Tianjin Construction Development Group (2515) H1 2024 earnings summary

Executive summary

• H1 revenue fell 10.6% YoY to RMB94.568m; attributable profit declined to RMB10.494m from RMB18.621m amid fewer new projects and slower tendering.

• Foundation and petrochemical growth partly offset lower municipal and building-related revenue.

• At 30 June 2024, 33 ongoing or not-yet-commenced projects carried contract value of RMB343.9m, excluding variation orders; 31 projects were conducted during H1.

Financial highlights

• Revenue was RMB94.568m versus RMB105.826m YoY; cost of sales was RMB71.688m versus RMB79.227m.

• Gross profit fell 13.9% to RMB22.9m; gross margin eased to 24.2% from 25.1%.

• Operating profit was RMB12.637m versus RMB21.175m; profit before tax was RMB11.931m versus RMB21.115m.

• Attributable net profit was RMB10.494m versus RMB18.621m; basic and diluted EPS was RMB0.06 versus RMB0.12.

• Administrative expenses rose 19.2% to RMB17.4m, including IPO-related professional fees; finance costs rose to RMB0.706m from RMB0.060m, mainly due to higher bank loans.

Outlook and guidance

• Slower tendering adversely affected H1 performance and may continue to pressure financial position; priorities include cost control, prudent operations, R&D and Jiexiao System deployment.

• Growth plans include expansion beyond Tianjin, petrochemical engineering development, and broader cooperation and business models.

• Urban renewal, affordable housing, flood management, urban safety and green smart cities are potential sources of construction demand.