China Everbright Water (U9E) AGM 2024 presentation summary

Financial performance

• FY2023 revenue was HK$6.705bn, down 0.3% YoY; gross profit rose 10% to HK$2.822bn and gross margin increased 4 ppt to 42%.

• EBITDA rose 13% to HK$2.470bn; profit attributable to equity holders increased 17% to HK$1.187bn and basic EPS rose 17% to HK41.51 cents.

• Full-year dividend increased 17% YoY to HK12.44 cents per share; final dividend was HK5.81 cents per share.

• At year-end, total assets were HK$34.221bn, up 2% YoY; gearing was 60.7%, down 0.4 ppt, and return on shareholders’ equity was 10.6%.

• Operating income’s share of revenue increased from 28% in 2019 to 46% in 2023; 2019–2023 CAGRs were 5% for revenue, 11% for EBITDA and 8% for attributable profit.

Operating performance and expansion

• In 2023, 6 new projects were secured and 1 supplementary agreement signed; the portfolio also added 2 O&M and 3 EPCO projects, plus other asset-light work.

• The footprint covered 60 districts, counties and cities across 13 provinces, municipalities and autonomous regions, plus 1 overseas market; 166 invested and held projects represented ~RMB30.8bn of investment.

• Designed water treatment and supply capacity was ~7.47m m³/day; 2023 wastewater treatment volume was ~1.749bn m³, while reusable water supply rose 5% YoY to ~46m m³.

• Four in-plant solar facilities generated over 10m kWh of green electricity in 2023; 11 wastewater plants received tariff increases of 4%–36%, and subsidies totaled ~RMB33m.

• More than 10 R&D projects were initiated and 28 patents granted; in-house technological processes secured contract value of ~RMB192m.

Financing and liquidity

• Year-end borrowings totaled HK$15.405bn, with long-term borrowings accounting for 70%; current ratio was 121%.

• Bank deposits and cash were HK$1.881bn and unused banking facilities were HK$1.604bn at year-end; together, available cash and facilities totaled HK$3.485bn.

• 2023 MTN issuances comprised RMB1bn at 3.20%, RMB1.5bn at 2.97% and RMB1bn at 2.82%, each with a 5-year maturity; the first tranche super and short-term commercial paper issuance was RMB1bn at 2.60% for 180 days.

• Since 2024, a RMB1.5bn 5-year MTN was issued at 2.80%, alongside RMB2bn of ABS; the MTN issuer and notes were rated AAA, and preference ABS were rated AAAsf.