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Extracted from Annual Report 2016

Financial Performance

Revenue increased by 13.3% from RMB1,435.3 million for financial year ended 31 December 2015 (“FY2015”) to RMB1,626.2 million for financial year ended 31 December 2016 (“FY2016”). This was mainly attributable to an increase of RMB152.6 million and RMB38.3 million from Engineering, Procurement and Construction (EPC) Integrated Solutions segment and Environmental Equipment Manufacturing segment respectively.

In line with the increase in revenue, the Group’s gross profit increased by 27.5% from RMB320.2 million for FY2015 to RMB408.3 million for FY2016, while its gross profit margin of 25.1% for FY2016 was fairly consistent compared to 22.3% for FY2015.

The Group’s profit before tax increased by 80.0% year-on-year (yoy) from RMB98.7 million to RMB177.7 million for FY2016 mainly due to the following factors:

  1. increase in the gross profit of RMB88.1 million; and
  2. increase in other operating income of RMB17.1 million in FY2016 mainly due to increased reversal of allowance for doubtful receivables by RMB20.7 million and increased government grant by RMB1.2 million.

On the other hand, administrative expenses increased by RMB13.0 million in FY2016 largely due to full-year impact of employee share option expenses and other personnel cost with expansion in the Group’s activities. Other operating expenses also increased by RMB13.7 million for FY2016 mainly due to higher impairment allowance made on trade and non-trade receivables of RMB14.4 million.

As a result of the above, the Group reported a 74.5% growth in its net profit attributable to shareholders to RM142.2 million for FY2016.

Cash Flow And Liquidity

The Group’s cash and cash equivalents decreased by RMB116.2 million from RMB397.5 million as at 31 December 2015 to RMB281.3 million as at 31 December 2016. Net cash generated from operating activities amounted to approximately RMB430.0 million for FY2016. Meanwhile, net cash used in investment activities amounted to RMB642.0 million, mainly due to expenditure in the EPC phase of Build-Operate-Transfer (BOT) projects (intangible assets to be recovered during the operation phase) and payment for land use rights. Net cash generated from financing activities amounted to RMB95.6 million largely due to proceeds from bank loans of RMB677.0 million, which were offset by the repayment of bank loans of RMB573.0 million.

Financial Position

The shareholders’ equity as at 31 December 2016 stood at RMB1,118.0 million, improved by 15.0% from RMB972.1 million as at 31 December 2015. Net asset value per share increased by RMB19.79 cents to RMB151.57 cents as at 31 December 2016.