Company Profile

Wasion Holdings Limited is the leading total solution provider of advanced metering, advanced distribution and energy efficiency management in China, and is committed to becoming an “Energy Metering and Energy Saving Expert” in China and across the world. The Group was listed on the Main Board of the Stock Exchange of Hong Kong Limited in December 2005, which was the first professional syndicate engaged in energy metering and energy efficiency management in China listed overseas, as well as the first company in Hunan Province listed on the Main Board overseas. In 2017, Wasion Holdings recorded revenue of RMB2,928 million and total assets of RMB7,884 million.

Wasion Holdings has long been focusing on the research and development, production and sales of total solutions relating to energy metering and energy efficiency management, the products and services of which have been extensively applied in energy supply industries for electricity, water, gas and heat, and large energy-consuming units of large-scale public infrastructure, petroleum and chemical, transportation, machine manufacturing, metallurgical and chemical fields and residents.

The advanced smart metering business of the Group mainly comprises of comprehensive smart meters, smart water meters, smart gas meters and ultrasonic calorimeters; various meters and power quality monitoring devices; comprehensive energy data collection terminals, load management terminals and user management devices; measurement automation systems and various application systems, services and energy data mining. The Group, with more than 20% of the domestic market share of high-end metering products, has built up its leading position in China and is the only professional manufacturer in China which provides various advanced energy metering products, systems and services for electricity, water, gas and heat, as well as satisfies the demand of the whole process from energy production, transmission and distribution to consumers.

The advanced smart metering business of the Group mainly comprises of comprehensive smart meters, smart water meters, smart gas meters and ultrasonic calorimeters; various meters and power quality monitoring devices; comprehensive energy data collection terminals, load management terminals and user management devices; measurement automation systems and various application systems, services and energy data mining. The Group, with more than 20% of the domestic market share of high-end metering products, has built up its leading position in China and is the only professional manufacturer in China which provides various advanced energy metering products, systems and services for electricity, water, gas and heat, as well as satisfies the demand of the whole process from energy production, transmission and distribution to consumers.

The advanced distribution and energy efficiency management business of the Group comprises mainly of 40.5kV/12kV comprehensive high voltage switchgear; 12kV smart switchgear; 35kV/10kV comprehensive circuit breakers; 10kV power distribution automation terminals; electrical and electronic devices for power quality control and smooth connection with new energy; smart distribution systems, engineering and services; energy-saving services, etc. The Group is devoted to becoming the leading total solution provider for advanced distribution system in China.

Amidst the substantial changes in energy production and energy consumption mode in China and the world, the material social responsibility and development opportunities arisen from energy saving and carbon reduction as well as the new demand of smart power grids, Wasion Holdings will adhere to its corporate motto “Energy Metering and Energy Saving Expert” while upholding its core value “Perfect Work with Passion, and Success Achieved with Integrity” by continuous innovation and improvement in order to become the pioneer in smart power grids and smart metering in China, one of the major international smart power grids and smart metering provider and a well-known international brand.

In the future, every city, every enterprise and every family will be benefited from the use of the technology, products and services of Wasion.

Chairman’s Statement

TO ALL SHAREHOLDERS,

On behalf of the board of directors of Wasion Holdings Limited (the “Group”), I am pleased to present the operating results of the Group for the financial year ended 31 December 2017.

China accelerated its pace of economic restructuring amidst the global economic recovery in 2017. Given the favourable market condition, the Group adhered to the operating guideline of “seeking progress in stability” to manage both opportunities and risks on a proactive and prudent manner while promoting the development of each of its business segment in a solid way. During the year, the Group recorded turnover of RMB2,928 million, representing an increase of 12% over 2016. EBITDA amounted to RMB572 million, representing an increase of 14% over 2016. Net profit after deducting minority shareholders’ interests stood at RMB301.58 million. Earnings per share was RMB30 cents. The proportion of balance of trade and other receivables over current assets decreased to 61% at the end of 2017 from 66% at the beginning of the year. Trade receivable turnover period improved by 30 days. The board of directors proposed to pay a final dividend of HK$0.24 per share in return of the shareholders’ continuous support.

Leveraging on its highly-recognized research and development strength, high quality end-customer base and marketing channels, together with cooperation with various well-known enterprise worldwide, the Group’s strategy of optimizing customer base has been proved to be fruitful, reflected by more diversified customer base. Overall, the power advanced metering infrastructure business performed well this year. The Group succeeded in bidding for contracts of over RMB660 million offered by the State Grid and the Southern Grid, outperforming its peers in both numbers and amounts. In 2017, the Group posted good results in the market served by the Southern Grid, offsetting the decrease in the tender volume from the State Grid. The communication and fluid advanced metering infrastructure business achieved satisfactory results growth throughout the year. Driven by the demand arising from “Internet+” smart energy market, the Group refined and intelligentized the management of water, electricity, gas and heating energy consumption, with its products and solutions being widely used in households and enterprises. As for the advanced distribution operations (“ADO”) business, the Group proactively commenced cooperation with customers other than the power grid companies, and successfully undertook numbers of power distribution system projects, including Changsha Metro Group and various production bases of new energy-powered batteries. The completion of the underground pipeline project in Changsha and the construction project of the information center of China Telecom in Dongjiang River, Hunan have further improved the Group’s comprehensive strength in the key ADO businesses.

The Group is committed to providing products and services with high quality, high efficiency and high technologies. In June 2017, it received the Hunan Governor Quality Award (湖南省省長品質獎), the highest honor in respect of quality in Hunan province. Following the National Intelligent Manufacturing Experimental and Demonstration Enterprise (國家 智能製造重點專項及試點示範企業) granted by the MIIT in 2016, the Group was also included on the list of “National Green Factory” (國家級綠色工廠) by the MIIT in November 2017.

In the future, we will continue to focus on technological innovation, maintaining its leading position in technologies and product upgrade in the industry. In the market served by the State Gird and the Southern Grid, the Group will introduce new smart meters to cater for rising market demands in addition to satisfying needs of expansion and replacement. In non-power market and new energy market, smart meters in line with the new specification required by the internet of energy will be launched. In gateway meter market, the Group will further diversify its product mix while facilitating traditional market shares.

In communication and fluid advanced metering infrastructure segment, the Group will keep pace with the development of communication and water metering industry in China. While focusing on the quality of its pilot projects in Hunan province, the Group will explore comprehensive solutions to the smart water business in other key provinces and cities throughout the country, and be proactively engaged in the water project tenders organized in different provinces and dedicated to improving its after-sales service. With various proprietary intellectual properties in communication technologies including power line carrier and low frequency wireless telecommunication, diversified products applying GPRS, 4G, and NB-IoT and strong competence in network-building and solutions, the Group is well positioned to improve its industrial chain, promote the communication experience in the emerging strategic areas such as internet-of-things and internet-of-energy in order to satisfy various market requirements due to regional and environmental disparity and improve its comprehensive technological strength and competitive edge in the market.

In terms of the ADO business, the establishment of advanced distribution network has been one of the priorities in the power sector development in China in the future. Demand for facility upgrade as a result of the primary and secondary power equipment integration technology presents significant opportunities for the power grid market. As a new model of business, comprehensive service, such as solutions and engineering procurement construction, will be the Group’s priority for development. With higher proportion of electricity in the end market of energy consumption and wider application of new energy, stored energy and electric vehicles, the Group will launch new products, approaches and services to meet customer’s rising demand for being smart and energy-saving in the market of comprehensive energy service and smart operation and maintenance by identifying new technologies, line of products, new market opportunities, new model of business and new source of revenue for its advanced distribution solutions.

Meanwhile, with the implementation of “One Belt, One Road” initiative in China, it has been a tendency for energy connect worldwidely. The development of the power advanced metering infrastructure and the construction of power grid in the prepherial countries is expected to usher in a wider space. The Group’s overseas business will embrace more development opportunities emerged in areas of metering solutions to electricity, water, gas and heating energy, end communication business, facilities of advanced power distribution system, construction of power distribution works, and distributed power generation.

Looking forward, under the operating principle of “march forward through innovative development” and driven by the market and customer, we will be determined to expand business scale, improve market structure, enhance product competitiveness and boost profitability by focusing on the improvement of overall operating quality to create values for the industry with its advanced technologies and leading position, and ultimately, to create values for its shareholders with solid returns.


Yours faithfully,
Ji Wei
Chairman

Hong Kong, 28 March 2018

Board of Directors

Mr. Ji Wei - Executive Directors

Mr. Ji Wei (吉為), aged 61, is an executive Director, the chairman of the Company and the founder of the Group. Mr. Ji is responsible for the Group’s overall strategic planning and the formulation of corporate policies. Prior to founding the Group in 2000, Mr. Ji was a business manager of Hunan Province Minerals Import and Export Company (湖南省五金礦產進出口公司) between 1980 and 1985 and the import and export manager of Hunan International Economic Development (Group) Company (湖南省國際經濟開發(集團)公司) between 1985 and 1989. Mr. Ji is also a director of Hunan Classic Investment Co., Ltd. (湖南經典投資有限公司). Mr. Ji was appointed as an executive Director of the Company with effect from 20 July 2004. Mr. Ji was consecutively appointed as a member of the 10th, 11th, and 12th Chinese People’s Political Consultative Conference of Hunan Province from 2007 to date. He was awarded with several honourary titles such as “Most Socially Responsible Entrepreneur”, “Most Caring Entrepreneur on Staff Development”, “Excellent Entrepreneur of Changsha Hi-Tech Zone”, “The Sixth Top Ten Educational Entrepreneur Award in China” and “Special Recognition Award for Occupational Technology Creation in Hunan Province”.

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Ms. Cao Zhao Hui - Executive Directors

Ms. Cao Zhao Hui (曹朝輝), aged 50, is an executive Director and the chief executive officer. Ms. Cao graduated from Hunan Commerce College with a bachelor degree in Economics. She also obtained a degree in executive master of business administration (EMBA) from the University of Hunan (湖南大學). Ms. Cao joined the Group in 2000 and was appointed as an executive Director of the Company with effect from 3 March 2005.

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Mr. Zeng Xin - Executive Directors

Mr. Zeng Xin (曾辛), aged 47, is an executive Director and General Manager of Wasion Electric Limited. Mr. Zeng graduated from the National University of Defense Technology with a bachelor’s degree in system engineering in 1992. During 1992 to 1993, he studied in the Qinghua University for a postgraduate degree programme. In 1995, Mr. Zeng obtained a master degree in engineering from the China Academy of Space Technology (中國空間技術研究院). In 2012, he graduated from the Advanced Management in the Energy Sector of Cheung Kong Graduate School of Business. He participated in several research projects in the China Academy of Space Technology (中國空間技術研究院) during his studies and after graduation. Mr. Zeng was a general manager for domestic sales of Wasion Group Limited, a general manager of Weisheng Energy Industrial Technology Co., Ltd., and vice president of the Group since 2006. Mr. Zeng joined the Group in July 2004 and was appointed as an executive Director of the Company with effect from 1 September 2005.

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Ms. Zheng Xiao Ping - Executive Directors

Ms. Zheng Xiao Ping (鄭小平), aged 54, is an executive Director and the President. Ms. Zheng graduated from the Taiyuan University of Technology with a bachelor’s degree in industrial automation in 1984. She obtained a master degree of engineering in automation from the North China Institute of Technology in 1987 and holds the qualification of Senior Engineer. Between 1987 and 1988, Ms. Zheng was a teaching assistant at the North China Institute of Technology. She lectured at the Taiyuan University of Technology between 1988 and 1993 and was appointed as the research director of Hunan Weisheng Electronics Co., Ltd. (湖南威勝電子有限公司) from 1993 to 2000 being responsible for the research and development work. She joined the Group in 2000 and was responsible for the research and development work of the Group. Ms. Zheng was appointed as a director of Changsha Weisheng Electronics Co., Ltd. (長沙威勝電子有限公司) in March 2004 and an executive Director of the Company with effect from 1 September 2005. Ms. Zheng was also awarded with various honourary titles such as “The Seventh Group of Outstanding Experts in Changsha”, “Top Ten Women Entrepreneurs with Outstanding Achievement in Changsha City”, “Awarded Women with Contribution and Improvement in Changsha Hi-Tech Zone”, “National Labour Day Medal” and “National Top Ten Technological Worker in Electronic Devices and Meters Industry”.

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Mr. Tian Zhongping - Executive Directors

Mr. Tian Zhongping (田仲平), aged 37, is an executive Director as well as the Vice President and General Manager of the Overseas Sales Department of the Group. Mr. Tian graduated from Xiangtan University (湘潭大學) with a bachelor degree in Engineering in 2002, and obtained a master degree in Control Engineering from Zhongnan University (中南大學) in 2008. Mr. Tian joined the Group in 2002 after graduation and had held positions as Development Engineer for firmware, Project Manager, Product Development Manager, Deputy Chief Engineer and General Manager of the Overseas Sales Department of the Group. During the period when he was a Development Engineer of the Group, Mr. Tian has obtained more than ten patents for products and technology. Mr. Tian was appointed as an executive Director of the Company on 26 January 2017. Mr. Tian was awarded with an honorary title of Excellent Entrepreneur of Changsha Hi-Tech Zone in 2017.

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Mr. Kat Chit - Non-Executive Directors

Mr. Kat Chit (吉喆), aged 34, is a non-executive Director. Mr. Kat graduated from the University of British Columbia of Canada with a bachelor degree in economics in 2007. From 2007 to 2011, he was an executive of the equity capital markets division of Macquarie Group Limited and was a director and the general manager of Guangdong Ruiding Power Technology Company Limited (廣東銳頂電力技術有限公司) since November 2014. Mr. Kat was appointed as a non-executive Director of the Company on 12 August 2014. Mr. Kat is the son of Mr. Ji Wei, the chairman, executive Director and controlling shareholder of the Company.

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Mr. Huang Jing - Independent Non-Executive Directors

Mr. Huang Jing (黃靖), aged 61, is an independent non-executive Director. Mr. Huang graduated from Sichuan University with a bachelor degree in English. He obtained his master degree in history from Shanghai Fudan University, and his doctor of philosophy degree in political science from Harvard University. Mr. Huang is currently a Richard Von Weizsäcker fellow from the Robert Bosch Stiftung. Mr. Huang had been a Lee Foundation chair professor of US-China Relations and director of Centre on Asia and Globalisation at the Lee Kuan Yew School of Public Policy, National University of Singapore. Prior to joining the Lee Kuan Yew School of Public Policy, Mr. Huang had taught at Harvard University, University of Utah and Stanford University. Mr. Huang had also been a senior research analyst at the Brookings Institution. Mr. Huang is a senior overseas economic analyst for China’s Xinhua News Agency, an advisory member of European-House Ambrosetti Foundation in Italy, a member of the Academic Board of Stars Foundation in Switzerland, a member of the Academic Board of the Center on China and Globalization, and a member of the Global Agenda Council at the World Economic Forum. Mr. Huang was appointed as an independent non-executive Director of the Company on 18 October 2016.

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Mr. Luan Wenpeng - Independent Non-Executive Directors

Mr. Luan Wenpeng (欒文鵬), aged 53, was an independent non-executive Director with doctor’s degree in electrical engineering. Mr. Luan is a PEng in British Columbia, Canada, a senior member of IEEE and a member of CIGRE. He has been engaged in the works as well as the research of systematic planning of the electrical power system, smart power grids, smart metering infrastructure, distribution automation, data analysis, distributed energy resources integration, asset management etc. for more than 16 years. As a distinguished expert of state level”, Mr. Luan is currently a chief expert in smart metering of the China Electric Power Research Institute, general secretary of the Technical Board of IEC distributed electric power system (SC8B), the chairman of the IEEE working group for microgrids planning and design (IEEE 2030.9 WG). Mr. Luan was appointed as an independent non-executive Director of the Company on 16 May 2016.

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Mr. Cheng Shi Jie - Independent Non-Executive Directors

Mr. Cheng Shi Jie (程時杰), aged 72, is an independent non-executive Director. Mr. Cheng graduated from the Xi’an Jiaotong University with a bachelor degree in electronic engineering in 1967, the Huazhong University of Science and Technology with a master degree in electrical engineering in 1981 and the University of Calgary, Canada with a doctoral degree in philosophy in 1986, respectively. He has been a professor in the Huazhong University of Science and Technology since 1991 and a visiting professor in the Nanyang Technological University in 1995 and 1996. Mr. Cheng was granted the qualification of doctoral tutor by the Academic Degrees Committee of the State Council in 1993 and was elected as an academician of the Chinese Academy of Sciences and a fellow of the Institute of Electrical and Electronics Engineers (美國電子電氣工程師協會) in 2007 and 2010 respectively. Mr. Cheng was appointed as an independent non-executive Director of the Company on 12 August 2014.

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Mr. Hui Wing Kuen - Independent Non-Executive Directors

Mr. Hui Wing Kuen (許永權), aged 69, is an independent non-executive Director and an Australian by nationality. Mr. Hui has extensive financial and taxation experience in Hong Kong and Australia. He is a member of the Hong Kong Institute of Certified Public Accountants, the Hong Kong Institute of Chartered Secretaries and CPA Australia. He obtained his Master of Business Administration degree from the University of South Australia. Mr. Hui was previously an independent non-executive Director of the Company from September 2005 to May 2014. Mr. Hui was appointed as an independent non-executive Director of the Company on 15 May 2015.

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Mr. Choi Wai Lung Edward - Senior Management

Mr. Choi Wai Lung Edward (蔡偉龍), aged 49, is the chief financial officer and company secretary of the Company. Mr. Choi is a fellow member of the Hong Kong Institute of Certified Public Accountants and the Association of Chartered Certified Accountants with over 27 years of experience in accounting, auditing and finance.

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Corporate Governance