China Everbright eyes acquisitions, expansion
Updated: 2009-05-13 07:18
By George Ng(HK Edition)
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HONG KONG: China Everbright International Ltd, a mainland-based environmental infrastructure investment firm, said it expects to acquire some projects this year and will increase capital expenditure outlay gradually over the next few years as its businesses are poised to enter a high-growth phase.
"We have been studying some projects...We will undertake those projects once they meet our appraisal requirements in terms of investment return, risk, location and other factors," said Chief Executive Officer (CEO) Chen Xiaoping, who fielded questions from the media after the company's annual general meeting yesterday.
"We expect to launch some projects this year," he added, without elaborating.
He also said that the company has over 20 research projects on hand and owns several patents.
One of the research projects involves fetching heat energy from waste water, while another one involves generation of electricity by burning crop leftovers.
The company, a Hong Kong-listed unit of mainland conglomerate China Everbright Holdings Co Ltd, also said it saw stable business performance during the first four months of this year after reporting a 39 percent growth in recurring profit last year.
"The performance of our business remained stable and satisfactory during the period," said Chen.
China Everbright is confident about its business prospects, citing strong state policy support for environmental businesses and the company's belief that it is entering a high-growth phase.
"Our businesses will benefit from favorable state policies, such as increases in service fees and electricity rates," Chen said.
"Our businesses are entering a high-growth phase," he added.
The CEO said China Everbright will place more emphasis on renewable energy production in the future.
The company currently operates in four major business sectors, including power generation (via burning of waste and rubbish), treatment of waste water, environmental infrastructure construction and environmental technology.
Chen also said that China Everbright will increase its capital expenditures (capex) gradually in the coming years in step with its rapid business growth.
The company spent approximately 1 billion yuan in capex each year during the past several years, he noted.
China Everbright will also boost its investment in environmental technology research, the CEO said.
The company spent around 10 million yuan every year in technology research during the past several years, representing 2 percent to 3 percent of annual profit, he said.
"Technological development will be the catalyst of our business growth in the future," he said.
"Our businesses could expand further only if we compound them with technological advancements," he added.
The company plans to set up a research center in joint venture with the Shandong Academy of Science, he revealed, adding that the institution will need a total investment of 10 million yuan and will focus on energy-saving and emission-reduction projects.
(HK Edition 05/13/2009 page15)