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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Greka Engineer. | LSE:GEL | London | Ordinary Share | KYG411211074 | ORD USD0.00001 (DI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.85 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMGEL
RNS Number : 6675J
Greka Engineering & Technology Ltd
09 April 2015
9 April 2015
GREKA ENGINEERING & TECHNOLOGY LTD.
("Greka Engineering" or the "Company")
Final Results 2014
Greka Engineering & Technology Ltd. (AIM: GEL), the unconventional gas sector engineering and technology business with pipeline, gas compression and power generation assets in China, is pleased to announce its audited financial results for the year ended 31 December 2014.
OPERATIONAL HIGHLIGHTS
-- Sales of 123 gas station dispensers in 2014, a 9.6% decrease on the 136 sold in 2013 -- No sales of wellhead compressors in 2014 (2013: 3 sold) -- No sales of SCADA in 2014 (2013: 2 sold)
-- 977,965 MCF (27.7 MCM) of gas for sale were processed in 2014, (2013: 1,038,263 MCF processed (29.4 MCM) , a 5.8% decrease
-- Sales of 10,915,738 kwh of power in 2014, (2013: 10,714,823 kwh), a 2% increase
-- 4.9 km of gas gathering pipeline constructed in 2014 resulting in 41.9 km of total pipeline at the end of 2014
-- 3.8 km of power line constructed in 2014, a total of 71.8 km of power lines at the end of 2014
FINANCIAL HIGHLIGHTS
-- Revenue increased by 41% to US$5.2m (2013:US$3.7m) -- Cash and bank deposits of US$2.6m at 31 December 2014 (2013: $3.5m)
CORPORATE HIGHLIGHTS
-- The Group's customer base increased by 43 (2013: 30 new customers) to 150 customers in China at year end (2013: 107 customers). This represented a 40% increase in the customer base
-- Three-year power sales contract with Jiaqin Agriculture, the Company's first unaffiliated power client
-- Power Line Construction Agreement with CUCBM, a CNOOC subsidiary -- No lost time due to injury or accident in 2014
Randeep S. Grewal, Executive Chairman of Greka Engineering, commented:
"We are quite pleased with the first full year of independent operations for Greka Engineering & Technology. The Company continued to make progress on building additional infrastructure for its key client Green Dragon Gas Ltd while continuing to process stable gas flows through our existing facilities. Additional clients have been added in "for power off take" and an enhanced pricing regime with all clients resulted in improved revenues. We look forward to steady growth in all our business sectors in 2015 as the unconventional gas market in China continues to grow independently from global oil price volatility."
Contacts:
Greka Engineering Betty Cheung, Director Corporate Affairs +852 3710 0088 Smith & Williamson Nominated Adviser Dr Azhic Basirov / David Jones / Ben Jeynes +44 20 7131 4000
WH Ireland
Broker +44 113 394 6600
Tim Feather
Walbrook
Media & Investor Relations + 44 20 7933 8780
Paul Cornelius / Guy McDougall get@walbrookpr.com
About Greka Engineering & Technology
Greka Engineering & Technology Ltd., (AIM; GEL) was demerged from Green Dragon Gas Ltd. (AIM; GDG) ("Green Dragon Gas") via a dividend in specie and was admitted to trading on AIM in September 2013.
Greka Engineering offers turnkey solutions to over 100 upstream, midstream and downstream gas suppliers. The Company's technologies include Compressed Natural Gas/Liquefied Natural Gas (CNG/LNG) compressor equipment, CNG retail dispenser equipment and CBM wellhead extraction technologies. The Company also supplies proprietary Integrated Circuit Card Point of Sale (ICC POS) and Supervisory Control and Data Acquisition (SCADA) software and hardware solutions for the remote management of transmission systems, power facilities, vehicle management and retail services.
In addition, the Company invests in, operates and maintains wholly owned assets for its customers in return for service contracts based on the volume management.
The Company has historically completed several Engineering, Procurement, Construction and Management (EPCM) contracts including the design, construction and management of gas gathering systems, a gas pipeline in Shanxi Province to the China West-East pipeline, the installation and commissioning of a 10MW gas-fired power facility in the Shanxi province and the construction of CNG retail stations.
Chairman's Statement
In 2014, Greka Engineering completed its first full-year operation as an independent quoted company on AIM following its demerger from Green Dragon Gas. The Company's performance improved from enhanced equipment utilization and customer expansion. Revenue increased 41% to US$5.2m and losses decreased to US$1.7m, a 12% reduction compared to the prior year.
High quality infrastructure assets (including coal bed methane field compressors, pipeline gathering systems and an Integrated Production Facility (IPF) form the core assets of the Group) provided reliable and increasing revenue for the Company. As highlighted in the interim report, the Company successfully renegotiated its gas gathering system usage, power sales and compression fees with its key client Green Dragon Gas. The renegotiated gas processing fee and power price provided for a 274% increase to gas process revenue over the previous year and power sales revenue increased by 185%.
The Company signed a three-year power sales contract with Jiaqin Agriculture which became our third client for power and the first unaffiliated client. Furthermore, we signed a Power Line Construction Agreement with CUCBM, a CNOOC subsidiary, under which we successfully built power lines connecting one of its valve groups to supply nine wells to our power grid. This initial valve group is to serve as a pilot to CUCBM on the benefits of connecting its remaining fourteen valve groups into our infrastructure. The pricing for power sales is consistent across all four clients.
In accordance with our strategy to be a technology leader within the unconventional gas market, product development continued. The Company made significant advances in the pipe network and power grid technology through the research and development of a micro casing pressure production pump. This pump can potentially increase gas production of a single gas well by over 20% compared to conventional technology and has been successfully deployed on three wells on a trial basis. We will evaluate launching the product on the basis of the performance during the coming year. Additionally, leveraging on the successful development of the LNG dispensers, the Company embarked on the development of C/LNG pump skids which provide mobility to an end user on its C/LNG dispensing capability. We expect to conclude on the market potential of this new product during the course of this year.
Looking forward to the coming year, we expect our continued growth to be diversified with increasing IPF utilization, rising power sales to all four clients, expanding power grid to CUCBM, reinitiated SCADA sales and stable dispenser sales within our existing China market.
Finally, I would like to thank the diligent management team that leads our hundred employees across a diversified business encompassing 24/7 infrastructure operations within the IPF, manufacturing products for gas distribution as well as continued technology development maintaining a leading edge within our niche unconventional gas market.
Randeep S. Grewal
Chairman
8 April, 2015
Consolidated Statement of Comprehensive Income
Hot Features
Premium
Year ended Year ended
31 December 31 December
2014 2013
Notes US$'000 US$'000
----------------------------------------- ------ ------------------- --------------------
Revenue 5,233 3,701
Cost of sales (4,083) (3,349)
----------------------------------------- ------ ------------------- --------------------
Gross profit 1,150 352
Selling and distribution (294) (224)
Administrative expenses (2,831) (1,975)
Other operating credit/(charge) 9 (24)
----------------------------------------- ------ ------------------- --------------------
Total administrative expenses (3,116) (2,223)
Loss from operations (1,966) (1,871)
Finance income 4 2 1
Finance costs 4 (58) (3)
----------------------------------------- ------ ------------------- --------------------
Loss before income tax (2,022) (1,873)
Income tax 6 78 71
----------------------------------------- ------ ------------------- --------------------
Loss for the year from continuing
operations (1,944) (1,802)
Profit/(loss) from discontinued
operations 7 241 (133)
----------------------------------------- ------ ------------------- --------------------
Loss for the year (1,703) (1,935)
Other comprehensive income/(expense):
Exchange differences on translation
foreign operations (95) 606
----------------------------------------- ------ ------------------- --------------------
Total comprehensive expense for
the year (1,798) (1,329)
----------------------------------------- ------ ------------------- --------------------
Loss attributable to:
- Owners of the company (1,703) (1,935)
----------------------------------------- ------ ------------------- --------------------
Total comprehensive income attributable
to:
- Owners of the company (1,798) (1,329)
----------------------------------------- ------ ------------------- --------------------
Basic and diluted loss per share
attributable to owners of the
company arising from:
- Continuing operations (cents) 5 (0.47) (0.44)
- Discontinued operations (cents) 5 0.05 (0.03)
Total (0.42) (0.47)
----------------------------------------- ------ ------------------- --------------------
Consolidated Statement of Financial Position
As at 31 December As at 31
Note 2014 December 2013
US$'000 US$'000
-------------------------------- ----- ------------------------ ------------------------
ASSETS
Non-current Assets
Property, Plant and Equipment 20,738 25,407
Intangible assets 1,901 2,399
22,639 27,806
-------------------------------- ----- ------------------------ ------------------------
Current assets
Inventories 1,978 2,009
Trade and other receivables 9,731 7,623
Cash and cash equivalents 2,626 3,494
-------------------------------- ----- ------------------------ ------------------------
14,335 13,126
-------------------------------- ----- ------------------------ ------------------------
Assets held for sale 1,753 1,753
-------------------------------- ----- ------------------------ ------------------------
Total assets 38,727 42,685
-------------------------------- ----- ------------------------ ------------------------
LIABILITIES
Current liabilities
Trade and other payables 3,830 5,915
Loans and borrowings 8 4,706 4,656
Current tax liabilities 12 13
-------------------------------- ----- ------------------------ ------------------------
8,548 10,584
Non current liabilities
Deferred taxation liabilities 475 599
475 599
-------------------------------- ----- ------------------------ ------------------------
TOTAL LIABILITIES 9,023 11,183
-------------------------------- ----- ------------------------ ------------------------
Total net assets 29,704 31,502
-------------------------------- ----- ------------------------ ------------------------
Capital and reserves
Share capital 4 4
Share premium account 35,949 35,949
Foreign exchange reserve 540 635
Accumulated losses (6,789) (5,086)
-------------------------------- ----- ------------------------ ------------------------
Total equity attributable to
owners of the Company 29,704 31,502
Consolidated Statement of Changes in Equity
Foreign
Share Share exchange Accumulated
capital premium reserve losses Total
US$'000 US$'000 US$'000 US$'000 US$'000
At 1 January 2013 - - 29 (3,151) (3,122)
------------------------------- ----------------- --------------- ---------------- --------------- --------------
Loss for the year - - - (1,935) (1,935)
Other comprehensive income:
Items that may be reclassified
subsequently to profit or
loss:
- Exchange difference on
translation of foreign
operations - - 606 - 606
------------------------------- ----------------- --------------- ---------------- --------------- --------------
Total comprehensive income
/(expense) for the year 606 (1,935) (1,329)
Capital contribution: waiver
of amounts owed to Green
Dragon Gas Ltd 4 35,949 - - 35,953
At 31 December 2013 4 35,949 635 (5,086) 31,502
------------------------------- ----------------- --------------- ---------------- --------------- --------------
Loss for the year - - - (1,703) (1,703)
Other comprehensive income:
Items that may be reclassified
subsequently to profit or
loss:
- Exchange difference on
translation of foreign
operations - - (95) - (95)
------------------------------- ----------------- --------------- ---------------- --------------- --------------
Total comprehensive expense
for the year - - (95) (1,703) (1,798)
At 31 December 2014 4 35,949 540 (6,789) 29,704
------------------------------- ----------------- --------------- ---------------- --------------- --------------
The following describes the nature and purpose of each reserve within owners' equity.
-- Share capital: Amount subscribed for share capital at nominal value.
-- Share premium: Amount subscribed for share capital in excess of nominal value, including capital contributions
-- Foreign exchange reserve: Foreign exchange differences arising on translating the results, assets and liabilities of foreign operations into the reporting currency.
-- Retained deficit: Cumulative net gains and losses recognized in profit or loss.
Consolidated Statement of Cash Flows
Year ended Year ended
31 December 31 December
2014 2013
US$'000 US$'000
------------------------------------- ------------------------- -------------------------
Operating activities
Loss before income tax (2,022) (1,873)
Profit/(loss) before tax from
discontinuing operations 241 (133)
------------------------------------- ------------------------- -------------------------
(1,781) (2,006)
Adjustments for:
Depreciation 1,022 1,120
Amortisation of other intangible
assets 495 494
Finance income (2) (1)
Finance costs 58 3
------------------------------------- ------------------------- -------------------------
Operating cash flows before
changes in working capital (208) (390)
Movement in inventories (93) 114
Movement in trade and other
receivables 208 847
Movement in trade and other
payables (549) 260
------------------------------------- ------------------------- -------------------------
Cash utilized by / generated
from operations (642) 831
Income tax 78 (83)
------------------------------------- ------------------------- -------------------------
Net cash (utilized by) / generated
from operating activities (564) 748
------------------------------------- ------------------------- -------------------------
Investing activities
Payments for purchase of property,
plant and equipment (206) (1,827)
Interest received 2 1
-------------------------------------
Net cash used in investing
activities (204) (1,826)
------------------------------------- ------------------------- -------------------------
Financing activities
Proceeds of short term loan 654 656
Repayment of short term loan (654) -
Finance costs paid (58) (3)
Net cash (used in)/from financing
activities (58) 653
------------------------------------- ------------------------- -------------------------
Net decrease in cash and cash
equivalents (826) (425)
Cash and cash equivalents at
the beginning of the year 3,494 3,882
------------------------------------- ------------------------- -------------------------
2,668 3,457
Effect of foreign exchange
rate changes (42) 37
------------------------------------- ------------------------- -------------------------
Cash and cash equivalents at
end of year 2,626 3,494
===================================== ========================= =========================
Abridged notes to the financial information for the year ended 31 December 2014
1. PRINCIPAL ACCOUNTING POLICIES
Basis of preparation
The financial statements have been prepared in accordance with IFRSs as adopted by the European Union, that are effective for accounting periods beginning on or after 1 January 2014. The principal accounting policies adopted in the preparation of the financial statements are set out in the Group's full annual report and accounts for the year ended 31 December 2014.
2. REVENUE AND SEGMENT INFORMATION
The Group determines its operating segments based on reports reviewed by the chief operating decision-makers ("CODMs") which are also used to make strategic decisions.
The Group reports its operations as two reportable segments: gas equipment sales and the provision of contract infrastructure services in PRC. The division of the engineering and technology operations into two reportable segments is reflective of how the CODMs manage the business.
The accounting policies of the reportable segments are the same as those described in the summary of principal accounting policies. We evaluate the performance of our operating segments based on revenues from external customers and segmental profits.
Year Ended 31 December 2014
Gas equipment Infrastructure Intercompany Consolidated
sales services from continuing
operations
--------------- --------------- ------------------- ----------------- -----------------
US$'000 US$'000 US$'000 US$'000
Revenue 1,973 3,734 (474) 5,233
Cost of sales (1,488) (3,069) 474 (4,083)
Gross profit 485 665 - 1,150
Loss before
tax (1,628) (394) - (2,022)
As at 31 December 2014
Transportation
Services
Gas equipment Infrastructure (Discontinued
sales services Operations) Intercompany Consolidated
--------------------- -------------- ------------------ ----------------- ------------- ---------------
Segment assets 5,773 32,632 1,753 (1,431) 38,727
Segment liabilities 11,024 35, - (37,322) 9,023
321
Year Ended 31 December 2013
Gas Consolidated
equipment Infrastructure from continuing
sales services Intercompany operations
--------------------- ----------- --------------- ------------- -----------------
US$'000 US$'000 US'$000 US$'000
Revenue 2,423 1,400 (122) 3,701
Cost of sales (1,818) (1,649) 118 (3,349)
Gross profit/(loss) 605 (249) (4) 352
Profit before
tax (1,378) (495) - (1,873)
As at 31 December 2013
Transportation
Services
Gas equipment Infrastructure (Discontinued
sales services Operations) Intercompany Consolidated
US$'000 US$'000 US$'000 US$'000 US$'000
--------------------- -------------- --------------- --------------- ------------- -------------
Segment assets 7,702 33,685 1,753 (455) 42,685
Segment liabilities 10,033 37,471 - (36,321) 11,183
Gas equipment sales represent the net invoiced value of gasequipment sales provided to 73 (2013:63) customers for the year. Infrastructure services represent sales to wholly owned subsidiaries of the Green Dragon Gas groupand the Greka Drilling Limited group.
3. LOSSFROM OPERATIONS
Loss from continuing operations is stated after charging:
2014 2013
US$'000 US$'000
Auditor's remuneration 34 58
Staff costs 1,454 1,486
Depreciation of property, plant
and equipment 1,022 1,120
Amortization of intangible assets 495 494
Operating lease expense (property) 126 150
Loss on disposal of property, plant
and equipment - 71
Foreign exchange gains/(losses) (1) 7
------------------------------------- ---------------------- ------------------------
4. FINANCE INCOME / EXPENSES
2014 2013
US$'000 US$'000
Bank interest income 2 1
------------------------ ------------------------ ------------------------
Bank interest expenses 58 3
------------------------ ------------------------ ------------------------
5. LOSSPER SHARE
The calculation of the basic and diluted earnings per share attributable to the owners of the Company is based on the following data:
2014 2013
US$'000 US$'000
Loss for the year
-Continuing operations (1,944) (1,802)
-Discontinuing operations 241 (133)
------------------------------------ ------------------ ------------------
Loss for the purpose of basic and
diluted loss per share (1,703) (1,935)
------------------------------------ ------------------ ------------------
Denominators
Number of shares used in basic and
diluted loss calculations 409,622,133 409,622,133
Basic and diluted loss per share
(cents)
- Continuing operations (0.47) (0.44)
- Discontinued operations 0.05 (0.03)
------------------------------------ ------------------ ------------------
Total used (0.42) (0.47)
------------------------------------ ------------------ ------------------
There were no potentially dilutive instruments in 2014 and 2013. The basic and diluted loss per share are equal as the Company has no dilutive instruments. There have been no shares or potentially dilutive instruments issued between year-end and the date these financial statements were approved.The 2013 comparative is calculated as if the shares legally issued during 2013 had been in issue since the start of that year.
6. TAXATION
2014 2013
US$'000 US$'000
Current tax
Charges for current year 46 53
Deferred tax liabilities
Reversal of temporary difference (124) (124)
---------------------------------- ------------------------- ------------------------
Income tax charge/(credit) (78) (71)
---------------------------------- ------------------------- ------------------------
The reasons for the difference between the actual tax charge for the years presented and the standard rate of corporation tax in the PRC, as the primary operating environment, applied to the loss for the years presented are as follows:
2014 2013
US$'000 US$'000
Loss before income tax - continuing
operations (2,022) (1,873)
Profit/(loss) before income tax
- discontinued operations 241 (133)
Loss before income tax (including
discontinued activities) (1781) (2,006)
Expected tax credit based on the
standard rate of corporation tax
in the PRC of 25% (2013: 25%) (445) (502)
Effect of:
Tax effect of revenue not taxable 22 -
for tax purposes
Movement in unrecognized tax losses
and other temporary differences 345 431
------------------------------------- ----------------------- -----------------------
Income tax charge (78) (71)
------------------------------------- ----------------------- -----------------------
The Company is incorporated in the Cayman Islands and is not subject to income tax. The primary operating companies are incorporated in the PRC and are subject to 25% tax rates. The group has unrecognised losses of $1,274,075 (2013: $763,393) which are not recognised given uncertainties in future taxable profits.
7. ASSETS HELD FOR SALE / DISCONTINUED OPERATIONS
The strategy of Greka Engineering is to develop its engineering and technology operations. In order to focus on the delivery of this strategy, prior to the demerger from Green Dragon Gas Ltd, during 2012 one of the Company's subsidiaries agreed a proposal to sell its non-core transportation operations to subsidiaries being retained within the Green Dragon Gas Ltd group following the demerger. Subsequently, it entered a legal agreement with Green Dragon Gas Limited on 1 July 2013 to dispose of motor vehicles and equipment for $1,753,357 of cash consideration in line with the previously agreed proposals. Notwithstanding the period that has elapsed between meeting the requirements for classification as assets held for sale, the Group remains committed to the disposal and expects it completion in due course. The completion of the transaction is subject to obtaining necessary legislative approvals and those approvals are progressing.
The following are the totals for the major classes of assets relating to Greka Engineering's transportation operation at the end of the reporting period:
2014 2013
US$'000 US$'000
Motor vehicles 1,733 1,733
Fixtures, fittings and equipment 17 17
Plant and machinery 3 3
---------------------------------- ------------------------ ------------------------
1,753 1,753
---------------------------------- ------------------------ ------------------------
The profit on discontinued operations in the Consolidated Statement of Comprehensive Income can be analysed, as follows:
2014 2013
US$'000 US$'000
Transportation service revenue 387 589
Cost of sales (146) (553)
Administrative expenses -!! (169)
-------------------------------- ------------------------ ------------------------
Profit/(Loss) before and after
taxation 241 (133)
-------------------------------- ------------------------ ------------------------
The Consolidated Statement of Cash Flows contains the following elements related to discontinuing operations:
2014 2013
US$'000 US$'000
Net cash flows attributable to
operating activities 241 (133)
Net cash flows attributable to
investing activities - (482)
Net cash flows attributable to - -
financing activities
-------------------------------- ----------------------- -----------------------
The assets held for sale are classified within the transportation services segment in Note 2.
8. LOANS AND BORROWINGS
2014 2013
US$'000 US$'000
Loans and borrowing - secured 4,706 4,656
------------------------------- ---------------------- ----------------------
On 11 April 2012, GTIG, Greka Integrated Products, Henan Boao Trading Co Limited and Aowei International (H.K.) Co., Limited (Aowei HK) entered into a loan agreement, pursuant to which Henan Boao Trading Co Limited made available a loan facility in the amount of the RMB equivalent of US$4,000,000. The facility is fully drawn and is repayable on demand but is matched by a US$4,000,000 receivable.
Included within loans and borrowings is a bank loan of US$653,702 (2013: $656,000) which is secured by buildings and structures with a book value of US$1,197,330 (2013: US$1,265,000).
9. PUBLICATION OF NON-STATUTORY ACCOUNTS
The financial information for the years ended 31 December 2014 and 31 December 2013 set out in this announcement does not constitute the Group's (being Greka Engineering and its subsidiaries) statutory financial information but is extracted from the audited financial statements for those years. The auditors have reported on the full accounts for both periods and their reports were unqualified and did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their reports.
10. ANNUAL REPORT
The Company's Annual Report and copies of this announcement will be available in due course on the Company's website at www.grekaengineering.com and from the office of the Company's Nominated Adviser, Smith & Williamson Corporate Finance Limited at 25 Moorgate, London EC2R 6AY, United Kingdom.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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