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Renewable Energy

mooo000
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28-May-2011 20:18

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they explain it was an accounting error in the latest results reported (see below). :x it does reflect very badly on REA and question its ethics whether it was a genuine mistake or a way to lure investors in. :( but i think that if what they are saying is true, hopefully things can improve. since the change in specifications by 1 customer is only a one off event. and if they can improve the efficiency of their operations, their profit is likely to increase. startup cost for renewable energy may be large, but it can provide a steady profit margin in the future. hopefully things work out. :) still waiting for REA to bottom out before averaging down. wish all gd luck!
Note: The results for 1H have been restated due to the following:
(a) Raw materials delivered to a subcontractor were mistakenly recorded as a
sale and classified as revenue. The reclassification has no impact to the
profit or loss account.
(b) The terms of sales to a customer varies from the usual terms applicable to
other customers of the Group. In accordance to the term of these sales, the
customer is liable for payment only upon receipt of goods. The restatement

reduced 1H profit by RMB8.8 million. However, the sales were subsequently

recognised in 2H. There is no impact to the full year result for FY2011.

sansgp ( Date: 28-May-2011 17:08) Posted:

Hi.. Something to ponder over. about the way they put together their account books..

On 13th Nov 2010, REA announced its half year result (ending sep 2010), it claimed a turnover of RMB 129 million with its RE business alone. and made a tidy profit from that business. Follow the links below:

http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_1772FBB44367A22A482577DA0025A674/$file/REAPressRelease.pdf?openelement

Now, On 27th May 2011, REA announces its full year turn over (ending March 2011) from its RE business as RMB 129 million, same amount! Co. made a LOSS too... Does it mean Something ? They very well knew of the disposal of fastening business but they booked an impairment loss for this purpose also.

http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_D2254A8CC8FB7A6D4825789D0036BDAB/$file/REA_New_Release.pdf?openelement

What are we to conclude from this? Management needs to make an explanation, especially with their old guards (from superior fastening) left or 'removed' from the present co.

NAV of REA group is RMB 0.2975 in march 2011 as compared to RMB 0.3941 in Sept 2010.

I will not be surprised if the share price moves up on monday but deeply concerned on the credibility of all these stuff.

I empathise with ourselves, the poor investors who believe all those SGX filings from Co. are authentic & make our investment decisions based on them.

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warrenbegger
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28-May-2011 19:42

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Yells: "Anyhow Buy Anyhow Die ^_^"

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I keep warn and warn till i also lazy to warn anymore liao, just let those want to jump into shit pool go bath in shit la. Sgx so many counter why still want to risk on this shit, backside too itchy ah? Already big vol of sell off to tips off liao still many idiot go catch falling bomb. Those still inside pray hard hard liao, i wont come here to warm again. There's a saying, Dumb people got no cure. Unless REA really do something to gain trust value and improve it own fundamental a lots, if not chance of winning is only 20%, and chance of losing more is 80%+. Like that go casino better, bet on banker got 49.99% chance of winning. Wish those inside luck liao, bye bye...

warrenbegger ( Date: 19-Apr-2011 19:27) Posted:

CFO just resign like that and company havent find a replacement!

That means? Why so urgent? CFO is a very important role to a company audit too, something wrong?

Those S-cheat CFO, u know if u resign so sudden before a company announce result will cause investor nightmare?

Now S-cheat + company incorporated in bermuda + catalist + CFO resign = ??? I also dont know cause still didnt see any big vol sell away to tips off

Warning Avoid REA after audit clear.

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medivh
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28-May-2011 18:40

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Thanks for the analysis.. this is much better ^^.

sansgp ( Date: 28-May-2011 17:08) Posted:

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sansgp
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28-May-2011 17:08

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New123
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27-May-2011 22:53

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I think the prices already factored in for the expectation of this Loss. Hopefully can see prices move up to 10 cents and above..

S$4.5M netted for disposal fastening business will be included for Year 2012 + RMB$48.5M cash on hand will give a good start for the new year..

" Mgmt will assessed the Manufacturing segment as part of an operation review, and have since taken steps to re-organise the business to improve the internal processes and efficiency.” Hopefully can see them returning back to profit for the 1st Half of 2012...

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tchoonw
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27-May-2011 21:09

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so how will the bugger react on monday?

New123 ( Date: 27-May-2011 20:23) Posted:

SINGAPORE, 27 May 2011 – In its first full year of operations since the commencement of its new renewable energy business, Renewable Energy Asia Group (亚洲新能源集团 )(“REA Group” or the “Group”) has notched RMB10.0 million in gross profit, on maiden revenue of RMB129.0 million, for the financial year ended 31 March 2011 (FY2011). However, on the back of lower production volume and higher per unit cost of production, the Group recorded a net loss of RMB39.1 million from its continuing operations. The Group’s manufacturing segment, which manufactures and fabricates wind turbine components and systems for local and international wind turbine manufacturers, was the sole revenue contributor in FY2011. The last quarter saw changes to production specifications by a major customer, which, coupled with a bottleneck in a production process arising from quality issues, resulted in a fall in production volume. This led to higher unit cost of production and impacted the profitability of the Group. The Group has also completed the disposal of the fastening business on 13 May 2011, netting it approximately S$4.5 million in cash consideration for the next financial year. The fastening business was reclassified as discontinued operations in FY2011.

On the wind farm investment front, the Group has begun to reap rewards from its 49%

stake in the Datang Baotou wind farm acquired in December 2010, recording share of

profit from associate of RMB1.3 million. The wind farm has a total capacity of 49.5

megawatts (MW) and had begun generating electricity in October 2010.

Commenting on the outlook of the industry in the year ahead, Mr Xu said, “The recent

Japan nuclear crisis has relit concerns on the safety and viability of nuclear energy,

and has also renewed focus on wind energy development. Given the demand

potential, we will pro-actively seek concessions and other opportunities to expand our

business in China. ”

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New123
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27-May-2011 20:23