Back to all announcements

DJ Gowin New Energy Group Limited Interim Results Six Months Ended 30 June 2016

TIDMGWIN

RNS Number : 3657L

Gowin New Energy Group Limited

30 September 2016

30 September 2016

Gowin New Energy Group Limited

("GNE" or the "Group")

(ISDX: GWIN)

Interim Results for the Six Months Ended 30 June 2016

Gowin New Energy Group Limited, the China-based group engaged in the research and development, outsourcing and sales of LED lighting products, today announces its unaudited financial results for the six months ended 30 June 2016.

Chairman's Statement

Business Overview

As previously reported, the Group terminated the Variable Interest Equity ("VIE") relationship with a PRC company Dongguan Yichia Optoelectronics Technology Co., Limited ("Yichia Opto") late last year. As a result of that termination between the Group and Yichia Opto, the Group's business turnover in the first half year of 2016 has significantly decreased, but has simultaneously enabled the Group to continue focusing on R&D progress and expand into other businesses with less working capital requirement. The Group has been exploring and implementing its expanding business base in the first half year of 2016 with minimal incremental business turnover in the six months ending 30 June 2016. In this period the Group has engaged with SOPHELIN BIOTECH CO., LTD and PLEASE BIOTECHNOLOGY CO., LTD developing an anti-allergy filter product which is close to completion. Additionally, the Group has engaged with XIANG-TENG ENTERTAINMENT LIMITED on entertainment sector game facility solutions which are expected to make meaningful profit contributions to the Group in the future. These two business development projects will commence sales in the second half year of 2016, driving expected strong sales and Group profit contribution.

Since most of the Group's employees operate the business in Taiwan, the Group's representative office has been set up in Taoyuan city, in operation since June 2016. To support the Group's future development, the Group is arranging to set up two subsidiaries respectively located in Taiwan and China. The implementation of the two subsidiaries is currently in the project planning phase; the Group will disclose more information as they approach becoming operational.

Financial Position

The total cash balance of the Group as at 30 June 2016 is RMB 9,204,796, considered sufficient (along with conservative projected sales income) to meet its medium term working capital needs for R&D, business expansion and recurring operational expenses. In addition, as a safety measure, should there be any additional unforeseen costs, the Group's CEO Chen Chih Lung has signed a promissory agreement to maintain the Group's ongoing operations and liquidity posture as required. The Board will continue to monitor its cash flow projections on a monthly basis.

Rosin Trading Limited ("Rosin", a subsidiary of the Group) lent US$890,000 to Choice Only International Ent. Co., Ltd. ("Choice") on 26 December 2015, due to be repaid by 26 June 2016. In order to ensure that Choice will redeem the loan in due course, the Group's CEO Chen Chih Lung deposited US$530,888 with the Group as security. As at 26 June 2016, Choice had an outstanding loan amount of US$340,880 which was settled out of the security deposit of US$530,888 provided by Chen Chih Lung. As a result, Choice has met its loan repayment obligations on 26 June 2016.

As described earlier in this report, the Group is proactively expanding its offerings in multiple markets. For example, the Group is evaluating a potential business partnership with TAIWAN THICK-FILM INDUSTRIES CORP. ("Tailon"). Tailon is a company mainly engaged in LED components and panels which they would potentially assemble for our Group's business and sales. Tailon currently has very strong business capital and profits, as revealed on its website and the Taiwan Stock Exchange. When the due diligence report is available the Board will meet to decide if, how and when to invest, at which time the Group will make an appropriate announcement.

Business Outlook

The main business projects which are under development by the Group in 2016 are (1) developing anti-allergy filter products (2) entertainment sector with game facility solutions (3) potential investment in Tailon. These projects, as they come to fruition, are expected to significantly enhance Group profitability beginning late in the second half year of 2016. Tailon, in particular, has broad scale and sustainable profits, with significant upside from a potential partnership with Gowin. In addition, the Group continues its focus on LED R&D and new innovations in indoor and outdoor lighting production which will enhance global commitment to new energy solutions, with features such as power saving function, wafers integration and power effectiveness.

Conclusion

The Board is confident about its business direction and expected growth in revenues and profits. Shareholders will be kept up to date on developments.

I really appreciate all the support from our shareholders. It's acknowledged that in the recent Group restructuring phase there has been little growth. However, with the continuous committed efforts of the Board and staff, a brighter future is anticipated with commensurate upward trends in shareholder value. Finally, on the behalf of the Board, I wish to thank our indispensable employees for their hard work and results.

Garry Willinge

Non-Executive Chairman

30 September 2016

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

Condensed consolidated statement of comprehensive income

For the six months ended 30 June 2016

 
                                                                     Restated 
                                                     Six months    Six months 
                                                          ended         ended 
                                                        30 June       30 June 
                                                           2016          2015 
                                                        RMB'000       RMB'000 
Continuing Operations                        Note   (Unaudited)   (Unaudited) 
 
Revenue                                      7               24             - 
Cost of sales                                               (23)            - 
                                                   ------------   ----------- 
Gross profit                                                  1             - 
 
Administrative expenses                      9           (3,410)       (5,679) 
Operating loss                                           (3,409)       (5,679) 
 
Finance income                               8              349             - 
 
Loss before tax                                          (3,060)       (5,679) 
 
Tax                                          10               -             - 
                                                   ------------   ----------- 
 
Loss from continuing operations                          (3,060)       (5,679) 
 
Discontinued operations 
Loss from discontinued operations                             -        (6,884) 
                                                   ------------   ----------- 
 
Loss for the period                                      (3,060)      (12,563) 
 
Other comprehensive income                                    -             - 
                                                   ------------   ----------- 
 
Total comprehensive loss for the period 
 attributable to owners of the parent                    (3,060)      (12,563) 
                                                   ============   =========== 
 
 
Loss per share attributable to owners of 
 the parent during the period expressed in 
 RMB per share 
Basic and diluted loss per share             11         (0.004)        (0.030) 
                                                   ============   =========== 
 

Gowin New Energy Group Limited

Condensed consolidated statement of financial position

As at 30 June 2016

 
                                           As at         Restated             As at 
                                                            as at 
                              Note       30 June          30 June       31 December 
                                            2016             2015              2015 
                                         RMB'000          RMB'000           RMB'000 
                                     (Unaudited)      (Unaudited)         (Audited) 
Assets 
Current assets 
Trade and other receivables    13         27,168               20             6,532 
Cash in bank                               9,204            5,988             1,309 
                                          36,372            6,008             7,841 
 
Assets directly associated 
 with the discontinued 
 operations                                    -          140,903                 - 
                                    ------------      ----------- 
Total assets                              36,372          146,911             7,841 
                                                      ----------- 
 
Current liabilities 
 
Trade and other payables       15       (16,144)          (13,575   )      (17,052) 
                                        (16,144)          (13,575   ) 
Liabilities directly 
 associated with the 
 discontinued operations                       -         (101,611   )             - 
Total liabilities                       (16,144)         (115,186   )      (17,052) 
                                    ------------      -----------      ------------ 
 

(MORE TO FOLLOW) Dow Jones Newswires

September 30, 2016 07:34 ET (11:34 GMT)

DJ Gowin New Energy Group Limited Interim Results -2-

Net assets                                20,228           31,725           (9,211) 
 
 
Equity attributable 
 to owners of the 
 Company 
Share capital                  16         77,071           44,571            44,571 
Share premium                             19,988           19,988            19,989 
Retained loss                            (76,831   )      (32,834   )      (73,771) 
Total equity                              20,228           31,725           (9,211) 
                                    ------------      -----------      ------------ 
 
 
 

Gowin New Energy Group Limited

Condensed consolidated statement of changes in equity

For the six months ended 30 June 2016

 
                                                  Attributable to owners of the Company 
                              ----------------------------------------------------------------------------- 
                                                                      Reverse acquisition 
                               Share capital   Share premium                      reserve   Retained losses      Total 
                                     RMB'000         RMB'000                      RMB'000           RMB'000    RMB'000 
 For the six months ended 30 
  June 2015 (Unaudited) 
 
  Balance at 1 January 2015 
  (Audited)                           34,571          14,677                     (10,049)          (10,222)     28,977 
 Loss for the period                       -               -                            -          (12,563)   (12,563) 
 Other comprehensive income 
 for the period                            -               -                            -                 -          - 
                              --------------  --------------  ---------------------------  ----------------  --------- 
 Total comprehensive income 
  for the period                           -               -                            -          (12,563)   (12,563) 
 Total transactions with 
  owners, recognized 
  directly in equity 
 Issue of shares                      10,000           5,311                            -                 -     15,311 
 Reallocation                              -               -                       10,049          (10,049)          - 
                              --------------  --------------  ---------------------------  ----------------  --------- 
 Restated balance as at 30 
  June 2015                           44,571          19,988                            -          (32,834)     31,725 
                              --------------  --------------  ---------------------------  ----------------  --------- 
 
 
   For the six months ended 
   30 June 2016 (Unaudited) 
 
   Balance as at 1 January 
   2016 (Audited)                     44,571          19,988                            -          (73,771)    (9,212) 
 Loss for the period                       -               -                            -           (3,060)    (3,060) 
 Other comprehensive income 
 for the period                            -               -                            -                 -          - 
                              --------------  --------------  ---------------------------  ----------------  --------- 
 Total comprehensive income 
  for the period                           -               -                            -           (3,060)    (3,060) 
 Total transactions with 
 owners, recognized directly 
 in equity 
 
 Issue of shares                      32,500               -                            -                 -     32,500 
 Balance as at 30 June 2016           77,071          19,988                            -          (76,831)     20,228 
                              ==============  ==============  ===========================  ================  ========= 
 

Gowin New Energy Group Limited

Condensed consolidated statement of cash flows

For the six months ended 30 June 2016

 
                                                              Restated 
                                              Six months    Six months 
                                                   ended         ended 
                                                 30 June       30 June 
                                                    2016          2015 
                                                 RMB'000       RMB'000 
                                             (Unaudited)   (Unaudited) 
 
Cash Flows used in Operating Activities 
Loss before tax                                   (3,060)       (5,679) 
Finance income                                      (349)            - 
Decrease/(increase) in trade and 
 other receivables                                   621        (1,877) 
Increase in trade and other payables               1,553         9,437 
Net cash used in operating activities 
 by discontinued operations                            -       (10,781) 
                                            ------------   ----------- 
 
Net cash used in operating activities             (1,235)       (8,900) 
 
 
Cash Flows generated from Financing 
 Activities 
Issue of shares                                    3,810        15,311 
Repayment of loan made to related 
 party                                             5,321             - 
Net cash used by discontinued operations               -          (435) 
 
Net cash generated from financing 
 activities                                        9,131        14,876 
 
 
Net increase in cash and cash equivalents          7,895         5,976 
                                            ------------   ----------- 
 
  Cash and cash equivalents at beginning 
  of period                                        1,309            12 
                                            ------------   ----------- 
 
Cash and cash equivalents at end 
 of period                                         9,204         5,988 
                                            ============   =========== 
 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

IR FBLFXQKFXBBF

(END) Dow Jones Newswires

September 30, 2016 07:34 ET (11:34 GMT)