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Sinovel predicts delisting from Shanghai exchange
Credit: 3 November 2014 by Jianxiang Yang, windpowermonthly.com ~~
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Sinovel has warned investors it is likely to be delisted when its 2014 annual report is released at the beginning of 2015.
In its Q3 report, Sinovel said revenues went up 47.71% to CNY 2.98 billion ($485 million) in January-September. But it made a net loss of CNY 436 million ($71 million). The company said its 2014 net profits are also likely to be in the red.
Sinovel, which was once China’s largest manufacturer, has reported losses for the past two years. If the figure is negative again this year, it will probably be delisted on the Shanghai stock exchange (SSE). The statement was made in accordance with the SSE regulations.
A number of factors have been cited as the cause for the losses: growing interest payments on unpaid loans, increasing provisions for bad debts, delayed projects execution due to shortage of fund and less-than-expected incomes.
The company said that a shortage of working capital is its biggest problem. It has been granted no new bank loans in the three-quarter period and the use of bank credits was also restricted. As a result, the risk of business operations and possibility of default on its two bonds kept growing.
This is the second warning from Sinovel in the last two months. At the end of August the company warned it was “unable to predict” the likely impact on its profits from its legal battles with AMSC.
In the Chinese manufacturer’s interim results, Sinovel said that it was unable “make a judgement” on how much a loss of any of the cases could have on the company’s performance “in the preceding half year and the future.”
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