Welcome!

News Feed Item

Changfeng Revenue Up 39%, Gross Profit Up 40% and Net Income Up 52% for the Three Months Ended March 31, 2014 With Compared to the Same Period of 2013

TORONTO, ONTARIO -- (Marketwired) -- 05/15/14 -- Changfeng Energy Inc. (TSX VENTURE:CFY) ("Changfeng" or the "Company") is pleased to announce that the Company has filed its unaudited condensed interim consolidated financial results for the first quarter ended March 31, 2013. The unaudited condensed interim consolidated financial results and Management Discussion and Analysis can be downloaded from www.SEDAR.com or from the Company's website at www.changfengenergy.com.

Summary of the First Quarter of 2014 Consolidated Financial Results


---------------------------------------------------------------------------
In thousands of Canadian dollars      Three months ended March 31,         
except percentages and per share             2014     2013   Change       %
amounts                                                                    
------------------------------------- -------------------------------------
Revenue                                    13,381    9,623    3,758     39%
------------------------------------- -------------------------------------
Gross margin                                7,790    5,572    2,218     40%
------------------------------------- -------------------------------------
Net income                                  1,930    1,273      657     52%
------------------------------------- -------------------------------------
EBITDA (1)                                  5,019    3,001    2,018     67%
------------------------------------- -------------------------------------
Note:                                                                       
(1) See Non- IFRS Financial Measures in this Press Release.                 

Sales from the gas distribution utility for the three months ended March 31, 2014 were $11.4 million, an increase of $3.4 million, or 43%, from $8.0 million for same period of 2013. This increase was attributable to the 11.5% appreciation of exchange rate between the Chinese RMB and the Canadian dollar, an increase in connection fees in the Sanya operation, increased gas volume sold of 11.0 million m3 in the Sanya operation in the first three months of 2014 compared to 10.9 million m3 sold in Sanya operation in the same period of 2013; and increased gas volume sold of 0.3 million m3 in the Xiangdong operation in the first three months of 2014 compared to 0.0 million m3 sold in the same period of 2013.

Total revenue from the CNG refueling retail station for the three months ended March 31, 2014 was $2.0 million, an increase of $0.3 million, or 18%, from $1.7 million for same period of 2013. The increase was attributable to the combined effect of the increased gas volume sold and the appreciation of exchange rate between the Chinese RMB and the Canadian dollar. (3.0 million m3 in the three months ended March 31, 2014 compared to 2.8 million m3 sold in the same period of 2013). The Company has been upgrading its station's refueling capacity to meet the increasing demand that is primarily driven by both rising gasoline prices and continued government support for clean energy vehicles. It is expected that more existing gasoline-fueled buses in the city will be converted into dual-fuel vehicles (gasoline/CNG).

Gross margin for the first quarter of 2014 increased $2.2 million, or 40%, to $7.8 million from $5.6 for the comparable period in 2013. The gross margin percentage of 58% for the first quarter of 2014 is approximately the same as for the first quarter of 2013.

General and administrative expenses for the first quarter of 2014 were $2.7 million, an increase of $0.6 million, or 27%, from $2.2 million in the same period of 2013. The increase was attributable to higher employee salaries and benefits as a result of a higher inflation rate in China, additional employees, higher conference and professional fees and higher exchange rate between the Chinese RMB and the Canadian dollar. General and administrative expenses as a percentage of sales for the first quarter of 2014 decreased to 20% from 22% in the first quarter of 2013.

Travel and business development expenses for the first quarter of 2014 were $1.1 million, an increase of $0.1 million, or 12%, from $1.0 million in the first quarter of 2013. Travel and business development expenses as a percentage of sales for the first quarter of 2014 decreased to 8% from 10% in the first quarter of 2013. These expenses normally fluctuate with travel and business development activities in mainland China as the Company seeks to develop new projects in close proximity to the new national pipelines.

Net income for the first quarter of 2014 was $1.9 million, or $0.030 per share (basic and diluted) compared to $1.3 million or $0.020 per share (basic and diluted) for the same period in 2013, primarily due to the reasons discussed above.

EBITDA (non-IFRS measure as identified and defined under section "Non-IFRS Measures") for the first quarter of 2014 was $5.0 million, an increase of $2.0 million, or 67%, from $3.0 million for the same period of 2013. The increase was driven primarily by higher sales. EBITDA as a percentage of revenue for the first quarter of 2014 was 38%, compared to 31% in the first quarter of 2013, representing an increase of 7% due to the sales increases but was partially offset by higher operating expenses, as discussed above.

Financial Position

Cash increased by $0.05 million to $15.20 million at March 31, 2014 from $15.15 million at December 31, 2013, primarily resulting from cash provided during the quarter by operating activities of $2.1 million and effects of foreign exchange on cash balances of $0.2 million, offset by $0.1 million repayment of long-term debt, $0.3 million for share buyback and cash used for capital expenditures of $1.9 million during the quarter.

Net cash provided by operations was $2.1 million for the first quarter of 2014 compared to $1.7 million for the same period of 2013.

Cash used in financing activities in the first quarter of 2014 included a $0.1 million principle payment of long-term debt and $0.3 million paid for the share buyback.

Capital expenditures in property and equipment totaled $1.9 million in the first quarter of 2014 compared to $2.2 million in the same period of 2013. The expenditures were mainly related to the purchase of equipment for the Xiangdong project and the on-going construction of pipeline networks to connect new customers in the Sanya Region.

Changfeng will finance the majority of the upcoming construction of projects under development in mainland China through its long-term bank loans with BOC Sanya and BOC Pingxiang, as well as operating cash flow from its existing operations.

Non-IFRS Financial Measures

The Company uses the following non-IFRS financial measure: EBITDA. The Company believes this non-IFRS financial measure provides useful information to both management and investors in measuring the financial performance and financial condition of the Company for the reasons outlined below.

Management uses this non-IFRS financial measure to exclude the impact of certain expenses and income that must be recognized under IFRS when analyzing consolidated operating performance, as the excluded items are not necessarily reflective of the Company's underlying operating performance and make comparisons of underlying financial performance between periods difficult. From time to time, the Company may exclude additional items if it believes doing so would result in a more effective analysis of underlying operating performance. The exclusion of certain items does not imply that they are non-recurring.

This measure do not have a standardized meaning prescribed by IFRS and therefore they may not be comparable to similarly titled measures presented by other publicly traded companies and should not be construed as an alternative to other financial measures determined in accordance with IFRS. This measure is listed and defined below:

EBITDA

EBITDA is defined herein as income before income tax expense, interest expense, depreciation and amortization, share of loss of investment in associate, as well as non-cash stock-based compensation expense. EBITDA does not have any standardized meaning prescribed by IFRS and therefore may not conform to the definition used by other companies. A reconciliation of net income to EBITDA for each of the periods presented as follows:


---------------------------------------------------------------------------
In thousands                         Three months ended March 31,          
(except for % figures)                   2014      2013    Change         %
---------------------------------------------------------------------------
Net Income                              1,930     1,273       657       52%
Add (less):                                                                
 Income tax                             1,469       744       725       97%
 Interest income                          (9)       (9)         0        0%
 Share of loss of investment in                                            
  associate                               7.6       0.3         7     2333%
 Stock-based compensation                  87         -        87      100%
 Amortization                           1,044       551       493       89%
 Interest expense                         490       442        48       11%
---------------------------------------------------------------------------
EBITDA                                  5,019     3,001     2,018       67%
---------------------------------------------------------------------------

About Changfeng Energy Inc.

Changfeng Energy Inc. is a natural gas service provider with operations located throughout the People's Republic of China. The Company services industrial, commercial and residential customers, providing them with natural gas for heating purposes and fuel for transportation. The Company has developed a significant natural gas pipeline network as well as urban gas delivery networks, stations, substations and gas pressure regulating stations in Sanya City & Haitang Bay. Through its network of pipelines, the Company provides safe and reliable delivery of natural gas to both homes and businesses. The Company is headquartered in Toronto, Ontario and its shares trade on the Toronto Venture Exchange under the trading symbol "CFY". For more information, please visit the Company website at www.changfengenergy.com.

Forward-Looking Statements

Information set forth in this news release may involve forward-looking statements under applicable securities laws. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this document are made as of the date of this document and the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities legislation. Although Management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. This news release does not constitute an offer to sell or solicitation of an offer to buy any of the securities described herein and accordingly undue reliance should not be put on such.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this 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
Between 2005 and 2020, data volumes will grow by a factor of 300 – enough data to stack CDs from the earth to the moon 162 times. This has come to be known as the ‘big data’ phenomenon. Unfortunately, traditional approaches to handling, storing and analyzing data aren’t adequate at this scale: they’re too costly, slow and physically cumbersome to keep up. Fortunately, in response a new breed of technology has emerged that is cheaper, faster and more scalable. Yet, in meeting these new needs they...
"We're a cybersecurity firm that specializes in engineering security solutions both at the software and hardware level. Security cannot be an after-the-fact afterthought, which is what it's become," stated Richard Blech, Chief Executive Officer at Secure Channels, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
When it comes to cloud computing, the ability to turn massive amounts of compute cores on and off on demand sounds attractive to IT staff, who need to manage peaks and valleys in user activity. With cloud bursting, the majority of the data can stay on premises while tapping into compute from public cloud providers, reducing risk and minimizing need to move large files. In his session at 18th Cloud Expo, Scott Jeschonek, Director of Product Management at Avere Systems, discussed the IT and busin...
According to Forrester Research, every business will become either a digital predator or digital prey by 2020. To avoid demise, organizations must rapidly create new sources of value in their end-to-end customer experiences. True digital predators also must break down information and process silos and extend digital transformation initiatives to empower employees with the digital resources needed to win, serve, and retain customers.
The IoT is changing the way enterprises conduct business. In his session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, discussed how businesses can gain an edge over competitors by empowering consumers to take control through IoT. He cited examples such as a Washington, D.C.-based sports club that leveraged IoT and the cloud to develop a comprehensive booking system. He also highlighted how IoT can revitalize and restore outdated business models, making them profitable ...
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...
SaaS companies can greatly expand revenue potential by pushing beyond their own borders. The challenge is how to do this without degrading service quality. In his session at 18th Cloud Expo, Adam Rogers, Managing Director at Anexia, discussed how IaaS providers with a global presence and both virtual and dedicated infrastructure can help companies expand their service footprint with low “go-to-market” costs.
Get deep visibility into the performance of your databases and expert advice for performance optimization and tuning. You can't get application performance without database performance. Give everyone on the team a comprehensive view of how every aspect of the system affects performance across SQL database operations, host server and OS, virtualization resources and storage I/O. Quickly find bottlenecks and troubleshoot complex problems.
"Once customers get a year into their IoT deployments, they start to realize that they may have been shortsighted in the ways they built out their deployment and the key thing I see a lot of people looking at is - how can I take equipment data, pull it back in an IoT solution and show it in a dashboard," stated Dave McCarthy, Director of Products at Bsquare Corporation, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
"We are the public cloud providers. We are currently providing 50% of the resources they need for doing e-commerce business in China and we are hosting about 60% of mobile gaming in China," explained Yi Zheng, CPO and VP of Engineering at CDS Global Cloud, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Predictive analytics tools monitor, report, and troubleshoot in order to make proactive decisions about the health, performance, and utilization of storage. Most enterprises combine cloud and on-premise storage, resulting in blended environments of physical, virtual, cloud, and other platforms, which justifies more sophisticated storage analytics. In his session at 18th Cloud Expo, Peter McCallum, Vice President of Datacenter Solutions at FalconStor, discussed using predictive analytics to mon...
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform and how we integrate our thinking to solve complicated problems. In his session at 19th Cloud Expo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and sh...
@GonzalezCarmen has been ranked the Number One Influencer and @ThingsExpo has been named the Number One Brand in the “M2M 2016: Top 100 Influencers and Brands” by Onalytica. Onalytica analyzed tweets over the last 6 months mentioning the keywords M2M OR “Machine to Machine.” They then identified the top 100 most influential brands and individuals leading the discussion on Twitter.
Today we can collect lots and lots of performance data. We build beautiful dashboards and even have fancy query languages to access and transform the data. Still performance data is a secret language only a couple of people understand. The more business becomes digital the more stakeholders are interested in this data including how it relates to business. Some of these people have never used a monitoring tool before. They have a question on their mind like “How is my application doing” but no id...
IoT is rapidly changing the way enterprises are using data to improve business decision-making. In order to derive business value, organizations must unlock insights from the data gathered and then act on these. In their session at @ThingsExpo, Eric Hoffman, Vice President at EastBanc Technologies, and Peter Shashkin, Head of Development Department at EastBanc Technologies, discussed how one organization leveraged IoT, cloud technology and data analysis to improve customer experiences and effici...