Better industrial structure to highlight scientific and technological advantages GCL Technology accelerates the implementation of 'one body and two wings' international layout for the granular silicon
Monday, 1 January 2024
EQS Newswire / 02/01/2024 / 01:00 UTC+8Better industrial structure to highlight scientific and technological advantages
GCL Technology accelerates the implementation of "one body and two wings" international layout for the granular silicon
GCL Technology, the leader in silicon materials, has perfectly achieved its established strategic goals. The entire company has been mobilized to focus on the research and development and intelligent manufacturing of green, low-carbon high-tech silicon materials based on granular silicon, accelerate the industrial structure adjustment, enhance scientific and technological innovation, and achieve the international layout of "one body and two wings" strategy.
On 29th December, GCL Technology (3800. HK) announced that its associate company, Xinjiang Goens Energy Technology Co., Ltd.* (新疆戈恩斯能源科技有限公司) (“Xinjiang Goens”) intended to distribute dividends to and to repurchase all equity interests held by Jiangsu Zhongneng Polysilicon Technology Development Co., Ltd.* (江苏中能硅业科技发展有限公司) ("Jiangsu Zhongneng"). Xinjiang Goens has a rod-shaped silicon annual production capacity of 60,000 tons. This sale marks that GCL Technology will completely cease its rod-shaped silicon production and achieve its established strategic goals.
The announcement shows that GCL Technology will fully demonstrate its technological innovation attributes, focus on the R&D and production of FBR granular silicon, and continue to promote green and efficient development of the photovoltaic industry. On the other hand, the proceeds from the transaction will increase the company's capital reserves and help the company launch its new granular silicon project. The transaction will also continue to optimize the company's core asset structure, improve the company's operating efficiency, increase its profitability, and achieve higher returns for shareholders.
"In June 2023, the company has completely shut down the rod silicon production capacity at its Xuzhou base. After the equity sale of the Xinjiang Goens rod silicon project, the company will fully focus on the research and development and production of granular silicon, continue to improve its technological content, and increase the modular capacity of granular silicon from the presently 20,000 tons to 60,000 tons. A relevant person in charge of GCL Technology told reporters: "The company will continue to strengthen the process of intelligentization, digitalization, and internationalization. Under the current photovoltaic industry cycle, through quality improvement and modular upgrade, artificial intelligence rapidly reducing production costs, and a focus on customer’s needs, the company will further optimize quality, and promote asset preservation and appreciation. With the help of GCL’s semiconductor-grade silicon material production experience and advantages, the N-type silicon materials proportion of granular silicon will be increased to 100%, comprehensively meeting the market needs of efficient N-type silicon materials and continue to create value for shareholders and the society."
According to the announcement, after the transaction is completed, the company is expected to receive RMB 5.466 billion in cash, including dividend of RMB 4.473 billion and RMB 993 million corresponding to the original equity holdings. As for the RMB 3.974 billion net asset loss (asset impairment) caused by the transaction, the above-mentioned person in charge said that it was mainly an impairment of goodwill. "Excluding the goodwill impairment, the actual loss incurred is about RMB 700 million. Taking into account the four-year installment and future operating changes in the market, this transaction was basically sold based on the consideration of net assets, achieving full preservation and appreciation of the initial investment."
The reporter indicated that GCL Technology has clearly stated in its 2022 Annual Report that it will completely cease the production of rod silicon by end of 2023. In order to deal with the new energy revolutions and market challenges, it will "orderly withdraw from the high-cost production of Siemens rod-silicon, transfer limited production capacity to high-margin granular silicon in a bid to maximize the group's profit."
The equity sale of Xinjiang Goens is an inevitable choice for GCL Technology to promote strategic transformation through technological innovation and fulfill its initial commitments.
A senior analyst in the industry told reporters, "GCL Technology is an advocate and leader of granular silicon technology. Under the current polysilicon market, it is a reasonable choice to focus on the R&D and production of granular silicon. In addition, GCL Technology is also seeking global expansion, clearing out old production capacity and increasing cash reserves. This transaction can also be regarded as the beginning of GCL Technology's overseas layout."
The aforementioned company official stated, "GCL Technology's overseas projects are also progressing rapidly, and the Middle East has been initially selected as the company's first overseas granular silicon project construction site." It is reported that GCL Technology's preliminary work in the Middle East project is being pushed forward intensively.
Previously, Saudi Arabia’s Minister of Investment Khalid Al-Falih and GCL Group Chairman Zhu Gongshan had an in-depth exchange of views regarding GCL’s new energy industry layout in Saudi Arabia on 10th December 2023. Saudi Arabia hopes that the new energy materials project of GCL can be launched in Saudi Arabia as soon as possible to provide green and low-carbon energy to Saudi Arabia and the Middle East region.
In addition, GCL Technology has also publicly stated that the company plans to invest a granular silicon factory overseas with an annual output of 120,000 tons, which may begin operations as early as 2025. The company has already considered the factory locations in many other countries, and the Middle East will be its first choice. GCL Technology’s “one body and two wings” international layout has officially arrived.
File: Better industrial structure to highlight scientific and technological advantages GCL Technology accelerates the implementation of "one body and two wings" international layout for the granular silicon
02/01/2024 Dissemination of a Financial Press Release, transmitted by EQS News.
The issuer is solely responsible for the content of this announcement.
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