China Everbright Greentech (1257) H1 2024 earnings summary

Executive summary

• Revenue for 1H2024 was HK$3,505.6 million, down 8% year-over-year, mainly due to a 61% drop in construction services revenue and continued pressure in hazardous and solid waste treatment.

• EBITDA declined 13% to HK$1,100.4 million, impacted by lower construction revenue, weaker demand for hazardous and solid waste treatment, and reduced treatment fees.

• Profit attributable to equity shareholders fell 45% year-over-year to HK$143.9 million; basic EPS dropped to HK6.97 cents.

• Interim dividend per share was HK1.4 cents, down from HK2.5 cents last year, with a payout ratio of 20.1%.

• The company maintained stable operations amid a challenging macroeconomic and industry environment, focusing on core businesses and innovative development.

Financial highlights

• Total assets at HK$38,891.4 million, total liabilities at HK$26,396.7 million; equity attributable to shareholders rose 1%.

• Gearing ratio improved to 67.87% (down 1.05ppt), and current ratio increased to 137.05% (up 25.15ppt), indicating stronger liquidity.

• Net asset value per share increased to HK$5.53 from HK$5.46 at year-end 2023.

• Cash and bank balances stood at HK$2,041 million; available cash and unused bank loan facilities totaled HK$9,271 million.

• Short-term loans fell 23% due to recovery of national tariff subsidies; effective interest rate lowered to 3.64%.

Outlook and guidance

• Strategic focus on developing clean energy operations, including distributed solar, energy storage, and virtual power plants.

• Plans to expand "Zero-carbon Industry Park" projects and asset-light business models to enhance profitability and sustainability.

• Emphasis on innovation, R&D, and international expansion, particularly in Belt and Road countries.

• Management expects ongoing challenges from subsidy withdrawal and slow economic recovery but aims to strengthen competitiveness and value creation.

• Focus remains on stable operation, cost reduction, and leveraging new business models.