Green & Smart Holdings plc Business Update (7874Z)

TIDMGSH

RNS Number : 7874Z

Green & Smart Holdings plc

31 May 2016

31 May 2016

Green & Smart Holdings plc

("Green & Smart" or "the Group")

Business Update

Green & Smart Holdings plc, a renewable energy company generating power from biogas captured through the treatment of Palm Oil Mill Effluent (POME) in Malaysia, provides the following update on trading ahead of announcing its interim results for six months ended 31 March 2016 in June 2016.

The first half of the year has seen the continuation of the momentum gained in the second half of the previous financial year. Currently, the Group derives its revenues from EPCC agreements for the construction of biogas power plants for its associated company, Megagreen Energy Sdn Bhd, and has a pipeline of EPCC agreements for plants to be built or refurbished by its other associated company, Concord Green Energy Sdn Bhd. In addition, the Group is building fully-owned projects, which will be connected to the national grid of Malaysia.

The Group's first fully-owned project is at Felda Kahang. In the Group's Admission Document dated 6 May 2016, the Group stated that it "is currently awaiting final construction work to be completed [at Felda Kahang] along with the delivery of the gas engines which are now in Malaysia. The Company expects to commission the plant and connect to the grid in May 2016." The Group confirms that the construction works have been completed. With regards to the interconnection to the grid, the sub-contractor has commenced laying trenches, the overhead poles and other cabling works as planned. However, the Group was notified yesterday that the two gas engines that were to be transferred to the site before the end of May 2016 are now expected to be delivered by mid-June as only one engine has passed the supplier's Factory Assessment Test. The Group cannot commence operations with just one engine of 1MW as the cabling and the interconnection works have been designed to be connected to both engines simultaneously. The modification of the Tenaga Nasional Berhad ("TNB"), the government-controlled electric utility, national grid substation includes the installation of additional electricity meters to recognise the power provided by the Felda Kahang plant, which can only occur once the gas engines have been connected. Consequently, the timing of the Felda Kahang project is now estimated as follows:

   --     Both gas engines delivered and connected by end June; and 
   --     interconnection works, cabling and modification to the TNB substation completed by mid-July. 

Live testing of biogas production and power generation from the plant will be undertaken by the Sustainable Energy Development Authority of Malaysian and TNB immediately following completion of the interconnection works and the Company is expected to earn revenue from this time.

The revised timetable is expected to reduce revenues for the year ended 30 September 2016 by approximately GBP240,000 reflecting power sales foregone over the expected period of delay.

The Group will provide a full update on the progress of all projects at the time of its results announcement in late June.

Enquiries

 
 Green & Smart Holdings plc 
--------------------------------  ----------------- 
 Sivadas Kumar, Group CEO          [phone] 
--------------------------------  ----------------- 
 
 SP Angel Corporate Finance 
  LLP 
--------------------------------  ----------------- 
 Robert Wooldridge, Stuart 
  Gledhill                         [phone] 
--------------------------------  ----------------- 
 
 Luther Pendragon Ltd 
--------------------------------  ----------------- 
 Harry Chathli, Claire Norbury, 
  Alexis Gore                      [phone] 
--------------------------------  ----------------- 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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May 31, 2016 11:28 ET (15:28 GMT)