SIIC Environment (BHK) Q1 2023 earnings summary

Executive summary

• 1QFY2023 revenue rose 7.5% YoY to RMB1,918.7m and gross profit increased 16.9% to RMB676.0m; profit attributable to owners fell 14.7% to RMB150.0m.

• Cash and cash equivalents were RMB2,577.6m at 31 March 2023; results were unaudited and had not been reviewed.

Financial highlights

• Profit for the period was RMB242.0m, down 5.4% YoY; basic and diluted EPS fell 14.8% to RMB5.82 cents.

• Gross margin rose to 35.2% from 32.4%; profit before tax was RMB336.0m versus RMB338.4m.

• Finance expenses increased 37.2% to RMB227.0m and administrative expenses increased 38.2% to RMB134.8m; construction income was RMB614m and O&M plus service-concession financial income rose 12.1% to RMB1.204bn.

• Net cash generated from operating activities was RMB47.5m; excluding cash used in service-concession projects, operating cash generated was RMB276.3m.

Outlook and guidance

• Priorities include green, low-carbon development, digital transformation and operational efficiency, with investment and expansion focused on the Yangtze River Economic Belt, Yangtze River Delta and Greater Bay Area.

• China’s post-pandemic recovery and policy support for wastewater treatment, recycling and environmental management were identified as growth opportunities.