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China Everbright (formerly: HanKore Environmental Tech Group)
02-09-2011, 04:47 AM. (This post was last modified: 20-01-2015, 10:35 AM by CityFarmer.)
Post: #1
China Everbright (formerly: HanKore Environmental Tech Group)
Business Times - 02 Sep 2011

HanKore expected to return to profit path


Further provisions for impairment losses seen unlikely

By LYNETTE KHOO

HAVING put the nightmare of impairment loss provisions behind it, HanKore Environment Tech Group is now expected to swing back into the black for the current financial year ending June 2012.

The group, having shaken off its chequered past with a revamped management team and board of directors, is now looking forward to the next three to five years, which chairman and CEO David Chen sees as the 'golden years' for the Chinese environmental industry.

HanKore chief financial officer Stanley Yeung said he is confident that there will be no further provisions for impairment losses on the value of the wastewater treatment plants and other assets, project costs over-run and repair costs.

Known formerly as Bio-Treat Technology, HanKore reported a net loss of 405.7 million yuan (S$76.6 million) for fiscal 2011 ended June 30, compared with a net profit of 222.1 million yuan for FY2010. This was due to an exceptional loss of 399.4 million yuan resulting from the provisions, against an exceptional gain of 306.2 million yuan for FY2010.

'Without the exceptional loss, we are already in the black in gross profits,' said Mr Yeung. 'These provisions have been fully written down and they are unlikely to be incurred again.'

The group has 14 large-scale municipal water/wastewater treatment projects in Beijing, Jiangsu, Shandong, Shaanxi and Henan.

In the first meeting with reporters here since his appointment, Mr Chen said HanKore is aiming to achieve a water capacity of five million tonnes per day in three years and 10 million tonnes per day in five years, up from the current built capacity of one million tonnes per day. It will also seek strategic cooperation with business partners to enter the overseas water service market, with an eye on the Middle East, Africa and South-east Asian regions.

Within China, the group is looking at potential projects in Shaanxi, Jiangsu and Chongqing and hopes to tap the recently inked cooperation agreement with the Xianyang City Environmental Protection Bureau. The latter has given HanKore the preferential right to invest in environmental projects in Xianyang City with an aggregate value of not less than one billion yuan within five years.

HanKore is seeking long-term financing for future projects, but is cautious not to fall into the same trap as the former Bio-Treat, Mr Yeung said, though he does not rule out the possibility of issuing convertible bonds again.

Earlier financial woes in the former Bio-Treat arose from a $206 million convertible bonds programme. A default on repayment for early redemptions in 2008 sent the group scurrying to raise funds and incurring more debts.

Uncertainties over its going-concern status due to the debts incurred have triggered audit disclaimers on its financial statements for fiscal 2009 and 2010.

The group has since restructured the outstanding convertible bonds with marked-down bonds and warrants and settled non-bank loans by issuing convertible notes and warrants to a new investor, Giant Delight Holdings, owned by Mr Chen.

More new shareholders, including Singapore-listed Boustead and Chinese private equity Ancient Jade International Holdings, have been ushered in through the sale of notes or shares by Giant Delight. Five of the seven board members have also been replaced.
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19-06-2013, 10:32 PM.
Post: #2
RE: HanKore Environmental Tech Group (fka "Bio-Treat")
Anybody following this stock? It will be added to NASDAQ Global Water Index from next Monday.

Vested.

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06-10-2013, 10:31 AM.
Post: #3
RE: HanKore Environmental Tech Group (fka "Bio-Treat")
Another SoundGlobal in the making?

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06-10-2013, 09:38 PM.
Post: #4
RE: HanKore Environmental Tech Group (fka "Bio-Treat")
There was an interview with its CEO in a recent The Edge.

I didn't read the company ARs, but one key point on the interview was execution. Hankore has a poor record in execution, both in constructing and managing BOT projects. The new CEO might change it, but it needs a good team, and it takes time to build-up a good team. The CEO seems more focus on PR now, rather on project management.

The view is mainly from the interview, which might not give a good picture of the company. Please feel free to comment if any.

May spent some time on the AR, before further comment

(not vested)
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡

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06-10-2013, 11:20 PM.
Post: #5
RE: HanKore Environmental Tech Group (fka "Bio-Treat")
(06-10-2013, 09:38 PM)CityFarmer Wrote: There was an interview with its CEO in a recent The Edge.

I didn't read the company ARs, but one key point on the interview was execution. Hankore has a poor record in execution, both in constructing and managing BOT projects. The new CEO might change it, but it needs a good team, and it takes time to build-up a good team. The CEO seems more focus on PR now, rather on project management.

The view is mainly from the interview, which might not give a good picture of the company. Please feel free to comment if any.

May spent some time on the AR, before further comment

(not vested)

I used to follow Hankore, my preliminary understanding:
Its has been years, I might not remember that facts correctly, feel free to point out the mistakes.


1) Biotreat got into trouble because a number of projects did not meet contractual requirements, e.g. amount of water to be treated (cannot remembered details), it has a high number of turnkey projects, and some of them turn bad, leading to trouble of bio-treat, the final straw come when they cannot pay their convertible bonds (IIRC)

2) As such, they focused more on BOT contracts, and reduced their turnkey projects drastically. (Better cashflow but lower margin)

3) I did a calculation a few years ago, because of their enlarged base (think 4 billion shares?), i remembered trying to work out their future projects earnings and it doesn't really make a dent to EPS, so I gave it a miss. I noticed they did win a few more contracts, not sure if those are big enough, but the price has already move, I will give it a miss.
life goes in cycles, predictable yet uncontrollable; just like the markets, but markets give you a second chance

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07-10-2013, 10:15 AM.
Post: #6
RE: HanKore Environmental Tech Group (fka "Bio-Treat")
(06-10-2013, 11:20 PM)Greenrookie Wrote: 2) As such, they focused more on BOT contracts, and reduced their turnkey projects drastically. (Better cashflow but lower margin)

BOT contract will provide future (long term) cash flow, with capital upfront. It does not provide immediate (short term) cash flow, in fact immediate negative cash flow is a norm.

May be I interpreted the statement wrongly.
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡

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30-12-2013, 10:05 PM.
Post: #7
RE: HanKore Environmental Tech Group (formerly: Bio-Treat)
A very interesting RTO, which involved China Everbright. Need more time to divest its impact...Big Grin

(not vested)
--------
FRAMEWORK AGREEMENT FOR THE PROPOSED ACQUISITION BY THE COMPANY OF
ASSETS IN THE ENVIRONMENTAL WATER SECTOR

The Board of Directors (the "Board") of the Company wishes to announce that the
Company has on 30 December 2013 entered into a framework agreement (the "Framework
Agreement") with China Everbright Water Investments Limited (the "Vendor", together with
the Company, the "Parties"), pursuant to which the Company proposes to acquire (the
"Proposed Acquisition") all the investments of the Vendor and China Everbright
International Limited ("CEIL") (subject to obtaining all relevant regulatory and third party
approvals, waivers and consents) in the environmental water sector (the "Target Assets").
The Proposed Acquisition is subject to, among other things, due diligence being conducted
and the execution of definitive transaction agreements (the "Definitive Agreements"). If the
parties proceed with the Proposed Acquisition, it will be undertaken in accordance with the
requirements of the Listing Manual (the "Listing Manual") of the Singapore Exchange
Securities Trading Limited ("SGX-ST").

Ref: http://infopub.sgx.com/FileOpen/HanKore_...eID=269270
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡

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31-12-2013, 10:47 AM.
Post: #8
RE: HanKore Environmental Tech Group (formerly: Bio-Treat)
Mr Market is excited on the newly announced RTO.

The company share price increased more than 30%, to $0.105 up to now. Well, no further detail available, so Mr. Market is speculating on the value of the RTO.

(not vested)
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡

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31-12-2013, 11:50 AM.
Post: #9
RE: HanKore Environmental Tech Group (formerly: Bio-Treat)
RTO at the wrong exchange? HKSE seems better in terms of liquidity and coverage. probably will dual list back in HK.

Maybe listed shells are getting too expensive in HK. Some reports said listed shells selling at hk500m.
"... but quitting while you're ahead is not the same as quitting." - Quote from the movie American Gangster

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02-01-2014, 10:15 AM.
Post: #10
RE: HanKore Environmental Tech Group (formerly: Bio-Treat)
(31-12-2013, 11:50 AM)opmi Wrote: RTO at the wrong exchange? HKSE seems better in terms of liquidity and coverage. probably will dual list back in HK.

Maybe listed shells are getting too expensive in HK. Some reports said listed shells selling at hk500m.

Hankore just shifted its headquarter to Singapore from Hong Kong. I doubt it will seek dual listing in SEHK.

The impending major shareholder, China Everbright Water Investments Limited, is listed in SEHK, stock code 0257

It is a bit different from other RTOs, IMO. It is more like a M&A of two companies with similar businesses.
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡

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