SINGAPORE (May 15): China Everbright Water reported 1Q19 earnings of HKD206.4 million ($36 million), up 16% from a year ago.
Basic earnings per share rose to HKD0.077 from HKD0.068 a year ago.
Revenue rose 26% or HKD272 million to HKD1.3 billion mainly due to higher sales from construction and operations as well as higher finance income.
Sales from construction rose HKD205.25 million mainly due to the construction of several water treatment and water supply projects as well as to the expansion and upgrading of several wastewater treatment plants.
Sales from operations rose HKD49.50 million due to the start of operations of new projects and tariff hikes.
Finance income rose HKD17.60 million due to the increase in contract assets.
Direct costs and operating expenses increased 31% to HKD887.04 million mainly due to higher construction costs.
1Q19 gross profit grew 18% to HKD426 million while overall gross profit margin stood at 32%.
Finance costs increased 40% HKD90.75 million.
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As at March 31, gearing stood at 56.5%.
In 1Q19, the group saw a total of 14 projects under construction. These include 10 wastewater treatment projects, two water environment treatment projects and two water supply projects.
Construction of these projects was carried out smoothly, with one project having completed construction and commenced operation during the period under review.
In terms of operations management, in 1Q19, a total of seven wastewater treatment plants of the company received regulatory approval for tariff hikes, ranging from 21% to 56%.
As at end March, group net asset value per share increased to HKD3.17 from HKD2.98.
In its outlook statement, China Everbright Water says there is less than two years left to reach the various environmental management goals set by the Chinese government.
As at 4.12pm, shares in China Everbright Water are trading at 4 cents.
