Chongqing Water(SH:601158)2016-03-30 16:00Financial Performance - The company's operating revenue for 2015 was approximately CNY 4.49 billion, representing an 8.50% increase compared to CNY 4.14 billion in 2014[16]. - The net profit attributable to shareholders for 2015 was approximately CNY 1.55 billion, a 7.00% increase from CNY 1.45 billion in 2014[16]. - The net profit after deducting non-recurring gains and losses was approximately CNY 1.32 billion, reflecting a 5.20% increase from CNY 1.26 billion in 2014[16]. - The cash flow generated from operating activities was approximately CNY 2.05 billion, a decrease of 5.73% compared to CNY 2.18 billion in 2014[16]. - The total assets at the end of 2015 were approximately CNY 19.59 billion, a decrease of 4.78% from CNY 20.57 billion at the end of 2014[17]. - The net assets attributable to shareholders at the end of 2015 were approximately CNY 13.59 billion, an increase of 2.63% from CNY 13.25 billion at the end of 2014[17]. - The basic earnings per share for 2015 were CNY 0.32, a 6.67% increase from CNY 0.30 in 2014[18]. - The weighted average return on net assets for 2015 was 11.65%, an increase of 0.71 percentage points from 10.94% in 2014[18]. - The company achieved a revenue of 4.488 billion RMB in 2015, representing a year-on-year growth of 8.50%[38]. - Net profit for the year was 1.552 billion RMB, an increase of 7.0% compared to the previous year, with earnings per share reaching 0.32 RMB, up 6.67%[38]. Market Position and Operations - The company holds approximately 70% of the tap water market and 82% of the sewage treatment market in Chongqing, indicating a strong monopolistic position[30]. - The urban sewage treatment rate reached 92.5% by the end of 2015, an increase of 0.7 percentage points from the previous year, highlighting improvements in infrastructure[30]. - The company is expected to benefit from the government's push for environmental protection and water pollution prevention, which is anticipated to create significant opportunities in the water services industry during the 13th Five-Year Plan[29]. - The establishment of Chongqing Environmental Investment Co., Ltd. may impact the company's expansion in the rural sewage treatment market, introducing some competition[30]. - The company has been granted a 30-year concession for water supply and sewage treatment, ensuring a stable operational framework[27]. Cash Flow and Investments - The net cash flow from financing activities was -3,140,225,880.28 CNY, primarily due to the repayment of a 1.7 billion CNY corporate bond[55]. - The company reported a significant increase in investment cash flow, with a net inflow of 2,515,230,429.31 CNY, compared to a net outflow of 1,292,594,941.39 CNY in the previous year[54]. - The company processed a total of 808.5244 million cubic meters of wastewater, generating service revenue of 2.2476979 billion RMB, which accounted for 50.08% of total revenue[43]. - Water sales volume reached 400.3183 million cubic meters, with an average selling price of 2.46 RMB per cubic meter, resulting in sales revenue of 984.0244 million RMB, or 21.93% of total revenue[43]. Corporate Governance and Shareholder Information - The company completed a capital increase on October 23, 2015, with a total of 1,756,800,000 shares (36.60%) from the controlling shareholder and 645,000,000 shares (13.44%) from the second-largest shareholder[120]. - After the capital increase, the new major shareholder, Chongqing Derun Environment Co., Ltd., holds 2,401,800,000 shares, accounting for 50.04% of the total shares[120]. - The total number of ordinary shareholders decreased from 56,905 to 53,609 during the reporting period[121]. - The top ten shareholders include Chongqing Derun Environment Co., Ltd. with 2,401,800,000 shares (50.04%) and Chongqing Water Asset Management Co., Ltd. with 1,849,160,689 shares (38.52%)[124]. - The company’s actual controller remains the Chongqing State-owned Assets Supervision and Administration Commission[120]. Environmental and Social Responsibility - The company has committed to social responsibility, achieving a wastewater treatment discharge volume of 779.57 million cubic meters and reducing COD by over 230,000 tons in 2015[41]. - The company has actively engaged in community service and environmental protection initiatives, enhancing its corporate social responsibility profile[115]. - The company donated nearly RMB 950,000 to support the construction of a children's center in Changdu, Tibet, and contributed RMB 2,000,000 to precision poverty alleviation efforts in Chongqing[115]. Future Outlook and Strategic Plans - The company plans to continue expanding its market presence, with ongoing projects in Sichuan and Yunnan expected to significantly increase its service capacity[39]. - The company aims to achieve an operating income of 4.642 billion yuan, with total operating costs and expenses estimated at 3.306 billion yuan[73]. - The company plans to complete an investment of 1.1 billion yuan and ensure stable increases in both water supply and sewage treatment volumes[73]. - The company is committed to expanding its water supply and sewage treatment services through mergers and acquisitions, aiming for strategic growth in the water industry[72]. Risks and Challenges - The company has outlined potential risks in its future development, which investors should be aware of[3]. - The company faces risks related to raw material supply, particularly due to uneven rainfall in Chongqing, which can increase water extraction and purification costs[74]. - The company’s water supply prices are regulated by the Chongqing municipal government, which poses a risk of delayed price adjustments in response to rising costs[75]. - The competitive landscape in the water and environmental protection sector is becoming more diverse, with increased participation from state-owned and private enterprises[71].