Press Release
28 February 2022
Everbright Water Announces 2021 Annual Results
Please click here for the presentation materials regarding 2021 Annual Results
Financial Highlights
| For the year ended 31/12/2008 | |||
| 2021 | 2020 | Change | |
| HK$’000 | HK$’000 | ||
| Revenue | 6,912,371 | 5,663,292 | 22% |
| Gross Profit | 2,801,589 | 2,200,536 | 27% |
| Gross profit margin (%) | 41 | 39 | 2 ppt* |
| EBITDA | 2,245,235 | 1,931,379 | 16% |
| Profit attributable by equity holders of the company | 1,200,329 | 1,024,271 | 17% |
| Basic earnings per share (HKcs) | 41,96 | 35.80 | 17% |
| Final dividend per share | |||
| (HK cents) | 6.83 | 6.07 | 13% |
| (equivalent in Singapore Cents) | 1.19 | 1.04 | 14% |
| Total dividend per share | |||
| (HK cents) | 12.58 | 9.81 | 28% |
| (equivalent in Singapore Cents) | 2.20 | 1.71 | 29% |
| (*ppt: percentage point) |
Singapore and Hong Kong, 28 February 2022 – China Everbright Water Limited (“Everbright Water” or the “Company”, stock codes: U9E.SG and 1857.HK) (中國光大水務有限公司), an environmental protection company focusing on water environment management, is pleased to announce the consolidated annual results of the Company and its subsidiaries (collectively the “Group”) for the financial year ended 31 December 2021 (“FY2021” or “year under review”).
The Group’s stable operating momentum saw it record revenue of HK$6.91billion in FY2021. Earnings before interest, taxes and depreciation (“EBITDA”) increased 22% from FY2020. Profit attributable to equity owners of the Company was HK$1.20billion, an increase 17% from FY2020. Basic earnings per share were HK41.96cs, which is an increase by HK6.16cs or 17% over FY2020. Overall gross profit margin was 41%, an increase of 2 percentage point from FY2020. The Group has access to a variety of financing channels that provide long- and short term financing options, has sufficient funds, quality assets, and a low gearing ratio and is in a healthy financial situation.
Everbright Water’s market development strategy was “high-quality development” in the past year. The Group was the first to enter the water markets in Tianjin, Hebei Province, and Mauritius. Thereby, it has solidified its business footprint in China’s strategic regions such as the Beijing-Tianjin-Hebei region, and successfully entered the water market along the “Belt and Road” route, further expanding its business outlook. The Group’s purchase of a 65% equity stake in Tianjin Binhai New Area Huantang Sewage Treatment Co. Ltd. allowed it to tap into Tianjin’s water market and gain valuable insight into the pursuit of opportunities under the mixed-ownership reform in China’s state-owned businesses. Securing Hebei Cangzhou Huanghua Waste Water Treatment Plants Public-Private Partnership Project enabled the Group to achieve comprehensive development in the Beijing-Tianjin-Hebei market. The Group’s 80%-owned subsidiary E+B Umwelttechnik GmbH secured operation and management (“O&M”) for the Mauritius St. Martin Waste Water Treatment Plant. This was an important milestone that allowed it to begin its international expansion. Additionally, the Group signed a framework agreement for Shandong Qingdao Maidao Waste Water Treatment Plant Expansion and Upgrading Project, as part of its effort to transform the Group’s Qingdao Waste Water Treatment Project (Maidao Plant) into an iconic “community-friendly” project that integrates high-quality water treatment facilities and a neighborhood-friendly park.
The Group secured 14 waste water treatment plants and 1 reusable water project in FY2021, a total investment of RMB3.76 billion. The Group also managed 1 engineering procurement and construction (“EPC”) project, and 1 overseas O&M (O&M) project. These newly secured projects provide an additional 489,000 m daily designed waste water treatment capacity3(including the O&M project’s treatment capacity) and an additional daily reusable water supply capacity, 54,000 m3. The Group had invested in or held 153 environmental projects as of 31/12/2021. The total investment was RMB28.43 billion. It also undertook 4 EPC and 3 O&M projects. These projects have a combined daily water treatment capacity exceeding 7 million m.3(includes treatment capacity for O&M projects).
China’s strategic goals of “Peaking Carbon Emission”, and “Achieving Carbon Neutrality”, were the background to which the Group conducted the necessary research and pilot programmes in relation to “Reducing pollution and carbon emission” and “Boosting synergy and efficiency”, leveraging on its business characteristics as well as competitive strengths. To support its future strategic development, the Group established six working groups that were specialized in six areas during the year under review. These included reusable water, in plant solar energy, and waste water source heat pumps. The Group launched the pilot program for in-plant solar energy at its Shandong Zibo Waste Water Treatment Project. In August 2021, the solar energy facilities were connected to the power grid. They are expected to produce electricity sufficient to meet 9% of the project’s power needs. This gives the Group valuable experience to help promote such programmes in future. The Group also participated in the first batch of pilot programs for monitoring and evaluating greenhouse gas emissions, which was organized by the Ministry of Ecology and Environment of the PRC to collect data for carbon calculation and water sample analysis.
Concerning technological innovation, the Group has continued to focus on the digital revolution that is driven through technological innovation and has made good progress. It also promoted its “Intelligent Water” management program during the year under review. The smart inspection and smart dosing systems have helped reduce the workload of frontline workers and improve the management of water projects. The Group also actively developed the “Intelligent Water” blueprint, which covers many aspects, including design and operations. It also promoted the development and implementation of information and supervisory systems. The Group provided its in-house-developed technological processes to its internal clients and external clients during FY2021. This resulted in a contract value of more than RMB100 millions. The Group was granted 28 patents in the last year, including 1 invention patent and 25 utility models. It also published 28 technical papers.
The Group took strong measures to ensure the safety and quality construction of its projects. It also implemented pandemic prevention control measures to ensure the smooth progression of its construction works. In FY2021, 6 projects were started construction by the Group, with an aggregate daily waste water treatment capacity at 130,000 m35 projects have been completed (including EPC), and have an aggregate daily waste water treatment capacity 72,500 m3; and 11 other projects that have been completed and are now in operation. These 11 projects have a combined daily wastewater treatment capacity of 249,000m.3. The Group had 13 projects at the preparatory stage as of 31 December 2021. This group has a total daily water treatment capacity in excess of 396,000 m3.
The Group continues to explore various options to improve its operations management efficiency. The Group explored the possibility of optimizing energy structures for waste water treatment plants through leveraging on projects that were in operation during the year. The Group collaborated with its partners to participate on market-based electricity transactions, in Jiangsu Province and Shandong Provinces. This helped reduce electricity costs. 9 waste water treatment plants in the Group were approved by regulators for tariff increases ranging from 4% up to 58%. Subsidies totaling RMB71.35million were also granted to the Group.
The Group continued to be flexible in choosing suitable financing tools to match its business development plan. It also kept its finance costs within a reasonable range during the year. The Company issued its second tranche of medium term notes in January 2021 with a principal of RMB1billion and a subscription rate 1.97 times. In August 2021, it issued its first tranche super and short-term commercial paper with a principal of RMB800m. These financing arrangements effectively replenished working capital in the Company’s subsidiaries.
Everbright Water made steady progress in 2021 with unrelenting effort. The Group has achieved great success through hard work and concerted effort in areas such as market expansion and technological innovation, engineering, construction, operations management and safety and environmental management. The Group has continued to develop its strategies that emphasize the “Innovation driven Development” in different aspects such as business management, research and development, and management. This allows the Group to continue to build its market position and competitive advantages in the water management sector. Looking ahead, the Group will remain true to its corporate mission of being “Devoted To Ecology and Environment For a Beautiful China”, actively participate in the national development process, and study industry trends. While maintaining stability is important, the Group will continue to adhere to the “Innovation Driven” development approach. It will also improve its strategic vision to be more international, professional, market-oriented and professional. The Group will use innovative methods to maximise existing businesses and explore new opportunities to expand its business. This is part of corporate development. It will also improve development agility, technology strengths, foster open ecospheres, and steadily “Make progress in stability, Pursue excellence in progress, and Seek innovation in excellence”. Everbright Water is confident and determined to continue pursuing “high-quality” development with a new paradigm in innovative development. The Group strives for sustainable and high returns for shareholders and other stakeholders. It also aims to contribute to China’s green and low-carbon development process.