SINGAPORE (July 24): CITIC Envirotech, the provider of environmental engineering services, reported a 65.6% fall in 2Q19 earnings ended June to nearly $15 million from $43.5 million a year ago.
This brings 1H earnings ended June down 77.3% to $19.4 million.
Revenue fell 30.3% to $202.8 million as sales from its engineering business fell 30% to $79 million while sales from membrane systems fell 44.7% to $67.9 million.
Correspondingly, materials purchased, consumables used and subcontractors’ fees decreased 42.8% to $100.6 million.
Finance costs, however, increased 80.7% to $19.1 million mainly due to additions of bank loans to finance the new investment projects during the period; and to re-finance the perpetual capital securities in November 2018.
In addition, other income decreased 39.1% to $3.6 million mainly due to gain on disposal of subsidiaries of $3.1 million in the same period last year.
As at end June, cash and cash equivalents stood at $560 million, up 70.6% from $328.2 million a year ago.
In its outlook statement, CITIC Envirotech says it is optimistic that its industry is well supported by China’s stringent environmental mandates as outlined in the country’s 13th Five Year Plan despite the challenging macro economic environment.
The group also expects its hazardous waste treatment, the most recent addition to its suite of capabilities, to become one of the key revenue drivers, led by government initiatives to introduce sustainable waste management mechanisms.
Shares in CITIC Envirotech closed 1.5 cent lower at 30 cents on Wednesday before the results announcement.
