Sunday, June 4, 2023
Martin Hennecke
HKEx Stock Code : 01296 
Corporate Profile
Principally engaged in (1) environmental and energy saving solutions, and (2) manufacturing and services of renewable energy facilities.

Business Review - For the year ended December 31, 2012

Revenues of the Group in 2012 were approximately RMB21,776.5 million, representing an increase of approximately RMB3,069.5 million, or 16.4% from RMB18,707.0 million in 2011, mainly due to the growth in wind power products and services and environmental protection businesses. Revenues in the wind power products and services and environmental protection businesses increased by approximately RMB1,951.3 million and RMB1,592.8 million as compared to 2011, which represent percentage increases of approximately 21.2% and 37.4%, respectively. The increase in revenue generated from wind power products and services business was primarily attributable to the Group's continuing efforts in expanding this business. The revenue increase in the environmental protection business was primarily due to policies issued by the PRC Government in late 2011 and in 2012 as well as the Group's leading position in this business segment. These increases were partially offset by a decrease of revenue from the Group's solar power products and services business. The decrease in revenue from the solar power products services business was due to a decrease in revenue in the solar cells and modules manufacturing business resulting from the Group's disposals of Guodian Jintech Solar Energy Technology (Yixing) Co., Ltd. (國電晶德太陽能科技(宜興)有限公司) (“Jintech”) and Guodian Ningxia Solar Co., Ltd. (國電寧夏太陽能有限公司) (“Ningxia Solar”) in June 2011 and August 2011, respectively, both of which were primarily engaged in manufacturing and sales of solar power products, and the consequential deconsolidation of results of Jintech and Ningxia Solar from the Group's results in 2012.

Business Outlook - For the year ended December 31, 2012

Last year witnessed the promulgation by the PRC Government of a series of laws and regulations which, among others, lay out nationwide performance parameters, standards and goals for environmental protection and energy conservation solutions sectors and renewable energy sectors. These laws and regulations constitute part of the regulatory environment in which the Group conducts its core businesses. Concerned with recent environmental pollution outbreaks and ongoing energy sustainability issues, the PRC Government is expected to intensify its efforts to improve the energy structure and to enhance environmental protection in 2013, signaled by public speeches given by senior PRC Government officials and new issued policies at the beginning of 2013. On January 1, 2013, the PRC State Council issued the 12th Five-year Energy Development Plan (《能源
發展“十二五”規劃》), which provided a blueprint and an action plan for the energy development in the PRC during the 12th five-year period. The 12th Five-year Energy Development Plan anticipates that during the 12th five-year period, the average annual growth rate for the wind power and solar power in the PRC would be 26.4% and 89.5%, respectively. In a speech given on February 19, 2013, Mr. Zhou Shengxian, the PRC Minister of Environmental Protection, highlighted the importance of air pollution reductions. According to the speech, rigorous emission limits would apply to new projects of six heavy-polluting industries, including coal-fired power, steel, petrochemical, cement, colored materials and chemical industries, and to existing projects of three industries, coal-fired power, steel, petrochemical industries, located in the identified key control areas in 19 provinces. Therefore, despite that global economy is still navigating through the path to recovery, the Group anticipates that favorable regulatory environment in the PRC is likely to present significant market opportunities for the Group's businesses in 2013. In response to the PRC Government's focus on promoting development of the renewable energies and strategic energy-related environmental protection and resources conservation measures, the Group's goal is to leverage on the significant market opportunities presented by the regulatory changes in the PRC, by focusing on enhancing technological innovations, strengthening overall management, promoting product and service competitiveness and increasing market shares. The Group plans to improve its innovation capability, advanced technologies, brand recognition and corporate culture in order to achieve the Group's sustainable development.

To leverage on the favorable policies in the PRC and to enhance its core competitiveness, the Group intends to implement the following, in 2013:

Continuously focusing on technology innovations and further exploring future growth areas

The Group believes that the advanced technology is the core competitiveness of the Group's businesses. To enhance this core competitiveness, in 2013, the Group plans to continue its efforts in aiming to achieve breakthroughs in the identified key research and development areas and core technologies, allocate sufficient financial and other resources to technology research and development and ramp up product innovations. Furthermore, the Group intends to accelerate the progress of technology research and development of lignite comprehensive utilization, flue gas waste heat comprehensive utilization, large-capacity offshore wind power generation, microgrid, wind farm energy storage systems, decentralized energy seawater desalinization, CO2 capture and fine particles (PM 2.5) collection, and to complete the showcase project for industrialization of the GaAs concentrator solar cell and the technological R&D for lignite conversion. In the meanwhile, the Group intends to focus on developing its general contracting business for power stations and its information management and electronic engineering business, and to cultivate markets outside of the power industry, in order to further explore new growth areas for the Group.

Integrating and optimizing business assets and promoting industry upgrade

In order to enhance the synergies among various segments and business lines and to increase its competitiveness, the Group intends to further integrate and optimize its core business assets. The Group plans to maintain and promote its existing market-recognized brand names and to create new products and services to diversify its portfolio. The Group also plans to actively search quality acquisition targets in the desulfurization and denitrification concession and water treatment businesses, as and when the market presents such opportunities, in order to optimize the Group's business assets. While aiming to steadily improve its traditional businesses, the Group intends to focus on desulfurization and denitrification concession operations and promote industry upgrade of its business. For environmental protection and energy conservation solutions, the Group intends to further improve its product and service quality, further develop and industrialize its new business line of EMC services and promote the application of new comprehensive boiler energy conservation technologies, such as waste heat recovery and low-NOx combustion technologies. In relation to its renewable energy related business, the Group intends to further develop the “one-stop shop” service model for wind power products and services to differentiate its services from its competitors and to increase the scale of its solar power EPC general contracting services.

Developing innovative business models and further cultivating the international market

Leveraging on the achieved leading market position in the PRC, the Company intends to further explore opportunities presented in the international market. The Group plans to further develop the “one-stop” shop business model by extending selected business lines to the upstream and downstream markets so that the Group's services cover the entire lifespan of a project, from planning, design, EPC general contracting to maintenance. The Group intends to utilize the new business model to promote international cooperation and renewable power station investment, in order to materialize its “going-out” strategy and create synergies between the Group's domestic and international businesses. The Group also plans to further improve its overseas sales network and to accelerate establishment of overseas sales offices at selected locations, by strengthening operations of its existing overseas branches, subsidiaries and offices in locations such as the United States of America, Canada and Thailand and by establishing new offices selectively, in order to achieve a shared overseas sales network within the Group.

Enhancing management efficiency and increasing profitability

The Group intends to improve the overall management efficiency and to transform the administration method, in order to increase its profitability. The Group plans to enhance its centralized capital management and increase financial efficiency, through implementing measures such as strengthening cost control and budget management. In addition, the Group intends to enhance cost control of the value chain, by establishing centralized management platforms for functions including the material procurement, project bidding and capital management, in order to improve the cost control of the logistics, procurement, processing and design phases of the management.

Source: Guodian Tech & Env (01296) Annual Results Announcement
Chairman Chen Feihu Issued Capital (shares) 1,310M
Par Value RMB 1 Market Capitalisation (HKD) 2,109M
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