SmartHeat propelled to top-gainer spot

Energy technology company SmartHeat Inc. (HEAT, quote) was the top gainer yesterday, finishing up 91.61% in the NASDAQ.

A SmartHeat PHE unit

HEAT is a U.S. penny-stock company that operates in China and products heat pumps, heat meters, and other similar energy products. The company designs products to help remedy China’s air pollution problem, caused in part by extensive coal burning for heat and cooking.

This spike was prompted by yesterday’s release of HEAT’s 2011 financial results. Fourth quarter 2011 sales increased to $33.68 million compared to $16.57 million in third quarter. The rest of the numbers, however, were less than stellar, including decreased sales and deliveries compared to 2010 and an operating loss of $8.82 for the fourth quarter. 

CEO James Jun Wang attributed losses to a slowdown in the Chinese economy across the board. China’s GDP growth rate decreased from 2010 to 2011. He hopes to open up new sales channels to improve income.  

NF Energy Savings Corp. (NFEC, quote), a competitor of HEAT in China’s energy manufacturing sector, also posted 2011 financial results this week. Gross profit was $4.17 million and the company also made progress in building new manufacturing facilities. 

Despite NFEC posting more impressive 2011 numbers, HEAT received more attention in the stock market. The company hopes this momentum, as well as a new cost-cutting strategy, will yield success for the rest of the year.