Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

China Singyes Solar Technologies Holdings Limited ʕ਷ጳุ˄ජঐҦஔછٰϞࠢʮ̡

(incorporated in Bermuda with limited liability)

(Stock Code: 750)

US$260,000,000 7.95% senior notes due 2019

(Stock Code: 5372)

RMB930 million 5% USD settled convertible bonds due 2019

(Stock Code: 5790)

(1) TERMINATION OF PROPOSED ISSUE OF HK$230 MILLION

12.00% CONVERTIBLE BONDS DUE 2021

AND

(2) LAPSE OF PLACING AND SUBSCRIPTION AGREEMENT

AND

(3) INSIDE INFORMATION

AND

(4) UPDATE ON SUSPENSION ON TRADING

1.

INTRODUCTION

This announcement is made by China Singyes Solar Technologies Holdings Limited (the "Company") pursuant to Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Stock Exchange") and the inside information provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the

Laws of Hong Kong).

2.

INSIDE INFORMATION

Reference is made to the announcement (the "Update Announcement") of China Singyes Solar Technologies Holdings Limited (the "Company") dated 18 October 2018 in relation to, among other things, updates on the status of debt securities of the Company. Unless the context requires otherwise, capitalised terms used in the following paragraphs shall bear the

same meanings as defined in the Update Announcement.

Loan defaults of the Group

Other than the 2018 Notes, 2019 Notes and 2019 CBs, as of 31 October 2018, the total amount of offshore loans amounted to approximately RMB219.6 million; and the total amount of offshore loans in default was approximately RMB202.1 million. The Payment Default constitutes an event of default under certain offshore loans of the Group and certain offshore loans are immediately payable on demand in accordance with their terms.

With respect to onshore loans, as at 31 October 2018, the total amount of loans in the PRC amounted to approximately RMB2,436.2 million, an aggregate amount of approximately RMB765.3 million of such loans may be regarded as being in default.

As of the date of this announcement, the onshore lenders have not demanded early repayment of their respective loans. The Group has been in close discussions with the onshore lenders. It is understood that, based on the current on-going discussions, the onshore lenders do not intend to demand immediate repayment of their respective loans and are open to considering extension of payment schedules under their respective loans.

Operations of the Group

The following describes the impact to date on the Group's principal lines of business resulting from the Payment Default, other events of default experienced by the Group, the direct and indirect consequences of such defaults and its understanding of the intentions of its onshore lenders:

  • (i) Curtain Wall and Green Building Business

    The curtain wall and green building business of the Group includes (1) construction contracts, (2) sale of goods, and (3) rendering of design and other services, which accounted respectively for 28.7%, 7.1% (among which 3.2% was generated from offshore markets and 3.9% was generated in the PRC market) and 0.2% of the total revenue (after tariff adjustment) of the Group for the year ended 31 December 2017. The business is generally funded by the Group's working capital. The majority of the construction works of ongoing projects are continuing in normal order since they generally do not involve the utilization of a large amount of working capital and the Group has been able to receive regular and recurring payments from customers, generally on a monthly basis. Payments of curtain wall projects are generally received as usual (on specified milestone dates as stipulated in the respective construction

    contracts), and are expected to provide consistent cash inflows to the Group. However,

    a considerable portion of the Group's offshore sale of goods business has been suspended due to the on-going negotiations with the Group's offshore creditor banks for cash deposits and receivables collection arrangements.

    As a liquidity preserving measure, for the time being, the Group will not bid for any new projects which have tight execution timetable and significant cash investment requirements. The Group will otherwise selectively take on any new projects which it

    considers to be appropriate from both profit and cashflow perspective.

  • (ii) Renewable Energy Business

    The renewable energy business of the Group includes the sale of renewable energy goods, rendering of operation and maintenance service, the sale of electricity (after tariff adjustment), and solar EPC projects, which accounted respectively for 12.8%, 0.2%, 4.8%, and 44.3% of the total revenue of the Group (after tariff adjustment) for the year ended 31 December 2017.

As at 30 June 2018, the Group owned photovoltaic power station projects with a total output of 467.8 MW. These projects are mainly funded by onshore project financing

loans and finance leases. The Group receives government subsidies and tariffs from its

on-grid solar farms in Guangdong monthly, and majority of the Group's on-grid solar farms in North West China are under the 6th or 7th batch of the government's subsidy program and hence the government subsidies are received on a regular basis. As at the date of this announcement, the income from sale of electricity and government subsidies is sufficient to cover the operating expenses and the interest and principal payment under the onshore loans and finance leases associated with all the power stations.

The ability of the Group to meet such interest and principal repayment obligations in the future will depend on whether the government subsidies and tariffs can continue to be received on time. The Group's financial position may be negatively impacted if there is any change in payment intervals of government subsidies in future.

Solar EPC projects generally require significant progress cash payments from the Group to its suppliers, and payments from customers are only received upon completion of a majority of the construction works for these projects. Given its current liquidity condition, the Group has failed to make various cash payments to suppliers for certain ongoing solar EPC projects. As a result, these projects under construction are delayed or suspended. As a liquidity preserving measure, for the time being, the Group is not seeking to bid for any new sizable solar EPC projects which require significant cash payments. The Group continues to closely monitor its cashflow position and regularly review its liquidity condition; it may resume suspended solar EPC projects as and when it considers appropriate from both a profit and cashflow perspective. It is the intention of the Group to resume and complete these projects when internal cash resources are available from other segments, disposal of assets and/or any other

financing sources so the Group can complete these projects under construction on time and to collect customer payments according to the contractual schedules.

(iii) New Materials Business

The new materials business of the Group, which accounted for 1.9% of the total revenue (after tariff adjustment) of the Group for the year ended 31 December 2017, is operated under China Singyes New Materials Holdings Limited, a separate company listed on the GEM board of the Stock Exchange (stock code: 8073) and a non-wholly owned subsidiary of the Company, the finances and operations of which are independent of and segregated from the Company. As a result, the Board is of the view that the new materials business of the Group is generally unaffected by the Group's

recent financial difficulties.

  • (iv) New Projects

    During the period from 17 October 2018 to 31 October 2018, the Group has won the bidding for certain new curtain wall projects with a total contract amount of approximately RMB120 million.

  • (v) Employees and Factory Production

    Currently, the Group does not have any redundancy plan to effect large-scale reduction to its labour force. However, it has reduced the production activities at its two factories, switching daily operation hours from 24 hours (3-shift) to 8-16 hours (1-2 shift).

  • (vi) Suppliers

    Currently, the relationship between the Group and its suppliers remains largely stable. The Group is actively engaging with its suppliers and seeking their understanding and

    support of the current financial condition of the Group.

Other Updates

The Group has been actively exploring opportunities to sell photovoltaic power station projects, including but not limited to those in Guangdong and other provinces of the PRC.

Further announcement(s) regarding any significant disposals will be made by the Company if and when appropriate.

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China Singyes Solar Technologies Holdings Ltd. published this content on 10 January 2019 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 10 January 2019 04:38:00 UTC