TIDMJHL
RNS Number : 4892T
Jetion Solar Holdings Limited
29 September 2010
+-------------------------------+--------------------------------------+
| For immediate release | 29th September, 2010 |
+-------------------------------+--------------------------------------+
Jetion Solar Holdings Limited
("Jetion" or the "Company")
Interim Results
Jetion Solar Holdings Limited (AIM:JHL), the manufacturer of high quality solar
cells and modules, announces today its unaudited interim results for the six
months ended 30th June, 2010
Financial Highlights
· Turnover US$146.7m (H1 2009: US$55.9m)
· Gross profit US$ 28.0m (H1 2009: US$ 10.1m)
· Pre-tax profit US$4.8m (H1 2009 : US$3.2m)
· Post-tax profit US$4.1m (H1 2009: US$2.4m)
· Gross margin 19.1% (H1 2009: 18.1%)
· Basic earnings per share US cents 5.44 (H1 2009: US cents 3.28)
Operating Highlights
· Sales volume 83.0MW (H1 2009: 37.1MW) up 123.7%
- Export sales volume increased to 79.5MW (H1 2009:
11.6MW)
- China sales volume decreased to 3.5MW (H1 2009:
25.5MW)
· Production volume:
- Solar cell output 60.1MW (H1 2009: 41.7MW)
- Solar module output 84.1MW (H1 2009: 11.3MW)
· Average efficiency rate of monocrystalline silicon solar cell production
lines exceeded 17.5% during the period (H1 2009: 17.0%)
Regarding the outlook Chairman Gabriel Kow said:
"During the second half of the year we have installed two new lines, both of
which are being utilised at full capacity and will therefore enable us to drive
our revenue. In addition, because of our expertise and long-standing customer
relationships which have allowed us to secure some longer term contracts, and
despite some margin pressures and the challenging market conditions, we remain
confident of meeting our expectations for the fullyear.
+---------------------------------+---------------------------------+
| | |
| | |
| Jetion Solar Holdings Limited | +44 (0) 20 7466 5000 |
| (today only) | |
+---------------------------------+---------------------------------+
| Gabriel Kow | |
+---------------------------------+---------------------------------+
| Eric Chan | |
+---------------------------------+---------------------------------+
| Raymond Wong | |
| | |
+---------------------------------+---------------------------------+
| Evolution Securities Ltd | +44 (0) 20 7071 4300 |
| (Nominated adviser) | |
+---------------------------------+---------------------------------+
| Tom Worlledge | |
+---------------------------------+---------------------------------+
| Tim Redfern | |
+---------------------------------+---------------------------------+
| Esther Lee | |
+---------------------------------+---------------------------------+
| | |
+---------------------------------+---------------------------------+
| Buchanan Communications | +44 (0) 20 7466 5000 |
+---------------------------------+---------------------------------+
| Mark Edwards | |
+---------------------------------+---------------------------------+
| Christian Goodbody | |
+---------------------------------+---------------------------------+
Chairman's Statement
Results
I am delighted to report that during H1 of 2010 Jetion Solar grew both its sales
revenue and volume significantly, by 162.4% and 123.7% respectively, compared
with the same period last year with the result that, despite incurring
significant foreign exchange losses, we have generated a profit before tax of
US$4.8m, up over 50% on 2009 (US$3.2m).
The growth in sales revenue and volume reflects the operational strength of our
business, and moreover, with two new production lines having been installed
since the 2010 half year end and two further production lines currently being
installed, volumes are expected to increase. The strong sales of modules that
we experienced in the first quarter of the year has continued through the
remainder of the first half, albeit that some 94.4% of our sales were
denominated in Euro, which has remained weaker than last year and therefore had
a significant impact on our overall profitability. Offsetting this however,
the product mix has changed in favour of the more profitable modules against the
lower margin solar cells, allowing us to achieve an improvement in gross margin
from 18.1% to 19.1%.
During the period we acquired the remaining 49% of Jetion Solar (Europe) that we
did not already own and the increase in distribution costs from US$0.8m to
US$2.5m reflects both the increased level of activity and the fact that we are
now presenting the results of Jetion Solar (Europe) from the second quarter of
2010 on a line-by-line basis.
The Company incurred a significant foreign exchange loss of US$13.2m on Euro
assets, being receivables and cash. The Company has reduced its holding of
foreign currency since the period end and increasingly utilises forward foreign
exchange contracts to manage its exposure to the Euro, thereby reducing the risk
of such losses in the future.
Market overview
National governments in the major photovoltaic ("PV") markets have been
gradually reducing the subsidies provided to PV installers with the consequence
that selling prices of solar modules are already on a downward trend,
particularly in Germany which is our most important market. At the same time, we
are seeing an increase in wafer prices, already up by as much as 40% since May
2010, and therefore expect margins to be reduced in the second half of this
year.
This pressure on margins will be exacerbated by the number of new entrants to
the domestic solar markets, which is increasing solar cell and module production
capacity. However, we believe that the expertise and quality control that
Jetion Solar is able to offer will help to retain business and, to some extent,
maintain margins.
Current trading and outlook
During the second half of the year we have already installed two new lines and
expect two further lines to complete installation by the end of October, almost
all of which we expect to be fully utilised thereby enabling us to drive our
revenue. In addition, because of the expertise and long-standing customer
relationships which have allowed us to maintain our customer base and despite
the margin pressures referred to above we remain confident of meeting our
expectations for the full year.
We have implemented a series of cost cutting measures and efficiencies to ensure
that our production and operational costs are maintained at a minimum.
Jetion Europe
We announced in April that we had completed the acquisition of Jetion Solar
(Europe) for a consideration satisfied by the issue of 1,132,000 new ordinary
shares. Jetion Solar (Europe) has been very important in building our European
business and providing solar installation expertise.
Hong Kong Listing
We announced earlier this month that we had decided to postpone indefinitely the
proposed listing on the Hong Kong Stock Exchange. The original rationale for the
listing was that it would provide the Company with better visibility in its
trading markets, increase liquidity in the shares and provide additional access
to capital sources. However, the board considers that the prevailing volatile
economic conditions and weak stock market sentiment do not provide the right
conditions for such a move.
Board Changes
We have announced today that Eric Chan, our CFO, has tendered his resignation
owing to family circumstances and will be leaving the Company with effect from
31st October 2010. We thank Eric for his considerable contribution over the
period that he has worked for Jetion Solar and we send him and his family our
very best wishes.
We are pleased however to announce the appointment of Grace Zhang as Deputy CFO
with effect from 1st October 2010. Grace is a qualified Chinese CPA who has
worked for Jetion Solar for almost three years and we are confident that the
transition that is required following Eric's departure will be smooth and incur
no disruption to our business.
Finally I would like to take this opportunity to thank our management and staff
for their efforts and perseverance in the execution of the company's strategies.
Their commitment has been essential to the success of Jetion Solar and in
particular to the considerable growth that we have achieved this year when
trading circumstances have been very testing. I also thank our shareholders for
their continued support at this time.
Gabriel Kow
29 September 2010
CEO's Review
In H1 2010, solar cell output was 60.1MW and solar module output was 84.1MW,
44.1% and 644.3% respectively higher than in the same period of last year,
enabling us to increase sales revenue to US$146.7m, 162.4% up on H1 2009. We
also achieved an increase in our gross profit margin to 19.1%, from 18.1% in the
same period last year.
However, the gradual reduction of subsidies on feed-in tariff in Europe and
increased production capacity in China is imposing selling price pressure with
the result that average selling prices are likely to fall from the current
level. We are examining all options to achieve reasonable price agreements for
all parties.
The increase in sales revenues was driven by a 123.7% improvement in volumes,
which, in turn, was as a result of strong demand for modules from Europe with
our principal customers based in Germany, Italy and the Czech Republic.
Furthermore the increasing demand from new manufacturers is driving up solar
wafer prices, which have risen by some 40% since May 2010 and also putting
pressure on our gross margins. It is difficult to pass such price increases
onto our customers when there are, at the same time, increasing supply sources
available to them.
However, we believe that as our production volumes increase our negotiating
strength for the purchasing of raw materials, including wafers, will improve.
In H2 2010 we have installed two new production lines thereby increasing our
solar cell capacity to 150MW and solar module capacity to 200MW. Another 50MW of
cell capacity is currently being installed. We are confident that we will fill
the order book sufficiently to utilise this additional capacity, bringing
economies of scale, improvement to our negotiating position in the procurement
process and reducing the per unit cost.
We remain committed to increasing our technological advantage and anticipate
further increasing our solar cell conversion efficiency rate which will reduce
the consumption of silicon material per watt.
Alina Xu
29 September 2010
CFO's Review
The recovery of the solar market in Europe, which had begun in H2 2009,
continued into H1 2010 and this has resulted in significantly increased sales to
$146.7m compared to $55.9m in H1 2009. Solar module shipments increased to
79.4MW from 11.6MW in H1 2009. The increased level of sales led to a higher
gross margin, 19.1% compared with 18.1% in 2009 as the cost absorption rate was
enhanced.
In April 2010 the Company completed the acquisition of the 49% of Jetion Solar
(Europe) that it did not already own and we are therefore now including its
results from Q2 2010 on a consolidated line by line basis. Further details of
the accounting treatment for the consolidation of Jetion Solar (Europe) are set
out in note 10 to the accompanying financial statements. As Jetion Solar
(Europe) is essentially a sales and consultancy operation, its principal costs
are in relation to distribution and this has resulted in a significant increase
in the reported distribution costs. Some $1.4m of the $4.8m of administrative
expenses relates to the costs of the previously proposed listing in Hong Kong.
We have increased our investment in research and development which is important
to maintain our technological advantage. The additional $3.3m incurred in H1
2010 over the same period last year was largely invested in improving our
average efficiency rate which rose from 17.0% to over 17.5%.
The Group suffered a substantial foreign exchange loss, amounting to some
$13.2m, due to the drop in the value of the Euro against the US Dollar in H1
2010.
The share of losses in Jetion Solar (Europe) relates to the period prior to its
acquisition on 1st April, 2010. Jetion Solar (Europe) has contributed
positively to the results of Jetion Solar in H1 2010 and we expect this to
continue. But due to adverse weather in Europe the sales activity at Jetion
Solar (Europe) was low in Q1 2010. This, together with depressed unit selling
prices, resulted in a loss of US$0.2m from Jetion Solar (Europe) in Q1 2010.
However, since completion of the acquisition, Jetion Solar (Europe)'s turnover
in Q2 2010 has picked up steadily to a level that is nearly twice that being
achieved in Q1 2010.
Prepayment for acquisition of fixed assets of US$19.2m mainly relates to the
installation of further cell production facilities due to be completed by the
end of October 2010.
The balance sheet as at 30 June, 2010 remains strong, with cash balances and
pledged bank deposit of US$107.7m, compared to US$43.7m in 30 June, 2009 and
$55.2m at 31 December 2009. This is partially offset by an increase in bank
loans to US$60.4m from US$33.5m a year ago and from $14.5m at 31 December 2009
for short term operational needs.
Eric Chan
29 September 2010
+--------------------------------------------------------------------------------+
| Consolidated income statement |
| for the six months ended 30 June 2010 |
| (Expressed in United States dollars) |
+--------------------------------------------------------------------------------+
+---------------------------+------+----------------------+----------------------+---------------------+
| | | Six | Six | Year |
| | | months | months | |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | ended 30 | ended 30 | ended |
| | | | | 31 |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | June | June | December |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | 2010 | 2009 | 2009 |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | (unaudited) | (unaudited) | (audited) |
+---------------------------+------+----------------------+----------------------+---------------------+
| |Note | $'000 | $'000 | $'000 |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Turnover | | 146,723 | 55,943 | 176,770 |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Cost of sales | | (118,735) | (45,839) | (135,368) |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Gross profit | | 27,988 | 10,104 | 41,402 |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Other operating income | | 291 | 113 | 241 |
+---------------------------+------+----------------------+----------------------+---------------------+
| Other operating expenses | | (191) | (2,710) | (7,379) |
+---------------------------+------+----------------------+----------------------+---------------------+
| Distribution costs | | (2,498) | (847) | (3,501) |
+---------------------------+------+----------------------+----------------------+---------------------+
| Administrative expenses | | (4,765) | (4,138) | (8,701) |
+---------------------------+------+----------------------+----------------------+---------------------+
| Research and development | | (3,663) | (321) | (1,784) |
| expenses | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Profit from operating | | 17,162 | 2,201 | 20,278 |
| activities | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Interest income | | 582 | 204 | 303 |
+---------------------------+------+----------------------+----------------------+---------------------+
| Interest expenses | | (1,185) | (533) | (747) |
+---------------------------+------+----------------------+----------------------+---------------------+
| Net foreign exchange | | (13,241) | 814 | 1,204 |
| (loss)/gain | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Net financing | | (13,844) | 485 | 760 |
| (expenses)/income | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+---------------------------+------+----------------------+----------------------+---------------------+
| Share of (losses)/profits | | | | |
| of jointly | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| controlled entity | | (197) | 486 | 265 |
+---------------------------+------+----------------------+----------------------+---------------------+
| Gain on deemed disposal | | | | |
| of jointly | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| controlled entity | | | | |
| arising from | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| business combination | | 1,722 | | |
| | | | - | - |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | 1,525 | 486 | 265 |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Profit before taxation | | 4,843 | 3,172 | 21,303 |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Income tax | 4 | (776) | (735) | (3,970) |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Profit for the period | | | | |
| attributable | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| to equity shareholders | | | | |
| of | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| the Company | | 4,067 | 2,437 | 17,333 |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
| | | ======== | ======== | ======== |
+---------------------------+------+----------------------+----------------------+---------------------+
| Earnings per share | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| Basic and diluted | | | | |
| earnings per | | | | |
+---------------------------+------+----------------------+----------------------+---------------------+
| share (US cents) | 6 | 5.44 | 3.28 | 23.36 |
+---------------------------+------+----------------------+----------------------+---------------------+
| | | | | |
| | | ======== | ======== | ======= |
+---------------------------+------+----------------------+----------------------+---------------------+
The notes on pages 8 to 18 form part of this interim financial report.
+--------------------------------------------------------------------------------+
| Consolidated statement of comprehensive income |
| for the six months ended 30 June 2010 |
| (Expressed in United States dollars) |
+--------------------------------------------------------------------------------+
+---------------------------------+------------------------+------------------------+-----------------------+
| | Six | Six | Year |
| | months | months | |
+---------------------------------+------------------------+------------------------+-----------------------+
| | ended 30 | ended 30 | ended |
| | | | 31 |
+---------------------------------+------------------------+------------------------+-----------------------+
| | June | June | December |
+---------------------------------+------------------------+------------------------+-----------------------+
| | 2010 | 2009 | 2009 |
+---------------------------------+------------------------+------------------------+-----------------------+
| | (unaudited) | (unaudited) | (audited) |
+---------------------------------+------------------------+------------------------+-----------------------+
| | $'000 | $'000 | $'000 |
+---------------------------------+------------------------+------------------------+-----------------------+
| | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| Profit for the period | 4,067 | 2,437 | 17,333 |
+---------------------------------+------------------------+------------------------+-----------------------+
| | | | |
| | ------------- | ------------- | ------------- |
+---------------------------------+------------------------+------------------------+-----------------------+
| Other comprehensive income for | | | |
| the | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| period, net of tax: | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| Exchange differences on | | | |
| translation of: | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| - financial statements of | (469) | 329 | 200 |
| subsidiaries | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| - financial statements of | | | |
| joint | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| controlled entity | (21) | 1 | 49 |
+---------------------------------+------------------------+------------------------+-----------------------+
| | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| | (490) | 330 | 249 |
+---------------------------------+------------------------+------------------------+-----------------------+
| | | | |
| | ------------- | ------------- | ------------- |
+---------------------------------+------------------------+------------------------+-----------------------+
| Release of exchange reserve | | | |
| upon | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| deemed disposal of jointly | | | |
| controlled | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| entity arising from business | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| combination | 2 | | |
| | | - | - |
+---------------------------------+------------------------+------------------------+-----------------------+
| | ------------- | ------------- | ------------- |
+---------------------------------+------------------------+------------------------+-----------------------+
| | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| Total comprehensive income for | | | |
+---------------------------------+------------------------+------------------------+-----------------------+
| the period | 3,579 | 2,767 | 17,582 |
+---------------------------------+------------------------+------------------------+-----------------------+
| | ======== | ======== | ======== |
+---------------------------------+------------------------+------------------------+-----------------------+
The notes on pages 8 to 18 form part of this interim financial report.
+--------------------------------------------------------------------------------+
| Consolidated balance sheet at 30 June 2010 |
| (Expressed in United States dollars) |
+--------------------------------------------------------------------------------+
+---------------------------+------+---------------------+--------------------+---------------------+
| | | At | At 31 | At |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | 30 June | December | 30 June |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | 2010 | 2009 | 2009 |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | (unaudited) | (audited) | (unaudited) |
+---------------------------+------+---------------------+--------------------+---------------------+
| |Note | $'000 | $'000 | $'000 |
+---------------------------+------+---------------------+--------------------+---------------------+
| Non-current assets | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Property, plant and | 7 | 52,681 | 43,152 | 43,345 |
| equipment | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Lease prepayments | | 2,689 | 2,720 | 2,747 |
+---------------------------+------+---------------------+--------------------+---------------------+
| Prepayments for | | | | |
| acquisition of | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| property, plant and | | 19,214 | 7,255 | 239 |
| equipment | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Prepayments for raw | | 17,071 | 16,519 | |
| materials | | | | - |
+---------------------------+------+---------------------+--------------------+---------------------+
| Intangible assets | | 1,385 | 1,926 | 2,488 |
+---------------------------+------+---------------------+--------------------+---------------------+
| Goodwill | 10 | 3,346 | | |
| | | | - | - |
+---------------------------+------+---------------------+--------------------+---------------------+
| Interest in a jointly | 10 | | | 344 |
| controlled entity | | - | - | |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | 96,386 | 71,572 | 49,163 |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+---------------------------+------+---------------------+--------------------+---------------------+
| Current assets | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Inventories | | 34,521 | 19,471 | 11,585 |
+---------------------------+------+---------------------+--------------------+---------------------+
| Trade and other | | 44,430 | 44,601 | 50,300 |
| receivables | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Current tax recoverable | | 237 | | |
| | | | - | - |
+---------------------------+------+---------------------+--------------------+---------------------+
| Pledged bank deposits | 8 | 70,708 | 30,156 | 21,628 |
+---------------------------+------+---------------------+--------------------+---------------------+
| Cash and cash equivalents | | 36,985 | 25,087 | 22,125 |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | 186,881 | 119,315 | 105,638 |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+---------------------------+------+---------------------+--------------------+---------------------+
| Current liabilities | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Bank loans | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| - unsecured | | 35,797 | 14,505 | 3,175 |
+---------------------------+------+---------------------+--------------------+---------------------+
| - secured | | 24,605 | | 30,300 |
| | | | - | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Trade and other payables | | 91,819 | 47,900 | 7,506 |
+---------------------------+------+---------------------+--------------------+---------------------+
| Amount due to a | | | | 979 |
| shareholder | | - | - | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Current tax payable | | | 2,477 | 679 |
| | | - | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | 152,221 | 64,882 | 42,639 |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Net current assets | | 34,660 | 54,433 | 62,999 |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| Total assets less current | | 131,046 | 126,005 | 112,162 |
| liabilities | | | | |
+---------------------------+------+---------------------+--------------------+---------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+---------------------------+------+---------------------+--------------------+---------------------+
+--------------------------------------------------------------------------------+
| Consolidated balance sheet at 30 June 2010 (continued) |
| (Expressed in United States dollars) |
+--------------------------------------------------------------------------------+
+---------------------------+------+---------------------+---------------------+--------------------+
| | | At | At 31 | At |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | 30 June | December | 30 June |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | 2010 | 2009 | 2009 |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | (unaudited) | (audited) | (unaudited) |
+---------------------------+------+---------------------+---------------------+--------------------+
| |Note | $'000 | $'000 | $'000 |
+---------------------------+------+---------------------+---------------------+--------------------+
| Non-current liabilities | | | | |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | | | |
+---------------------------+------+---------------------+---------------------+--------------------+
| Deferred tax liabilities | | 653 | 957 | 1,929 |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | | | |
+---------------------------+------+---------------------+---------------------+--------------------+
| Net assets | | 130,393 | 125,048 | 110,233 |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | | | |
| | | ======== | ======== | ======== |
+---------------------------+------+---------------------+---------------------+--------------------+
| Capital and reserves | 9 | | | |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | | | |
+---------------------------+------+---------------------+---------------------+--------------------+
| Share capital | | | | |
| | | - | - | - |
+---------------------------+------+---------------------+---------------------+--------------------+
| Reserves | | 130,393 | 125,048 | 110,233 |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | | | |
+---------------------------+------+---------------------+---------------------+--------------------+
| Total equity attributable | | | | |
| to equity | | | | |
+---------------------------+------+---------------------+---------------------+--------------------+
| shareholders of the | | 130,393 | 125,048 | 110,233 |
| Company | | | | |
+---------------------------+------+---------------------+---------------------+--------------------+
| | | | | |
| | | ======== | ======== | ======== |
+---------------------------+------+---------------------+---------------------+--------------------+
The notes on pages 8 to 18 form part of this interim financial report.
+--------------------------------------------------------------------------------+
| Consolidated statement of changes in equity |
| for the six months ended 30 June 2010 |
| (Expressed in United States dollars) |
+--------------------------------------------------------------------------------+
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | General | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | Share | Share | Capital | reserve | Exchange | Retained | Total |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | capital | premium | reserve | fund | reserve | earnings | equity |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | Note | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Balance at 1 January 2009 | | | 62,951 | 958 | 3,887 | 8,903 | 30,767 | 107,466 |
| | | - | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Changes in equity for the six | | | | | | | | |
| months | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| ended 30 June 2009: | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Total comprehensive income for | | | | | | 330 | 2,437 | 2,767 |
| the period | | - | - | - | - | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Balance at 30 June 2009 | | | 62,951 | 958 | 3,887 | 9,233 | 33,204 | 110,233 |
| (unaudited) | | - | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
| | | ========= | ========= | ========= | ========= | ========= | ========= | ========= |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Balance at 1 July 2009 | | | 62,951 | 958 | 3,887 | 9,233 | 33,204 | 110,233 |
| | | - | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Changes in equity for the six | | | | | | | | |
| months | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| ended 31 December 2009: | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Total comprehensive income for | | | | | | (81) | 14,896 | 14,815 |
| the period | | - | - | - | - | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Appropriation | | | | | 2,924 | | (2,924) | |
| | | - | - | - | | - | | - |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Balance at 31 December 2009 | | | 62,951 | 958 | 6,811 | 9,152 | 45,176 | 125,048 |
| (audited) | | - | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
| | | ========= | ========= | ========= | ========= | ========= | ========= | ========= |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Balance at 1 January 2010 | | | 62,951 | 958 | 6,811 | 9,152 | 45,176 | 125,048 |
| | | - | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Changes in equity for the six | | | | | | | | |
| months | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| ended 30 June 2010: | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Total comprehensive income for | | | | | | (488) | 4,067 | 3,579 |
| the period | | - | - | - | - | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Issuance of shares | 10 | | 1,766 | | | | | 1,766 |
| | | - | | - | - | - | - | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| Balance at 30 June 2010 | | | 64,717 | 958 | 6,811 | 8,664 | 49,243 | 130,393 |
| (unaudited) | | - | | | | | | |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
| | | | | | | | | |
| | | ========= | ========= | ========= | ========= | ========= | ========= | ========= |
+---------------------------------+----------+-----------+-----------------------+------------------------+-----------------------+--------------------------+------------------------+-----------------------+
The notes on pages 8 to 18 form part of this interim financial report.
+--------------------------------------------------------------------------------+
| Consolidated cash flow statement |
| for the six months ended 30 June 2010 |
| (Expressed in United States dollars) |
+--------------------------------------------------------------------------------+
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | Six | Six | Year |
| | | months | months | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | ended | ended | ended |
| | | 30 | 30 | 31 |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | June | June | December |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | 2010 | 2009 | 2009 |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | (unaudited) | (unaudited) | (audited) |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | Note | $'000 | $'000 | $'000 |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Operating | | | | |
| activities | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Profit | | 4,843 | 3,172 | 21,303 |
| before | | | | |
| taxation | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Adjustments | | | | |
| for: | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - | | 2,793 | 3,425 | 5,255 |
| Depreciation | | | | |
| and | | | | |
| amortisation | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - Loss | | | | |
| on | | | | |
| disposal | | | | |
| of | | | | |
| property, | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| plant | | | | 9 |
| and | | - | - | |
| equipment | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - | | | | |
| Cash-settled | | | | |
| share-based | | | | |
| payment | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | 23 | (54) | 56 |
| expenses | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - | | | | |
| Impairment | | | | |
| losses on | | | | |
| trade and | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | 2,401 | 6,505 |
| other | | - | | |
| receivables | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - | | 1,185 | 533 | 747 |
| Interest | | | | |
| expense | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - | | (183) | (204) | (303) |
| Interest | | | | |
| income | | | | |
| from | | | | |
| bank | | | | |
| deposits | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - Gain | | | | |
| on | | | | |
| deemed | | | | |
| disposal | | | | |
| of | | | | |
| jointly | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
| controlled | | | | |
| entity | | | | |
| arising | | | | |
| from | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | (1,722) | | |
| business | | | - | - |
| combination | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - | | | | |
| Share | | | | |
| of | | | | |
| losses/(profits) | | | | |
| of jointly | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | 197 | (486) | (265) |
| controlled | | | | |
| entity | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - | | | | |
| (Reversal)/elimination | | | | |
| of | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
| transactions | | | | |
| with jointly | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | (904) | 160 | 899 |
| controlled | | | | |
| entity | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - Net | | | | |
| fair | | | | |
| value | | | | |
| (gain)/losses | | | | |
| of | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | (399) | 115 | |
| foreign | | | | - |
| exchange | | | | |
| contracts | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| - | | (54) | (4) | (211) |
| Foreign | | | | |
| exchange | | | | |
| gain | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Operating | | | | |
| profit | | | | |
| before | | | | |
| changes | | | | |
| in | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | 5,779 | 9,058 | 33,995 |
| working | | | | |
| capital | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Increase | | | | |
| in | | | | |
| non-current | | | | |
| prepayments | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| for | | (554) | | (5,950) |
| raw | | | - | |
| materials | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Increase | | (4,330) | (1,752) | (9,631) |
| in | | | | |
| inventories | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Decrease/(increase) | | | | |
| in trade and | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| other | | 4,747 | 4,400 | (7,083) |
| receivables | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Increase | | 22,701 | 570 | 40,747 |
| in trade | | | | |
| and | | | | |
| other | | | | |
| payables | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Net | | 28,343 | 12,276 | 52,078 |
| cash | | | | |
| generated | | | | |
| from | | | | |
| operations | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Income | | (3,794) | (3,129) | (5,537) |
| tax | | | | |
| paid | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| Net | | | | |
| cash | | | | |
| generated | | | | |
| from | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| operating | | 24,549 | 9,147 | 46,541 |
| activities | | | | |
+------------------------+--------+-----------------------+-------------------------+------------------------+
| | | | | |
| | | ------------- | ------------- | ------------- |
+------------------------+--------+-----------------------+-------------------------+------------------------+
+--------------------------------------------------------------------------------+
| Consolidated cash flow statement |
| for the six months ended 30 June 2010 (continued) |
| (Expressed in United States dollars) |
+--------------------------------------------------------------------------------+
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | Six | Six | Year |
| | | months | months | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | ended | ended 30 | ended |
| | | 30 | | 31 |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | June | June | December |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | 2010 | 2009 | 2009 |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | (unaudited) | (unaudited) | (audited) |
+---------------------------+------+---------------------+-----------------------+----------------------+
| |Note | $'000 | $'000 | $'000 |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Investing activities | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Payment for the | | | | |
| acquisition of | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| property, plant and | | (19,716) | (2,178) | (8,193) |
| equipment | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Proceeds from disposal of | | | | |
| property, | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| plant and equipment | | | | 173 |
| | | - | - | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Cash inflow from | | | | |
| acquisition of | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| subsidiaries | 10 | 2,721 | | |
| | | | - | - |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Interest received | | 183 | 204 | 303 |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Net cash used in | | | | |
| investing | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| activities | | (16,812) | (1,974) | (7,717) |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | | |
| | | ------------ | ------------- | ------------- |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Financing activities | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Release of pledged | | 64,396 | 37,257 | 8,077 |
| deposits | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Placement of pledged | | (104,952) | (31,657) | (10,986) |
| deposits | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Proceeds from bank loans | | 74,608 | 33,475 | 21,789 |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Repayment of bank loans | | (28,704) | (44,835) | (52,150) |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Repayment of amount due | | | | |
| to | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| a shareholder | | | | (979) |
| | | - | - | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Interest paid | | (1,185) | (533) | (747) |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Net cash generated | | | | |
| from/(used in) | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| financing activities | | 4,163 | (6,293) | (34,996) |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | ------------- | ------------- |
| | | ------------ | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Net increase in cash and | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| cash equivalents | | 11,900 | 880 | 3,828 |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Cash and cash equivalents | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| at 1 January | | 25,087 | 21,180 | 21,180 |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Effect of foreign | | | | |
| exchange | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| rate changes | | (2) | 65 | 79 |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| Cash and cash equivalents | | | | |
+---------------------------+------+---------------------+-----------------------+----------------------+
| at 30 June/31 December | | 36,985 | 22,125 | 25,087 |
+---------------------------+------+---------------------+-----------------------+----------------------+
| | | ======== | | |
| | | | ======== | ======== |
+---------------------------+------+---------------------+-----------------------+----------------------+
The notes on pages 8 to 18 form part of this interim financial report.
+--------------------------------------------------------------------------------+
| Notes to the unaudited interim financial report |
| (Expressed in United States dollars) |
+--------------------------------------------------------------------------------+
1 Basis of preparation
This interim financial report has been prepared in accordance with International
Accounting Standard ("IAS") 34 "Interim Financial Reporting", promulgated by the
International Accounting Standards Board ("IASB"). It was authorised for issue
on 29 September 2010.
The interim financial report has been prepared in accordance with the same
accounting policies as adopted in the 2009 annual financial statements, except
for the accounting policy changes that are expected to be reflected in the 2010
annual financial statements. Details of these changes in accounting policies
are set out in note 2.
The preparation of an interim financial report in conformity with IAS 34
requires management to make judgements, estimates and assumptions that affect
the application of policies and reported amounts of assets and liabilities,
income and expenses on a year to date basis. Actual results may differ from
these estimates.
The interim financial report contains consolidated financial statements and
selected explanatory notes. The notes include an explanation of events and
transactions that are significant to an understanding of the changes in
financial position and performance of the Group since the 2009 annual financial
statements. The consolidated interim financial statements and notes thereon do
not include all of the information required for full set of financial statements
prepared in accordance with International Financial Reporting Standard
("IFRSs").
The interim financial report is unaudited, but has been reviewed by KPMG in
accordance with International Standard on Review Engagements 2410 "Review of
interim financial information performed by the independent auditor of the
entity" issued by the International Auditing and Assurance Standards Board.
2 Changes in accounting policies
The Group has adopted all relevant new and revised IFRSs and IASs, amendments
and interpretations, which are effective for accounting periods beginning on or
after 1 January 2010. The adoption of these new and revised standards,
amendments and interpretations has no significant impact on the Group's results
of operations and financial position for the current or comparative periods,
except for the following development which is relevant to the Group's financial
statements:
2 Changes in accounting policies (continued)
IFRS 3 (revised 2008), Business combinations
As a result of the adoption of IFRS 3 (revised 2008), any business combination
occurring on or after 1 January 2010 will be recognised in accordance with the
new requirements and detailed guidance contained in IFRS 3 (revised 2008).
These include the following changes in accounting policies relevant to the
Group:
- Transaction costs that the Group incurs in connection with a
business combination, such as finder's fees, legal fees, due diligence fees and
other professional and consulting fees, will be expensed as incurred, whereas
previously they were accounted for as part of the cost of the business
combination and therefore impacted the amount of goodwill recognised. No
significant transaction costs were incurred in connection with the business
combination which occurred in the current period.
- If the Group holds interests in the acquiree immediately prior to
obtaining control, these interests will be treated as if disposed of and
re-acquired at fair value on the date of obtaining control. Previously, the
step-up approach would have been applied, whereby goodwill was computed as if
accumulated at each stage of the acquisition. As a result of this new policy,
the Group's profit before taxation for the six months ended 30 June 2010
increased by approximately $1.7 million and goodwill increased by the same
amount.
- Contingent consideration will be measured at fair value at the
acquisition date. Any subsequent changes in the measurement of that contingent
consideration will be recognised in profit or loss, unless they arise from
obtaining additional information about facts and circumstances that existed at
the acquisition date within 12 months from the date of acquisition (in which
case they will be recognised as an adjustment to the cost of the business
combination). Previously, contingent consideration was recognised at the
acquisition date only if payment of the contingent consideration was probable
and it could be measured reliably. All subsequent changes in the measurement of
contingent consideration and from its settlement were previously recognised as
an adjustment to the cost of the business combination and therefore impacted the
amount of goodwill recognised. The fair value of the contingent consideration
in connection with the business combination which occurred in the current period
is estimated to be insignificant.
In accordance with the transitional provisions in IFRS 3 (revised 2008), these
new accounting policies will be applied prospectively to any business
combinations in the current or future periods. No adjustments have been made to
the carrying values of assets and liabilities that arose from business
combinations whose acquisition dates preceded the application of this revised
standard.
The Group has not applied any new standard or interpretation that is not yet
effective for the current accounting period.
3 Segment reporting
The Group manages its business by business operations. In a manner consistent
with the way in which information is reported internally to the Group's most
senior executive management for the purposes of resource allocation and
performance assessment, there is one reportable segment identified for the
Group.
The Group's operations are regarded as a single business segment, engages in the
manufacturing and trading of solar cells and modules and the provision of
related processing services. In addition, the Group's turnover and operating
profit are mainly derived from its operations in the People's Republic of China
("PRC").
In prior periods, the Group's senior executive management monitored the results,
assets and liabilities on the following bases:
Segment assets include all tangible and intangible assets with the exception of
interest in a jointly controlled entity. Segment liabilities include all
liabilities with the exception of deferred income relating to jointly controlled
entity and deferred taxation. Segment profit is determined based on profit
after taxation, excluding the Group's share of profits or losses of jointly
controlled entity, elimination of transactions with jointly controlled entity
and deferred taxation.
In order to improve the assessment of segment performance, subsequent to the
acquisition of Jetion Solar (Europe) Limited as disclosed in note 10, the
Group's senior executive management monitors the results, assets and liabilities
attributable to the reportable segment which are presented in the same way in
the Group's consolidated income statement and balance sheet.
4 Income tax
+---------------------------------+----------------------+----------------------+--------------------+
| | Six | Six | Year |
| | months | months | |
+---------------------------------+----------------------+----------------------+--------------------+
| | ended | ended | ended |
| | 30 | 30 | 31 |
+---------------------------------+----------------------+----------------------+--------------------+
| | June | June | December |
+---------------------------------+----------------------+----------------------+--------------------+
| | 2010 | 2009 | 2009 |
+---------------------------------+----------------------+----------------------+--------------------+
| | (unaudited) | (unaudited) | (audited) |
+---------------------------------+----------------------+----------------------+--------------------+
| | $'000 | $'000 | $'000 |
+---------------------------------+----------------------+----------------------+--------------------+
| Current tax | | | |
+---------------------------------+----------------------+----------------------+--------------------+
| | | | |
+---------------------------------+----------------------+----------------------+--------------------+
| Current year - PRC Enterprise | 174 | 1,024 | 4,165 |
| Income Tax | | | |
+---------------------------------+----------------------+----------------------+--------------------+
| | | | |
+---------------------------------+----------------------+----------------------+--------------------+
| Deferred tax | | | |
+---------------------------------+----------------------+----------------------+--------------------+
| | | | |
+---------------------------------+----------------------+----------------------+--------------------+
| Origination and reversal of | | | |
| temporary | | | |
+---------------------------------+----------------------+----------------------+--------------------+
| differences | (304) | (289) | (1,261) |
+---------------------------------+----------------------+----------------------+--------------------+
| | | | |
+---------------------------------+----------------------+----------------------+--------------------+
| Withholding tax paid | 906 | | 1,066 |
| | | - | |
+---------------------------------+----------------------+----------------------+--------------------+
| | | | |
+---------------------------------+----------------------+----------------------+--------------------+
| Total income tax expense | 776 | 735 | 3,970 |
+---------------------------------+----------------------+----------------------+--------------------+
| | | | ======== |
| | ======== | ======== | |
+---------------------------------+----------------------+----------------------+--------------------+
4 Income tax (continued)
(a) Pursuant to the approval document obtained from the relevant
tax authorities in the PRC, the subsidiary in the PRC is entitled to a tax
concession period whereby the subsidiary is fully exempted from PRC enterprise
income tax for the two years starting from its first profit-making year,
followed by a 50% reduction in the PRC enterprise income tax rate for the next
three years. The standard income tax rate in the PRC is 25%.
The first profit-making year of the subsidiary was 2006 so that the subsidiary
was fully exempted from PRC enterprise income tax from 1 January 2006 to 31
December 2007 and is subject to a preferential tax rate of 12.5% from 1 January
2008 to 31 December 2010.
Pursuant to the rules and regulations of Liechtenstein, Jetion Solar (Europe)
Limited, a subsidiary of the Group, is not subject to any income tax in
Liechtenstein. Taxation for subsidiaries of the Group in Germany, Luxembourg
and Italy was charged at a corporate income tax rate of 15%, 21% and 27.5%
respectively during the period. No provision for income tax has been made for
the subsidiaries in Germany, Luxembourg or Italy as these subsidiaries did not
have assessable income that is subject to income tax during the period.
(b) The Corporate Income Tax Law of the PRC also imposes a
withholding tax at 10%, unless reduced by a tax treaty or agreement, for
dividends distributed by a PRC-resident enterprise to its immediate holding
company outside the PRC from earnings generated on or after 1 January 2008.
Under the Agreement between the Mainland of China and Hong Kong Special
Administration Region for the Avoidance of Double Taxation and Prevention of
Fiscal Evasion, or Mainland China/HKSAR DTA, Hong Kong tax residents which hold
25% or more of a PRC enterprise are entitled to a reduced dividend withholding
tax rate of 5%. Undistributed earnings generated prior to 1 January 2008 are
exempted from such withholding tax under CaiShui [2008] No. 1 Notice on Certain
Preferential Corporate Income Tax Policies.
Accordingly, Jetion Solar (Hong Kong) Limited, a subsidiary of the Company, is
subject to 5% withholding tax on dividends receivable from Jetion Solar (China)
Co., Ltd ("Jetion China") in respect of its profits earned since 1 January 2008.
5 Dividend
The directors do not recommend the payment of an interim dividend for the six
months ended 30 June 2010 (six months ended 30 June 2009: $Nil; year ended 31
December 2009: $Nil).
6 Earnings per share
(a) Basic earnings per share
The calculation of basic earnings per share is based on the profit attributable
to ordinary equity shareholders of the Company of $4,067,000 (six months ended
30 June 2009: $2,437,000 (unaudited); year ended 31 December 2009: $17,333,000
(audited)) and the weighted average of 74,775,676 ordinary shares (30 June 2009:
74,209,676 shares (unaudited); year ended 31 December 2009: 74,209,676 shares
(audited)) in issue during the interim period.
(b) Diluted earnings per share
Diluted earnings per share for the six months ended 30 June 2010, 30 June 2009
and year ended 31 December 2009are not presented as there were no dilutive
potential ordinary shares during all periods.
7 Property, plant and equipment
During the six months ended 30 June 2010, the Group acquired property, plant and
equipment with an aggregate cost of $11,851,000 (six months ended 30 June 2009:
$2,228,000 (unaudited),year ended 31 December 2009: $3,975,000 (audited); in
which $3,976,000 was acquired through the acquisition of subsidiaries (see note
10).
Certain property, plant and equipment of $8,011,000 (31 December 2009:
$4,730,000 (audited); 30 June 2009: $3,403,000 (unaudited)) and lease
prepayments of $2,689,000 (31 December 2009: $696,000 (audited); 30 June 2009:
$1,324,000 (unaudited)) were pledged to banks to secure bank loans of $7,323,000
(31 December 2009: $Nil (audited); 30 June 2009: $2,928,000 (unaudited)) and
banking facilities as at 30 June 2010.
8 Pledged bank deposits
Pledged bank deposits represent bank deposits of the Group pledged as security
for bank loans of $17,282,000 (31 December 2009: $Nil (audited); 30 June 2009:
$27,372,000 (unaudited)), forward foreign exchange contracts with notional
amount of RMB180,056,000 (equivalent to $26,374,000) (31 December 2009: $Nil
(audited); 30 June 2009: $Nil (unaudited) and issuance of bills payable of
$69,552,000 (31 December 2009: $37,316,000 (audited); 30 June 2009: $Nil
(unaudited). The pledged bank deposits will be released upon the settlement of
relevant bank loans, forward foreign exchange contracts and other banking
facilities.
9 Capital and reserves
During the six months ended 30 June 2010, 1,132,000 shares were issued for
acquisition of subsidiaries (see note 10). The fair value of the shares of
$1,766,000 was credited to the share premium account. These 1,132,000 shares of
nil par value rank pari passu with the existing ordinary shares of the Company
in all respects.
No shares were issued during the six months ended 30 June 2009 and year ended 31
December 2009.
10 Acquisition of subsidiaries
During the six months ended 30 June 2010, the Group entered into a sale and
purchase agreement with the venturers of the 51% owned jointly controlled entity
of the Group, Jetion Solar (Europe) Limited, to acquire the remaining equity
interest in Jetion Solar (Europe) Limited satisfied by the issue of 1,132,000
new shares of the Company of nil par value. In addition, in accordance with the
sale and purchase agreement, if the Company is not successfully listed on the
Main Board of the Stock Exchange of Hong Kong Limited ("SEHK") or equivalent
stock market by 31 December 2011 ("the failure event"), the Group is required to
issue an additional 1,132,000 shares ("Contingent Consideration") to the
venturers. The acquisition was completed on 1 April 2010. The fair value of
the consideration was approximately $1,766,000, which was determined based on
the quoted market price of the shares at the date of acquisition. The
Contingent Consideration is recognised at fair value at the acquisition date.
The fair value of Contingent Consideration is estimated to be insignificant
since the Directors considered the failure event is improbable based on the
progress of the listing plan as at the date of acquisition. On the acquisition,
Jetion Solar (Europe) Limited became a wholly-owned subsidiary of the Group.
The acquisition is expected to provide the Group with better management control
over the operations in Europe, enhanced profits for the Group and future
business opportunities.
On 22 September 2010, the Group entered into a supplemental agreement with the
venturers to amend the date of the above failure event from 31 December 2011 to
31 December 2012.
10 Acquisition of a subsidiary (continued)
The principal activity of Jetion Solar (Europe) Limited and its subsidiaries are
the distribution of solar modules. The contributions to the Group's revenue and
profit for the period from Jetion Solar (Europe) Limited and its subsidiaries
since the date of acquisition are approximately $26,906,000 and $1,712,000
respectively. If the acquisition had occurred on 1 January 2010, revenue and
net profit of the Group for the six months ended 30 June 2010 would have been
approximately $131,614,000 and $4,369,000 respectively.
Details of net assets acquired and goodwill are as follows:
+-----------------------------+-------------+-------------------------+-------------------------+
| | Carrying | Fair | |
| | | value | |
+-----------------------------+-------------+-------------------------+-------------------------+
| | amount | adjustment | Fair |
| | | | value |
+-----------------------------+-------------+-------------------------+-------------------------+
| | (unaudited) | (unaudited) | (unaudited) |
+-----------------------------+-------------+-------------------------+-------------------------+
| | $'000 | $'000 | $'000 |
+-----------------------------+-------------+-------------------------+-------------------------+
| | | | |
+-----------------------------+-------------+-------------------------+-------------------------+
| Property, plant and | 3,976 | | 3,976 |
| equipment | | - | |
+-----------------------------+-------------+-------------------------+-------------------------+
| Intangible assets | - | 25 | 25 |
+-----------------------------+-------------+-------------------------+-------------------------+
| Inventories | 10,723 | | 10,723 |
| | | - | |
+-----------------------------+-------------+-------------------------+-------------------------+
| Trade and other receivables | 4,582 | | 4,582 |
| | | - | |
+-----------------------------+-------------+-------------------------+-------------------------+
| Cash and cash equivalents | 2,721 | | 2,721 |
| | | - | |
+-----------------------------+-------------+-------------------------+-------------------------+
| Trade and other payables | (21,769) | | |
| | | - | (21,769) |
+-----------------------------+-------------+-------------------------+-------------------------+
| | | | |
+-----------------------------+-------------+-------------------------+-------------------------+
| Net assets acquired | 233 | 25 | 258 |
+-----------------------------+-------------+-------------------------+-------------------------+
| | ======== | | |
| | | ======== | |
+-----------------------------+-------------+-------------------------+-------------------------+
| Goodwill arising from acquisition | | |
| | | 3,346 |
+-------------------------------------------+-------------------------+-------------------------+
| | | |
+-------------------------------------------+-------------------------+-------------------------+
| | | 3,604 |
+-------------------------------------------+-------------------------+-------------------------+
| | | |
| | | ======== |
+-------------------------------------------+-------------------------+-------------------------+
| Satisfied by: | | |
+-------------------------------------------+-------------------------+-------------------------+
| | | |
+-------------------------------------------+-------------------------+-------------------------+
| Fair value of consideration | | 1,766 |
+-------------------------------------------+-------------------------+-------------------------+
| Fair value of net assets of 51% equity | | |
| interest | | |
+-------------------------------------------+-------------------------+-------------------------+
| held immediately prior to the | | |
| acquisition | | 1,838 |
+-------------------------------------------+-------------------------+-------------------------+
| | | |
+-------------------------------------------+-------------------------+-------------------------+
| | | 3,604 |
+-------------------------------------------+-------------------------+-------------------------+
| | | |
| | | ======== |
+-------------------------------------------+-------------------------+-------------------------+
| Net cash inflow in respect of the | | |
| acquisition | | |
+-------------------------------------------+-------------------------+-------------------------+
| of subsidiaries | | 2,721 |
+-------------------------------------------+-------------------------+-------------------------+
| | | |
| | | ======== |
+-----------------------------+-------------+-------------------------+-------------------------+
Trade and other receivables represent gross contractual amounts and approximate
fair value of the receivables. The balances of the receivables were considered
fully recoverable as at the date of acquisition.
10 Acquisition of a subsidiary (continued)
The goodwill is attributable mainly to the benefit of skills and technical
talent of the acquired business's work force and the synergies expected to be
achieved from integrating the entities into the Group's existing businesses.
The goodwill is not deductible for tax purposes. The recoverable amount of
goodwill is estimated annually whether or not there is any indication of
impairment. No indication of impairment of goodwill was noted as at 30 June
2010.
11 Capital commitments
Capital commitments in respect of the purchase of property, plant and equipment
outstanding at 30 June 2010 not provided for were as follows:
+------------------------------+----------------------+----------------------+-------------------------+
| | At | At 31 | At |
+------------------------------+----------------------+----------------------+-------------------------+
| | 30 June | December | 30 June |
+------------------------------+----------------------+----------------------+-------------------------+
| | 2010 | 2009 | 2009 |
+------------------------------+----------------------+----------------------+-------------------------+
| | (unaudited) | | (unaudited) |
| | | (audited) | |
+------------------------------+----------------------+----------------------+-------------------------+
| | $'000 | $'000 | $'000 |
+------------------------------+----------------------+----------------------+-------------------------+
| | | | |
+------------------------------+----------------------+----------------------+-------------------------+
| Authorised and contracted | 12,322 | 20,808 | 291 |
| for | | | |
+------------------------------+----------------------+----------------------+-------------------------+
| | | | |
| | ======== | ======== | ======== |
+------------------------------+----------------------+----------------------+-------------------------+
12 Contingent liabilities
(a) Financial guarantee issued
As at 31 December 2009 and 30 June 2009, Jetion China has issued a single
guarantee to a bank in respect of a banking facility granted to a related party,
Jiangyin Xingyuan Accessory Household Appliances Co., Ltd. ("Xingyuan"). The
directors did not consider it probable that a claim would be made against the
Group under the guarantee. The maximum liability of the Group at 31 December
2009 and 30 June 2009 under the single guarantee issued was the outstanding
amount of the facility drawn down by the related party of $2,344,000 (audited)
and $2,342,000 (unaudited) respectively. Such guarantee was released during the
current period. No other guarantee was issued as at 30 June 2010.
(b) Outstanding legal cases
(i) In March 2010, a writ was issued against Jetion China, a
wholly owned subsidiary of the Company, in respect of Jetion China's failure to
repay $3,043,000 (including overdue interest of $268,000) for the purchase of a
software package by Jetion China for a consideration of $2,775,000 in 2007 ("the
Claim"). The Claim is made on the basis of a debt assignment from the software
supplier to the plaintiff and allegedly Jetion China has a debt repayment
obligation in favour of the plaintiff. Based on a legal opinion from Jiangsu
Tianyi Law Firm ("?????????") and available information on hand, the directors
are of the opinion that there is no merit in the claim and, therefore, do not
consider any provision in respect of the claim to be necessary.
12 Contingent liabilities(continued)
(b) Outstanding legal cases (continued)
(ii) Subsequent to the balance sheet date, a claim for damages was
sent to Jetion China by a supplier through their lawyers in respect of Jetion
China's failure to purchase the committed quantities of solar wafers in year
2009 as set out in the supply agreement dated 23 July 2008. A claim of
$1,476,000 was made by the supplier, and no formal legal proceedings have been
instigated. Based on the legal advice and available information up to date, the
directors are of the opinion that there is no merit in the claim and, therefore,
no provision is considered necessary as at the balance sheet date.
13 Material related party transactions
During the six months ended 30 June 2010, 30 June 2009 and year ended 31
December 2009, transactions with the following parties are considered to be
related party transactions:
+--------------------------+-------------------------------------------+
| Name of party | Relationship |
+--------------------------+-------------------------------------------+
| | |
+--------------------------+-------------------------------------------+
| Ming He Ni ("Mr Ni") | Former director of Jetion China |
+--------------------------+-------------------------------------------+
| | |
+--------------------------+-------------------------------------------+
| Li Jin Gai ("Mr Gai") | Former Chief Executive Officer and |
| | director of the |
| | Company |
+--------------------------+-------------------------------------------+
| | |
+--------------------------+-------------------------------------------+
| Xingyuan | Controlled by a sister of a director of |
| | the Company |
+--------------------------+-------------------------------------------+
| | |
+--------------------------+-------------------------------------------+
| Wuxi Sundy Technology | Controlled by members of the families of |
| Company | Mr Gai |
+--------------------------+-------------------------------------------+
| Limited (Wuxi Sundy") | and Mr Ni |
+--------------------------+-------------------------------------------+
| | |
+--------------------------+-------------------------------------------+
| Yang Jiezhen | Equity shareholder of the Company |
+--------------------------+-------------------------------------------+
| | |
+--------------------------+-------------------------------------------+
| Jetion Solar (Europe) | Jointly controlled entity of the Group |
| Limited | prior |
+--------------------------+-------------------------------------------+
| | to 1 April 2010 (the date of |
| | acquisition) (see note 10) |
+--------------------------+-------------------------------------------+
13 Material related party transactions (continued)
(a) Key management personnel remuneration
Remuneration for key management personnel of the Group for the six months ended
30 June 2010 is as follows:
+---------------------------------+------------------------+-----------------------+------------------------+
| | Six | Six | Year |
| | months | months | |
+---------------------------------+------------------------+-----------------------+------------------------+
| | ended | ended | ended |
| | 30 | 30 | 31 |
+---------------------------------+------------------------+-----------------------+------------------------+
| | June | June | December |
+---------------------------------+------------------------+-----------------------+------------------------+
| | 2010 | 2009 | 2009 |
+---------------------------------+------------------------+-----------------------+------------------------+
| | (unaudited) | (unaudited) | (audited) |
+---------------------------------+------------------------+-----------------------+------------------------+
| | $'000 | $'000 | $'000 |
+---------------------------------+------------------------+-----------------------+------------------------+
| | | | |
+---------------------------------+------------------------+-----------------------+------------------------+
| Basic salaries, allowances and | | | |
| benefits | | | |
+---------------------------------+------------------------+-----------------------+------------------------+
| in kind | 511 | 498 | 1,168 |
+---------------------------------+------------------------+-----------------------+------------------------+
| Share-based payments | 9 | (20) | 7 |
+---------------------------------+------------------------+-----------------------+------------------------+
| | | | |
+---------------------------------+------------------------+-----------------------+------------------------+
| | 520 | 478 | 1,175 |
+---------------------------------+------------------------+-----------------------+------------------------+
| | | | |
| | ======== | ======== | ======== |
+---------------------------------+------------------------+-----------------------+------------------------+
(b) Transactions with related parties
+------------+--------+-------------------+------------------------+-----------------------+--------+--------+--------+--------+--------+
| | | Six | Six | Year |
| | | months | months | |
+------------+--------+-------------------+------------------------+-----------------------+
| | | ended | ended | ended |
| | | 30 | 30 | 31 |
+------------+--------+-------------------+------------------------+-----------------------+
| | | June | June | December |
+------------+--------+-------------------+------------------------+-----------------------+
| | | 2010 | 2009 | 2009 |
+------------+--------+-------------------+------------------------+-----------------------+
| | | (unaudited) | (unaudited) | (audited) |
+------------+--------+-------------------+------------------------+-----------------------+
| | Note | $'000 | $'000 | $'000 |
+------------+--------+-------------------+------------------------+-----------------------+
| Trade | | | | |
| related: | | | | |
+------------+--------+-------------------+------------------------+-----------------------+
| | | | | |
+------------+--------+-------------------+------------------------+-----------------------+
| Sales | | | | |
| of | | | | |
| goods | | | | |
| to | | | | |
| Jetion | | | | |
| Solar | | | | |
+------------+--------+-------------------+------------------------+-----------------------+
| | (ii) | 14,879 | 7,171 | 38,405 |
| (Europe) | | | | |
| Limited | | | | |
+------------+--------+-------------------+------------------------+-----------------------+
| | | | | |
+------------+--------+-------------------+------------------------+-----------------------+
| Sales | | | 133 | 133 | | | | | |
| of | | - | | | | | | | |
| goods | | | | | | | | | |
| to | | | | | | | | | |
| Wuxi | | | | | | | | | |
| Sundy | | | | | | | | | |
+------------+--------+-------------------+------------------------+-----------------------+--------+--------+--------+--------+--------+
| Processing | | | | |
| service | | | | |
| received | | | | |
| from | | | | |
+------------+--------+-------------------+------------------------+-----------------------+
| Wuxi | | | 31 | 31 |
| Sundy | | - | | |
+------------+--------+-------------------+------------------------+-----------------------+
| | | | | |
+------------+--------+-------------------+------------------------+-----------------------+
| Purchases | | | | |
| of goods | | | | |
| from Wuxi | | | | |
+------------+--------+-------------------+------------------------+-----------------------+
| | | | 2 | 11 |
| Sundy | | - | | |
+------------+--------+-------------------+------------------------+-----------------------+
| | | | | ======= |
| | | ======= | ======= | |
+------------+--------+-------------------+------------------------+-----------------------+--------+--------+--------+--------+--------+
13 Material related party transactions (continued)
(b) Transactions with related parties(continued)
Notes:
(i) The directors of the Company are of the opinion that the above
trading transactions were made in accordance with normal commercial terms and
were priced with reference to prevailing market prices and in the ordinary
course of business.
(ii) As disclosed in note 10, Jetion Solar (Europe) Limited became
a wholly-owned subsidiary of the Group on 1 April 2010. As such, the sales
amount with Jetion Solar (Europe) Limited disclosed above relate to the period
from 1 January 2010 to the date of acquisition.
As disclosed in note 12(a), Jetion China had issued a single guarantee to a bank
in respect of a banking facility granted to Xingyuan as at 31 December 2009 and
30 June 2009. Such guarantee was released during the current period. No other
guarantee was issued as at 30 June 2010. On the other hand, Xingyuan guaranteed
bank loans and banking facilities of Jetion China amounting to $11,718,000 (31
December 2009: $46,140,000 (audited); 30 June 2009: $3,175,000 (unaudited)) as
at 30 June 2010.
(c) Amount due from related party
+------------------------------+-------------+----------------------+-----------------------+
| | At | At 31 | At |
+------------------------------+-------------+----------------------+-----------------------+
| | 30 June | December | 30 June |
+------------------------------+-------------+----------------------+-----------------------+
| | 2010 | 2009 | 2009 |
+------------------------------+-------------+----------------------+-----------------------+
| | (unaudited) | (audited) | (unaudited) |
+------------------------------+-------------+----------------------+-----------------------+
| | $'000 | $'000 | $'000 |
+------------------------------+-------------+----------------------+-----------------------+
| Trade related: | | | |
+------------------------------+-------------+----------------------+-----------------------+
| | | | |
+------------------------------+-------------+----------------------+-----------------------+
| Jetion Solar (Europe) | | 15,057 | 6,297 |
| Limited | - | | |
+------------------------------+-------------+----------------------+-----------------------+
| | | | |
| | ======== | ======== | ======== |
+------------------------------+-------------+----------------------+-----------------------+
Amounts due from Jetion Solar (Europe) Limited as at 31 December 2009 and 30
June 2009 were unsecured, interest free and had no fixed terms of repayment.
(d) Amount due to a related party
+------------------------------+-------------+-----------+-------------------------+
| | At | At 31 | At |
+------------------------------+-------------+-----------+-------------------------+
| | 30 June | December | 30 June |
+------------------------------+-------------+-----------+-------------------------+
| | 2010 | 2009 | 2009 |
+------------------------------+-------------+-----------+-------------------------+
| | (unaudited) | (audited) | (unaudited) |
+------------------------------+-------------+-----------+-------------------------+
| | $'000 | $'000 | $'000 |
+------------------------------+-------------+-----------+-------------------------+
| Non-trade related: | | | |
+------------------------------+-------------+-----------+-------------------------+
| | | | |
+------------------------------+-------------+-----------+-------------------------+
| Yang Jiezhen | | | 979 |
| | - | - | |
+------------------------------+-------------+-----------+-------------------------+
| | | | |
| | ======== | ======== | ======== |
+------------------------------+-------------+-----------+-------------------------+
Amount due to a related party is unsecured, interest free and repayable on
demand
This information is provided by RNS
The company news service from the London Stock Exchange
END
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