Click here to close now.


News Feed Item

Hanwei Energy Services Reports Third Quarter Fiscal 2014 Financial and Operational Results

VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 02/12/14 -- Hanwei Energy Services Corp. (TSX:HE) ("Hanwei" or the "Company"), today reported its financial results for the quarter ended December 31, 2013 (the "Reporting Period"). All amounts are in Canadian Dollars unless otherwise noted.

Financial Summary

For the three months ended December 31, 2013:

--  Revenues were $3.4 million, representing a decrease of 61% as compared
    to revenues of $8.6 million for the same period of the prior year. This
    decrease was primarily due to a reduction in demand from the Company's
    major Chinese and Kazakhstan customers and increased competition from
    other suppliers. 
--  EBITDA from continuing operations for the three months ended December
    31, 2013 was negative $367,000 as compared to EBITDA from continuing
    operations of $654,000 for 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 December 31, 2013:

--  Revenues were $11.0 million, representing a decline of 50% as compared
    to revenues of $21.8 million for the same period of the prior year. This
    decrease was primarily due to a reduction in demand from the Company's
    major Chinese and Kazakhstan customers and increased competition from
    other suppliers. 
--  EBITDA from continuing operations for the nine months ended December 31,
    2013 was negative $659,000 as compared to EBITDA from continuing
    operations of $2.7 million for 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 $0.01 and nil for the three and nine months ended December 31, 2013 as compared to basic and diluted earnings per share of nil for the three months ended December 31, 2012 and $0.01 for the nine months ended December 31, 2012.

As of January 31, 2014, FRP pipe sales orders yet to be completed and shipped were approximately $6.2 million (the majority of which are expected to be completed within the fiscal year ended March 31, 2014).

Cash balance was $4.7 million as at December 31, 2013, representing an increase of $2.3 million from a cash balance of $2.4 million as of September 30, 2013.

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 Kazakhstan, a market in which it entered in 2009. Internationally the Company has undertaken a number of initiatives to expand out its sales in other markets and while initial orders have been received principally in the Middle East the sales results of entering new international markets have not yet materialized.

While the Company continues its efforts to drive sales it has seen a softening in its two principal markets of China and Kazakhstan with year over year sales reducing. This has primarily been due to less FRP products being ordered by end users in these markets as well as increased competition from other manufacturers. The Company will continue its sales and marketing efforts in the international markets but it is yet unknown if future sales results in these markets will be achieved and can restore or grow revenue.

Due to the downturn in the China and Kazakhstan FRP markets the Company is therefore actively investigating other corporate development opportunities focussed on restoring revenue including licensing of Hanwei's FRP manufacturing technologies, new sales and distribution arrangements, and other initiatives.

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 Green to a private Chinese company for an
    amount of $11.4 million (RMB65 million). The major asset of Hanwei Green
    is a manufacturing plant located in Tianjin, China which 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, 2013 under 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. 

Graham Kwan, Executive Vice President and Rick Huang, Chief Financial Officer of Hanwei will host a conference call to discuss its operational and financial results for the quarter ended December 31, 2013. Management invites analysts and investors to participate on the conference call:

Date:               Wednesday, February 12, 2014                            
Time:               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

About Hanwei Energy Services Corp.

Hanwei Energy Services Corp. is a leading manufacturer of high pressure, fiberglass reinforced plastic ("FRP") pipe products and associated technologies and services for the international oil and gas infrastructure industries. Hanwei serves major energy customers in the Chinese and global energy markets.

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 June 18, 2013 and Management Discussion and Analysis for the year ended March 31, 2013 both of which are filed with Canadian securities regulators and available on SEDAR at The forward-looking information in this press release describes the Company's expectations as of the date of this press release.


More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
"eFolder does a lot of different things but we protect data and we are focused on protecting data no matter where it resides," explained Carlo Tapia, Product Marketing Manager at eFolder, in this interview at Cloud Expo, held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA.
The Internet of Things (IoT) is growing rapidly by extending current technologies, products and networks. By 2020, Cisco estimates there will be 50 billion connected devices. Gartner has forecast revenues of over $300 billion, just to IoT suppliers. Now is the time to figure out how you’ll make money – not just create innovative products. With hundreds of new products and companies jumping into the IoT fray every month, there’s no shortage of innovation. Despite this, McKinsey/VisionMobile data...
Cloud computing is unquestionably one of the driving forces of DevOps, as the automation of operations transforms enterprise software development. DevOps, however, is more than a technology trend, as it represents a move toward silo-busting, self-organizing horizontal teams that drive business velocity. At the same time, enterprise Digital Transformation represents an upheaval across the enterprise, as customer preferences and behavior drive enterprise technology decisions. This transformation ...
Most of the IoT Gateway scenarios involve collecting data from machines/processing and pushing data upstream to cloud for further analytics. The gateway hardware varies from Raspberry Pi to Industrial PCs. The document states the process of allowing deploying polyglot data pipelining software with the clear notion of supporting immutability. In his session at @ThingsExpo, Shashank Jain, a development architect for SAP Labs, discussed the objective, which is to automate the IoT deployment proces...
Just over a week ago I received a long and loud sustained applause for a presentation I delivered at this year’s Cloud Expo in Santa Clara. I was extremely pleased with the turnout and had some very good conversations with many of the attendees. Over the next few days I had many more meaningful conversations and was not only happy with the results but also learned a few new things. Here is everything I learned in those three days distilled into three short points.
In demand-intensive mobile and web applications, an emerging pattern is to host the Systems of Engagement in the cloud (for maximum responsiveness) but keep the Systems of Record with the other important business systems in the company datacenter, often on a tightly secured mainframe. But what about the space in between? In this IBM Redpaper publication, we show that the IBM Bluemix cloud platform offers technologies that make it easy for cloud-based SoEs to securely connect to on-premises IBM...
DevOps is about increasing efficiency, but nothing is more inefficient than building the same application twice. However, this is a routine occurrence with enterprise applications that need both a rich desktop web interface and strong mobile support. With recent technological advances from Isomorphic Software and others, rich desktop and tuned mobile experiences can now be created with a single codebase – without compromising functionality, performance or usability. In his session at DevOps Su...
As organizations realize the scope of the Internet of Things, gaining key insights from Big Data, through the use of advanced analytics, becomes crucial. However, IoT also creates the need for petabyte scale storage of data from millions of devices. A new type of Storage is required which seamlessly integrates robust data analytics with massive scale. These storage systems will act as “smart systems” provide in-place analytics that speed discovery and enable businesses to quickly derive meaningf...
In his keynote at @ThingsExpo, Chris Matthieu, Director of IoT Engineering at Citrix and co-founder and CTO of Octoblu, focused on building an IoT platform and company. He provided a behind-the-scenes look at Octoblu’s platform, business, and pivots along the way (including the Citrix acquisition of Octoblu).
In his General Session at 17th Cloud Expo, Bruce Swann, Senior Product Marketing Manager for Adobe Campaign, explored the key ingredients of cross-channel marketing in a digital world. Learn how the Adobe Marketing Cloud can help marketers embrace opportunities for personalized, relevant and real-time customer engagement across offline (direct mail, point of sale, call center) and digital (email, website, SMS, mobile apps, social networks, connected objects).
OpsHub, Inc. has announced enhanced support for DevOps and Migration for both Team Foundation Server and Visual Studio On-line in a heterogeneous environment. With added support for build and release entities in OpsHub Integration Manager (OIM) Microsoft customers can now leverage Visual Studio build and release services to manage DevOps processes in a heterogeneous environment. With the enhanced support customers can manage the DevOps process in Team Foundation Server while undertaking activit...
The buzz continues for cloud, data analytics and the Internet of Things (IoT) and their collective impact across all industries. But a new conversation is emerging - how do companies use industry disruption and technology enablers to lead in markets undergoing change, uncertainty and ambiguity? Organizations of all sizes need to evolve and transform, often under massive pressure, as industry lines blur and merge and traditional business models are assaulted and turned upside down. In this new da...
SYS-CON Events announced today that Catchpoint, a global leader in monitoring, and testing the performance of online applications, has been named "Silver Sponsor" of DevOps Summit New York, which will take place on June 7-9, 2016 at the Javits Center in New York City. Catchpoint radically transforms the way businesses manage, monitor, and test the performance of online applications. Truly understand and improve user experience with clear visibility into complex, distributed online systems.Founde...
In recent years, at least 40% of companies using cloud applications have experienced data loss. One of the best prevention against cloud data loss is backing up your cloud data. In his General Session at 17th Cloud Expo, Sam McIntyre, Partner Enablement Specialist at eFolder, presented how organizations can use eFolder Cloudfinder to automate backups of cloud application data. He also demonstrated how easy it is to search and restore cloud application data using Cloudfinder.
With all the incredible momentum behind the Internet of Things (IoT) industry, it is easy to forget that not a single CEO wakes up and wonders if “my IoT is broken.” What they wonder is if they are making the right decisions to do all they can to increase revenue, decrease costs, and improve customer experience – effectively the same challenges they have always had in growing their business. The exciting thing about the IoT industry is now these decisions can be better, faster, and smarter. Now ...