Gowin New Energy Grp - Half-year Report
21/09/2022 07:00
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RNS Number : 0276A Gowin New Energy Group Limited 21 September 2022
21 September 2022
Gowin New Energy Group Limited ("GNE" or the "Group")
(AQSE: GWIN)
Interim Results for the Six Months Ended 30 June 2022
Gowin New Energy Group Limited, engaged in the research and development,
outsourcing and sales of LED lighting products, and the tea trading business,
today announces its unaudited financial results for the six months ended 30
June 2022.
2022 Interim Report Chairman's Statement
Gowin New Energy Group Limited (the "Group" or "Gowin") is pleased to release
its 2022 Interim Report period 1 January 2022 to 30 June 2022. There has been
no material change to the financial position of the Group since the 2021
Annual Report.
Gowin has historically been engaged in the sale and investment of LED related
products based in Taiwan. The Group's only LED business in the year to date
has been through its minority interest in a Taiwan-based company, Taiwan
Thick-Film Industries Corp (TTFI), listed on the Taipei Stock Exchange, which
is principally engaged in the manufacture and sales of LED backlight modules
and components distributed primarily in the Asia market.
The Group continues to look out for the opportunity to relaunch its tea
trading business, focused on the collection, distribution and sale (including
auction market) of high-quality Chinese Pu-erh tea and Taiwan high-mountain
tea. It remains highly dependent on China's zero-Covid policy environment,
which has seen continuous rolling lockdowns across the country, most recently
affecting 21 million people in Chengdu and large populations in other cities.
As before, given China is the key to Gowin's tea business supply chain, the
Covid related impacts there are significant and means the Group must continue
to be patient before formally driving the tea business forward. In the
meantime, Covid restrictions have been partially lifted in Taiwan improving
the business environment there; interestingly enough, there are only two
places in the world that have major trade surpluses with China - one is
Australia and the other Taiwan.
The Group announced the proposed launch of a new agarwood trading business on
10 February 2022. The agarwood business will focus on trading high-quality
agarwood products, including agarwood incense which is widely used in
religious ceremonies in Taiwan and essential oil which can be applied in many
ways in daily life. The Group has worked hard since February, to further its
design and preparations for this business; additionally, sales and
distribution agreements and other relevant agreements are being finalised. For
example, taking advantage of the improved Covid mobility environment, the
Group is proactively performing market development and engaging with
prospective clients in order to secure their future business. The Group
continues to work with a stable supplier that provides products at competitive
pricing. A market survey has been conducted in conjunction with industry
partners that includes an e-commerce company and an artwork merchant. The
survey confirms key customer purchase intentions in Gowin's agarwood
addressable market. In addition, the Group is being creative, designing and
producing differentiated artwork and gift boxes for the digital and physical
environments; some of this agarwood planning is expected to be replicable to
the tea business at the appropriate time. The Group looks forward to updating
the market on its agarwood initiatives in due course.
2022 Interim Report Chairman's Statement
The Group conducted its AGM on 16 September 2022, with all resolutions passed
unanimously.
As before, the Group continues to provide a safe working environment for its
workforce and introduced preventive measures to reduce the spread of Covid-19
in the workplace, including working from home. The Group will continue to
prioritise occupation health and safety and pay close attention to the ongoing
and mutating Covid-19 outbreak and respond to its impact, if any, on the
Group.
CEO Mr Chen Chih-Lung continues his commitment to fund short term liquidity to
support the Group's working capital requirements as and when required. His
most recent working capital loan was announced on 26 April 2022. These loans
are a measure of his determination and commitment to the Group.
The Directors would like to take this opportunity to express sincere gratitude
to all shareholders for their continued support and to thank all staff members
of the Group for their dedication and contribution to the Group.
The directors of Gowin New Energy Group Limited accept responsibility for this
announcement.
For further information please visit company's website at www.gowingrp.com
(http://www.gowingrp.com/gowingrp_en/index.php/) or contact the following:
Gowin New Energy Group Limited
Garry Willinge
Tel: +852 9100 9972
Novum Securities Limited
AQSE Corporate Adviser
David Coffman/ Lucy Bowden
Tel: +44 (0)207 399 9400
REPORT ON REVIEW OF INTERIM FINANCIAL INFORMATION
INDEPENDENT REVIEW REPORT TO GOWIN NEW ENERGY GROUP LIMITED
Introduction
We have been engaged by the Group to review the condensed set of consolidated
financial statements in the half-yearly financial report for the six months
ended 30 June 2022 which comprises the Condensed Consolidated Balance Sheet,
Condensed Consolidated Statement of Comprehensive Income, Changes in Equity
and Cash Flows and related notes. We have read the other information
contained in the half-yearly financial report and considered whether it
contains any apparent misstatements or material inconsistencies with the
information in the condensed set of financial statements.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been
approved by, the Directors. The Directors are responsible for preparing the
half-yearly financial report in accordance with the AQSE Rules for Issuers.
The annual financial statements of the Group are prepared in accordance with
IFRSs as adopted by the European Union. The condensed set of financial
statements included in this half-yearly financial report has been prepared in
accordance with International Accounting Standard 34, "Interim Financial
Reporting".
Our responsibility
Our responsibility is to express to the Group a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.
This report, including the conclusion, is made solely to the Group for the
purpose of the AQSE Rules for Issuers. We do not, in producing this report,
accept or assume responsibility to anyone, other than the Company, for our
work, for this report, or for the conclusion we have formed. This report may
not be provided to third parties without our prior written consent.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements. A review of interim financial information consists of making
enquiries, primarily of persons responsible for financial and accounting
matters, and applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance with
International Standards on Auditing, and consequently does not enable us to
obtain assurance that we would become aware of all significant matters that
might be identified in an audit. Accordingly, we do not express an audit
opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2022 is not prepared, in all
material respects, in accordance with International Accounting Standard 34 and
the AQSE Rules for Issuers.
PKF Littlejohn LLP
15 Westferry Circus
Statutory
Auditor
Canary Wharf
London E14 4HD
20 September 2022
Gowin New Energy Group Limited
Condensed consolidated statement of comprehensive income
For the six months ended 30 June 2022
Six months Six months
ended ended
30 June 2022 30 June 2021
RMB'000 RMB'000
Continuing Operations Note (Unaudited) (Unaudited)
Revenue 7 - -
Cost of sales - -
Gross profit - -
Administrative expenses 10 (1,576) (1,852)
Operating loss (1,576) (1,852)
Finance costs 9 (160) (153)
Other income/ (loss) - 5
Investment gain/(loss) (1,018 ) 399
Foreign exchange gain/(loss) 714 (100)
Loss before tax (2,040) (1,701)
Tax 11 - -
Loss from continuing operations (2,040) (1,701)
Other comprehensive income - -
Total comprehensive loss for the period attributable to owners of the parent (2,040) (1,701)
Loss per share attributable to owners of the parent during the period
expressed in RMB per share
Basic and diluted loss per share 12 (0.007) (0.006)
Gowin New Energy Group Limited
Condensed consolidated statement of financial position
As at 30 June 2022
As at As at As at
Note 30 June 30 June 31 December 2021
2022 2021
RMB'000 RMB'000 RMB'000
(Unaudited) (Unaudited) (Audited)
Assets
Non-Current Assets
Long-term investments 14 3,283 4,292 4,395
Current assets
Trade and other receivables 15 106 43 74
Cash in bank 16 2,418 2,609 2,330
2,524 2,652 2,404
Total assets 5,807 6,944 6,799
Current Liabilities
Loans from equity holders 17 (14,915) (14,199) (14,560)
Trade and other payables 17 (12,505) (10,657) (11,812)
Total liabilities (27,420) (24,856) (26,372)
Net liabilities (21,613) (17,912) (19,573)
Equity attributable to owners of the Company
Share capital 18 29,000 29,000 29,000
Preference share 18 2,195 2,195 2,195
Retained losses (52,808) (49,107 ) (50,768)
Total equity (21,613) (17,912) (19,573)
Gowin New Energy Group Limited
Condensed consolidated statement of changes in equity
For the six months ended 30 June 2022
Attributable to owners of the Company
Share capital Preference share Retained losses Total
RMB'000 RMB'000 RMB'000 RMB'000
29,000 2,195 (47,406) (16,211)
For the six months ended 30 June 2021 (Unaudited)
Balance as at 1 January 2021 (Audited)
Loss for the period - - (1,701) (1,701)
Total comprehensive income for the period - - (1,701) (1,701)
Balance as at 30 June 2021 29,000 2,195 (49,107) (17,912)
29,000 2,195 (50,768) (19,573)
For the six months ended 30 June 2022 (Unaudited)
Balance as at 1 January 2022 (Audited)
Loss for the period - - (2,040) (2,040)
Total comprehensive income for the period - - (2,040) (2,040)
Balance as at 30 June 2022 29,000 2,195 (52,808) (21,613)
Gowin New Energy Group Limited
Condensed consolidated statement of cash flows
For the six months ended 30 June 2022
Six months Six months
ended ended
30 June 2022 30 June 2021
RMB'000 RMB'000
((Unaudited) (Unaudited)
Cash Flows used in Operating Activities
Loss before tax (2,040) (1,701)
Finance cost 159 150
Investment loss/(gain) 1,018 (399)
Foreign currency (gain)/loss (777) 162
Decrease/(Increase) in trade and other receivables 7 53
(Decrease)/Increase in trade and other payables 878 665
Net cash used in operating activities (755) (1,070)
Cash Flows generated from Financing Activities
Shareholders' loans 843 1,334
Net cash generated from financing activities 843 1,334
Net increase/(decrease) in cash and cash equivalents 88 264
Cash and cash equivalents at beginning of period 2,330 2,345
Cash and cash equivalents at end of period 2,418 2,609
Gowin New Energy Group Limited
Notes to the condensed consolidated interim financial information
For the six months ended 30 June 2022
1. General information
Gowin New Energy Group Limited ("the Company") was incorporated in the Cayman
Islands. The registered office of the Company is located at Cricket Square,
Hutchins Drive, PO Box 2681, Grand Cayman, KY1-1111, Cayman Islands and the
main business office is located at 4F., No. 5, Ln. 332, Siyuan Rd., Xinzhuang
Dist., New Taipei City, Taiwan (R.O.C.).
The principal activity of Gowin New Energy Group Limited and its subsidiaries
("the Group'') has historically been the research and development, outsourcing
and sales of LED lighting products, and the tea trading business. The Group is
continuing with its corporate restructuring including investing in businesses
in related fields.
During this period of corporate restructuring, the CEO, Mr. Chen Chih Lung,
has supported the Group financially by way of loans and guarantees.
The Company's shares are listed on the AQUIS Stock Exchange (AQSE).
The condensed consolidated interim financial information is presented in
Renminbi ("RMB"), which is the presentational and functional currency of the
Group, and all values are rounded to the nearest thousand except where
indicated otherwise.
2. Basis of Preparation
The non-statutory condensed interim consolidated financial statements have
been prepared in accordance with International Financial Reporting Standards
(IFRS) and IFRS Interpretations Committee (IFRS IC) Interpretations.
The condensed interim consolidated financial statements have been prepared
under the historical cost convention, except for equity investments held at
fair value through profit or loss.
The preparation of the condensed interim consolidated financial statements in
conformity with IFRS requires the use of certain critical accounting
estimates. It also requires Management to exercise its judgement in the
process of applying the Group's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and
estimates are significant to the Consolidated non-statutory Financial
Statements, are disclosed in Note 5.
-New and amended accounting standards adopted by the Group
Effective during the period
There are no new standards or amendments to standards adopted in the period
which have a material impact on the financial position or performance of the
Group.
Not yet effective
At the date of authorisation of these non-statutory condensed interim
consolidated financial statements, the following Standards, amendments and
interpretations were not yet effective:
•IAS 1 － The amendments of disclosure of accounting policies will take
effect on 1 January 2023.
•IAS 8 － The amendments of definition of accounting estimates will take
effect on 1 January 2023.
•IAS 12 － The amendments of deferred tax related to assets and liabilities
arising from a single transaction will take effect on 1 January 2023.
•IFRS 10 & IAS 28 － The amendments of asset sales or investment
between investors and their affiliates or joint ventures are subject to the
decision of the international accounting standards board.
•IAS 1 － The amendments of classification of liabilities as current or
non-current are effective on 1 January 2023.
The Group is evaluating the impact of the new and amended standards above. The
Directors do not expect that these new and amended standards will have a
material impact on the Group's results or shareholders' funds.
3. Going Concern
The non-statutory condensed interim consolidated financial statements have
been prepared on a going concern basis.
The Group reported a net loss after tax of RMB 2,040,000 for the six months
ended 30 June 2022 (six months ended 30 June 2021: loss of RMB 1,701,000).
Management's assessment of the ability of the Group to continue as a going
concern has considered cashflow forecasts, including assumptions regarding the
Group's activities, raising funds from existing shareholders and the open
market, and the Group's ability to settle liabilities as and when they fall
due.
Mr Chen has recommitted his personal financial support to provide loans for
business operations as and when required for a period of no less than 12
months from the date of the condensed interim financial statements.
Based on the above, the Directors consider there are reasonable grounds to
believe that the Group will be able to fund the Group's future operating
expenses. Should the Group not be able to continue trading, adjustments would
have to be made to reduce the value of assets to their recoverable amounts, to
provide for further liabilities which might arise and to re-classify
non-currents assets as current.
The non-statutory condensed interim consolidated financial statements do not
include any adjustments that may be required should the Group be unable to
continue as a going concern.
4. Risks and uncertainties
The additional activities planned for the Group will add new challenges, risks
and uncertainties. The Board is activity reviewing the impact of its plans but
does not immediately see any variations in the key financial risks other than
the valuation of investments.
5. Critical accounting estimates and judgements
The preparation of condensed consolidated interim financial information
requires Management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the end of the reporting period. Significant items subject to
such estimates are set out in Note 5 of the Group's 2021 Annual Report and
Financial Statements. The nature and amounts of such estimates have not
changed significantly during the interim period.
6. Significant accounting policies
The condensed consolidated interim financial information has been prepared
under the historical cost convention as modified by the revaluation of
financial assets and financial liabilities at fair value through profit or
loss.
The accounting policies and methods of computation used in the preparation of
these condensed consolidated interim financial information are consistent with
those used in the Group's 2021 Annual Report and Financial Statements.
7. Segment information
The business of the Group is primarily focused on the procurement, sales and
distribution of tea products. For the purpose of IFRS 8, the chief operating
decision makers are the Directors. All of the Group's activities is derived
from Taiwan and China. Internal and external reporting is on a consolidated
basis, with transactions between Group companies eliminated on consolidation.
Therefore, the financial information of the single segment is the same as that
set out in the consolidated statement of comprehensive income, the
consolidated statement of financial position, the consolidated statement of
changes in equity and the consolidated statement of cash flows.
8. Financial assets
All financial assets are recognised and de-recognised on a trade date basis
where the purchase or sale of an investment is under a contract whose terms
require delivery of the investment within the timeframe established by the
market concerned, and are initially measured at fair value plus transaction
costs, except for those financial assets classified as at fair value through
profit or loss which are initially measured at fair value.
The Group assesses at the end of each reporting period whether there is
objective evidence that a financial asset, or a group of financial assets, is
impaired. For equity investments, a significant or prolonged decline in the
fair value of the security below its cost is also evidence that the assets are
impaired. If any such evidence exists the cumulative loss - measured as the
difference between the acquisition cost and the current fair value, less any
impairment loss on that financial asset previously recognised in profit or
loss - is removed from equity and recognised in profit or loss. Impairment
losses recognised in the consolidated income statement on equity instruments
are not reversed through the consolidated income statement.
9. Finance cost
Six months Six months
ended ended
30 June 2022 30 June 2021
RMB'000 RMB'000
(Unaudited) (Unaudited)
Interest cost 159 150
Bank charges 1 3
Total finance cost 160 153
10. Expense by nature
Six months Six months
ended ended
30 June 2022 30 June 2021
RMB'000 RMB'000
(Unaudited) (Unaudited)
Staff costs 470 522
Directors' remuneration 748 750
Auditors' remuneration 4 179
Other professional fees 281 327
Other operating expenses 73 74
Total administrative expenses 1,576 1,852
11. Income tax
Six months Six months
ended ended
30 June 30 June
2022 2021
RMB'000 RMB'000
(Unaudited) (Unaudited)
Current income tax for the period - -
- -
The Group is not subject to taxation in the Cayman Islands, British Virgin
Islands or Samoa Islands.
No provision for Hong Kong or Chinese taxation has been made as the Group has
not generated any taxable profit in Hong Kong, Taiwan or China.
12. Loss per share
Loss per share for the period ended 30 June 2022 is calculated by dividing RMB
2,040,000 loss for the period attributable to the equity holders of the
Company by the average number of shares, of 290,000,533.
Six months Six months
ended ended
30 June 30 June 2021
2022
RMB RMB
(Unaudited) (Unaudited)
Basic and diluted loss per share (RMB) (0.007) (0.006)
No diluted loss per share are presented as there are no potential ordinary
shares outstanding for the six months ended 30 June 2022 and 2021.
13. Dividend
No dividends were proposed during the reporting period and the Directors do
not recommend the payment of an interim dividend for the six months ended 30
June 2022.
14. Long term investments
Quoted equity securities RMB'000
As at 1 January 2022 4,395
Investment gain(loss) (1,018)
Foreign exchange gain(loss) (94)
As at 30 June 2022 3,283
The Company holds 1,081,600 shares in Taiwan Thick-Film Industries Corp., a
company listed on Taipei Stock Exchange.
15. Trade and other receivables As at As at
30 June 30 June
2022 2021
RMB'000 RMB'000
(Unaudited) (Unaudited)
Guarantee deposits paid 16 16
Prepayment 29 4
Loans to related party 52 13
Amounts due from related party 9 10
106 43
The amounts due from related party and the loans to related party were
unsecured, interest-free and repayable on demand. The related party is
controlled by a director of the Group.
16. Cash and cash equivalents As at As at
30 June 30 June
2022 2021
RMB'000 RMB'000
(Unaudited) (Unaudited)
Cash on hand 9 9
Cash at bank and in hand 2,409 2,600
2,418 2,609
17. Trade and other payables As at As at
30 June 30 June
2022 2021
RMB'000 RMB'000
(Unaudited) (Unaudited)
368
Trade payables 368
Accruals and other payables 311 92
Loans from equity holders 14,915 14,199
Amount due to key management personnel 11,826 10,197
Receipt in advance - -
27,420 24,856
18. Share capital
RMB'000
Share capital
Ordinary Shares at £0.01 29,000,065.89 29,000
Preference Shares at £0.02 2,195,400 2,195
As at 30 June 2022 31,195,465.89 31,195
19. Related party transactions
The ultimate controlling party of the Group is the CEO Mr Chen Chih Lung.
20. Approval of interim financial information
The condensed consolidated interim financial information was approved by the
Board of Directors on 20 September 2022.
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