Hong Kong, Feb 12, 2009 AEST (ABN Newswire) - Despite tough operating environment in 2008 resulting from the substantial increases in coal price and the sharp turnaround of economic prospects, GCL-Poly Energy Holdings Limited (HKG:3800) still managed to meet its internal targets and achieved satisfactory performance by fully leveraging its business advantages, timely adjusting its business strategies and proactively implementing a series of effective measures to grow revenues and to control expenditures.
Entering into 2009, the overall operating environment for China's power industry is showing improvement, even though there are still a lot of uncertainties in the global economy and the Chinese economy. Firstly, the substantial pullback in coal price since the last quarter of 2008 has greatly lightened the fuel cost burden on power producers. Secondly, lower interest rates and improved industry prospects make it easier and cheaper for power producers to obtain bank loans. Thirdly, the value-added tax rate on coal is raised to 17% from 14% in 2009, which results in higher tax deduction amount and thus lower fuel cost for power producers.
In the meantime, like other industries, China's power producers will also inevitably be affected by economic slowdown, in terms of weak demand for electricity. With regard to this concern, Mr. Zhu Gong Shan, the Executive Director and Chairman of GCL-Poly, pointed out that the impact from the weak electricity demand may not be that substantial to the Company, since GCL-Poly's diversified power plants, such as gas-fired cogeneration, coal-fired cogeneration, biomass-fired cogeneration, incineration power generation and wind power generation, are either clean, efficient or renewable, thus promoted and encouraged by Chinese government and can enjoy higher dispatch priority.
In order to better leverage the improving operating environment and to achieve better performance in 2009, GCL-Poly will, on the one hand, take proactive and effective measures to further control fuel cost, grow steam market and maintain stable steam price, and on the other hand, proactively optimize the power plant portfolio and further push forward the vertical integration strategy, thus laying solid foundation for the Company's sustainable growth in the future.
The Chairman's View on Global Economy and its Impact to the Company
Looking forward, Mr. Zhu Gong Shan, also the Chairman of Golden Concord Holdings Limited ("GCL Group"), believes that challenges and opportunities coexist. Mr. Zhu said, Chinese government's massive economic stimulus plan together with Obama Administration's new energy initiatives provide great opportunities to GCL Group and GCL-Poly, both of which focus on environmentally friendly and renewable energy. GCL Group and GCL-Poly will make proactive preparations to take hold of the opportunities so as to lead their business up to a new level.
Contact
Investor Relations Contact:
Mr. Zhou Jiangbo
Tel: +852-3761-3138
Email: zhoujiangbo@gcl-power.com.hk
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