China: Goldwind Publishes H1 Results

Xinjiang Goldwind Science & Technology Co., Ltd. (“Goldwind”) has announced its interim results for the six months ended 30 June 2012 (the “reporting period”). According to unaudited financial statements prepared in accordance with International Financial Reporting Standards, the Group generated revenues of RMB3,451.01 million, net profits of RMB72.07million, basic earnings per share of RMB 0.03 during the reporting period. Goldwind’s net profit was within the expected range as announced in its 2012 First Quarterly Report.

Goldwind reported a sequential increase in the comprehensive gross margin to 13.3% during the six months ended 30 June 2012, as compared to 12.8% during the six months ended 31 December 2011. The Group’s comprehensive gross margin was 21.0% during the six months ended 30 June 2011.

Goldwind achieved a high successful bidding rate on new projects during the first half of 2012. As a result, Goldwind reported a 23.4% increase in its total backlog to 7,806.0 MW on 30 June 2012, from 6,327.0 MW on 31 December 2011. The Group’s 30 June 2012 backlog included orders under contract of 4,838.75 MW and successful bids awaiting final contracts of 2,967.25MW.

Accelerated R&D to Maintain Leading Position in the Wind Market

During the reporting period, the Company launched its ultra-low wind speed series GW93/1500 Permanent Magnet Direct-Drive (PMDD) turbines. This model is designed for IEC Class S wind resource areas where the annual average wind speed is lower than 6.5 m/s. The prototype has performed better than expected.

Since connected to the grid in early July, the prototype generated total power of over 160,000KWh with availability of over 98%. With an average wind speed of 5.5 m/s to 6.5 m/s, the GW93/1500 series produces 6% more power on average as compared to Goldwind’s GW87/1500 series turbines, which are designed for IEC Class III wind resource areas with an average wind speed of 6.0 m/s to 8.0 m/s.

The Company’s commercially produced GW87/1500 low wind speed turbine recently received the design assessment certificate from TÜV Nord, demonstrating that the GW87/1500 meets international standards. This will support the Company’s efforts to further expand in overseas markets. Over 60% of the new projects approved by the National Energy Administration in March 2012 are in low wind resource areas.

In accordance with anticipated market demand in challenging offshore environments, the Company is pursuing development of larger capacity wind turbines with our characteristic emphasis on quality, efficiency and reliability.

Goldwind was the first to install an offshore wind turbine in Asia in 2007, erecting a 1.5 MW unit in Bohai Bay. In 2010, the Company installed and connected two 2.5 MW intertidal wind turbines. In 2011, Goldwind installed its first 3.0 MW intertidal wind turbine. Goldwind’s intertidal installed capacity has reached nearly 50 MW.

As previously disclosed, Goldwind is developing a 6.0 MW offshore wind turbine and has begun research on a 10.0 MW offshore wind turbine.

Strong Performance Track Record in Established Markets

As the world’s largest and most experienced manufacturer of PMDD wind turbines, Goldwind’s accumulated installed PMDD capacity now exceeds 10 GW, with projects in more than 20 provinces of China and over 10 countries across 6 continents. For example, Goldwind is participating in18 projects in the Americas with a total capacity of 288 MW, including 14 projects in the United States.

Goldwind is committed to a strategy of “globalization through localization”. The Company has pursued internationalization of its R&D program and products, marketing efforts, capital resources, human resources and management team.

Goldwind currently employs more than 300 team members in its international business, which includes the North American, Central and South American, European, Australian, Asian and African markets.

Among Goldwind’s team members working in regional offices, over 95% were hired locally based on strong technical skills, managerial experience, and wind industry expertise. In 2011, nearly 10% of the company’s revenues came from overseas markets and this is expected to grow to more than 30% by 2015.

During the period under review, Goldwind completed the sale of its first Australian project, Mortons Lane wind farm. Goldwind’s second Australian project, Gullen Range wind farm, received approval from TransGrid to connect to the Australian grid. This is the first project in Australia to use Goldwind´s 2.5 MW wind turbines.

In the United States, Goldwind’s largest overseas project to date, the 109.5 MW Shady Oaks wind farm, has been successfully connected to the power grid and commenced generating power. In June, Goldwind announced that it will provide 2.5 MW units to a project in Vermont that is supported by local bank financing. The 10.0 MW Georgia Mountain project will generate enough power to supply an estimated 4,200 households.

Goldwind’s first project in Africa, Ethiopia’s Adama wind farm, was successfully connected to the grid and commenced generating power during the reporting period. Goldwind’s first project in South America, the high altitude Villonaco wind farm in Ecuador, is under construction.

Goldwind has achieved strong growth in the international market and solid development in the domestic market, as well. As the domestic wind industry enters into a period of stable growth, customers are increasingly focused on product quality and project life-cycle cost of energy.

Manufacturers with advanced technology, quality products and strong service capabilities have a competitive advantage. Goldwind achieved the highest successful bidding rate in the domestic market during the first half of 2012, winning over 20% of public tenders.

“In the past six months, we focused on optimizing management and strengthening cost controls. The interim results met our expectations, with steady growth in the international markets and solid development in our domestic market. Goldwind has accelerated product research and development, which will further promote our global business development,” said Wu Gang, Chairman, President and CEO of Goldwind.

[mappress]

Offshore WIND staff, August 27, 2012; Image: Goldwind