China Jinjiang Environment reports 2Q18 net profit falls 11.2 percent amid higher finance costs

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China Jinjiang Environment reported on Sunday that its second quarter net profit fell 11.2 percent on-year to 149.45 million yuan amid lower revenue, higher finance costs and a foreign-exchange loss.

Revenue for the quarter ended 30 June fell 5.3 percent on-year to 680.32 million yuan, mainly on a decrease in revenue from construction services under build-operate-transfer (BOT) concession agreements, the China-based waste-to-energy operator said in a filing to SGX late on Sunday.

Revenue from BOT construction-service concession agreements fell 81.7 percent on-year in the quarter to 34.7 million yuan as the expansion phase of the Yinchuan Zhongke WTE facility and the Gaomi Lilangmingde WTE facility are nearly completed, it said.

That was partly offset by the WTE business, excluding revenue from BOT construction-services concession agreements, seeing a 1.2 percent on-year increase in revenue to 445.0 million yuan due to an increase in waste treated after the commencement of waste collection and transportation operations for the Lucknow, Gurgaon and Gwalior projects in India, it said.

The segment was also boosted by an increase in revenue from sales of steam from the Zhuji Bafang WTE facility, offset by a decrease in revenue from eight WTE facilities undergoing expansion and upgrading, which led to lower amounts of waste treated and lower electricity sales, it said.

The project technical and management services and energy management contracting (EMC) segment saw revenue rise 124.9 percent on-year to 200.6 million yuan on a larger number of contracts, it said.

Finance costs in the quarter rose 64.6 percent on-year to 63.72 million yuan amid an increase in bank borrowings, China Jinjiang Environment said.

Its foreign exchange loss was 53.7 million yuan in the quarter, swinging from a year-earlier foreign exchange gain of 8.01 million yuan, China Jinjiang Environment said.

Other income and other gains and losses swung to a loss of 9.9 million yuan in the second quarter, from a gain of 37.4 million yuan in the year-earlier period, mainly on the foreign exchange loss and reduced income from the treatment of sludge, partly offset by a gain on the disposal of a 70 percent stake in Hohhot Jiasheng New Energy WTE facility, a gain on the re-measurement on the remaining 30 percent stake in that facility and an increase in scrap material sales, it said.

For the first half, net profit fell 15.4 percent on-year to 250.29 million yuan, while revenue increased 12.5 percent on-year to 1.435 billion yuan, it said.

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