China Water Affairs Announces FY2014/15 Annual Results
Core Business Continues to Grow Strongly
2015/6/29 下午 01:10:00 cwg

Results Highlights:
 
For the year ended 31 March
 
 
2015
HK$m
2014
HK$m
Change
Revenue
2,859
2,747
+4%
Gross profit
1,352
1,147
+18%
Profit from operations
1,137
829
+37%
Net profit
704
558
+26%
Profit attributable to Owners of
 the Company
371
281
+32%
Earnings per share (in HK cents)
26.17
19.77
+32%
Full year dividend per share (in HK cents)
7
5
+40%
 
(29 June 2015, Hong Kong) China Water Affairs Group Limited (“China Water Affairs” or the “Company”, stock code: 00855.HK), the leading integrated water services operators in China, today announced the annual results of the Company and its subsidiaries (the “Group”) for the twelve months ended 31 March 2015 (the “Period”).
During the Period under review, total revenue of the Group was HK$2,859 million, an increase of 4% compared with 2014, driven by the growth in city water supply and waste water treatment business. Gross profit increased by 18% to HK$1,352 million Y-o-Y. Gross profit rate increased 5 percentage points to 47% Y-o-Y, reflecting further improvement on profitability. Profit from operations was HK$1,137 million, a significant increase of 37% Y-o-Y. Net profit was recorded at HK$704 million, up 26% Y-o-Y. Profit attributable to Owners of the Company increased by 32% to HK$371 million. The Board of Directors recommends a final dividend of 4 Hong Kong cents per share, taking the total dividends in the Period to 7 Hong Kong cents per share, up 40% Y-o-Y.
During the Period under review, the Group’s core water business recorded solid results. Revenue from city water supply segment was HK$2,197 million, an increase of 17% compared with 2014. This represented 77% of the Group’s total revenue and remained as the main income source of the Group. Profit from this segment was HK$941 million, an increase of 29%. The revenue from sewage treatment segment was HK$170 million, a sharp increase of 106%.  Profit of this segment was HK$56 million, a significant increase of 76% compared with 2014. The total revenue from city water supply and sewage treatment was recorded at HK$2,367 million, up 21% as compared with 2014 and accounted for 83% of the Group’s total revenue. The total profit from the two segments was HK$997 million, 31% higher than 2014 and accounted for 88% of the Group’s total profits. The profitability of the Group’s core business segments continues to grow strongly.
Mr Duan Chuan Liang, Chairman of the Group, said, ‘During the Period under review, the Group has undertaken a series of merger and acquisition activities and strengthened internal operational control. Meanwhile, the Company stepped up its efforts in tariff collection and recovery and implemented a water leakage reduction scheme. The efforts have elevated the profitability of water supply core business, signifying our strategic initiatives to concentrate on water supply business and eliminate the reliance on property development. The acquisition of Goldtrust’s water business will create a new O&M operation model with lighter investment in water assets, boosting its future rapid growth.
As of 31 March 2015, the total assets of the Group were HK$15.102 billion, up 12% from 31 March 2014. Total equity amounted to HK$6.436 billion, increased by 13% from 31 March 2014. The net gearing ratio was slightly up by 1 percentage point to 55%, reflecting the rapid growth of the Group’s core business and business projection for future development.
Looking ahead, Mr. Duan Chuan Liang, commented, “The Chinese Government is deepening the reform of water industry and promoting the adoption of the Public-Private Partnership (PPP) mode to develop civil infrastructure projects, aiming to build a long-term PPP in the areas of infrastructure and public services. On 21 April 2015, the State Council issued ‘Measures for the Management of Infrastructure and Public Utilities Concession’ (『基礎設施和公用事業特許經營管理辦法』) to further open up the investment opportunities to the social and private funds in the field of concessionary utilities. The development of concessionary infrastructure and utilities will be one of the ‘twin engines’ of China’s economic development. Furthermore, the State Council has just issued a policy of ‘Water Ten Plan’, rolling out a road map of water tariff reform. They aim to start the progressive water tariff system across the county by the end of 2015, fully utilize the market mechanism. With opportunities arisen from the government’s policy, and backed by the company’s strategic positioning and sound financing, we will scale up the merger and acquisition activities to create synergy with our existing businesses and to improve our operational efficiency, bringing larger returns to our shareholders.”
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About China Water Affairs Group Limited
China Water Affairs Group Limited is principally engaged in waterworks investment and operations as well as other related businesses in the PRC. The Group’s businesses include urban water supply, water supply systems management, meter installation and related value-added businesses. Currently, the Group is undergoing rapid development, with operations being extended to over 30 cities in various provinces including Guangdong, Jiangxi, Henan, Jiangsu, Hunan, Hubei, Sichuan etc. With a well established cooperative relationship with various local water authorities, the Group has achieved a leading position in the PRC water industry.
 
This press release is issued by PRChina Limited on behalf of China Water Affairs Group Limited.
 
For investor and media enquiries
PRChina Limited
Charles Chan / Henry Chik
Tel: (852) 2522 1838 / (852) 2522 1368
Email: ckchan@prchina.com.hk / hchik@prchina.com.hk

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