27 Mar 2023

CEG’s FY22 revenue was down by 5% YoY to HK$8,048m, mainly driven by 1) 25% decline in construction revenue to HK$1,297m as only 6 (FY21: 15) biomass and HWT projects were under construction during the period , which was partially offset by 2) 1% YoY growth in total operation revenue to HK$6,384m with operation revenue from biomass/HWT/ER/solar & wind changed by -3%/+46%/-53%/-8% YoY. As a result, operation rev as a % of total rev reached 79%, up significantly from 52%/75% in FY20/FY21, with only 21% of revenue derived from non-cash flow driven construction/finance income segments. GPM was down by 6.9ppts YoY to 20.9% due to 1) higher unit cost for biomass, and 2) decline in unit prices for HWT owing to pandemic and related control measures. Admin ratio was only up slightly by 0.3ppt to 7.7% due to revenue decline, while finance cost stayed flat at HK$740m as total loans was up by only 11% YoY to HK$20.7bn. Including one off gains/losses such as impairments losses on PPE/goodwill/debtors at FV totaling Rmb139m (FY21: Rmb1.1m), NP was down by 69% YoY to HK$345m, which was inline with our estimates of Rmb357m. Full year DPS was at HK$0.036 (FY21: HK$0.11), representing a payout ratio of 21.9% (FY21: 20.5%).

CROSBY Research – China Everbright Greentech (1257 HK/BUY): Inline FY22 results