SNEN INTRODUCTION PPT 062908 (for MUNC)

8/14/2019 SNEN INTRODUCTION PPT 062908 (for MUNC)

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www.sinoenergycorporation.com


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Safe Harbor Statement

This presentation contains forward-looking statements within the meaning of the safe-

harbor provisions of the Private Securities Litigation Reform Act of 1995.

Such statements involve known and unknown risks, uncertainties and other factors that

could cause the actual results of the Company to differ materially from the results

expressed or implied by such statements, including changes from anticipated levels of

sales, future national or regional economic and competitive conditions, changes in

relationships with customers, access to capital, difficulties in developing and marketing

new products, marketing existing products, customer acceptance of existing and new

products, and other factors.

Accordingly, although the Company believes that the expectations reflected in suchforward-looking statements are reasonable, there can be no assurance that such

expectations will prove to be correct. The Company has no obligation to update the

forward-looking information contained in this presentation.


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Equity Snapshot

Source: Yahoo Finance, Company SEC Filings

OTC BB Symbol: SNEN

Price (05/30/2008): $ 2.80

Shares Outstanding: 31.42 mil

Market Capitalization (05/30/2008): $87.97 mil

Average Daily Trading Volume(05/30/2008) 50.5K

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EPS-Fully Diluted Shares (ttm to 03/31/08): 25 cents


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1956: A state owned company under the name Qingdao General Machinery Factory, after our privatization in 2004, changename as Qingdao Sinogas General Machinery Co. Ltd (WOFE)

June 2006: Consummated a reverse merger in the OTC market

February 2007: Started trading in the U.S. capital market under ticker symbol: SNEN

Key Accomplishments

August 2006 to March 2007: Established three subsidiaries Wuhan Sinoenergy Gas Ltd. Pingdingshan

Sinoenergy Gas Ltd, and Hubei Gather Energy Gas Co., Ltd

March 2007: Acquired 70% of equity of Jiaxing Lixun Automotive Electronic Co., Ltd. (conversion

kits manufacturing)

July 2007: Acquired 45% equity of Anhui Gather Energy (natural gas processing plant)

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January 2008: Acquired HK Giant Power International Ltd. for its investments in gas

processing plants

December 2007: Acquired Qingdao Shan Yang Tai Chemistry Resources DevelopmentCo., Ltd for its manufacturing site

April 2008: Received a $17.87 million (RMB 124.76 million) strategicinvestment from a group of Chinese investors. the Company is reorganizing itsgroup structure to more clearly separate its business segments by function.


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Business Model

CNG Vehicle Value Chain

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Secured 450

million cubic

meters natural

gas resources

annually from

Sinopec and

Petro China

Build or

invest in

natural gas

process plants

to process

secured

natural gas

Natural Gas Processing

plant (whole sale)

Build and

operate CNG

filling stations

in Central and

East China

CNG Truck Trailer

(manufacturing)

CNG filling Station

(retail)

Vehicles

conversion kits

(manufacturing)

One of the three

companies who

held license

issued by centralgovernment to

manufacture

CNG truck

trailers

Manufacture

and sale of

alternative

fuel vehicle

conversion

kits


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Facilities and Equipment Manufacturing

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Manufacturing

CNG deposit and delivery facilities

Customized Pressure Containers

Conversion Kits for alternative fuel


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Facilities and Equipment Manufacturing

Legacy business

Customized Pressure Containers- 50 years manufacturing experience in

designing and manufacturing non-standard Pressure Containers, holding A1,A2 licenses issued by central government

CNG Deposit and Delivery Facilities - Over ten years experience in CNG

facilities and equipment manufacturing, being issued C2 and C3 licenses for

truck trailer manufacturing by central government.

New developed business

Conversion Kits - Expanded position in the CNG vehicle conversion-kit market

by acquiring 70% equity of Lixun, a leading designer and manufacturerconversion kit electronic parts

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CNG Wholesale

Plan to build 4 large CNG processing plants inAnhui Province and Hubei Province through Hubei

Gather (55% subsidiary) and Anhui Gather (45%subsidiary)

Under full capacity, the four plants can process 400

million cubic meters of natural gas per year

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Through HK Giant Power (100% subsidiary) invested in four CNG processing

and wholesaling businesses in Central and East China by directly or indirectly

owns stakes ranging from 9% to 35%.

Three of the four business has a 20-year natural gas supply and distribution

contract with PetroChina respectively. The current aggregate daily natural gas

handling capacity arrives to 300-350 thousand cubic meters.


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CNG Wholesale - Natural Gas Supply

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Qingdao

Xuancheng

Pingdingshan

Wuhan

Puguang Pipeline

West-East GasPipeline

70 million cubic

meters per year

quota was issued

to SNEN

50 million cubic

meters per year

quota was issuedto SNEN

400 million cubic

meters per yearquota was issued

to SNEN

Sino-PecPuguang Gas

Pipeline

400 million

m3/year

Petro-ChinaWest-East Gas

Pipeline

70 million

m3/year

Petro-ChinaSichuan-East

Gas Pipeline

50 million

m3/year

The Pipecontroller

ResourceTransferPipeline

NaturalGas

Quota

Natural Gas Resource owned by Sinoenery


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5 filling stations open in Wuhan City, 2 station opens inPing Ding Shan city, and 1 station opens in Xuancheng City

10 standard stations are nearly completed and waiting

for PRC government approval for opening

Another 15 standard stations are under construction inWuhan, Xuancheng and Pingdingshan

CNG Retail-CNG Filling Station

Goal to bu i ld around 100 s tandard s t a t ions in t hree to f i ve c i t ies and operat e 60

standard s ta t ions across China by end of 2009 target ing bus and tax i f leet

opera tors

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CNG Filling Station - serving taxis, buses and fleet vehicles understrong government support for CNG vehicle adoption.


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CNG Retail -Advantages

Natural gas powered vehicles emit

significantly less nitrogen oxide, carbon

monoxide and carbon dioxide than gasoline

Natural gas is significantly cheaper thangasoline

In 2007 PRC government has offered tax

preferences to overseas investors in natural

gas operating to use more of the cleanenergy source

Adoption of compressed natural gas for transportation fuel will be driven by

inherent environmental benefits, economic advantages, and strong government

support.

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Key Market - Wuhan City

Wuhan has more than 20,000 taxis and 6,292 buses including 7,000 CNG-

fueled vehicles, currently supplied by 12 CNG filling stations

Wuhan eventually plans to transform all taxis and buses into CNG-burning

vehicles (Wuhan Municipal Government)

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One CNG processing plant and 30 CNGstandard stations expected to be built in

Wuhan by the end of 2008 goal to operate 2

CNG processing plants and 50 to 60 standard

CNG filing stations by the end of 2009

Sinoenergy opened five retail CNG filling

stations in Wuhan by April 2008


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CNG Filling Station Project Analysis

Assumptions:

Under full operating capacity, average sales for one CNG substation is 10,000cubic meters per day

Approx 9 months for new stations to reach target utilization

Assumed tax rate of 15% (expect to be granted 100% tax exemptions in the

first two years)

Revenue per station under full capacity of $1.3 to $1.5 million annually withoperating income of $350K to $450K and net income of $250K to $300K

Cost for one CNG filling station is about $800,000

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Experienced Management Team

Mr. Tianzhou Deng, Chairman Mr. Deng has worked in the natural gas industry in China for almost 20 years

Chairman of Beijing Sanhuan Technology Development Co., Ltd. from 1999 to 2005

President and Director of Natural Gas Vehicle Development Center, CNPC from 1997 to 1999

President and Chief Engineer of Jianghan Chemical Co., Ltd., CNPC from 1992 to 1997

Engineer and project manager of Jianghan Petroleum Designing Academy from 1982 to 1992 Master of Management, China Science & Technology University; Bachelor of Science in Chemistry, University of Petroleum, China

Mr. Deng has worked as a scientist on clean energy research for his entire career

Mr. Bo Huang, CEO and President Chairman and General Manager of Qingdao Sinogas from 2005 to present

President of Beijing Sanhuan Technology Development Company Ltd. from 2001 to 2005

Investment Consulting Manager and Vice President of Chencheng Group Company from 1997 to 2001

Manager of China Huaneng Group from 1993 to 1996 Bachelor Degree in Economics from the Peoples University of China

Ms. Lan Gu, CFO Senior auditor at Canada based Lanno Torollenie LLP, responsible for planning and managing client engagements

Audit leader at Deloitte Touche Tohmatsu CPA Ltd. in Shanghai

Auditor at PricewaterhouseCoopers in Canada

Hounrs Degree of B.A. in business with a concentration in financial analysis from York University in Canada

U.S. Certified Public Accountant and Canadian Chartered Accountant

Mr. Anlin Xiong, Secretary of the Company Senior Manager, Vice department director at BOE Technology Group Co. Ltd, responsible for strategy & technolgy planning and

management, Intellectual Propperty management and operation

MS in EE from University of Illinois at Urbana Champaign in the U.S., BS in EE from Tsinghua University in China

Certificate of China Legal Professional, which is the lawyer qualification certificate in China

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Summary Income Statement

Quarter Ended Quarter Ended Six Months Ended

March 31, March 31 March 31

($ in thousands) 2008 2007 2008 2007

Revenues $7,734 +195% $2,626 $16,541 +215% $5,255

Gross Profit 3,723 +260% 1,035 7,634 +179% 2,733

Operating Income 2,618 + 534% 413 5,365 +281% 1,408

Net income 2,843 + 108% 350 5,162 +252% 1,466

Earnings Per Share-diluted $0.07 $0.02 $0.14 $0.06

Weighted average diluted shares 37.65Mil 23.16Mil 37.75Mil 23.92Mil

Source: Companys SEC filings

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OperatingIncome($inmillions)

Growing Revenues and Profits

CAGR = 79%

Revenues

($inmillions)CAGR = 61%

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8.212.4

24.7

83-85

53-56

0

10

20

30

40

50

60

70

80

90

2005 2006 latest 12

months

ending Dec

31, 2007

Fiscal 2008E Fiscal 2009E

3.7 4.2

7.0

24-26

14-15

0.0

5.0

10.0

15.0

20.0

25.0

30.0

2005 2006 latest 12

months

ending Dec

31, 2007

Fiscal 2008E Fiscal 2009E


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Investment Highlights

Government supporting to promote clean energy

Two years income tax 100% exemption, three years 50% exemption, after preferenceends income tax rate will be 15%

NDRC notice requests CNG whole sale price for vehicle using keep stable whileprovincial municipalities should increase local CNG retail prices so that they fallbetween 60% and 75% of the local price for 90 octane gasoline.

Secure Natural Gas Resources

Sinoenergy has secured 500 million cubic meters CNG deposit with Sinopec, and Petro-China to support our future 120 CNG stations

Valuable Company Owned Real Estate

A CNG down-stream industrial chain integration

Integrate matured CNG facilities manufacturing business with new emerged CNGvehicle retail business as well as CNG vehicle fuel conversion kit manufacturing andselling business, which builds up a platform of diversified revenue

Experienced management team with significant industry expertise andinternational experience


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Contact Information:

Anlin Xiong

Secretary & Vice President

Sinoenergy Corporation

Tel : +86-10-84932965 ext 860

Email: [email protected]

Crocker CoulsonPresidentCCG Elite Investor RelationsTel: +1-646-213-1915

Email: [email protected]

Thank You

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SNEN INTRODUCTION PPT 062908 (for MUNC)

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