Panda Green Energy flags 60% fall in full-year earnings

An aerial view of panda-shaped solar plants built by Panda Green Energy Group in Datong, Shanxi province, China.
An aerial view of panda-shaped solar plants built by Panda Green Energy Group in Datong, Shanxi province, China.PHOTO: REUTERS

SINGAPORE - Panda Green Energy Group on Wednesday (March 28) issued a profit guidance, stating that it may record a 60 per cent plunge in net profit to RMB153 million (S$31.9 million) for the year ended Dec 31, 2017, as compared to last year.

This significant drop in earnings was attributed mainly to a RMB290 million fair value loss on financial instruments, and a 28 per cent increase in finance costs from the year-ago period.

The fair value loss on financial instruments was due mainly to a RMB229 million loss recognised on the issue of shares and warrants, Panda Green Energy said.

In 2016, the group did not record any fair value loss on derivative financial instruments.

Additionally, Panda Green Energy raised about RMB12 billion in debt financing for its latest financial year.

This was used for business development, early redemption of convertible bonds, repayment of existing indebtedness and working capital purposes, which resulted in a 28 per cent increase in finance cost from 2016, the group said.

According to the global eco-development solutions provider, the firm also focused its resources on managing and expanding its renewable energy business. This saw the group's aggregate installed capacity of its power plants increasing by 795.9 megawatt to about 2,000 megawatt.

For the full year, Panda Green Energy's revenue rose by an estimated 53 per cent, while Ebita (earnings before interest, taxes, depreciation and amortisation) increased by 41 per cent from the previous year.

Nonetheless, the company noted that it is still in the midst of finalising its annual results, which are expected to be published by the end of March.

It added that the projected figures announced are based on information available to the company, and subject to adjustment and review by the group's audit committee.

Panda Green Energy is headquartered in Hong Kong, and was formerly known as United Photovoltaics Group.

As at 11.32am on Wednesday, the counter was trading down 2.3 per cent to HK$0.85 apiece.