Jiuzhou Electric: based on power electronics for low-carbon economy

Question one: Recently, the company's general meeting of shareholders successively reviewed and adopted the joint venture to establish Ningbo Jiuzhou Shengbao Power Co., Ltd. (electric vehicle battery and high-power energy-storage battery) using wholly-raised funds, and wholly-owned Jiuzhou Technology (wind power converters and photovoltaics). Inverter, high-voltage dynamic reactive power compensation device). The implementation schedule of the project and when it will reach production will affect the performance of the company in 2010? In addition to the above two projects, are there any specific plans for the use of other raised funds? The company is mainly engaged in R&D, manufacturing, sales, and service of power electronic equipment and its associated electronically-controlled automation products. Along with the expansion and upgrading of the industry, valve-regulated sealed batteries are used as an accessory product of the company's leading product, DC power supply, and the market demand. Increasingly. The company's production capacity has lagged behind and it is difficult to fully meet market needs. Investment in the establishment of Jiuzhou Shengbao will help improve the company's product chain and improve the company's capacity bottleneck. Jiuzhou Technology, a wholly-owned subsidiary, will achieve an annual production capacity of 300 sets of megawatt wind turbines, 100 sets of high-power solar photovoltaic inverters and 200 sets of high-voltage dynamic reactive power compensation devices. Since 2006, the company has been engaged in the research and development of megawatt wind turbine converters. At present, it has fully mastered all the technologies and production of full-power direct-drive wind turbines and double-fed wind turbines. The craft is the drafting unit of China's wind power converter standard.

Based on the wind turbine converter technology, the company has successfully developed a photovoltaic inverter with a stand-alone capacity of 100-500 KW. The photovoltaic grid-connected inverter is the key equipment in the solar power generation system, and the market has huge room for growth.

High-voltage dynamic reactive power compensation technology is the company's technical reserves over the years. Before the company went public, it had not carried out massive promotion due to financial bottlenecks. In 2009, it completed sales of 7.24 million yuan, and completed sales revenue of 5.4 million yuan in the first half of this year. The sales growth of this product is more than 50%. At present, reactive power compensation is mainly divided into power grids and industrial users, which are the key technologies for flexible AC transmission and improving the power quality of users. Flexible transmission technology is an important technical support for the realization of a strong smart grid, especially for the large-scale access of intermittent energy sources such as wind power and solar energy. In industrial applications, a large number of impact loads, such as electric arc furnaces, rolling mills, and electrified railways, are connected to the power grid, causing significant pollution to power quality. In-place reactive power compensation for these large-impact nonlinear loads or asymmetric loads can achieve power quality control, energy conservation, consumption increase, and increase product quality.

Jiuzhou Technology expects to generate revenue from the third quarter of next year. After all the production is completed, it can increase sales revenue of the company by RMB 420 million and increase profits by RMB 36 million. Ningbo Shengbao Power will generate a portion of revenue during the year. The actual situation will be seen in the progress of implementation. After reaching the full production capacity, it will achieve a sales income of 200 million yuan and a profit of 15 million yuan. In addition to investing in the above two subsidiaries, the company also used 35 million yuan of super-raised funds for the construction of corporate marketing networks and technical support centers. There are still over 100 million over-raised funds, which are temporarily used to supplement liquidity.

Question 2: The company's wind power converters, photovoltaic inverter product certification, market progress, whether to sign the supply agreement with the mainstream machine manufacturers, DC operational power nuclear power certification progress?

Harbin is one of the areas where domestic wind resources are enriched. The Harbin government is building a wind power industry base and requires that the key equipment of wind turbines be fully supported locally. This directly solves the market problems of the company's converters. Wind power converters have been linked to Hafei. Signed 100 sets of supply agreements. Under the active promotion and guidance of the local government, Harbin established the wind power industry alliance. The company and Hafei are both members of the Harbin Wind Power Industry Alliance. In the next 10 years, Harbin City will add several million kilowatts of installed capacity of wind power, and the company's market prospects for wind power converter products are optimistic. At present, due to the fact that the national standard has not yet been enacted, there is some uncertainty in the progress of market promotion for wind power converter products.

PV inverters are undergoing national "Golden Sun" project product certification and are expected to be completed before the end of the year.

DC operation power nuclear power qualification certification is actively promoted and is expected to pass in the second half of next year.

Question 3: In May of this year, the company renewed a five-year contract manufacturing agreement with Rockwell and OEMed PF7000A and PF7000B air-cooled medium voltage inverters for Rockwell. How did the company view OEM products and its own brand products? Is there any possibility of competition?

Rockwell is one of the world's most famous automation companies and has a history of more than 100 years. The cooperation with the company has increased the company's stable sales revenue and profits, which can enhance the company's industry influence. At the same time, cooperation with international first-class electrical manufacturers has also brought the company closer to or reached international level in terms of management level, quality control, production equipment and technology, testing facilities and technology, and is conducive to the company's further development of international business. .

The company's own brand of high-voltage inverter is a voltage source power unit series multi-level high-voltage inverter, and Rockwell's high-voltage inverter is a current source AC/DC high-voltage inverter, the two types of technology are different. The technology of the company's own branded products does not have technical dependence on Rockwell.

Up to now, there have been no two bidders participating in the bid at the same time. In the future, with the expansion of the company's inverter production capacity and the intensified market competition, the possibility of competition will not be ruled out.

Question 4: Recently, the company was successively selected as the list of industrial energy-saving service companies recommended by the Ministry of Industry and Information Technology (the first batch), the National Development and Reform Commission and the first batch of energy-saving service companies of the Ministry of Finance. At present, what are the specific implementation plans for the company's progress in contract energy management projects?

The company is steadily advancing the contract energy management model, but it is estimated that it will take 3-5 years before major progress can be made. It is constrained by the lack of complete supporting policies and regulations. In 2010, the state financial allocation was 2 billion yuan to subsidize contract energy management. The number is limited. More often than not, it shows policy orientation. Local government subsidies are limited by local government financial resources and are not in place.

Question 5: Please briefly introduce the technical cooperation between the company and Siemens in the field of medium and low voltage switchgear. Is it the OEM or technology transfer?

The company began mass production and sales of electrical control and automation products by acquiring Harbin Electric Control Equipment Factory in 2003.

On April 27 this year, Jiuzhou Electric and Siemens (China) Co., Ltd. held a technical cooperation signing ceremony. Jiuzhou Electric will become Siemens designated "the latest 40.5KV8DA, 8DB gas insulated medium voltage switch" and "SIVACON-8PT" in China. "Low-voltage switch" equipment manufacturers, have the right to manufacture and sell these two products. "40.5KV8DA, 8DB gas insulated medium voltage switch" and "SIVACON-8PT low voltage switch" equipment are the core technology of Siemens. As the world's most advanced medium voltage and low voltage switch products, they are widely used in metallurgy, construction, and subway. , petrochemical, nuclear power and other fields.

Siemens transferred the design drawings of medium and low voltage switchgears to Jiuzhou Electric instead of OEM. Mainly for the Harbin Metro, local governments require foreign-funded enterprises participating in the Harbin Metro project to transfer technology to Chinese partners. The Harbin Metro is scheduled to be put into operation in 2012, and equipment tenders will begin this year. It is expected that it will contribute to the company's performance next year.

Question 6: In the first half of the year, the company’s accounts receivable was 3194.6444 million yuan, accounting for 35.40% of the current-period assets, which was an increase of 30.08% compared with 24559.97 million yuan at the end of the previous year. Other receivables also increased from 25.9468 million yuan at the end of the previous year to 41.7882 million yuan, an increase of 61.04%. Will the company’s operating funds be under pressure and how will the company respond?

The industry in which the company is located has seasonal characteristics. Revenue recognition is basically concentrated in the second half of the year. In the last three years, the company's operating income in the second half of the year is about two-thirds of the total annual income. Therefore, each year's mid-term report reflects negative operating cash flow in the financial statements. In the first half of this year, the company’s sales scale expanded, resulting in a corresponding increase in accounts receivable. In the second half of the year, revenues gradually began to be recognized as accounts receivable. The amount of money will drop significantly. In addition to the company’s IPO over-raised funds, which are used to repay bank loans, invest in two subsidiaries, and establish corporate marketing networks and technical support centers, there are more than RMB 100 million in cash and there is ample cash in hand, which will not exert pressure on operating funds.

in conclusion:

The company has developed a series of products such as high-voltage inverters, megawatt wind power converters, photovoltaic inverters, high-voltage dynamic reactive power compensation devices, and high-frequency switching power supplies, focusing on high-voltage, high-power power electronics. The new energy field has broad development prospects and is in a leading position in the industry.

The company has established technical cooperation relationships with world-famous companies such as Rockwell and Siemens, which not only increased the company’s stable sales revenue and profits, but also enabled the company’s management level, quality control, production equipment and technology, and testing facilities. The proximity of hard-software and other technologies to the international level is conducive to the company's further development of international business.

Recently, the company was successively selected into the list of industrial energy-saving service companies recommended by the Ministry of Industry and Information Technology (the first batch), the list of the first batch of energy-saving service companies of the National Development and Reform Commission and the Ministry of Finance, and the fourth batch of the three ministries and commissions designated by the Ministry of Science and Technology, the State Council SASAC and the All-China Federation of Trade Unions. A list of companies conducting pilot projects for innovative companies. It is conducive to the accumulation of company talents, funds, and scientific and technological achievements, and has an important role in promoting the company's creativity and core competitiveness.