Canvest Environmental Protection Group Company (1381) H2 2024 earnings summary

Executive summary

• Revenue from continuing operations fell 15.4% year-over-year to HK$4,198.3 million, mainly due to a sharp drop in construction revenue as most WTE projects are now operational.

• Profit attributable to equity holders from continuing operations decreased 9.7% to HK$923.6 million; total profit attributable to equity holders (including discontinued operations) dropped 13.5% to HK$866.1 million.

• Gross profit margin and EBITDA margin from continuing operations improved significantly to 48.3% and 62.8%, respectively, reflecting a higher share of core operations.

• The Group treated 17.0 million tonnes of waste (+2.4% YoY), generated 6.53 billion kWh of green energy (+5.1% YoY), and offset 9.83 million tonnes of CO2 equivalent emissions (+14.0% YoY).

• Major business shift from construction to operations and services, with environmental sanitation business expanding and new contracts worth ~RMB2 billion secured.

Financial highlights

• Revenue from power sales and waste treatment rose 4.3% to HK$3,575.6 million.

• Cost of sales decreased 24.7% to HK$2,172.5 million, mainly due to lower construction costs.

• Operating profit from continuing operations was HK$1,602.7 million (down from HK$1,667.8 million YoY).

• Basic EPS from continuing operations was HK38.0 cents (down from HK42.1 cents YoY).

• No interim or final dividend declared for 2024.

Outlook and guidance

• The sector is entering a phase of stable volume optimization, focusing on resource recovery and intelligence-driven growth.

• Policy support for green, low-carbon, and circular development remains strong, with new government initiatives expected to drive further industry transformation.

• The Group aims to leverage technology to optimize operational efficiency, reduce costs, and explore added value in heat supply and carbon asset development.