C&G ENVIRONMENT PROTECTION, which is listed on the Singapore Exchange, is benefiting from China’s political determination to deal with its pollution problems.
The PRC leading developer and operator of waste-to-energy plants posted revenue growth of 29.8% to HK$258.9 million for 1Q2011.
It has two key revenue streams: operation services (1Q2011: HKD28.3 million) and construction (1Q2011: HKD230.6 million).
Revenue from operation services comprises income from electricity generation and tipping fee for waste handling services provided.
This increased by 179.6% to HKD28.3 million, as its new plants in Hui’An, Huangshi and Anxi were completed and became operational.
”Our fourth plant in Anxi was successfully connected to the state electricity grid this month, we expect to see more revenue contribution from this,” said CEO Lin Yan.
Construction work on another plant in Fuqing is expected to complete by the second quarter of this year. This will bring C&G’s treatment capacity to 4,500 tons per day.
When all of its waste-to-energy plants under construction are completed, its capacity is expected to exceed 10,000 tons per day.
Net profit attributable to owners was HKD25.1 million. Excluding one-off items incurred in 1Q2010, this represented a 208.6% growth in earnings, as compared to the previous corresponding quarter.
A corporate restructure that transplanted C&G from China’s highly competitive textile sector to greentech resulted in a one-off gain on bargain purchase of HKD161.2 million and HKD11.3 million in transaction costs incurred for the acquisition of its waste-to-energy subsidiaries in 1Q2010.
Last year, it fully divested its previous business of manufacturing differential PET chips, polyester short fiber, bi-component short fiber and functional yarns.
China is world’s largest greentech player
China’s emphasis on greentech has resulted in the sector growing by a remarkable 77% last year.
It is the now the world’s largest greentech producer, according to a study commissioned by the World Wildlife Fund for Nature (WWF).
Its greentech sector produced more than 44 billion euros (Rmb 410 billion), or 1.4% of GDP last year.
The waste-to-energy market in China’s 600 cities alone amounts to a whopping Rmb 240 billion over China’s 12th 5-year plan (2011-2015), according to official estimates.
Its target is to have at least 80% of municipal waste produced in cities to be disposed off in non-toxic form by 2015.
To achieve this, the government has been speeding up the construction of waste management infrastructure.
Having the nation’s leading technology in waste-to-energy certainly puts C&G in a sweet spot, as the government is requiring waste management infrastructure to be faster and more efficient.
Related story: C&G ENVIRONMENT: Achieves Maiden Net Profit, Proposes A Dividend - And Ups Its Treatment Capacity
