China Ming Yang Announces Financial Results for Fourth Quarter and Full Year Ended December 31, 2010

China Ming Yang Wind Power Group Limited (“Ming Yang” or the “Company”) (NYSE: MY), a leading wind turbine manufacturer in China, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2010.

Fourth Quarter 2010 Financial Highlights

* Total wind turbine generators (“WTGs”) commissioned reached a historical high of 253 units of 1.5 MW WTGs, or 379.5 MW, representing increases of 5.9% over Q3 2010 and 462.2% over Q4 2009.

* Total revenue was RMB1,713.3 million (US$259.6 million), representing increases of 15.3% over Q3 2010 and 403.9% over Q4 2009.

* Gross profit was RMB382.9 million (US$58.0 million), representing increases of 54.0% over Q3 2010 and 818.2% over Q4 2009. Gross margin for the fourth quarter was 22.3% compared to 16.7% in Q3 2010 and 12.3% in Q4 2009.

* Total comprehensive income for the period was RMB212.2 million (US$32.2 million), an increase of 19.7% over Q3 2010. We incurred comprehensive loss in Q4 2009.

* Basic and diluted earnings per ordinary share were RMB1.83 (US$0.28) compared to basic and diluted earnings per ordinary share of RMB1.70 for Q3 2010 and basic and diluted loss per ordinary share of RMB0.90 for Q4 2009.

Full Year 2010 Financial Highlights

* Total WTGs commissioned were 802 units, or 1,203.0 MW, representing an increase of 427.6% over 2009.

* Total revenue was RMB5,517.8 million (US$836.0 million), an increase of 370.5% over 2009.

* Gross profit was RMB1,087.4 million (US$164.8 million), an increase of 1330.8% over 2009. Gross margin for the full year 2010 was 19.7% compared to 6.5% in 2009.

* Total comprehensive income for the year was RMB690.0 million (US$104.5 million), compared with a total comprehensive loss of RMB223.1 million in 2009.

* Basic and diluted earnings per ordinary share were RMB6.61 (US$1.00) compared to basic and diluted loss per ordinary share of RMB2.21 in 2009.

Mr. Chuanwei Zhang, Chairman and CEO of Ming Yang, commented: “I am extremely pleased with our continued strong performance in the fourth quarter. We recognized revenues from 253 units of 1.5 MW WTGs in the quarter. While pricing across the industry continues to be challenging, we worked hard to reduce costs and successfully increased our gross margin to 22.3% for the quarter. In addition, our order backlog provides us with great confidence that we are on track to fulfill our expected sales targets for 2011.”

“Looking ahead, we have kicked off an optimization program for our 1.5 MW WTG to further customize these to our customers’ requirements and to streamline our production processes,” Mr. Zhang continued. “At the same time, we intend to focus on five key strategies: leverage our innovative SCD WTGs’ competitive advantages in cost and technology in the rapidly growing offshore wind market in China; promote innovative business models such as EPC and BOT projects to enhance our service offerings to our customers and extend our value chain participation; further integrate our upstream capabilities through acquisitions;  explore inland on-shore wind resources in western China with our integrated wind/solar hybrid projects; and develop overseas opportunities with a focus on the North American market.”

Mr. Zhang concluded, “The China wind power market continues to enjoy rapid growth. We strongly believe that we are well-positioned to leverage advantages across our technology, engineering skills and robust business model to execute our strategies and grow market share in this exciting industry.”

Fourth Quarter 2010 Unaudited Financial Results

Total Revenue

Total revenue in the fourth quarter of 2010 was RMB1,713.3 million (US$259.6 million), representing increases of 15.3% from RMB1,486.0 million in the third quarter of 2010 and 403.9% from RMB340.0 million in the corresponding period in 2009. This increase in revenue was primarily due to a higher number of WTGs for which revenue was recognized this quarter. The Company commissioned 253 units of 1.5 MW WTGs in the fourth quarter of 2010, compared to 239 units of 1.5MW WTGs in the third quarter of 2010 and 45 units of 1.5 MW WTGs for the corresponding period in 2009.

Gross Profit and Gross Margin

Gross profit in the fourth quarter of 2010 was RMB382.9 million (US$58.0 million), representing increases of 54.0% from RMB248.7million in the third quarter of 2010 and 818.2% from RMB41.7 million for the corresponding period in 2009. This increase was primarily due to increased number of WTGs delivered and commissioned. Gross margin was 22.3% in the fourth quarter of 2010, compared to 16.7% in the third quarter of 2010 and 12.3% for the corresponding period in 2009. This increase was primarily due to a significant decrease in average WTGs production cost while recognizing revenue from a favorable mix of old and new projects.

Selling and Distribution Expenses

Selling and distribution expenses were RMB64.5 million (US$9.8 million) for the fourth quarter of 2010, compared to RMB29.7 million in the third quarter of 2010 and RMB35.8 million for the corresponding period of 2009, representing increases of 117.2% and 80.2%, respectively. This increase was mainly due to share-based compensation expenses of RMB5.2million (US$0.8 million), and an increase in transportation costs as a result of the higher volume of WTGs shipments this quarter.

Administrative Expenses

Administrative expenses were RMB60.2 million (US$9.1 million) for the fourth quarter of 2010, compared to RMB45.1 million in the third quarter of 2010 and RMB24.8 million for the corresponding period of 2009, representing increases of 33.5% and 142.7%, respectively. This increase was primarily due to RMB7.4 million (US$1.1 million) in professional fees related to the Company’s initial public offering (“IPO”) in October 2010 and RMB22.8 million (US$3.4 million) in shared-based compensation expense.

Research and Development Expenses

Research and development expenses were RMB13.6 million (US$2.1 million) for the fourth quarter of 2010, compared to RMB6.2 million in the third quarter of 2010, representing an increase of 119.4% primarily due to intensive capital investment needed for the development phase of WTGs that can operate in extreme temperatures and at high altitudes and RMB 6.0 million (US$0.9million) in share-based compensation expense. This also compares to RMB30.3 million for the fourth quarter of 2009, representing a 55.1% decrease primarily due to early stage development expenses relating to the 2.5/3.0MW SCD wind turbine prototype in the fourth quarter of 2009.

Net Finance Expenses/Income

Net finance expense was RMB1.3 million (US$0.2 million) for the fourth quarter of 2010, compared to a net finance income RMB9.4 million in the third quarter of 2010 and net finance expense of RMB13.8 million in the corresponding period of 2009. Interest income for the period increased significantly primarily due to interest from IPO proceeds received in October 2010.

Total Comprehensive Income for the Period and Earnings per Share

Total comprehensive income for the fourth quarter of 2010 was RMB212.2 million (US$32.2 million), compared to RMB177.4 million for the third quarter of 2010, representing an increase of 19.6%. We incurred a loss of RMB90.0 million for the corresponding period of 2009.

For the fourth quarter of 2010, basic and diluted earnings per ordinary share were RMB1.83 (US$0.28) compared to basic and diluted earnings per ordinary share of RMB1.70 for the third quarter of 2010 and basic loss per ordinary share of RMB0.90 for the same period in 2009.

Full Year 2010 Unaudited Financial Results

Total Revenue

Total revenue in 2010 was RMB5,517.8 million (US$836.0 million), an increase of 370.5% from RMB1,172.7 million in 2009, due to a significantly higher number of WTGs being commissioned in the year.

Gross Profit and Gross Margin

Gross profit in 2010 was RMB1,087.4 million (US$164.8 million), an increase of 1,330.8% from RMB76.0 million in 2009. Gross margin for the year 2010 was 19.7% compared to 6.5% in 2009, due to the fact that the company was able to realize benefits of economies of scale, lower material procurement costs through domestic sourcing, as well as product optimization and improved production processes.

Selling and Distribution Expenses

Selling and distribution expenses in 2010 were RMB149.2 million (US$22.6 million), compared to RMB90.9 million in 2009, primarily due to increased transportation costs of delivering a higher number of WTGs in 2010, as well as share-based compensation expenses incurred in the fourth quarter of 2010.

Administrative Expenses

Administrative expenses in 2010 were RMB150.8 million (US$22.8 million), compared to RMB67.5 million in 2009, primarily due to listing expenses of RMB34.0 million (US$5.2 million) for the year.

Research and Development Expenses

Research and development expenses in 2010 were RMB43.1 million (US$6.5 million), compared to RMB52.8 million in 2009, primarily due to a decrease in early stage development expenses relating to the 2.5/3.0MW SCD wind turbine prototype.

Net Finance Expenses

Net finance expenses in 2010 was RMB35.1 million (US$5.3 million), compared to net finance expense of RMB49.6 million in 2009, primarily due to interest income on IPO proceeds which were received in October 2010.

Total Comprehensive Income for the Year and Earnings per Share

Total comprehensive income for the year 2010 was RMB690.0 million (US$104.6 million), compared to a loss for the year 2009 of RMB223.1 million.

For the full year 2010, basic and diluted earnings per ordinary share were RMB6.61 (US$1.00) compared to basic and diluted loss per ordinary share of RMB 2.21 for the year 2009.

Currency Conversion

Solely for the convenience of readers, certain Renminbi amounts have been translated into U.S. dollar amounts at the rate of RMB6.6000 to US$1.00, the noon buying rate in New York for cable transfers of Renminbi per U.S. dollar as set forth in the H.10 weekly statistical release of the Federal Reserve Board as of December 31, 2010. No representation is intended to imply that the Renminbi amounts could have been, or could be, converted, realized or settled into U.S. dollar amounts at such rate, or at any other rate.

(prnewswire)

[mappress]

Source: prnewswire, March 09, 2011

 

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