GCL New Energy's debt ratio drops to 22.8%

On the evening of August 23, GCL New Energy (0451.HK) released its interim financial results for 2024. The report shows that as of June 30, 2024, GCL New Energy's debt ratio has continued to decrease to a more robust level of approximately 22.8%. The company's liquidity, overall debt issues, and financing pressures have been greatly improved.

Coinciding with the 10th anniversary of GCL New Energy's listing and the final year of its light asset transformation strategy, the company has actively responded to industry cycle adjustments, and the effects of the light asset strategic transformation it has resolutely promoted are significant. In October 2023, GCL New Energy sold its last batch of 36 photovoltaic power station projects in China, with a total scale of about 584 megawatts. At the same time, it actively and prudently handled the debt terms of existing notes, completing the redemption and repurchase of nearly $240 million in US dollar notes within 2023. In terms of asset operations, it has "lightened" its load to face the downturn with a more robust financial performance.

Adhering to the direction of digital intelligence, cultivating new quality productive forces in the post-operation and maintenance market

With the steady advancement of dual carbon goals and new types of power systems, efficient and high-quality post-market operation and maintenance services have become rigid demands. Digital intelligence operation and maintenance is the inevitable choice to achieve high-quality operation and maintenance, and digital intelligence has always been an important direction for GCL New Energy to explore post-market operation and maintenance services.

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As a pioneer and leader in digital intelligence operation and maintenance, the operation and technology company under GCL New Energy officially launched its independently developed third-generation "Xinyi Lian" comprehensive energy management platform at the 2024 International Photovoltaic and Smart Energy (Shanghai) Conference ("SNEC 2024"), declaring that the comprehensive energy digital intelligence overall solution has completed all overall design and been successfully put into the market. The platform integrates the latest energy management technology and intelligent operation and maintenance strategies, forming four major units of data systems, management systems, knowledge bases, and AI centers. It covers real-time monitoring, production management, business management, market management, supply chain management, multi-terminal integration, knowledge bases, AI centers, eight major functional modules, and 178 models. It covers wind, light, storage, charging, virtual power plants, and other comprehensive energy multi-formats, building a mature and stable full life cycle green operation new ecology, and helping to provide precise and efficient photovoltaic power station energy asset services.

In addition, GCL New Energy has reached cooperation agreements with several strategic partners to seek greater development opportunities in the new energy post-operation and maintenance service market. It is reported that on May 11, 2024, the operation and technology company under GCL New Energy and Guoshun Technology Group Co., Ltd. ("Guoshun Technology") signed a strategic cooperation agreement at the GCL Energy Center in Suzhou. According to the agreement, the two parties will cooperate in multiple business fields such as comprehensive energy management, data service platforms, AI power trading, and overseas market expansion, jointly exploring the new energy operation and maintenance market, exploring new models, expanding new fields, and achieving new leaps. Guoshun Technology, as a company integrating photovoltaic, wind power, hydropower, energy storage, natural gas, hydrogen energy, and other comprehensive smart energy supply, smart agriculture, etc., has rich project construction experience and performance in the North China region and has extensive project cooperation resources with large state-owned enterprises and central enterprises. While consolidating market share, GCL New Energy flexibly responds to market changes, continuously innovates, actively develops energy storage business, provides a variety of supply and demand resource matching services, and continuously promotes the integration of "wind and light storage" to cope with the multi-energy complementary situation that the new energy storage market will form in the future, and lays out in advance the potential growth pole of photovoltaic storage parity. As of June 30, 2024, GCL New Energy has signed various operation and maintenance service contracts with nearly 300 photovoltaic power stations across the country, with a total installed capacity of about 7.3 gigawatts, ranking at the forefront in market share.

Creating the "second growth pole" of natural gas, seizing the new era of energy navigation

According to the "China Natural Gas Development Report (2024)", domestic natural gas consumption in 2023 returned to rapid growth, and world natural gas consumption resumed positive growth. It is expected that the natural gas consumption volume in 2024 will be 420 billion to 425 billion cubic meters, a year-on-year increase of 6.5% to 7.7%, and liquefied natural gas ("LNG") imports will continue to grow. Faced with this round of industry cycles, GCL New Energy, while deeply developing the vertical development of digital intelligence operation and maintenance, actively explores new tracks, seeks new opportunities in the global market, and takes LNG (liquefied natural gas) trade as the core driving force for the company's development, forging a new engine for development.

GCL New Energy relies on the upstream oil and gas resources of GCL Group in Ethiopia and the domestic LNG receiving station resource platform held by the group. Taking natural gas trade as the link, it seizes the new opportunities of energy going to sea and strives to create natural gas trade as the "second growth pole" of GCL New Energy in the economic double circulation pattern. On the one hand, it integrates international LNG long-term contracts and domestic natural gas resources to create a competitive international and domestic natural gas resource pool and actively explores the domestic and foreign LNG markets. On the other hand, it uses the Singapore trading company as a platform to promote the continuous expansion of international trade volume and manage market risks through hedging.

Since 2023, GCL New Energy has widely recruited talents, fully explored talents in the oil and gas industry, and continuously explored several senior industry experts to join the team. As of the reporting period, it has built an experienced, capable, and passionate natural gas trade team, promoting the rapid growth of natural gas trade business. On July 3, 2024, GCL New Energy signed a strategic cooperation agreement with the Shanghai Petroleum and Natural Gas Trading Center. The two parties will achieve complementary advantages in resource advantages in aspects such as information sharing, energy and infrastructure transactions, product innovation, market research, and resource services. They will jointly study and innovate the fair service cooperation model of the receiving station and jointly ensure regional energy supply security, promote the national "X+1+X" natural gas marketization reform, and play an active role in the construction of the natural gas production, supply, storage, and sales system.Patiently Implementing ESG Principles, Resolutely Embracing the Path of Green and Sustainable Development

The year 2024 marks the ninth consecutive year that GCL New Energy has published its ESG report, and it is another year of unwavering commitment to long-term investment and implementation of ESG management. On one hand, GCL New Energy integrates the ESG philosophy into the full life cycle services of the industry chain, formulating clear action plans and service guidelines around key ESG issues such as green and low-carbon development, and digital and intelligent operation and maintenance. On the other hand, the company implements solutions to ESG issues from top to bottom, integrating them into daily business operations and supply chain management, continuously reducing the environmental impact of its operations, and encouraging partners to practice ESG principles together. This collective effort aims to maximize the comprehensive value of economic, social, and environmental benefits, bringing more returns to society and shareholders. In addition, GCL New Energy actively fulfills its social responsibilities, carries out charitable activities at various levels, and collaborates with the Guanghua School of Management at Peking University on integrated practice projects to jointly explore the future of green development in the industry.

Faced with new challenges such as a slowdown in global economic growth, ongoing international trade frictions, and geopolitical struggles, GCL New Energy will continue to strengthen its foundation and enhance its internal capabilities, continuously improving the operation and maintenance level of energy market services to create greater value for the preservation and appreciation of customers' carbon assets. At the same time, the company actively seeks change and innovation, fully seizing new opportunities in LNG trade, contributing to the green, secure, and stable transition of the global energy landscape. In the future, GCL New Energy will continue to practice ESG principles, promote ESG governance by all employees and the sustainable development of the industry chain through internal governance improvements and external cooperation, and bring more returns and value to society, customers, and shareholders with a long-term philosophy.