China Everbright FY18 profit grows 32%; to pay out 0.5 Singapore cent/share

CHINA Everbright Water's net profit rose 32 per cent to HK$676.5 million (S$116.5 million) for 2018 as it recorded higher revenues from construction, operation and finance, the water treatment company announced on Wednesday during the market's midday trading break.

Earnings per share was HK$0.256 for the 12 months ended Dec 31, 2018. The company is proposing a final dividend of S$0.005 per share, up from the S$0.0049 year-ago payout. China Everbright shares were trading at 34.5 Singapore cents as at 1.16pm on Wednesday, up 1.5 per cent or half a cent on the day.

Revenue grew 33 per cent to HK$4.8 billion during the year, as the construction of a sponge city project, water supply, and expansion and upgrading contracts helped to raise construction revenue by HK$698.9 million. Operation revenue grew by HK$358.3 million on the commencement of new projects, tariff hikes for several projects and one-off income of HK$75.2 million from retrospective tariff adjustment from two waste-water treatment projects. Finance revenue increased by HK$119.5 million due to an increase in service concession financial receivables.

Net asset value per share declined slightly to HK$2.98 from a year-ago HK$2.99. Current and non-current service concession financial receivables rose 14.2 per cent to HK$13.2 billion as at end-2018 due to the recognition of construction revenue for expansion and upgrading projects for several water plants, the sponge city construction project and other projects.

Trade and other receivables, both current and non-current, grew 45.1 per cent to HK$1.2 billion due to an increase in operation revenue from waste-water treatment and reusable water projects, the acquisition of Xuzhou Engineering Design Institute and the start of operations at a few projects.

Cash and cash equivalents shrank by 17.7 per cent to HK$1.7 billion as the company burned HK$1.0 billion of cash for operating activities.

Looking ahead, the company expects the water environment management sector to maintain a rapid pace of growth. The company said it will "continue stable growth and seek opportunities to foster its strength and achieve excellence" in that market environment.