SINOENERGY HOLDING LIMITED.ppt

,2,safeharborstatement,thispresentationcontainsforward-lookingstatementswithinthemeaningofthesafe-harborprovisionsoftheprivatesecuritieslitigationreformactof1995.suchstatementsinvolveknownandunknownrisks,uncertaintiesandotherfactorsthatcouldcausetheactualresultsofthecompanytodiffermateriallyfromtheresultsexpressedorimpliedbysuchstatements,includingchangesfromanticipatedlevelsofsales,futurenationalorregionaleconomicandcompetitiveconditions,changesinrelationshipswithcustomers,accesstocapital,difficultiesindevelopingandmarketingnewproducts,marketingexistingproducts,customeracceptanceofexistingandnewproducts,andotherfactors.accordingly,althoughthecompanybelievesthattheexpectationsreflectedinsuchforward-lookingstatementsarereasonable,therecanbenoassurancethatsuchexpectationswillprovetobecorrect.thecompanyhasnoobligationtoupdatetheforward-lookinginformationcontainedinthispresentation.,equitysnapshot,source:yahoofinance,companysecfilings,otcbbsymbol:snenprice(11/23/2007):$3.45sharesoutstanding:31.41milmarketcapitalization(11/23/2007):$108mileps-fullydilutedshares(ttmto06/30/07):25centsaveragedailytradingvolume(11/23/2007)188kshares,3,1956:foundedin1956underthenameqingdaogeneralmachineryfactory.,2004:qingdaogeneralmachineryprivatizedandregisteredassinogasgeneralmachinerylimitedcorporation(sinogas),whichownspropertyof659,000sqftlandand300,000sqftoffice&plantincentralofqingdaocity,june2006:consummatedareversemergerintheotcmarket,feb.2007:startedtradingintheu.s.capitalmarketundertickersymbol:snen,keyaccomplishments,august2006tomarch2007:establishedthreesubsidiaries-wuhansinoenergygasltd.pingdingshansinoenergygasltd,andhubeigatherenergygasco.,ltd.-licensedtooperatecngstations,withsinoenergyas90%,90%and55%equityownerrespectively,march2007:acquired70%ofequityofjiaxinglixunautomotiveelectronicco.,ltd.,july2007:acquired45%equityofanhuigatherenergy,nov.2007:complete70%equityacquisition,inturnown100%xuanchengsinoenergyvehiclegasco.ltd,4,5,investmenthighlights,governmentsupportingtopromotecleanenergytwoyearsincometax100%exemption,threeyears50%exemption,afterpreferenceendsincometaxratewillbejust15%ndrcnoticerequestscngwholesalepriceforvehicleusingkeepstablewhileprovincialmunicipalitiesshouldincreaselocalcngretailpricessothattheyfallbetween60%and75%ofthelocalpricefor90octanegasoline.securenaturalgasresourcessinoenergyhassecured500millioncubicmeterscngdepositwithsinopec,andpetro-chinatosupportourfuture120cngstationsvaluablecompanyownedrealestateacngdown-streamindustrialchainintegratematuredcngfacilitiesmanufacturingbusinesswithnewemergedcngvehicleretailbusinessaswellascngvehicleconversionkitmanufacturingandsellingbusiness,whichbuildsupaplatformofdiversifiedrevenueexperiencedmanagementteamwithsignificantindustryexpertise,majorbusinesslines,legacybusiness50yearsmanufacturingexperienceindesigningandmanufacturingnon-standardpressurecontainers,holdinga1,a1licensesissuedbycentralgovernmentovertenyearsexperienceincngfacilitiesandequipmentmanufacturing,beingissuedc2andc3licensesfortrucktrailermanufacturingbycentralgovernment.,newlydevelopedbusinessexpandedpositioninthecngvehicleconversion-kitmarketbyacquiring70%equityoflixun,aleadingdesignerandmanufacturerconversionkitelectronicpartsleveragingexperienceincngfacilitymanufacturingandbuildingcngstations,enteredintocngwholesaleandvehicleretailbusiness,6,servingtaxis,busesandfleetvehiclesunderstronggovernmentsupportforcngvehicleadoption2fillingstationsopenininwuhancityand1stationopensinxuanchengcity22cngfillingstationsareunderconstructioninwuhan,xuanchengandpingdingshan,newbusiness-cngretail,goaltobuildaround100andoperatearound60cngretailsubstationsinfivecitiesacrosschinabyendof2009targetingbusandtaxifleetoperators,7,publicbusfuelcostaverage200kilometersperday(usd),taxifuelcostaverage400kilometersperday(usd),economicadvantages,8,keymarketstatisticsforwuhancity,wuhanhasmorethan20,000taxisand6,292busesincluding667cng-burnedbusesand1,321dual-fuel(cng/lpgandgasoline)taxissuppliedby9cngfilingstations.accordingtowuhanmunicipalsgovernmentplanning,2007and2008willbethestartupphaseofwuhanscngvehicledevelopment.onecngprocessingplant,onemotherstationand30cngstationsexpectedtobebuiltinwuhanbytheendof2008-goaltooperate50to60cngfilingstationsinthethreeyearsto2009.wuhanalsoplanstotransformalltaxisandbusesintocng-burningvehiclesbyendof2008.firsttwocngfillingstationsinwuhanbuiltbysinoenergyopenedinseptember.,9,securenaturalgassupply,secured400millioncubicmetersnaturalgasquotafromsinopecsunder-constructionpuguangmainpipelinesecured100millioncubicmetersnaturalgasquotafrompetrochinasmainpipelineandmotherstation,10,cngfillingstationprojectanalysis,assumptions:underfulloperatingcapacity,averagesalesforonecngsubstationis10,000cubicmetersperdayapprox9monthsfornewstationstoreachtargetutilizationassumedtaxrateof15%(expecttobegranted100%taxexemptionsinthefirsttwoyears)revenueperstationunderfullcapacityof$1.3to$1.5millionannuallywithoperatingincomeof$350kto$450kandnetincomeof$250kto$300kcostforonecngfillingstationisabout$800,000roiisabout3.5years,11,cngfillingstationcontribution,12,newbusiness-cngwholesale,plantobuild4largecngprocessingplantsinanhuiprovinceandhubeiprovincethroughhubeigather(55%subsidiary)andanhuigather(45%subsidiary)expectedtobeginoperationinlate2008orearly2009underfullcapacity,fourplantscanprocess400millioncubicmetersofnaturalgasperyeartheseplantsareexpectedtogeneraterevenuesofapproximately$100to$120millionandnetincomeof$20millionifallprocessednaturalgasisusedincngfillingstations,fourplantscansupplycompressednaturalgasto100to120cngretailfilingstations,13,experiencedmanagementteam,mr.tianzhoudeng,chairmanmr.denghasworkedinthenaturalgasindustryinchinaforalmost20yearschairmanofbeijingsanhuantechnologydevelopmentco.,ltd.from1999to2005presidentanddirectorofnaturalgasvehicledevelopmentcenter,cnpcfrom1997to1999presidentandchiefengineerofjianghanchemicalco.,ltd.,cnpcfrom1992to1997engineerandprojectmanagerofjianghanpetroleumdesigningacademyfrom1982to1992masterofmanagement,chinasciencebachelorofscienceinchemistry,universityofpetroleum,chinamr.denghasworkedasascientistoncleanenergyresearchforhisentirecareermr.bohuang,ceoandpresidentchairmanandgeneralmanagerofqingdaosinogasfrom2005topresentpresidentofbeijingsanhuantechnologydevelopmentcompanyltd.from2001to2005investmentconsultingmanagerandvicepresidentofchenchenggroupcompanyfrom1997to2001managerofchinahuanenggroupfrom1993to1996bachelordegreeineconomicsfromthepeoplesuniversityofchinams.qiong(laby)wu,cfoseniorauditoraternst&young,beijing,fromfebruary2004tojune2006,auditinchargeoffederalexpresschinaandlucentchina,anddirectedtheiposofshanghaielectricandairchinaonthehongkongexchangeconsultantofaccountingandtaxationandpartnerassistantathlb,beijingyongtuocpafrom2001to2004materialengineeratchinabuildingmaterialacademy/accountantatbeijingtrendco.from1996to2001masterofprofessionalaccountant,andbachelorinaccountingfromdeakinuniversity,australiacpaaustralia,14,summaryincomestatement,quarterendedquarterendedyearendedyearendedjune30june30dec.31dec.31($inthousands)2007200620062005revenues$6,181+82.7%$3,383$12,393$8,236grossprofit3,209+167.7%1,1996,4844,415grossmargin51.9%35.4%52%54%operatingincome2,216+279.5%5844,1953,719operatingmargin35.9%17.3%33.8%45.1%netincome$1,946+1320%$137$3,447$2,460earningspershare-diluted$0.07$0.01$0.1