China: Xiangyu Dredging Announces 2011 Interim Results
Xiangyu Dredging Holdings Limited, the largest privately owned dredging company in China in terms of dredging volume in 2010, announced the unaudited interim results of the Company and its subsidiaries (the “Group”) for the six months ended 30 June 2011(the “Reporting Period”).
– Revenue of RMB461.6 million, representing a year-on-year increase of 188%
– Gross profit posted RMB183.8 million, representing an increase of 104% as compared with the same period of 2010
– Net profit was RMB135.4 million, representing an increase of 112% as compared with the same period of 2010
– During the six months ended 30 June 2011, Xiangyu Dredging has obtained new dredging contracts and extension of existing contracts amounted to about RMB2.5 billion
– At the pre-tax backlog amount of approximately RMB3.2 billion as of 30 June 2011.
During the period, attributable to capital and reclaimed dredging activities in the PRC, which led to increased demand for the Group’s dredging services, revenue achieved about RMB461.6 million, representing an increase of 188% as compared with the same period of last year. Gross profit amounted to RMB183.8 million with a y-o-y increase of 104%. Net profit surged to RMB135.4 million, representing an increase of 112% as compared with the same period of 2010.
During the six months ended 30 June 2011, Xiangyu Dredging obtained new dredging contracts and extension of existing contracts amounted to about RMB2.5 billion, resulting at the pre-tax backlog amount of approximately RMB3.2 billion as of 30 June 2011. In addition, the Group continues to expand business scope by establishing environmental dredging operations.
Current major Capital and reclamation dredging projects
1. Caofeidian Industrial Area Project (Hebei Province)/Dalian Changxingdao Harbor Project, (Liaoning Province)/Tianjin Port Project (Tianjin)
These projects are long term expansion projects of major ports in the PRC, of which Caofeidian Industrial Area Project was included in PRC government’s Eleventh Five Year Plan and it is planned until about 2030; Dalian Changxingdao Harbor Industrial Area was designated by the State Council as a National Economic and Technological Development Area in 2010; and it is planned until 2020; and Tianjin Port project was a port expansion project in Tianjin Port.
As the size of these projects is large, dredging works are divided into many phases. The Group has in the past provided the said dredging services on a continuous basis. The contract sums for new contracts (including extension of contracts on hand) entered into in respect of these projects amounted to about RMB0.7 billion in total during the period ended 30 June 2011.
2. Jingtang Harbor Project, Hebei Province:
This project is the dredging part of a tourism area in Hebei Province. In 2010, we were engaged to provide capital and reclamation dredging services in Jingtang Harbor under the agreement with a contract sum of approximately RMB800 million. The remaining backlog as of 30 June 2011 amounted to about RMB 0.6 billion.
3. Dongying Harbor Project (Shandong Province):
The Dongying Harbor was designated by the State Council as the leading port of the Yangtze River Delta in Shandong Province under the State Council’s “Development Plan for the Efficient Ecological and Economic Zone in the Yangtze River Delta“. The Group entered into a letter of intent (non-binding) directly with the project owner of Dongying Harbor Project in 2010 for the phase one of the port expansion project in Dongying Harbor, which initially indicates its allowance for the Group to participate in the dredging works of this project. Currently, tender procedure relating to embankment under phase 1 of this project will start shortly.
The management has closely monitored its progress and works are expected to commence in 2011.
4. Yancheng City Project, Jiangsu Province:
The Yancheng City project forms part of the ten-year Jiangsu Coastal Development Project, and its total expenditure is estimated to be RMB105.5 billion. The Group has entered into a five-year framework agreement (non-binding) directly with the project owner for engaging the Group in dredging works involving output of no less than an aggregate of 120 million cubic meters over 2011 and 2012 (estimated contract sum of about RMB1.2 billion). The project is expected to commence by end of 2011.
Current major Environmental protection dredging and water management projects
1. Wuhan City Projects:
Xiangyu Dredging entered into a series of letters of intent and framework agreements for certain dredging projects in Donghu, Nanhu and Guanqiaohu of Wuhan City since 2010.
2. Yandu Rivers Project, Jiangsu Province:
Yandong project is to conduct environmental protection dredging work for restoring the ecology and treating the polluted waters of the rivers and waterway improvement services in Yandu District of Yancheng City, Jiangsu Province.
Looking forward, Mr. Liu Kaijin, Chief Executive Officer of Xiangyu Dredging, commented, “2011 interim resutls is Xiangyu Dredging’s first results since its lisitng on HKEx. Remarkable performance in the dredging industry fully reflected our strength and growth potential. As the largest private dredging company in China, Xiangyu Dredging will ride on strong client relationship and project pipeline to secure more contracts to capture the growth in the dredging industry.”
About Xiangyu Dredging
Xiangyu Dredging has been listed on the Stock Exchange of Hong Kong on 20 June 2011. The Company is the largest privately owned dredging company in China in terms of dredging volume in 2010, according to the Frost & Sullivan Report. The Company is engaged in providing capital dredging, reclamation dredging, maintenance dredging and environmental protection dredging services. The Company has cultivated strong client relationships and has a strong project pipeline including large-scale projects with prestigious clientele. The Company has strong ability to evaluate project profitability and selectively engage in profitable projects, and have undertaken contract work on dredging projects such as Caofeidian Industrial Area Project, Dalian Changxingdao Harbor Project and Tianjin Port Project. The Company achieved an average dredger working efficiency rate of approximately 83% in 2010, which was higher than the industry average of 70% in China. Web site: www.xiangyu.com.hk.
Source: acnnewswire, August 26, 2011;