China State half year profit up by a third

Analysis, Slider 15 Aug 2013
China State half year profit up by a third

Half year profit at leading mainland contractor China State Construction International Holdings (3311) has surged by nearly a third thanks to bulging order books.

For the six months ending 30 June 2013, profit attributable to owners of the company was HK$1.17 billion, up 32.2 percent compared with a year ago.

Group revenue jumped by 21.6 percent to HK$10.9 billion but its share of revenue from joint ventures plunged by 37.1 percent to HK$962 million.

Gross profit climbed 36.7 percent year on year to HK$1.37 billion.

The company, controlled by state owned giant China State Construction Engineering Corporation, reported gross profit margin as 12.6 percent compared with 11.2 percent a year ago.

“The construction industry in Hong Kong and Macau remained strong with the support of government projects. However the shortage of resources was as serious as that of last year, “ the company said in a stock exchange statement Wednesday.

Among the projects it bagged during the first half were a residential development for Sino Land (0083) at Pak Shek Kok in Tai Po district, a Fire Services Training School in Tsueng Kwan O and the Slip Road 8 Section for the Central-Wan Chai Bypass.

Over in Macau, the company won a large public housing project in IIha Verde worth HK$1.89 billion and bagged the MGM Cotai project for MGM China Holdings (2282) worth HK$10.5 billion, the highest contract value for a project ever undertaken independently by the company.

In mainland China, the company said progress of its infrastructure investments and affordable housing projects was satisfactory.

It secured affordable housing projects in Zhenjiang Jingkou district and Wenzhou Lucheng district during the first half.

The company, as part of a joint venture, entered into a contract for the development of a road related build-transfer project in Zhengzhou.

Back in Hong Kong and Macau, the company said it would focus on projects of large size or premium quality or government commissioned ones for “better profit, economy of scale and publicity”.

Danny Chung



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