent year over year. Of the total revenue, gas distribution utility and compressed natural gas (CNG) vehicle refuelling contributed 176.3 million renminbi ($35.4-million) and 28.6 million renminbi ($5.7-million), respectively. Gross profit rose by 14 per cent to 89.2 million renminbi ($17.9-million), compared with 78.3 million renminbi ($15.7-million) in H1 2017. EBITDA (earnings before interest, taxes, depreciation and amortization) from continuing operations was 32.2 million renminbi ($6.5-million) compared with 28 million renminbi ($5.6-million) in H1 2017. Profit attributable to shareholders from continuing operations was 34.4 million renminbi ($6.9-million), compared with 19.8 million renminbi ($4-million) in H1 2017, increased by 73 per cent year over year, due to an increase in profit from continuing operations and fair-value change of 14.5 million renminbi ($2.9-million) on a put option arising from the disposal of the company's controlling interest in a subsidiary. Basic earnings per share from continuing operations amounted to 0.53 renminbi (11 cents), compared with 0.3 renminbi (six cents) in H1 2017.

This is the second year of Changfeng's three-year plan to strategically shift its corporate focus to sustainable energy in combination with natural gas to become an integrated energy provider in China. During the reported period, total gas sales volume rose by 19 per cent to 29.5 million cubic metres, mainly contributed by Sanya and the commencement of gas sales in the Hebei region in the second quarter of 2018. The increase in gas price continued since May, 2017.

Huajun Lin, chairman, president and chief executive officer of Changfeng, said: "We are pleased to have delivered satisfactory results with growing revenue and improved profitability. We expect the volume of gas sold during the rest of the year to increase with our existing pipeline networks in the Sanya region, continuing to add both residential and commercial and industrial customers to its network, the industrial customers in Hebei province, and the successful procurement of the two new LNG [liquefied natural gas] supply customers in Wenchang city, Hainan province, this month, which marked Changfeng's first step into extending its natural gas distribution business outside of Sanya city on the Hainan Island.

"We will continue to put great effort in the preparation of the HK IPO [Hong Kong initial public offering] as to meet the target of successful listing on the HKEX [Hong Kong Stock Exchange] within the first half of 2019, which will serve to broaden Changfeng's investor base, increase stock liquidity, and allow the company to gain access to and recognition of strategic investors in the Chinese market."

Business review

Projects in operation

Currently, Changfeng has six projects in operation: two pipeline natural gas distribution projects, two liquefied natural gas supply distribution projects and two compressed natural gas vehicle refuelling stations. Changfeng has a 30-year exclusive concession right to distribute natural gas in Sanya city and the supply of natural gas to three factories in Xingtai city, Shijiazhuang city and Baoding city in Hebei province, which officially commenced in March, 2018, April, 2018, and May, 2018, respectively.

Projects under development

Major projects under development include the integrated smart energy project, which combines the usage of multiple clean energy sources, including solar, hydro, electricity and natural gas (combined cooling, heat and power/cogeneration), to supply cooling, heating as well as hot water to the hotels, shopping centres and households in the Haitang Bay area of Sanya city, Hainan province, with the 30-year concession right to build, own and operate four energy-processing stations there.

Prospects

For the rest of 2018, Changfeng will continue to implement its long-term growth strategy through its proposed Guangdong Grid pipelined gas project in the Western Guangdong area of the Guangdong province and work toward moving forward the development of the Haitang Bay integrated smart energy project with the EDF Group in Sanya city to commence commercial operation by the end of 2018. The unaudited condensed interim consolidated financial results and management discussion and analysis can be downloaded from SEDAR or from the company's website.

Mr. Lin concluded: "Since the company's inception over 20 years ago, Changfeng has always strived to provide natural gas -- a cleaner alternative to coal -- to our customers. We believe that China's smart energy is on a strong growth trend and presents huge potential with opportunities. Changfeng will continue to adhere to its development strategies and leverage its abundant experience in operating an advanced model so as to provide cleaner energy, striving for the highest returns to our shareholders."

About Changfeng Energy Inc.

Changfeng Energy is a leading integrated smart energy provider and natural gas distribution company (or natural gas utility) in China.

Teleconference

Date:  Tuesday, Sept. 4, 2018

Time:   10:30 a.m. ET; 10:30 p.m. Beijing time

Topic:   Changfeng Energy 2018 interim results

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