A-Power Energy is the largest provider of distributed power generation systems in China, focusing on energy-efficient and environmentally friendly projects of 25MW to 400MW. In 2008, A-Power entered the wind energy market and has built China's largest wind turbine manufacturing facility, located in Shenyang, Liaoning Province, with technologies licensed from German FUHRLÄNDER AG and Denmark-based Norwin, and a total annual production capacity of 1,125MW. In March 2009, A-Power entered into an agreement to establish a Joint Venture partnership with GE Drivetrain Technologies to produce wind turbine gearboxes in Shenyang. A-Power also has strategic relationships with Tsinghua University in Beijing and the China Academy of Sciences in Guangzhou to develop and commercialize other renewable energy technologies.
Where is A-Power based?
A-Power is based in Shenyang, the capital of Liaoning Province, in Northeast China.
How many employees does A-Power have?
As of December 31, 2007, A-Power had approximately 250 employees, around 100 of them were engineers.
When did A-Power go public and on what exchange does A-Power trade?
A-Power became public through a reverse merger (RTO). On January 22, 2008, A-Power began trading on the NASDAQ Capital Market and on June 2, 2008, A-Power began trading on the NASDAQ Global Select Market. Ticker symbol is APWR.
Can I purchase A-Power stock directly from the Company?
No, investors must purchase A-Power stock through a licensed brokerage firm in the public market.
When does A-Power's fiscal year end?
December 31.
How do I obtain a copy of A-Power's SEC filings?
You can view and print a copy of our filings with the SEC under the Investor Relations -> SEC Filings section on this Website.
Will A-Power pay dividends?
Since our incorporation, we have never declared or paid any dividends. We may declare and pay cash dividends on our ordinary shares in the future. Our board of directors has complete discretion on whether to pay dividends. Even if our board of directors decides to pay dividends, the form, frequency and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions, shareholders' interests and other factors that our board of directors may deem relevant.
Will A-Power buy back stock?
From time to time, we consider repurchasing Company shares when we deem the stock is undervalued. We are discussing the opportunity to repurchase stock with our lawyers. We will make an announcement if and when a stock repurchase program is implemented.
What is A-Power's guidance for FY 2009?
$320 million for revenue and $32 million for net income. This guidance reflects all the DG contracts already signed and already in progress as of June 16, 2009. It does not include any additional DG contracts to be signed throughout the year or any revenue from the wind turbine business.
How many common shares are outstanding and how many shares are in the float?
34 million diluted shares outstanding and the float is approximately 22 million shares.
When are quarterly earnings announced?
A-Power will make an announcement regarding the date of its earnings release and earnings conference call at least two weeks in advance.
What are the terms of your June 19, 2009 sale of the $40 million Senior Convertible Notes and warrants to purchase an additional 1.5 million shares?
The Notes bear initial interest at 3% per annum, which will be increased each year, as specified in the Notes up to a maximum of 12% per annum, payable quarterly, at the Company's option, in cash or shares of the Company's common shares, par value $0.0001 per shares (the "Common Shares"). The Notes have a five year term through June 19, 2014, and are convertible into Common Shares at any time or times after the Company obtains Shareholder Approval, as discussed below, and are subject to customary anti-dilution adjustments. The initial conversion price of the Notes is $10.637 per Common Share. The Company may redeem the Notes at 110% of the principal amount, plus any accrued and unpaid interest, beginning November 19, 2011, provided the market price of the Common Shares is at least 200% of the then applicable conversion price for 20 consecutive trading days prior to the redemption. The Notes are subject to events of default customary for convertible securities. The Warrants grant the Buyers the right to acquire shares of Common Shares at $10.637 per share, subject to customary anti-dilution adjustments. The Warrants may be exercised to purchase Common Shares at any time or times on or after the Company obtains Shareholder Approval, and have a term of five years. For detailed information, please click here to read our 6-K filing with the SEC.
What is in your backlog?
As of June 16, 2009, we had 18 projects in firm contracts. and we have received down payments from customers and they make periodical payments according to construction schedules. We are no longer providing backlog information, same way as we do not announce LOIs, MOUs and so on.
In addition, we will make announcements to update our investors and analysts with new contracts incremental to our current annual guidance.
As we do not provide quarterly guidance, our analysts will need to project our numbers by their own research and other channel checking. We do not comment on the accuracy of their models.
When do you expect to sign that DG project in Thailand?
We are waiting for this potential customer's deposit. As soon as we receive the deposit, our official contract starts. And we will make an announcement. However, we do not guarantee the timing as there are many factors which could delay them from making the deposits.
Why has your wind turbine production been delayed several times?
We are a new entrant to the wind business. There were many reasons and factors that caused the delays in our preparation for wind turbine. For example, as we began our new relationships with suppliers overseas, the sourcing of the components took longer than expected, due to logistical reasons. And the global financial crisis affected some of our European suppliers and they had to adjust productions in this tough business climate. But fortunately we have now started the production of our first two units of wind turbines and are beginning full-scale production.
Can you give us an update on the shipment of your first two units of the 2.7MW wind turbines?
As of July 27, 2009, we have finished the assembly of the first two units of the 2.7MW wind turbines, to be shipped to Daxinglong Mountain Wind Power Generation Plant ("Daxinglong Mountain") in Jinzhou City, Liaoning Province in Northeast China. Our wholly-owned subsidiary, Liaoning Gaoke Energy Group, has been contracted to install the wind turbines in Daxinglong Mountain and we are currently preparing for the erection of the towers while waiting for the Jinzhou Municipal Government to evaluate the final power-transmission data. Upon Jinzhou City's approval and the completion of the towers, the first two wind turbines will be shipped and installed. The installation process is expected to take less than three weeks.
Are there research reports available about A-Power?
Currently, A-Power is followed by Raymond James, Dougherty & Company, AERCA Advisors, and RedChip Independent. In addition, we have been talking to major brokerages about potential analyst coverage.
What do you think of your current research coverage?
As many of our DG contracts are long term projects (18-24 months) whose construction schedules may change from quarter to quarter and subsequently impact the payment to A-Power, we only provide annual guidance at this time.
As we do not provide quarterly guidance, our analysts will need to project our numbers by their own research and other channel checking. We do not comment on the accuracy of their models.
How do you improve A-Power's transparency to investors and analysts?
We believe we have improved our transparency over the past year, as we opened doors to all investors and analysts who approached us. Specifically, over the past two months, we also have recruited a very experienced accounting veteran to be our new CFO and commit ourselves to more transparency and communications with Wall Street; we provided frequent updates on our corporate Website and investor FAQs and will continue to do so; we periodically issued news releases to inform investors and analysts of our recent contracts, strategic industry alliances, and other corporate developments; and we attended high-profile investor conference events and marketed ourselves to some of the highest quality institutional investors. A-Power is committed to transparency and accessibility to investors and analysts. If your have any further suggestions, please don't hesitate to contact us.
What is Shenyang Power Group?
Shenyang Power Group ("Shenyang Power") is a local DG industry alliance 60% owned by A-Power and supported by the Shenyang Municipal Government (which owns 20% of the alliance) in the forms of seed capital, investments and loan guarantees. Shenyang Power was established in June 2009 and has as its CEO Mr. Jinxiang Lu, Chairman and CEO of A-Power. In addition to A-Power, the founding members include Northern Heavy Industry Group (comprising Shenyang Mining Machinery Co. and Shenyang Heavy Machinery Co.), Shenyang Blower Group, Shenyang Boiler Manufacturing Co., Ltd., Liaoning Electricity Design & Planning Institute, Liaoning Construction & Installation Group Co., Ltd., Liaoning International Construction Engineering Group and three major power system manufacturers in Harbin. The ultimate goal for Shenyang Power is to aggregate the potentials of local power industry companies, talented individuals as well as natural resources so that it will have the capability to pursue large-scale, technologically advanced and managerially sophisticated electricity-generation systems both within China and overseas.
When is Shenyang Power expected to start work on the Macau LNG project? What's the potential for annual revenue and net income from this project?
On July 10, 2009, A-Power announced that its majority-owned Shenyang Power signed an MOU with Macau Natural Gas Co., Ltd. ("MNG") to construct an offshore liquefied natural gas ("LNG") complex to import, store and re-gasify LNG and to distribute natural gas to Macau and elsewhere. The project's estimated cost is currently $1.5 billion and it is expected to take 2 years to complete. Shenyang Power is expected to finalize the contract terms with MNG later this year and start the initial construction phase sometime next year. The annual revenue and net income from this project, as well as the disbursement of the income within the Shenyang Power alliance, are being negotiated, and the management deems it premature to disclose such details to the public at the moment.
How do I contact Investor Relations?
Mr. Valentine Ding or Mr. Dixon Chen at +1-646-284-9412 or valentine.ding@us.grayling.com; dixon.chen@us.grayling.com
Can you give us an update on your JV with GE to produce gearboxes?
The JV, which is 25% owned by us and 75% owned by GE, has received approval from local government authorities and an existing plant, about 10 minutes' drive from A-Power's existing wind turbine assembly facilities in Hunnan New District in Shenyang, has been selected and remodeled to house the JV's gearbox production lines. It is currently in the equipment testing stage and we anticipate that commercial production will begin in August 2010 and the designed annual capacity will be 1,200 units.
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