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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.

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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.