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China Natural Gas Inc. Reports Operating Results (10-Q/A)

February 29, 2012 | About:
10qk

10qk

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China Natural Gas Inc. (CHNG) filed Amended Quarterly Report for the period ended 2011-03-31.

China Natrl Gas has a market cap of $41.4 million; its shares were traded at around $1.93 with a P/E ratio of 2.6 and P/S ratio of 0.5. China Natrl Gas had an annual average earning growth of 15.5% over the past 5 years.

Highlight of Business Operations:

Revenues . Revenues for the three months ended March 31, 2011 increased to $24,108,108 from $19,366,823 for the three months ended March 31, 2010, an increase of $4,741,285 or 24.5%. We sold natural gas of 45,906,401 cubic meters during the three months ended March 31, 2011, compared to 44,161,281 cubic meters during the three months ended March 31, 2010. We also sold gasoline of 1,495,015 liters during the three months ended March 31, 2011, compared to 1,929,034 liters sold during the three months ended March 31, 2010. For the three months ended March 31, 2011, 89.8% of our revenues was generated from the sale of natural gas and gasoline, and the remaining 10.2 % was generated from our installation and auto conversion services.

Natural Gas from Fueling Stations. Natural gas revenue from our fueling stations increased by 24.8% or $3,626,812, to $18,256,422 for the three months ended March 31, 2011, from $14,629,610 for the three months ended March 31, 2010. Natural gas revenue from our fueling stations accounted for 75.7% of our total revenues for the three months ended March 31, 2011, which was the largest contributor among our major business lines. During the three months ended March 31, 2011, we sold 38,785,147 cubic meters of compressed natural gas, or CNG, compared to 40,592,457 cubic meters during the three months ended March 31, 2010, through our fueling stations. Though sales volume decreased over the period, sales revenue actually increased, because the average unit selling price increased to $0.48 (RMB 3.13) from $0.34 (RMB 2.34), net of VAT, due to increased competition from a growing number of natural gas fueling stations in the regions we operate. With respect to average sales revenue and volume per station, in the three months ended March 31, 2011, we sold approximately $480,432 and 1,020,662 cubic meters of CNG per station, respectively, compared to approximately $406,378 and 1,127,568 cubic meters, respectively, in the three months ended March 31, 2010.

Installation Services. Revenue from installation services increased by 0.2%, or $3,920, to $2,011,694 for the three months ended March 31, 2011, compared to $ 2,007,774 for the three months ended March 31, 2010, and contributed 8.3% of our total revenues for the three months ended March 31, 2011. Revenue from our four largest customers accounted for 28.7%, 24.7%, 12.7% and 11.3%, respectively, of our installation revenue for the three months ended March 31, 2011.

Our cost of revenue for the three months ended March 31, 2011 was $14,387,307, an increase of $4,115,952, or 40.1%, compared to $10,271,855 for the three months ended March 31, 2010, mainly attributable to increase in average procurement costs. Our average procurement price of natural gas increased to $0.37 (RMB 2.43) for the three months ended March 31, 2011 from $0.25 (RMB 1.71) for the comparable period in 2010. Over the same period, our total revenues increased by 24.5%.

Natural Gas from Fueling Stations. Costs of revenue of our natural gas sold through our fueling stations increased by 44.2%, or $3,210,818, to $10,482,954 for the three months ended March 31, 2011, from $7,272,136 for the three months ended March 31, 2010. The increase was primarily due to the increase in average procurement prices from $0.25 (RMB 1.71), net of VAT, for the three months ended March 31, 2010, to $0.37 (RMB 2.43), net of VAT, for the three months ended March 31, 2011. However, the average procurement cost remained below the natural gas average retail price of $0.48 (RMB 3.13), net of VAT, for the three months ended March 31, 2010 and 2011, respectively.

Read the The complete Report

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10qk
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