【True Insight Hong Kong Stock Market Trends】Guangdong Investment (00270.HK) announced its first quarter 2024 results, with revenue increasing by 19.8% year-on-year, and the water resources business continuing to rise.
Zhenzhuo Financial News April 25, 2024, $GUANGDONG INV(00270.HK) announced unaudited results for the three months ended March 31, 2024.
During the period, the Group's consolidated revenue was HK$6.389 billion, a year-on-year increase of 19.8%, mainly due to increased revenue from property investment and development businesses. Consolidated pre-tax profit increased by 11.7% to HK$1.936 billion (excluding changes in the fair value of investment properties), primarily driven by stable growth in the water resources and power generation businesses. The consolidated profit attributable to the Company's owners decreased by 0.9% year-on-year to HK$1.272 billion.
Water Resources Business Continues to Grow, Pre-Tax Profit of Dongzhen Water Supply Project Rises 5.9% YoY
The Dongzhen Water Supply Project remains a significant contributor to the Group's profit and revenue. During the period, water supply revenue to Hong Kong increased by 2.4% to HK$1.401 billion, while revenue from water supply to Shenzhen and Dongguan rose by 2.3% to HK$360 million. The pre-tax profit of the Dongzhen Water Supply Project (excluding net exchange differences and net financial expenses) was HK$1.178 billion, up 5.9% compared to the same period last year.
Other water resources projects progressed well during the period. As of the end of March 2024, the total designed water supply capacity of other water resources projects and the total designed sewage treatment capacity of sewage treatment plants were 16.15 million tons per day and 3.35 million tons per day, respectively. The combined pre-tax profit of other water resources projects (excluding net exchange differences and net financial expenses) was HK$572 million, a year-on-year increase of 15.8%.
Non-Water Resources Businesses Maintain Positive Momentum
During the period, the hotel business maintained positive development, with revenue from hotel ownership, operation, and management increasing by 16.2% to HK$163 million. Driven by higher average rental rates and occupancy rates, the rental business revenue of Guangdong Investment Tianhe City rose by 18.3% to HK$417 million, with the average occupancy rate remaining high. The department store retail business performed steadily overall. The power generation business saw improved operational efficiency due to increased electricity sales and lower coal prices. The road and bridge business performed as expected, with the daily average toll traffic of Xingliu Expressway increasing by 2.7% to 29,743 vehicles.
Property Development Projects Located in Core Areas, Sales Meet Expectations
The increase in Guangdong Investment's revenue during the period was mainly attributed to higher revenue from property investment and development. The Group's listed subsidiary, Guangdong Investment Properties, holds properties primarily in key cities in Guangdong Province, such as Guangzhou, Shenzhen, Zhuhai, and Foshan. During the period, revenue from property sales was HK$1.728 billion. As of March 31, 2024, Guangdong Investment Properties held completed properties for sale worth approximately HK$9.967 billion and properties under development for sale worth approximately HK$21.502 billion, totaling HK$31.469 billion (December 31, 2023: HK$32.733 billion). Of this, sales of properties that have been contracted and paid for but not yet delivered amounted to approximately HK$9.233 billion, which will be recognized as revenue upon delivery.
Looking ahead, the Group will continue to expand its presence in the upstream and downstream of the water resources industry chain, actively extending into high-value-added businesses. While consolidating the scale of its core businesses, the Group will optimize its asset portfolio and resource allocation. Leveraging its business strengths and resources, the Group will actively seize potential development opportunities arising from the "Guangdong-Hong Kong-Macao Greater Bay Area" strategic plan and continue to explore market acquisition opportunities, striving for new breakthroughs in profit growth and further enhancing the Company's operational performance and overall value.
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