For the three months ended
-- Revenues were
$3.4 million, representing a decrease of 61% as compared to revenues of $8.6 millionfor the same period of the prior year. This decrease was primarily due to a reduction in demand from the Company's major Chinese and Kazakhstancustomers and increased competition from other suppliers. -- EBITDA from continuing operations for the three months ended December 31, 2013was negative $367,000as compared to EBITDA from continuing operations of $654,000for the same period of the prior year, representing a decline of 156%. The decline in EBITDA was primarily driven by the decline in revenues.
For the nine months ended
-- Revenues were
$11.0 million, representing a decline of 50% as compared to revenues of $21.8 millionfor the same period of the prior year. This decrease was primarily due to a reduction in demand from the Company's major Chinese and Kazakhstancustomers and increased competition from other suppliers. -- EBITDA from continuing operations for the nine months ended December 31, 2013was negative $659,000as compared to EBITDA from continuing operations of $2.7 millionfor the same period of the prior year. The decline in EBITDA was primarily driven by the decline in sales.
The Company had basic and diluted loss per share of
Cash balance was
Update on Corporate Strategy
Hanwei's core business remains in its FRP pipe manufacturing. The Company holds longstanding relationships with the leading Chinese oil & gas producers that include CNPC, PetroChina and Sinopec (and which have yielded repeat orders over the last ten years). The Company has also been previously successful in its sales efforts in
While the Company continues its efforts to drive sales it has seen a softening in its two principal markets of
Due to the downturn in the
Update on Major Cash Receivables
-- Outstanding Wind Receivable: During the three-month period ended
December 31, 2013, the Company received a payment of $0.9 million( RMB5 million) as part of the outstanding accounts receivable due from its wind farm customers. The full amount of these receivables was previously allowed for and the Company's wind power business has been discontinued. As of the date of this MD&A approximately $32.7 million( RMB194.2 million) has been collected with a balance of $5.1 million( RMB29.0 million) outstanding. The Company is continuing its efforts to collect the balance of this outstanding amount. -- Tianjin Plant Divestment: As previously reported the Company reached an agreement on May 27, 2013, to sell all of the equity interest in its wholly owned subsidiary Hanwei Greento a private Chinese company for an amount of $11.4 million( RMB65 million). The major asset of Hanwei Greenis a manufacturing plant located in Tianjin, Chinawhich was constructed for wind blade production. The majority of the regulatory documentation and jurisdictional approvals required for the ownership transfer were completed as of ( February 10, 2014). Under the current Agreement the Company is due to receive payments of $1.9 million( RMB11.0 million) upon completion of the ownership transfer documents and $3.3 million( RMB19.0 million) (due before December 31, 2013under the current Agreement terms). Contemporaneously with the receipt of this payment the ownership transfer shall take effect and subject to a final payment of $6.1 million( RMB35.0 million) due May 27, 2014(within twelve months after the agreement was signed on May 27, 2013). With the delay in receiving the necessary jurisdictional approvals the Company is in discussions with the buyer as to revisions to the timing of these payments that may result in a delayed payment schedule. -- Wind Inventory Sale: During the year ended March 31, 2012, the Company executed a contract for sale of the majority of its wind power equipment inventory to a Chinese customer for agreed items totaling $15.7 million( RMB93.6 million). To date $12.6 million( RMB75.3 million) of this amount has been received by the Company. The balance to be paid is approximately $3.3 million( RMB18.3 million) which is expected to be received by the end of the Company's fiscal year ending March 31, 2014.
Wednesday, February 12, 2014Time: 1:00 a.m., Eastern Time( 10:00 am Pacific Time) Dial in number: 1-888-539-3612 or 1-719-325-2464
A replay of the conference call will be available on the Company's website www.hanweienergy.com.
Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.
Certain information in this press release is forward-looking within the meaning of certain securities laws, and is subject to important risks, uncertainties and assumptions a description of which is set out in the risk factors section of the Company's Annual Information Form dated
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS PRESS RELEASE PRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS PRESS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, THE COMPANY DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME, EXCEPT AS REQUIRED BY APPLICABLE SECURITIES LEGISLATION.
FOR FURTHER INFORMATION PLEASE CONTACT:
Hanwei Energy Services Corp. Graham KwanExecutive Vice President, Strategic Development and Corporate Affairs 604-685-2239 firstname.lastname@example.org Hanwei Energy Services Corp. Yucai (Rick) HuangChief Financial Officer 604-685-2239 email@example.com Source: Hanwei Energy Services Corp.