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China Natural Gas, Inc. Message Board

  • lemew@frontier.com lemew Aug 22, 2013 4:40 PM Flag

    Shuwen Kang on LNG Gross margins fro Q-1

    "Gross margin for our LNG business was 22.1% for the three months ended March 31, 2013, increased from 17.5% for the three months ended March 31, 2012, attributable to the increase of sales price and decrease of processing costs of LNG. This gross margin is lower than that of CNG sold through fueling stations, because till March 31, 2013, we had been selling the greatest part of LNG to industrial customers at wholesale price. We expect that the gross margin of LNG sales will be improved as eight semi-trailers have begun operations as of March 31, 2013, selling LNG to vehicles at retail price, with a gross margin of approximately 50%."

    The wholesale cost means little, it is the margin where the value sits.

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    • lemew@frontier.com lemew Aug 22, 2013 7:12 PM Flag

      and wouldn't you know, here is the comment for Q-2 on gross margins: "Gross margin for our LNG business was 19.7% for the three months ended June 30, 2013, decreased from 26.7% for the three months ended June 30, 2012, attributable to the decrease of sales price and increase of processing costs of LNG. This gross margin is lower than that of CNG sold through fueling stations, because till June 30, 2013, we had been selling the greatest part of LNG to industrial customers at wholesale price. We expect that the gross margin of LNG sales will be improved as eight semi-trailers have begun operations as of June 30, 2013, selling LNG to vehicles at retail price, with a gross margin of approximately 50%."

      If the margins for LNG Q-1 and Q-2 were 50%, earnings and EPS respectively: $6.4m and $5.9m for net income; $0.30 and $0.27 for EPS.

 
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