l The Group actively adjusted its operating strategies and steadily developed high-quality businesses. Under the volatile and ever-changing business environment, the Group recognised the importance of sustainable development and proactively adjusted its operating strategies according to the situation, steadily developed high-quality business and refined operation to further improve operational efficiency. However, due to the obstruction of tendering and implementation progress of overseas infrastructure and other related projects, the Group’s revenue from overseas projects decreased significantly in the first half of the year, resulting in a total revenue of RMB272.6million for the period, representing a year-on-year decrease of 20.5%.
l The gross profit margin improved steadily due to technological upgrade, optimization of product and customer structure. Benefiting from the continuous upgrade of the Company’s technology, the continuous increase in the added value of products and services, and the steady optimization of the customer structure of products and services sold, the gross profit margin increased by 4.6 percentage points year-on-year to 34.3%, and the gross profit amounted to RMB 93.5 million, representing a year-on-year decrease of 8%.
l The refined management continued to deepen and the profitability continued to improve. Benefiting from the Group’s continuous refined management strategy, while maintaining good operational efficiency, administrative and other operating expenses further decreased. Coupled with the one-off gains from the disposal of certain subsidiaries of the Group during the Period, both operating profit and net profit achieved a significant year-on-year increase, with profit of RMB116.0 million and RMB 49.1 million respectively, representing a year-on-year increase of 347.7% and 571.2% respectively.
l The asset-liability structure further improved significantly, with operating cash flow continuing 5.5 years. The Group continued to implement a strict internal control system. As at the end of the period, the Group’s accounts receivable, accounts payable and inventory level remained at a reasonable level, and the finance costs continued to decrease, and recorded positive operating cash flow for five and a half consecutive years; In addition, During the period, certain subsidiaries with net liabilities controlled by the Group was divested,resulting in a significant decrease in the liabilities of the Group and a further significant improvement in the structure of assets and liabilities.
(Hong Kong, 25 August 2021) Boer Power Holdings Limited (“Boer Power”, the “Company”, together with its subsidiaries the “Group”; Stock Code: 1685.HK), a leading solutions provider for intelligent electrical distribution systems and energy efficiency management in China, is pleased to announce its unaudited interim results for the six months ended 30 June 2021 (the “Period” or “1H2021”).
Continuous Improvement in Operation Quality, Further Improvement in Asset and Liability Structure
During the Period, the global economy recovered at a slow pace. Nonetheless, the Pandemic remained severe in some countries and disrupted overseas infrastructure construction. In light of the ever-changing business environment, the Group recognised the importance of sustainable development and seized opportunities to actively adjust operational strategy by conducting high-quality businesses in a sound manner and enhancing efficiency through refinement of operation.
During the Priod, the revenue of the Group was RMB272.6 million for the Period (six months ended 30 June 2020: RMB342.8 million), representing a year-on-year decrease of 20.5%. Benefited from the continuous technological upgrade, increasing added value of products and services, and the steady improvement of the product mix for sales and customer structure of services, the gross profit margin of the Group increased by 4.6 percentage points year-on-year to34.3% and the gross profit reached RMB93.5million (six months ended 30 June 2020: RMB101.6 million), representing a year-on-year decrease of 8.0%. Meanwhile, with the continuous implementation of refined management strategy, the Group has maintained good operation efficiency, resulting in a further decrease in administrative and other operating expenses. Coupled with the one-off gains from the disposal of certain subsidiaries of the Group during the Period, profit from operations, profit before taxation and profit for the Period amounted to RMB116.0 million (six months ended 30 June 2020: RMB25.9 million), RMB99.6 million (six months ended 30 June 2020: RMB7.8 million) and RMB49.1 million (six months ended 30 June 2020: RMB7.3 million) respectively, representing a significant year-on-year increase of 347.7%,1,178.8% and 571.2% respectively.
As the Group continued to implement a stringent internal control system during the Period, it kept trade receivables, trade and bill payables and inventory at a reasonable level at the end of the Period, while finance costs continued to decrease. The Group has recorded positive operating cash flows consecutively for the past five and a half years. In addition, the Group significantly improved its gearing structure due to its disposal of certain subsidiaries with net liability and greatly reduces its liability during the Period.
Continue to Optimize Its “One-Stop Data Center Solution” by Taking Advantage of the New Infrastructure
As of 30 June 2021, the Boer Power’s business is divided into the following two segments: Intelligent Electrical Integrated Management Solutions (“IEM Solutions”); and Components and Spare Parts Business (“CSP Business”). As a product from in-depth integration of power grids and Internet of Things (“IoT”), the ubiquitous power IoT falls within the industrial Internet sector of the power industry and is one of the important aspects of the new infrastructure segment.
Based on modern communication and Internet technology and relying on its own “Cloud Smart” big data platform, the Group provided its customers with solutions for intelligent power distribution, power consumption and energy efficiency management, including hardware integrated systems, customised operating systems and software, new energy power generation and sales of electricity system, as well as one-stop intelligent power integrated management solutions for type of products and services online and offline operation and maintenance management.Leveraging its superior technology, the Group performed uninterrupted monitoring, data collection and two-way transmission on electrical terminal equipment via the Internet, which allowed it to conduct real-time analysis on operation and energy efficiency to secure safe operation of equipment and enhance operation efficiency.
As a core component of the new infrastructure, the development of 5G is underway. At the same time, the demand for data centres keeps on growing in the digital era. With the implementation of supportive policies and increasing favourable measures and manpower, the action plan will encourage the launch and use of data centres. Currently, power consumption of data centres accounts for 2% of national power consumption in China and its share has been on a rising trend. Against the backdrop of carbon peak and carbon neutrality, it is important to strike a balance between development and energy saving. Over the years, the Group operates in the data centre power distribution market. Leveraging its technology optimisation efforts and the “One-stop Data Centre Solution”, it maintains a good image and reputation in the market and continues to win market share. The Group will seize opportunities from the new infrastructure and enhance service experience to offer better service quality.
Maintain a Stable and High-Quality Customer Base and Further Deepen Its Leading Market Position
During the period, the Group continued to provide tailor-made smart, energy-saving and efficient system solutions and long-term maintenance and consulting services and products to the market.In the infrastructure market segment,The Group is committed to providing diversified services and customised solutions for various infrastructure construction and municipal construction projects, including intelligent power solutions to buildings, rail transit, wastewater treatment and different types of transportation hub projects. The rise of new infrastructure and the digital economy creates the need to optimise planning, reduce energy consumption and minimise the mismatch of demand, which brings new demand and growth potential for the business of the Group. With its unremitting efforts, the Group has been widely recognized by the market and built up a good long- term relationship with clients, including a number of top Fortune Global 500 companies as well as domestic and foreign large- scale long-term corporate customers. In terms of market share, the Group also outperformed its peers. In addition, it garnered a well-established presence and reputation in the industry when maintaining cooperation with domestic leading companies in the communication and data centre operation sectors.
In regard to the overseas market, the ongoing Pandemic shook the global economy. Due to the substantial impact of the Pandemic, infrastructure projects under construction or planning did not progress well around the world. This posed an enormous challenge to the Company in the bidding and implementation of overseas projects during the Period. In order to address the mid- to-long term negative impact brought by the unstable outbreak overseas, the Company continued to adopt prudent operating and financial measures during the Period. Meanwhile, it also developed new overseas business prudently and steadily through its existing global sales network and four overseas branches. By seizing all opportunities for business cooperation and growth, it aimed to create momentum for sustainable development.
Mr. Qian Yixiang, Chairman and CEO of Boer Power said, “The Group has been well known for its advanced and in-place smart power transmission and distribution solutions for over 35 years, and the hardware and software and big data platforms have been at the forefront of the industry. Looking into the second half of 2021, in view of the uncertainties arising from the unpredictable global pandemic, the Group will adhere to the solid and prudent operation strategy and strictly review project risks. Apart from consolidating the substantial business growth, the Group will also focus on business innovation and upgrade as its future development approach by improving and optimising the one-stop intelligent electrical integrated management system and its own product structure. Meanwhile, it will further refine the management process to maintain operating efficiency, control operating costs and boost profitability. Furthermore, it will consistently perform strict internal control, which has become one of its operational focuses, in order to keep its trade receivables, trade payables and inventories at a reasonable level. This will help maintain a continuous positive cash flow, further reduce borrowings, cut finance costs on an ongoing basis and improve the gearing structure of the Company. Capitalising on the rise of the digital economy, the Group will actively adapt to relevant policy and seize all available opportunities for cooperation and business development. By gathering momentum for sustainable development, the Group will strive to maximise shareholder value.”
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