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China New Energy Ltd (CNEL)

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Wednesday 31 May, 2017

China New Energy Ltd

Contract Wins in China

RNS Number : 6263G
China New Energy Ltd
31 May 2017
 

31 May 2017

 

China New Energy Limited

("CNE" or "the Company")

 

Contract Wins in China

 

The Board of CNE (AIM:CNEL), the AIM quoted engineering and technology solutions provider to the bioenergy sector, is pleased to provide an update regarding a number of recent contract wins with customers in north and west China to expand their existing capacity and to modernise their ethanol production lines.  

 

Since the start of 2017, the Company has won a total of seven contracts in the north and west of China to design, supply and install ethanol processing equipment and to commission the upgraded plants. Four contracts represent a significant increase in activity with existing customers which have, between them, a total new production capacity of 529,000 tonnes of ethanol per year. The increase in ethanol production capability will primarily be for use in the food industry. The Company attributes the increase in its activity to the recent change to Chinese legislation that restricted the use of food products, particularly corn, for the production of ethanol and to its increased marketing efforts in north China. 

 

The total value of the seven contracts to CNE is, in aggregate, approximately RMB 115 million, (approximately GBP £12.8 m) which will be received over the terms of the contracts in accordance with agreed milestones. A number of the contracts have commenced with initial milestone payments of approximately RMB24 million (£2.7 million) having been received. All of the contracts are expected to commence in Q2 2017 and be commissioned in 2018.

 

Mr Yu, Chairman of CNE commented, "We are delighted to win these contracts with Yinshan Hongzhan Industry Co., Ltd, Inner Mongolia Liniu Biochemical Co., Ltd, Jilin Boda Biochemical Co. Ltd and Heilongjiang Weikete Biotechnology Co., Ltd. These confirmed orders, when added to our previously announced contracts with COFCO and Supercare Group comprise a significant order book for 2017 into 2018 and, on the current timetable, we anticipate being able to recognise much of that revenue this year. The board is very pleased that our decision to intensify the marketing of our products and services to the north Chinese markets following the modification of Chinese legislation to relax restrictions on the use of corn as a feedstock for ethanol production."

 

The information contained within this announcement constitutes inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014.

 

For further information, please visit www.chinanewenergy.co.uk or contact:

 

China New Energy Limited


Nick Brooks

 

Tel: +44 7920 060218

[email protected]  

 

Richard Bennett

 

Tel: +44 7966 388 374

[email protected]

 

Ivy Xu

[email protected]

Tel: +86 20 8705 9371



Cairn Financial Advisers LLP (Nomad)


Jo Turner / Sandy Jamieson          

Tel: +44 20 7213 0880



Daniel Stewart and Company (Broker)


David Lawman

Tel: +44 20 7776 6550

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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