Citic Envirotech reports 2Q19 net profit dropped 66 percent

Hong Kong money-changer with yuan symbol signHong Kong money-changer with yuan symbol sign. Photo taken pre-Covid

Citic Envirotech reported Wednesday its second quarter net profit dropped 65.6 percent on-year to S$14.99 million as engineering revenue and membrane system sales fell.

Revenue for the quarter ended 30 June fell 30.3 percent on-year to S$202.85 million, the company said in a filing to SGX.

Engineering revenue dropped 29.8 percent on-year to S$79.0 million, while membrane system sales declined 44.7 percent on-year to S$67.9 million, the filing said.

Treatment revenue, including finance income from service concessions, rose 0.5 percent on-year to S$56.0 million, Citic Envirotech said.

The company didn’t declare a dividend for the quarter, compared with a 0.5 Singapore cent a share dividend in the year-ago period.

Citic Envirotech was upbeat in its outlook.

“Notwithstanding the macro economic environment, CEL is optimistic that its industry is well supported by China’s stringent environmental mandates as outlined in the country’s 13th Five Year Plan,” the filing said. “The group is committed to pursue opportunities and secure projects in the municipalities for projects involving a wide range of environmental services such as its core wastewater treatment solutions as well as its hazardous waste treatment solutions.”

Citic Envirotech said it expected hazardous waste treatment, a recent addition to its services, to become a key revenue driver.

In addition, the company noted its wholly owned subsidiary Memstar has begun operations at a membrane manufacturing facility in Texas, U.S., and that is expected to boost international sales.

“The group expects this to continue gaining traction in tandem with higher anticipated demand for water purification and safe drinking water,” the filing said. “CEL will continue to leverage its proprietary membrane technology and expertise in environmental engineering to entrench its position as a leading player in the environmental protection sector.”

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