SIIC Environment Q1 profit jumps 47.3% to 150m yuan

MAINBOARD-listed SIIC Environment Holdings posted a 47.3 per cent rise in first quarter net profit to 150.1 million yuan (S$30.3 million), from 101.9 million yuan a year ago.

This was from higher water treatment and supply sales volume contributed from existing entities, the wastewater treatment firm said on Thursday morning before the market opened.

For the three months ended March 31, earnings per share rose to 5.76 fen, from 3.91 fen a year ago. No dividend has been declared, unchanged from the year before. Shares of the company closed at 31 Singapore cents on Tuesday, down one cent.

Revenue rose 13.4 per cent to 1.33 billion yuan, from 1.18 billion yuan in the prior year after revenue across all categories increased.

Construction revenue rose 1.9 per cent to 509 million yuan, from 499.6 million yuan a year ago from a higher amount of construction activities compared with the previous year.

Operating and maintenance income from service concession arrangements grew 16.3 per cent to 479.0 million yuan, from 411.8 million yuan a year ago, due to higher water treatment and supply sales volume.

Financial income from service concession arrangements also rose, 16.4 per cent to 232.2 million yuan from 199.4 million the year before, also from higher water treatment and supply sales volume.

Service income from non-service concession arrangements climbed 32 per cent to 39.5 million yuan from 30.0 million yuan the year before. This was from higher water treatment volume from operations and maintenance projects compared with a year ago.

Other income meanwhile, more than doubled to 75.8 million yuan from 36.5 million yuan a year ago, due to ad-hoc installation works carried out.

On outlook, the group said upgrading of existing wastewater treatment infrastructure remains a key business focus for the group in fiscal 2019. This is because more stringent environmental mandates are expected to drive demand from industrial sectors pushing for new investments or upgrades to local wastewater treatment facilities.

The Chinese government continues to implement strict measures for higher standard water treatment across the country, while adopting a no-tolerance approach for rule breaks in the fight against environmental pollution, the group added.

"Looking ahead, investments in the construction of urban wastewater treatment and recycling facilities are projected to reach RMB565 billion under the 13th Five-Year Plan, which let us remain optimistic on the industry outlook and opportunities in the months to come," Xu Xiaobing, chief executive officer of SIIC Environment Holdings said.