Neo-Neon Lands LED Lighting Contracts From Sinopec

Taipei, Dec. 1, 2011 (CENS)--Hong Kong-listed lighting maker Neo-Neon Holdings Ltd. recently announced it has won a two-year contract to equip gas stations run by Sinopec Corp., mainland China’s No.1 petrochemical manufacturer, with LED lighting fixtures.

According to the lighting manufacturer, which was founded by Taiwanese and headquartered in Guangdong Province of the mainland, it has begun supplying the fixtures to the petro company’s 1,360 gas stations in Shanxi Province as the first step of the provision. The initial provision is estimated to bring in sales revenue of around RMB76.5 million (US$11.9 million at US$1: NT$6.4).

In two separate deals, the company singed a two-year contract for its subsidiary, Neo-Neon LED Lighting International Co., Ltd., to provide the Beijing Centergate Development and Construction Co., Ltd. with LED lighting fixtures and a contract to co-found an energy venture with a Chinese state-run suburban welfare promotion center.

All these deals have given a huge boost to Neo-Neon’s share prices, making its share price in Hong Kong stock market surge 10.5% to close at HK$1.6 on Nov. 29 and its Taiwan Deposit Receipt units rallying 3% to close at NT$4.21 the same day.

Neo-Neon announced its sales result for the half year closing on September 30 this year were HK$788 million (US$102 million at US$1: HK$7.7), up 7.9% from the same half of last year. However, it reported a loss of HK$102 million (US$13 million) in the meantime.

The company stated in a press release that festering global economy and LED oversupply were the major factors behind the loss. The sales growth, the company ascribed, was mostly due to the acquisition of HCI Acquisition Corp., a U.S.-based LED company designing, manufacturing and distributing the products, in Jan. this year. The acquisition contributed Neo-Neon HK$219 million (US$28 million) in revenue.

Neo-Neon Holdings Chairman Ben Hung pointed out that the company is working to minimize the impact of the European and American economic meltdowns on its operations by boosting sales in mainland China, which is designated by the company to be its next earnings source.