Financial Performance - In Q1 2025, the company achieved a revenue of 874 million yuan, a year-on-year increase of 11.12% [2] - Net profit for the same period was 200 million yuan, up by 10.62% [2] - Basic earnings per share reached 0.47 yuan, reflecting a growth of 11.90% [2] - Total assets amounted to 14.426 billion yuan, with equity attributable to shareholders at 6.877 billion yuan [2] Growth Drivers - The company focuses on four key growth areas: 1. Resource utilization with six new projects expected to generate additional profits in 2024 [2] 2. Steam heating optimization, with a business yield significantly higher than traditional power generation [2] 3. Activation of existing assets through green certificate trading and carbon reduction projects [2] 4. Expansion into overseas markets, particularly in Thailand and Vietnam, aligned with the Belt and Road Initiative [2] Strategic Challenges - The decline in 2024's performance was attributed to prolonged accounts receivable aging leading to bad debt losses and fixed asset impairments [3] - The company is addressing challenges through smart upgrades and expansion of high-margin overseas projects [4] Shareholder Returns - The company has outlined a three-year shareholder return plan (2024-2026) with a minimum dividend payout ratio of 30% [4] - Plans to adjust dividends based on cash flow and capital expenditures while enhancing long-term value through share buybacks [4] Market Management - The company emphasizes the importance of market value management and investor relations, integrating these principles into daily governance [5] - Currently, there is no separate market value management policy disclosed, but related management concepts are applied [5] Business Adjustments - The company is cautiously adjusting its strategy for battery recycling due to a sluggish market, with potential exit measures being considered for the lithium battery recycling business [8]

Investment Rating - The report maintains a "Positive" investment rating for the environmental protection sector, consistent with the previous rating [2]. Core Insights - The report highlights a significant increase in the issuance and trading volume of green certificates in 2024, with a focus on how waste incineration power companies can leverage green certificate revenue to offset the decline in national subsidies [2][15]. - The average trading price of green certificates in 2024 is noted to be 5.59 yuan per certificate, indicating low market activity and limited short-term profit contribution for companies [2][30]. - The report emphasizes the growing demand for green certificates driven by policies encouraging high-energy-consuming industries to purchase green electricity certificates, which is expected to enhance revenue for waste incineration companies [2][22]. Summary by Sections Market Performance - As of April 25, 2025, the environmental protection sector rose by 1.02%, outperforming the broader market, with specific sub-sectors like water treatment and waste incineration showing positive growth [8][10]. Industry Dynamics - The report discusses recent policy developments, including the launch of enhanced green certificate verification functions by the National Energy Administration and guidelines for ultra-low emissions from waste incineration plants in Zhejiang Province [31][34]. - The green certificate system has seen explosive growth in 2024, with cumulative issuance reaching 4.955 billion certificates, a 21-fold increase year-on-year, and trading volume at 553 million certificates, a fourfold increase [15][19]. Investment Recommendations - The report suggests that the "14th Five-Year Plan" will continue to drive high demand for energy conservation and environmental protection, with a focus on quality operational assets in the water and waste incineration sectors [40]. - Key recommendations include companies like Huanlan Environment, Xingrong Environment, and Hongcheng Environment, with additional attention to Wangneng Environment and Junxin Co [40]. Company Announcements - The report includes financial performance highlights from various companies in the sector, indicating growth in revenue and net profit for several firms, such as Lankun Environment and Junxin Co [36][37][38].

Investment Rating - The report maintains an investment rating of "Positive" for the environmental protection sector [2]. Core Viewpoints - The report highlights a significant increase in the issuance and trading volume of green certificates in 2024, with a focus on how waste incineration power companies can leverage green certificate revenue to offset the decline in national subsidies [2][15]. - The average trading price of green certificates in 2024 is noted to be 5.59 yuan per certificate, indicating low market activity and limited short-term profit contribution for companies [2][30]. - The report emphasizes the potential for increased demand for green certificates as policies encourage high-energy-consuming industries to purchase green electricity certificates [2][22]. Summary by Sections Market Performance - As of April 25, the environmental protection sector rose by 1.02%, outperforming the broader market, with specific sub-sectors like waste incineration and resource recovery showing notable gains [8][10]. Industry Dynamics - The report discusses the recent announcement from the National Energy Administration regarding the upgrade of green certificate cancellation functions, enhancing the trading system's efficiency [31]. - It also mentions the implementation of low emission technology guidelines for waste incineration plants in Zhejiang Province [31][34]. Special Topic - The report details the explosive growth in green certificate issuance and trading volume in 2024, with a total issuance of 4.955 billion certificates, a year-on-year increase of 21 times, and a trading volume of 553 million certificates, a fourfold increase [15][19]. - The report notes that the manufacturing sector accounts for nearly 70% of green certificate purchases, with data centers emerging as a new growth area for green certificate consumption [19][20]. Investment Recommendations - The report suggests that the "14th Five-Year Plan" will continue to drive high demand for energy-saving and environmental protection initiatives, particularly in the water and waste incineration sectors, which are expected to maintain robust profitability and cash flow [40]. - Key recommendations include companies like Huanlan Environment, Xingrong Environment, and Hongcheng Environment, with additional attention to companies such as Wangneng Environment and Junxin Co., Ltd [40]. Company Announcements - The report includes financial performance highlights from various companies in the sector, indicating growth in revenue and net profit for several firms, such as Lankun Environment and Junxin Co., Ltd [36][37][38].

Core Viewpoint - The company reported a significant increase in net profit exceeding 30%, indicating stable core business operations and improved gross margins [2] Financial Performance - In 2024, the company achieved operating revenue of 7.171 billion yuan, a year-on-year increase of 19% - The net profit attributable to shareholders reached 2.704 billion yuan, up 32% year-on-year - The non-recurring net profit was 2.619 billion yuan, also showing double-digit growth year-on-year [2] - Operating cash flow improved, reaching 2.430 billion yuan, a 5% increase year-on-year [2] Business Segments - Project operations generated revenue of 3.370 billion yuan, a 10% increase year-on-year, with a gross margin improvement of 0.14 percentage points to 59.48% - Equipment, EPC, and services generated revenue of 3.759 billion yuan, a 29% increase year-on-year, with a gross margin increase of 9.74 percentage points to 44.46% [2] Project Developments - The company progressively launched waste incineration and kitchen waste projects, with 55 waste incineration projects in operation by the end of the reporting period, totaling an operational scale of approximately 3.73 thousand tons per day [3] - In 2024, the company processed 12.5438 million tons of household waste and 494.6 thousand tons of kitchen waste, with several new projects entering formal operation [3] - The company actively participated in green certificate trading, achieving a total of approximately 4.92 million green certificates issued by the end of 2024 [3] Equipment and New Materials - The equipment business had a robust order backlog, with new orders totaling approximately 3.17 billion yuan in 2024 [4] - The new materials project is progressing well, with the first production line for high-nickel materials entering trial production [4] Profit Forecast - The company is expected to achieve operating revenues of 11.669 billion yuan, 16.505 billion yuan, and 18.282 billion yuan for 2025-2027, representing year-on-year growth rates of 62.72%, 41.45%, and 10.76% respectively [4] - The net profit attributable to shareholders is projected to be 3.220 billion yuan, 3.777 billion yuan, and 4.103 billion yuan for the same period, with growth rates of 19.08%, 17.31%, and 8.63% respectively [4]