China: Ming Yang Profit Down 8,7 pct

China Ming Yang Wind Power Group Limited (“Ming Yang” or the “Company”), a leading wind turbine manufacturer in China, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2011.

 Fourth Quarter 2011 Financial Highlights:

Total wind turbine generators (“WTGs”) commissioned amounted to an equivalent wind power project output of 250.5MW, or 167 units of 1.5MW WTGs, representing a decrease of 34.0% compared to Q4 2010.

Total revenue was RMB808.3 million (US$128.4 million), representing a decrease of 52.8% compared to Q4 2010.

Gross profit was RMB56.6 million (US$9.0 million), representing a decrease of 85.2% compared to Q4 2010. Gross margin was 7.0% for Q4 2011, compared to 22.3% in Q4 2010.

Total comprehensive loss was RMB128.7 million (US$20.5 million), compared to a total comprehensive income of RMB212.2 million in Q4 2010.

Basic and diluted loss per share was RMB0.96 (US$0.15), compared to basic and diluted earnings per share of RMB1.83 for Q4 2010.

 Full Year 2011 Financial Highlights:

Total WTGs commissioned amounted to an equivalent wind power project output of 1,470MW, or 980 units of 1.5MW WTGs, representing an increase of 22.2% compared to 2010.

Total revenue was RMB5,515.8 million (US$876.4 million), compared to RMB5,517.8 million in 2010.

Gross profit was RMB993.1 million (US$157.8 million), representing a decrease of 8.7% compared to 2010. Gross margin was 18.0%, compared to 19.7% in 2010.

Profit for the year was RMB292.3 million (US$46.4 million), representing a decrease of 58.8% compared to 2010.

Total comprehensive income was RMB253.1 million (US$40.2 million), representing a decrease of 63.3% compared to 2010.

Basic and diluted earnings per share was RMB2.35 (US$0.37), compared to RMB6.61 for 2010.

 Recent Developments

On January 17, 2012, the Company announced the registration and issuance of up to RMB1.0 billion RMB-denominated unsecured three-year medium-term notes. The notes have a fixed annual interest rate of 8.5% and will mature on January 12, 2015.

On February 7, 2012, the Company announced that it had signed engineering, procurement and construction (“EPC”) contracts for an aggregate of 125 MW wind power projects in Bulgaria, and had shipped the first batch of its WTGs under the EPC contracts in the same month.

On March 13, 2012, the Company announced that it opened its North American research and development center on the Centennial Campus of North Carolina State University in Raleigh, North Carolina in the United States. The center will focus on offshore wind turbine research and development.

“2011 was a particularly challenging year for the wind power industry in China, highlighted by lower demand in the wake of significant growth from the previous years, and as a result the industry has shifted its focus from size and speed to quality and efficiency,” commented Mr. Chuanwei Zhang, Chairman and CEO of Ming Yang. “Against this industrial slow-down, I am pleased to report that Ming Yang has continued to see sustained demand through the full year 2011, and has also been able to reach its targeted gross margin on an annual basis, despite the previously announced delays in revenue recognition and overall market softness impacting performance and results in the fourth quarter.”

 “Looking ahead, we believe that the wind power industry will maintain solid growth over the long term, and will continue to focus on quality and efficiency, despite the continued challenges we expect in the industry. As of December 31, 2011, our order backlog amounted to 2.1 GW and cumulative signed orders since our inception amounted to 5.0 GW. As our track record shows, we believe Ming Yang is well-positioned to leverage on its core strengths in quality and innovation to capture market opportunities, enhance its market leadership and grow its market share. We have already seen the average selling price (“ASP”) of WTGs begin to recover during the first quarter of 2012, which we believe will partially ease the pressure on our gross margin in the ensuing quarters.”

 Mr. Zhang added, “Ming Yang has also initiated an important step in international market expansion with the Bulgaria projects. We believe that, with the advantages in cost competitiveness and innovative business solutions, Ming Yang’s international market development will further enhance its leadership in the industry in the future. Our new research and development center in North Carolina is also expected to provide solutions for us to lower the cost of energy and further increase reliability, making our WTGs more competitive and further powering our competitiveness in both China and the international markets.”

 Fourth Quarter 2011 Financial Results

 Revenue

Revenue in the fourth quarter of 2011 was RMB808.3 million (US$128.4 million), representing a decrease of 52.8% from RMB1,713.3 million in the corresponding period of 2010. The Company commissioned WTGs amounted to an equivalent wind power project output of 250.5MW, or 167 units of 1.5MW WTGs, compared to 379.5 MW, or 253 units of 1.5MW WTGs, for the corresponding period in 2010. The decrease in revenues in the fourth quarter was primarily due to (i) the delayed EPC projects representing an equivalent wind power project output of 196.5MW, or 131 units of 1.5MW WTGs ; (ii) the delays in installation and commission of 1.5MW WTGs of certain wind farm projects representing an equivalent wind power project output of 40.5MW, or 27 units, primarily caused by adverse weather conditions; and (iii) slower growth in the wind industry in China in 2011.

 Gross Profit and Gross Margin

Gross profit in the fourth quarter of 2011 was RMB56.6 million (US$9.0 million), representing a decrease of 85.2% from RMB382.9 million for the corresponding period in 2010. Gross margin in the fourth quarter of 2011 was 7.0%, compared to 22.3% for the corresponding period in 2010. The year-over-year decline was a result of (i) a significant decrease in ASP compared to the corresponding period in 2010, due to the highly competitive market environment and (ii) higher costs resulting from the installation of higher specification WTGs for certain wind power projects, for which we recognized revenue in the fourth quarter of 2011.

Profit/(Loss) for the Period and Earnings/(Losses) per Share

Loss for the fourth quarter of 2011 was RMB121.9 million (US$19.4 million), compared to a profit of RMB231.4 million in the corresponding period of 2010.

For the fourth quarter of 2011, basic and diluted loss per share was RMB0.96 (US$0.15), compared to basic and diluted earnings per share of RMB1.83 for the corresponding period in 2010.

 Full Year 2011 Financial Results

 Revenue

Revenue was RMB5,515.8 million (US$876.4 million) for the full year 2011, compared to RMB5,517.8 million in 2010. The Company commissioned WTGs amounting to an equivalent wind power project output of 1,470MW, or 980 units of 1.5MW WTGs, compared to 802 units of 1.5MW WTGs in 2010. The substantially similar revenue in 2011 as compared to 2010 was primarily due to the impact of the fourth quarter 2011 results which offset revenue growth in the first nine months of 2011.

 Gross Profit and Gross Margin

Gross profit was RMB993.1 million (US$157.8 million) for the full year 2011, representing a decrease of 8.7% from RMB1,087.4 million in 2010. Gross margin was 18.0%, compared to 19.7% in 2010. The decline in gross profit and gross margin year-over-year was primarily due to a significant decrease in ASP in 2011 amid a volatile and highly competitive pricing environment.

 Profit for the Year and Earnings per Share

Profit for the year of 2011 was RMB292.3 million (US$46.4 million), compared to RMB709.2 million in 2010, representing a decrease of 58.8%. Basic and diluted earnings per share were RMB2.35 (US$0.37), compared to RMB6.61 for 2010.

[mappress]

Offshore WIND staff, March 30, 2012