APWR

[kslifka]

I've been watching APWR the past week...but never bought  

Up big after news  


A-Power Receives LOIs for 380 2.5 MW Wind Turbines
Friday February 1, 10:21 am ET

SHENYANG, China--(BUSINESS WIRE)--A-Power Energy Generation Systems, Ltd. (NASDAQ: APWR - News, APWRW - News, APWRU - News) ("A-Power"), announced today that its wholly owned Chinese operating subsidiary, Liaoning GaoKe Energy Group ("GaoKe"), has received letters of intent for 380 2.5 MW wind turbines, a number that will utilize all of its anticipated plant capacity through 2009. The company is presently engaged in negotiations to finalize these contracts and turn them into purchase orders. As was previously announced, the first phase of the plant is scheduled to be completed in the third quarter of this year.

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Mr. Edward Meng, A-Power's CFO commented, "As we have previously announced, we have recently acquired rights to both 2.5 MW turbines from Fuhrlander AG of Germany and 225 kW and 750 kW turbines from Norwin A/S of Denmark and we are planning to begin producing these in our new facility in Shenyang later this year. At this time we are very glad to report that we have already received a number of letters of intent that aggregate to 380 units to purchase the 2.5 MW turbines. In addition, we have received a number of LOI's for Norwin's 750 KW turbines. As previously stated, the sales price for the 2.5MW wind turbine is expected to be RMB 20 to 24 million ($2.7 to $3.2 million), while the 750kw turbine is expected to sell for RMB 3.4 to 3.7 million ($0.46 to $0.51 million). Both are expected to have gross margins of approximately 8 to 12%. In order to meet this demand as quickly as possible, we are making arrangements to import many of the subassemblies from suppliers around the world that presently supply Fuhrlander and Norwin. Over time we are confident that we will be able to identify second-source qualified suppliers for many of these subassemblies in China to further improve the gross margins."

[BigSully1]

Very interesting,  sounds like they may need to raise funds for further expansion though if contacts are indeed for real?, as these potential contracts would tie up all of their planned capacity through 2009. I see a 10% owner/insider just added to his holdings on Wednesday just before this news. Insider trading? I would use caution here , IMO.

[ravenquork]

If the numbers shown in the press release are correct, APWR could make a total of $9.75 per share by the end of 2009.

380 units x 3,000,000 each x 10% gross profit = 114,000,000
114million/7million shares = $16.28/share in gross profits for the larger turbines
throw in an additional %20 for the smaller turbines gives us gross profits of $19.54/share

Assuming half of the gross(just a guess here) flows to the bottom line we get a net of 9.75/share before the end of  2009

Lets say that 1.75  comes this year x a pe of 20 we get a share price of $35 at the end of 08
The remaining $8.00 would come in 09 x a pe of 20  and we get a share price of $160.00  Of course a company growing that quickly might command a much higher pe, say 40 then the price could be $320   

Of course anything could go wrong, but this looks like it might be a good pure wind energy play.

fyi - APWRW is moving at about %50 faster rate than APWR

[kslifka]

If the numbers shown in the press release are correct, APWR could make a total of $9.75 per share by the end of 2009.

380 units x 3,000,000 each x 10% gross profit = 114,000,000
114million/7million shares = $16.28/share in gross profits for the larger turbines
throw in an additional %20 for the smaller turbines gives us gross profits of $19.54/share

Assuming half of the gross(just a guess here) flows to the bottom line we get a net of 9.75/share before the end of  2009

Lets say that 1.75  comes this year x a pe of 20 we get a share price of $35 at the end of 08
The remaining $8.00 would come in 09 x a pe of 20  and we get a share price of $160.00  Of course a company growing that quickly might command a much higher pe, say 40 then the price could be $320   

Of course anything could go wrong, but this looks like it might be a good pure wind energy play.

fyi - APWRW is moving at about %50 faster rate than APWR

Thanks for doing the math ravenquork..

I gotta admit I didn't buy this morning even though I saw the news.  I was a little skeptical...since they we not actual orders yet.

I actually saw APWR posted on one of the yahoo's message boards a few days ago.  I was really interested in buying a wind power company.

I'm thinking now that at least speculation will drive APWR higher.

[setravis]

A-Power Shares Find the Wind
at Their Back...

A-Power Energy Generation Systems, Ltd. (APWR), formerly
Chardan South China Acquisition Corp., through its PRC operating
subsidiary, Liaoning GaoKe Energy Group Co., Ltd., is
the largest provider of distributed power generation systems in
China and will enter into China's wind energy market in 2008. The Company
is also focused on developing and commercializing additional renewable energy
technologies and has strategic relationships with both, Tsinghua University and the China
Sciences Academy in Guangzhou.
Earlier this week, APWR announced that Liaoning GaoKe Energy entered into an agreement
with Norwin A/S of Denmark which gave GaoKe the exclusive right to produce and sell Norwin's
750 kW and 225 kW wind turbines in China. It was noted that the 750 kW turbine would sell
for $460 thousand to $510 thousand and have a gross margin between 8-12%. To secure the
rights, GaoKe paid Norwin a $3.5 million licensing fee.
The 2.5 MW wind turbine rights were acquired from Germany-based Fuhrlander AG and, when
combined, would create a wind turbine portfolio that would give GaoKe the ability to accommodate
the varying wind conditions across China.
To secure these rights, GaoKe agreed to pay Fuhrlander approximately $13.9 million (which
covers the license, training and a fixed royalty). Fuhrlander will also receive a minority percentage
of the gross profit generated from the sale of the first 100 wind turbine units manufactured
by GaoKe.
The sales price of the 2.5MW wind turbine was expected to be between $2.7 million and $3.2
million with 8 to 12% gross margins. GaoKe would have the capacity to produce a maximum of
300 of the 2.5MW wind turbines on an annual basis after the first phase of its wind production
facility was completed later this year.
On Friday, the Company announced that GaoKe had received letters of intent for 380 2.5 MW
wind turbines which was noted as utilizing all of the anticipated plant capacity through 2009.
Along with the letter of intent for the 2.5 MW turbine, the Company noted that they had also
received a number of letter of intent for the 750 kW variation.
Assuming the Company finalized all of the 380 LOI's, they would recognize some $1.12 billion
in sales and some $112 million in profits, using average prices and margins but disregarding the
$17.4 million in license fees and the LOI's for the smaller 750kW versions.
In comparison, the Company (formerly Head Dragon Holdings Limited) reported revenue of
$38.76 million in the third quarter producing $4.19 million in income. Nine month results displayed
revenue of $110.45 million and $11.85 million in income.
Following the announcement, shares gained some 22.78% on over 1.01 million in volume. With
the incredible growth the Company expects over the coming months from the sale of these wind
turbines in China, it easily becomes one to watch.

[kslifka]

IF APWR can put in a nice white candle today...it should move much higher in the coming days.

[kslifka]

Nice looking chart with good volume today.

[kslifka]

News 

A-Power Receives Two New Distributed Power Generation Contracts Worth a Combined $72.3 Million
Tuesday February 12, 9:36 am ET

SHENYANG, China--(BUSINESS WIRE)--A-Power Energy Generation Systems, Ltd. (NASDAQ:APWR - News) (NASDAQ:APWRW - News) (NASDAQ:APWRU - News) ("A-Power") announced today that it has signed two new domestic contracts to develop distributed power generation systems worth a combined $72.3 million. The first is a $44.5 million contract to construct a 24 MW distributed power generation system for a new paper and pulp plant in Wuzhong, China. This project is expected to begin in June 2008 and will take about 12 months to complete. The second is a $27.8 million contract to construct a 24 MW stand alone distributed power plant in Hailen, China. This project is expected to begin this month and will be completed in approximately 12 months.

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Mr. Jinxiang Lu, A-Power's Chairman and CEO, commented, "The growth of our distributed power generation business continues to accelerate. These new contracts are a testament to the market's recognition of our track record and our ability to quickly develop and construct quality systems that meet the specific power and heat needs of our customers. In addition to these new contracts announced today, we are in discussions with a number of other potential distributed power generation customers and we expect a majority, if not all, of these will turn into contracts over the next few months."

About A-Power

A-Power Energy Generation Systems, Ltd., formerly Chardan South China Acquisition Corp., through its PRC operating subsidiary, Liaoning GaoKe Energy Group Co., Ltd., is the largest provider of distributed power generation systems in China and will enter into China's wind energy market in 2008. The Company is also focused on developing and commercializing additional renewable energy technologies and has strategic relationships with both Tsinghua University and the China Sciences Academy in Guangzhou.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, about A-Power and GaoKe. Forward-looking statements are statements that are not historical facts. Including statements relating to expected future contract performance targets and potential new contracts. Such forward-looking statements, based upon the current beliefs and expectations of A-Power's and GaoKe's management, are subject to risks and uncertainties, which could cause actual results to differ from the forward looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: business conditions in China; continued compliance with government regulations; legislation or regulatory environments, requirements or changes adversely affecting the businesses in which GaoKe is engaged; cessation or changes in government incentive programs; fluctuations in customer demand; management of rapid growth and transitions to new markets; intensity of competition from or introduction of new and superior products by other providers of distributed power generation and other energy generation technology; timing, approval and market acceptance of new product introductions; general economic conditions; geopolitical events and regulatory changes, as well as other relevant risks detailed in A-Power's filings with the Securities and Exchange Commission. The information set forth herein should be read in light of such risks. Neither A-Power nor GaoKe assumes any obligation to update the information contained in this press release.

[kslifka]

Moving up.