SIIC more than doubles Q4 earnings

Water treatment firm SIIC Environment saw fourth quarter earnings more than double to 65.9 million yuan (S$14.32 million), despite a lower revenue, thanks to a higher share of results from joint ventures and associates.

The group recorded a net profit of 31.3 million yuan for the same period a year ago. It posted revenue of 286 million yuan, down 34.5 per cent from the corresponding period in 2013, mainly due to less substantial completion of certain projects, and the divestment of its engineering, procurement and commissioning business in the third quarter.

Still, its bottomline was given a boost by the 18.4 million yuan it received in its share of results from joint ventures and associates, compared with 4.4 million yuan a year ago. Its newly acquired associate Longjiang Environmental Protection Group and joint venture Shanghai Pucheng Thermal Power Energy had contributed to the higher results..

The group now has a portfolio of about 70 water treatment and supply projects, with a capacity of 5.5 million tonnes a day, and three incineration plants with a capacity of 3,200 tonnes a day. Most of these have started contributing to the group, with the rest starting contribution in FY2015/2016, SIIC said.

The firm added that it will continue to "actively seek" merger and acquisitions opportunities.

The penetration of wastewater treatment capacity in urban areas in China has risen from 57.1 per cent in 2006 to nearly 90 per cent in 2013, but the municipal waste water treatment sector remains very fragmented, it noted.

"This presents huge market potential which is favourable to companies with strong fundamentals and the group believes it is well-equipped to capture these M&A opportunities going forward," it said in a statement.

The counter ended trading 0.1 cent lower at S$0.131 on Monday.