A-POWER ENERGY (GREY:APWR)

SHENYANG, China, July 5, 2011 /PRNewswire-Asia-FirstCall/ -- A-Power Energy Generation Systems, Ltd. (NASDAQ: APWR) ("A-Power"), a leading provider of distributed power generation systems in China and a manufacturer of wind turbines, today announced that Mr. Kin Kwong (Peter) Mak, A-Power's Chief Financial Officer, will come to the end of his extended service contract on July 15, 2011.

The Company also announced that Mr. Michael Zhang, the Company's Vice President for Strategic Planning, Internal Audit, and Internal Control, and recently elected to the Company's board of directors, will also serve as interim CFO, effective July 15, while the Company conducts a search to fill the CFO position. As interim CFO, Mr. Zhang will oversee the Company's financial operations and financial reporting.

Mr. Mak was appointed Chief Financial Officer in May 2009. His two-year contract had been extended 1.5 months to July 15, 2011. Mr. Mak said, "I am grateful for the Company's support of my work. As agreed, the extension of my service contract term until July 15 is coming to an end. I wish every success to Chairman Lu and to A-Power."

Mr. Jinxiang Lu, A-Power's Chairman and Chief Executive Officer, said, "We understand Peter's desire to continue his career in another direction, and we wish him well.

"We are very fortunate to have an officer of Michael Zhang's high caliber and great experience in financial reporting available to step in as interim CFO as we work together to select our new auditor, complete the audit of our 2010 financial results, and then resume our regular financial reporting."

Mr. Zhang, age 42, joined A-Power in January 2010 as Vice President, initially for the design, implementation, and management of the Company's internal and disclosure controls systems, and later his scope was expanded to include internal audit, strategic planning, and the integration of the Company's Evatech Co. Ltd. solar equipment manufacturing subsidiary in Japan. He has more than 18 years of experience in internal audit, internal controls, corporate governance, and risk management related services. Mr. Zhang's professional experience includes assisting listed issuers with the preparation of their US GAAP financial statements.

Prior to joining A-Power, Mr. Zhang was Executive Director of Business Risk Services with Ernst & Young (China) Advisory Limited from August 2007 through May 2009. Previously he was Director of Enterprise Risk Services at Deloitte Touche Tohmatsu CPA Ltd. from April 2005 through May 2007, where his responsibilities included the provision of internal control (Sarbanes-Oxley Section 404) consulting services to a variety of corporate clients. Mr. Zhang earlier served with Lenovo Group Ltd. for more than four years as director of internal audit and internal controls and with China National Petroleum Corporation for seven years as an internal auditor and, initially, as a software engineer.

Mr. Zhang is a Certified Internal Auditor and a past member of the Internal Auditing Standards Board of The Institute of Internal Auditors. Mr. Zhang graduated from Northwest University with a Bachelor's Degree in Computational Mathematics. He received an MBA in Finance from Hong Kong Chinese University.

Since November 2010, Mr. Zhang has been an independent director and audit committee chairman on the Board of Directors of China Shengda Packaging Ltd., a Nasdaq-listed China-based paper packaging company that has no relationship with A-Power. Since September 2009, he has served as an independent director in Beijing Kingstar Consulting Firm Limited, a development-stage consulting firm that has no relationship to A-Power. Since May 2009, he has served as an independent director of Well-Tech (Changzhou) Electronic Technology Co., Ltd., a provider of mechanical manufacturing services that has no relationship to A-Power.

Mr. Zhang was elected as a director of A-Power, effective on June 8, 2011.

SHENYANG, China, June 29, 2011 /PRNewswire-Asia-FirstCall/ -- A-Power Energy Generation Systems, Ltd. (NASDAQ: APWR) ("A-Power" or the "Company"), a leading provider of distributed power generation systems in China and a manufacturer of wind turbines, today announced that two independent directors on its board of directors have resigned, effective June 27, 2011. The board of directors has accepted their resignations.

Mr. Remo Richli has resigned as a director of A-Power and as chair of the board's audit committee. Mr. Richli stated that his resignation was based on his understanding of events that occurred over the past few weeks, including the resignation of the Company's independent auditor. He also stated that he did not agree with the course of action that the Company has proposed to take in response to recent events.

Mr. Dilip R. Limaye has regretfully resigned as a director of A-Power and as chair of the board's compensation committee. He stated that his decision to resign was prompted by the events of the last several weeks about which he communicated his concerns and views on actions that should be taken.

Mr. Jinxiang Lu, A-Power's Chairman and Chief Executive Officer, said, "Regretfully, we have accepted the resignations of Mr. Richli and Mr. Limaye and understand their concerns and reservations. We thank them for their contributions to the board and wish them well as they continue their careers."

A-Power has started its search to replace these two independent directors.

SHENYANG, China, June 27, 2011 /PRNewswire-Asia-FirstCall/ -- A-Power Energy Generation Systems, Ltd. (NASDAQ: APWR) ("A-Power" or "the Company"), a leading provider of distributed power generation systems in China and a manufacturer of wind turbines, today announced that its independent auditor, MSCM LLP, has resigned. In its letter to the Company dated June 26, 2011, MSCM stated that it had resigned because the Company had not retained a qualified independent forensic accounting firm to evaluate certain business transactions that MSCM stated was necessary for MSCM to complete its audit of the Company's financial statements for the year ended December 31, 2010 on a timely basis.

In light of MSCM's withdrawal, A-Power and members of the Audit Committee of the Board of Directors will be meeting with other qualified independent auditing firms. The Company will announce its new independent auditor after the Audit Committee has selected a firm and an audit engagement contract has been entered into between the Company and that firm.

As a result of MSCM's resignation, the Company's annual report on Form 20-F for the year 2010 will be delayed beyond June 30, 2011, the date the filing is due at the Securities and Exchange Commission. A-Power greatly regrets this delay and will work as rapidly as possible with a new independent auditor to complete the audit of its financial statements for the year 2010 and to then file its annual report on Form 20-F.

SHENYANG, China, June 20, 2011 /PRNewswire-Asia/ -- A-Power Energy Generation Systems, Ltd. (NASDAQ: APWR) ("A-Power" or "the Company"), a leading provider of distributed power generation systems in China and a manufacturer of wind turbines, today made the following statement:

We are aware of the article published on the Seeking Alpha website on June 17, 2011 by a self- admitted short seller, Mr. Eiad Asbahi, who stands to profit if the stock price of A-Power declines. We are reviewing the issues raised in this article and will provide answers by way of a press release as soon as possible.

SHENYANG, China, June 17, 2011 /PRNewswire-Asia/ -- A-Power Energy Generation Systems, Ltd. (NASDAQ: APWR) ("A-Power" or "the Company"), a leading provider of distributed power generation systems in China and a manufacturer of wind turbines, today announced that Mr. Robert B. Leckie resigned from A-Power's Board of Directors on June 14, 2011.　

Mr. Leckie resigned as a result of concerns that his views on process and best practices were not necessarily shared throughout the Company, but Mr. Leckie has confirmed to the Company that his resignation was not prompted by any disagreement with A-Power on any matter relating to the Company's operations, policies, or practices.

The Board of Directors of the Company, through the Nominating and Corporate Governance Committee, will seek to identify a qualified individual to fill the vacancy on the Board of Directors created by Mr. Leckie's departure.

SHENYANG, China, April 7, 2011 /PRNewswire-Asia-FirstCall/ -- A-Power Energy Generation Systems, Ltd. today explained the delay of its intended early reporting of the year 2010 results and its related conference call.

Mr. Kin Kwong (Peter) Mak, A-Power's Chief Financial Officer, said, "The scope of the audit field work that is necessary to bring the audit of our 2010 financial statements to a conclusion was not immediately recognized when the conference call was initially scheduled to discuss our results. After learning from both our internal team and from our outside professional advisers that the work on the financial statements and conclusion of the audit could not be completed prior to the date we had previously scheduled for release, we, of necessity, postponed the conference call and the release of the financial results for 2010.

"While we very much regret the delay and confusion caused by our premature announcement of the conference call, it is most important that our financial statements for the year ended December 31, 2010 are completed with all due care and that these financial statements are accurate and reliable when they are released.

"I again confirm that the delay was not the result of any accounting irregularities or investigation of accounting errors, nor do we expect any restatement of A-Power's previously audited financial statements as a result of the ongoing audit processes for 2010."

Third quarter 2010 financial highlights

• Revenues decreased 40.7% to $57.3 million from $96.6 million in the third quarter 2009.

• Gross profit decreased 2.5% to $12.3 million in the third quarter from $12.6 million in the third quarter 2009.

• Gross profit margin was 21.5% in the third quarter compared to 13.1% in the third quarter 2009.

• Income from operations decreased 63.2% to $3.4 million in the third quarter from $9.4 million in the third quarter 2009.

• Net loss attributable to A-Power was $(1.0) million in the third quarter compared with a net loss of $(0.6) million in the third quarter 2009.

• Net loss per diluted common share was $(0.02) in both the third quarter 2010 and third quarter 2009 on 34.0% higher weighted average common shares outstanding in the third quarter 2010 than in the prior third quarter.

• Guidance for the year 2010 has been revised downward to revenues of $310 million and net income of $50 million due to lower-than-expected wind turbine sales.

Mr. Jinxiang Lu, A-Power's Chairman and CEO said, "A-Power's results in the third quarter were less than we hoped we would achieve. The shortfall was due mainly to lower revenues in our Distributed power generation segment because of the timing of work under contracts, and to less-than-planned sales in our Wind power segment. Although Wind power achieved revenues of $15.5 million in the third quarter, we had assumed we would be able to book revenues from a major customer, Spinning Star LLC. However to date, Spinning Star has been unable to secure the expected construction financing for its wind farm project in Texas.

"We believe our strategy to benefit from alternative power generation, in the forms of distributed power, wind power, and photovoltaic solar power, continues to be valid for the Company's long-term success and is in the best interests of our shareholders. Our design, engineering, suppliers, and operations are all in very good shape and remain competitive in the marketplace.

"Recently, we have won a major new contract in our Distributed power business for the engineering, procurement, and construction of four hydropower plants over a period of six years, to be located in the Jilin province of China. The project is expected to generate RMB 1.87 billion (about $279 million) over project's anticipated six year life.

"We are very aware of our responsibility to shareholders and are doing everything possible to simultaneously expand our businesses and protect our assets in the most prudent of ways.

"We hope to see greater predictability in financing for our customers in 2011 and the years ahead."

Business outlook and guidance

In light of the general softness in the wind energy business and, in particular, the lack of turbines purchases from Spinning Star and the consequent impact of these factors on the near-term demand for A-Power's wind turbines, the Company has reduced its guidance for the full year 2010. It now expects

• revenues of $310 million (reduced from $500 million)
• net income of $50 million (reduced from $60 million).

"GAAP net income attributable to A-Power in the 2010 second quarter increased 86.3% to $11.6 million, or $0.25 per diluted share, from $6.3 million, or $0.14 per diluted share in the prior year period. Non-GAAP net income, declined to $1.1 million from $4.7 million in prior year period." 

Non-GAAP EPS works to about $0.02 vs. $0.13.

In the 2010 second quarter, total shares outstanding on a diluted basis were 46.5 million shares, an increase of 32%, compared with 35.3 million in the prior year period.

Business Outlook

The Company reiterates its guidance for its full year 2010 outlook of revenues of $500 million and net income of $60 million. This guidance is based upon the on-going DG projects and revenues from the expected sale of wind turbines to be generated during the remainder of 2010.

Mr. Lu continued, "We have many compelling opportunities in our business that can drive our revenue growth significantly higher in the second half of the year. Our DG business is expected to remain the primary performance driver with sales coming from our existing 15 projects. Significant sales are also expected in our wind turbine business in the second half of the year. We expect to begin delivery of 2.0 MW or larger turbines to customers in the second half of 2010. We are building a platform that will establish A-Power as an emerging leader in both distributed power and alternative power generation systems and are working aggressively to capitalize on the long-term growth opportunities in these areas."

First Quarter Financial Highlights

     -- Revenues were $67.3 million representing a 115.8% year-over-year
        increase;
     -- Gross margin increased to 14.5% from 12.6% in the first quarter of
        2009;
     -- Net income (GAAP) attributable to A-Power was $29.3 million, or $0.64
        per diluted share;
     -- Cash, cash equivalent and restricted cash were $220.4 million;
     -- Prepayments, deposits, other receivables from customers were $102.4
        million;
     -- Annual guidance for 2010 raised to revenues of $500 million with net
        income of $60 million.

Mr. Jinxiang Lu, A-Power's Chairman and CEO commented, "We are very excited with our strong revenue growth and solid gross margin expansion in the first quarter. Although the first quarter is typically a slow season in our DG activities in most parts of China due to the winter weather condition, we set new records for both revenue and net income growth in first quarter of 2010. Our geographic diversification into southern China and international projects are contributing more DG revenues. Our wind turbine business continues to gain traction and we remain confident in the market outlook, as our larger turbines are receiving favorable consideration in China, and the outlook for future turbine exports also appears promising. With more components arriving and our production expanding, we are continuing to move forward on all facets of our wind turbine business, both domestically and internationally. On the financial side, we continued to work to strengthen our balance sheet and manage our cash flow to prepare ourselves for further expansion during 2010."

Management raised its view that revenues for 2010 will reach $500 million and net income will reach $60 million, from previously announced annual guidance of $380 million in revenues and $45 million in net income, respectively. These targets are based on the Company's current views on the operating and market conditions, which are subject to change and to future developments, including those referred to under our safe harbor statement below.

A-Power today reaffirmed its revenue and after-tax net income guidance for 2009 of $320 million and $32 million, respectively. These targets are based on the Company's current DG contracts, which are subject to change when the Company signs new DG contracts and/or recognizes revenues from wind turbine sales during 2009. A-Power expects that it will from time to time provide periodic updates when additional major DG contracts and wind turbine sales are confirmed.

Source: PR Newswire (August 27, 2009)

A-Power adjusted upward its revenue and after-tax net income guidance for 2009.

FULL YEAR 2009 Guidance

	Full Year 2009	Full Year 2008	Period Change
GAAP Revenue	$320.0 million	$264.9  million	20.8%
Net Income	$32.0 million	$28.5 million	12.2%

'Entering 2009, we expect continued growth in our DG business as our strong track record attracts more industrial companies to use our systems to improve their electricity power management and utility cost control. On the wind turbine generator front, we want to fully leverage our technology partnerships with global wind technology leaders like Fuhrlander, Norwin and GE. Although our wind power business is still in its infancy, we see strong demand from the market for our 2.7MW wind turbines, as China is graduating from the Kilo-Watt class and moving towards Mega-Watt wind turbines. With our engineers and technicians completing training in Germany, our top priority is to secure components and ramp up production to satisfy the growing market demand.'

FULL YEAR 2009 Guidance

	Full Year 2009	Full Year 2008	Period Change
GAAP Revenue	$290.00 million	$264.87  million	9.49%
Net Income	$29.00 million	$28.52 million	1.68%

Guidance Update: 

 For the 2008 fourth quarter, the Company now expects revenue to be approximately $76 million and net income to be approximately $5 million. Both revenue and net income guidance are now lower than previous guidance of $158 million and $15.5 million, respectively.

"Due to the unusual current macro economic conditions, a few of our key potential contracts, which we expected to close in the fourth quarter, were postponed."

"Entering into 2009, we remain confident with a positive outlook for China's wind energy market as both government and enterprises have a strong commitment for renewable energy development, and we maintain a leading position in the marketplace, where the barrier to enter is high. As a result, we continue to expect profitable growth in 2009."

GeoPerspective:

As for 2009 the company commented that they will remain profitable, but gave no specifics.  This may make it difficult for investors  to place a valuation on the company.

Source: PR Newswire (December 30, 2008)

Updated Valuation Scenario reflecting 2008 First Quarter Financials

Trailing EPS: $0.32
Forward EPS: $0.67 to $.86
EPS past growth rate: 100%
EPS future growth rate: 130%

EPS numbers and growth rates have been adjusted to reflect a fully taxed scenario and any one time charges or gains. The GeoTeam feels that these adjustment are necessary for investors to make proper investment decisions.

Potential Scenarios Based on P/E to EPS Growth Comparison:
( Growth Rate * Trailing EPS)

Common rule of thumb that the P/E should equal the past EPS growth rate: $32.00
Common rule of thumb that the P/E should equal the future EPS growth rate: $41.60

GeoTeam Note: We used Trailing EPS in this example. Some investors may choose to use Future EPS as an option.

These scenarios are not intended to be investment advice, but are scenarios based on some commonly used investment guidelines. They are provided to aid investors in making their own investment decisions.

The GEO Team is awaiting the filing of the firm's 2007 10 K for further analysis.

Currently, it appears that APWR has approximately 33 million shares outstanding and is essentially paying no taxes. Applying a standard tax rate to the company would infer EPS of $.29 for 2007.

Fully Taxed adjusted EPS guidance range for 2008 is $.67 to $.86. This would translate into a minimum of 130% EPS growth rate for 2008.

Valuing APWR is somewhat challenging. Typically the GEO Team applies a

- P/E of 25 to fully taxed trailing EPS in conjunction with a 15 P/E on the four quarters forward fully taxed EPS to obtain an idea of what a stock may be worth in the short-term.

AND

- A P/E of 25 on the four quarters forward fully taxed EPS to obtain an idea of what a stock may be worth in the longer-term.


However, there are certain instances when we may look to other methods to derive additional valuation possibilities such as:

- When the company's short or long term EPS growth rate exceeds 50%.
- When the company is involved in a HOT sector.
- When the company is the leader in their industry.

APWR meets all three of these criteria. In addition the management seems very focused with a goal of maximizing shareholder value:

"We believe one of our most important tasks is not just to ensure a strong current performance, but at the same time to create the conditions for sustainable long-term success with the goal of becoming the leading clean energy company in Asia. We feel that we took a major stride in that direction in 2007 – in the interest of our stockholders, our employees and A-Power.” (Source: Press, March 31, 2008)

In cases like this the GEO Team may use EPS growth rates and/or higher P/E's in the analysis of potential value. Please refer to the Potential Valuation Scenario section of this discussion for an example an example.


The GeoTeam has held a position in APWR for sometime now.

Trailing EPS: $0.29
Forward EPS: $0.67 to $.86
EPS past growth rate: 100%
EPS future growth rate: 130%

EPS numbers and growth rates have been adjusted to reflect a fully taxed scenario and any one time charges or gains. The GeoTeam feels that these adjustment are necessary for investors to make proper investment decisions.



Potential Scenarios Based on P/E to EPS Growth Comparison:
( Growth Rate * Trailing EPS).

Common rule of thumb that the P/E should equal the past EPS growth rate: $29.00
Common rule of thumb that the P/E should equal the future EPS growth rate: $37.70

GeoTeam Note: We used Trailing EPS in this example. Some investors may choose to use Future EPS as an option.

These scenarios are not intended to be investment advice, but are scenarios based on some commonly used investment guidelines. They are provided to aid investors in making their own investment decisions.

2007 financial notes:

* 2007 Net Income increased 103% to $15.2 million.

* 2007 Revenue increased 54.5% to $152.5 million.

* Backlog as of March 31, 2008 approximately $550 million, up from $398.2 million at the end of 2007.

* Exceeded the make good net income target, associated with the reverse merger, of $14 million.

The GEO Team is awaiting the filing of the firm's 2007 10 K



APWR has a full exemption from PRC income tax for two years starting from 2007 and a 50% exemption from PRC income tax for three years starting from 2009.

(Source: Press, March 31, 2008)

The 2007 incentive share operating after tax earnings target was $14 million.

2008 Earnings Guidance

Mr. Jinxiang Lu, A-Power’s Chairman and CEO commented about A-Power’s earnings outlook for 2008, “As a result of the accelerating growth of our domestic (China) distributed power generation business and the backlog associated with this business, our ongoing discussions for multiple distributed power contracts in Southeast Asia, as well as the anticipated start of our wind turbine production operation, we expect that our year-end 2008 net income will range from $35 to $45 million, or approximately $1.05 to $1.35 per share.”



(Source: Press, March 31, 2008)