Gowin New Energy Grp - Audited Annual Results year ended 31 December 2016

31 May 2017

 

Gowin New Energy Group Limited

("Gowin" or the "Company")

 

Audited Annual Results for the year ended 31 December 2016

 

Gowin New Energy Group Limited is delighted to report its audited annual results for the twelve months ended 31 December 2016.

 

Chairman's statement

Business Overview

The principal activity of Gowin New Energy Group Limited ("the Group') is research and development, outsourcing production and sales of LED lighting products in China and abroad, with focus on general lighting and backlighting. The financial year 2016 for the Group including its subsidiaries was a year of continued restructuring and business development with long term sustainability in mind. The results clearly show the ordinary course of LED lighting sales continued to be very slow. Since the Variable Interest Equity ("VIE") contracts were terminated with Yichia Optoelectronics Technology Co., Ltd ("Yichia Opto") in 2015, the subsidiary Gowin New Energy Holdings Limited ("Holdings") serves no purpose. Consequently, the winding-up process of Holdings was approved by the Board in 2016 and is currently being completed. Upon completion of both the winding-up processes of Holdings and Yichia Opto, the Group's investments in those entities also cease providing for simpler management and the elimination of the losses that had accumulated over a number of years.

 

Regarding the Group's business strategy, its focus has consistently been on LED operations and sales, including after the VIE contract termination with Yichia Opto in 2015, but it is evidential that sales performance has been below target for reasons to do with the market and lack of human and financial resources to engage effectively.  Therefore, the Board has been working diligently reviewing its investment opportunity options, for the benefit of the long term. The Group continues to value its position as a publicly listed company on NEX. The Directors continue to evaluate business opportunities for the Group aiming to increase value for shareholders, announcements about which will be made when preparations are complete. As explained in the Group's Interim Results for the six months ended 30 June 2016, one of the opportunities being evaluated is a relationship with TAIWAN THICK-FILM INDUSTRIES CORP. ("TTFI"). TTFI's principal activity is production and sales of LED and Back Light Module products, a similar business to the Group. TTFI is listed on the Taipei Stock Exchange and is profitable.

 

Financial Position

 

The Group will concentrate on achieving returns through its LED business subsidiaries and from associated investment returns. The Group intends to attract capital and make cash investments in other businesses. CEO Mr. Chen Chih-Lung has signed a pledge letter promising to support the Group's working capital needs as necessary, such that the Group does not anticipate any working capital or going concern issues in the foreseeable future.         

 

Business Outlook and Conclusion

 

The Board will continue to examine opportunities to grow in the LED industry in 2017. As already expressed, CEO Mr. Chen Chih-Lung has made a commitment to the Group to provide financial assistance for any additional working capital requirements needed, thus providing for a brighter future for the Group. 

 

The Directors look forward to the coming year with confidence.

 

Events After Reporting Date

 

On 7 February 2017, the Group conducted an AGM. Six ordinary resolutions and three special resolutions were passed unanimously. In particular, special resolution 9 provided for the approval of the Capital Reduction of Gowin New Energy Group Limited, as explained in the Notice of the Annual General Meeting published for all shareholders on 15 January, 2017.  

 

 

 

The Board highly appreciates all the support from our shareholders. Though the post VIE restructuring period has been difficult, the Board is confident it is taking the right actions to prepare for a sustainable future. Additionally, on the behalf of the Board, I wish to sincerely thank our hard working employees for their efforts and results.

 

Garry Willinge

Non-Executive Chairman

31 May 2017

 

 

 

The directors of Gowin New Energy Group Limited accept responsibility for this announcement.

 

For further information please visit www.gowinyichia.com or contact the following:

Garry Willinge                                        Gowin New Energy Group Limited           +852 9100 9972

David Scott / James Dewhurst     Alexander David Securities Limited                      +44 20 7448 9820

 

 

 

 

 

 

 

 

GOWIN NEW ENERGY GROUP LIMITED

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2016

 

	Note
		2016	2015
Continuing Operations		RMB'000	RMB'000
Revenue	6	28	652
Cost of sales	10	(26)	(632)
Gross profit		2	20
Administrative expenses	10	(7,232)	(9,248)
Impairment of trade receivables	15	-	(410)
Other income	9	-	105
Operating loss		(7,230)	(9,533)
Finance income	8	354	-
Finance cost	9	(59)	(15)
Provision on amount due from equity holder	15	-	(20,941)
Loss before tax from continuing operations		(6,935)	(30,489)
Tax	11	-	-
Loss for the year from continuing operations		(6,935)	(30,489)
Discontinued operations
Loss from discontinued operations		-	(23,011)
Loss for the year attributed to equity holders of the parent		(6,935)	(53,500)
Other Comprehensive Income		-	-
Total Comprehensive Income for the year attributable to owners of the parent		(6,935)	(53,500)
Earnings per share expressed in RMB per share
Basic and diluted earnings per share for the year attributable to equity holders of the parent	12	(0.01)	(0.12)
Earnings per share for continuing operations expressed in RMB per share
Basic and diluted earnings per share for continuing operations for the year attributable to equity holders of the parent	12	(0.01)	(0.07)

 

 

 

 

 

 

 

 

GOWIN NEW ENERGY GROUP LIMITED

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

FOR THE YEAR ENDED 31 DECEMBER 2016

 

	Note
		31 December 2016	31 December 2015
		RMB'000	RMB'000
ASSETS
CURRENT ASSETS
Trade and other receivables	15	33,096	6,532
Cash and cash equivalents	16	2,079	1,309
		35,175	7,841
TOTAL ASSETS		35,175	7,841
LIABILITIES
CURRENT LIABILITIES
Trade and other payables	17	(18,821)	(17,052)
		(18,821)	(17,052)
TOTAL LIABILITIES
NET ASSETS		16,354	(9,211)
EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT
Share capital	18	77,071	44,571
Share premium		19,989	19,989
Retained earnings		(80,706)	(73,771)
		16,354	(9,211)

 

 

The Consolidated Financial Statements were approved by the board of Directors and authorised for issue on 31 May 2017 and were signed on its behalf by:

 

Garry Willinge                            Chen Chih-Lung

Director                                     Director

 

 

 

GOWIN NEW ENERGY GROUP LIMITED

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2016

 

	Attributable to owners of the parent
	Share capital (Note 18)	Share premium	Reverse acquisition reserve	Retained earnings	Total
	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000
Balance at 1 January 2015	34,571	14,677	(10,049)	(10,222)	28,977
Loss for the year	-	-	-	(53,500)	(53,500)
Other comprehensive income for the year	-	-	-	-	-
Total comprehensive income for the year	-	-	-	(53,500)	(53,500)
Total transactions with owners, recognised directly in equity
Issue of shares	10,000	5,312	-	-	15,312
Reallocation	-	-	10,049	(10,049)	-
Balance as at 31 December 2015	44,571	19,989	-	(73,771)	(9,211)
Loss for the year	-	-	-	(6,935)	(6,935)
Other comprehensive income for the year	-	-	-	-	-
Total comprehensive income for the year	-	-	-	(6,935)	(6,935)
Total transactions with owners, recognised directly in equity
Issue of shares	32,500	-	-	-	32,500
Balance as at 31 December 2016	77,071	19,989	-	(80,706)	16,354

 

 

 

 

 

 

GOWIN NEW ENERGY GROUP LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 DECEMBER 2016

	2016	2015
	RMB'000	RMB'000
Cash Flows from Operating Activities
Loss Before Tax	(6,935)	(9,533)
Finance income	(354)	(15)
Finance cost	40	-
(Increase)/Decrease in trade and other receivables	(5,582)	327
Increase/(Decrease) in trade and other payables	383	(1,464)
Net cash used by discontinued operations	-	(10,250)
Net cash used in operating activities	(12,448)	(20,935)
Cash Flows from Investing Activities
Finance income	354	-
Net cash used in investing activities	354	-
Cash Flows from Financing Activities
Proceeds from issue of shares	3,810	15,312
Loan made to related party	(527)	(5,775)
Repayment of loan from related party	5,775	-
Shareholders' loans	3,846	12,618
Finance cost	(40)	-
Net cash generated from financing activities	12,864	22,155
Net Increase in cash and cash equivalents	770	1,220
Cash and cash equivalents at the beginning of the year	1,309	89
Cash and cash equivalents at the end of the year	2,079	1,309

 

Non-cash transactions:

As explained in note 17 Trade and Other Payables, RMB3,855,000 of the amount due to Mr Chen Chih-Lung has been converted into convertible loan during the year.

As explained in note 18 Share Capital, certain convertible loans where capitalized during the year by the issue of Ordinary Shares.