Feature News

    HONG KONG, July 28 /PRNewswire-Asia/ --



    Results Highlights:
                               Financial Highlights

    (HKD '000)                            FY2008/09    FY2007/08 Growth (%)

    Revenue                               1,033,199      765,538      35%
    Gross Profit                            320,769      267,007      20%
    Profit from Operations                  395,164      364,261       8%
    Net profit from Continuing Operations   228,674      175,373      30%
    Basic earnings per share from
    Continuing Operations (HK cents)           9.39         6.34      48%
    Final dividend per share (HK cents)           3           --      --

China Water Affairs Group Limited ("China Water Affairs" or the "Company", Hong Kong Stock Exchange: 0855.HK), one of the leading integrated water services operators in China, today announced the audited results of the Company and its subsidiaries (the "Group") for the year ended 31 March 2009 (the "Review Period").

During the Review Period, the Group's total revenue amounted to HK$1,033 million, representing a 35% year-on-year increase. Its gross profit advanced 20% year-on-year to HK$321 million. Net profit from continuing operations was HK$229 million, representing an increase of 30% year-on-year. Basic earnings per share from continuing operations were 9.39 Hong Kong cents, up 48% from the previous financial year. The board of directors recommended a final dividend of 3 Hong Kong cents per share.

"Despite the global economy faced severe challenges and the Chinese economy experienced a marked slowdown in 2008, our core water business posted a satisfactory performance during the Review Period. The Group achieved significant growth of revenues in city water supply and sewage treatment operations. The Group achieved remarkable growth in its water business during the Review Period. The operation and construction of city water supply segment generated HK$680 million in revenue, up 77% year-on-year. It remained the largest revenue contributor for the Group. The operation and construction of sewage treatment segment produced HK$82 million in revenue, representing an increase of 200% year-on-year," said Mr. Duan Chuan Liang, Chairman of China Water Affairs.

The Group completed the acquisition of water business in Hunan Province and the raw water, water supply and sewage treatment projects in Dayawan, Huizhou City during the Review Period. The Dayawan projects provide exclusive raw water, water supply and sewage treatment services to the largest petrochemical production base in China. Its growth potential is enormous. The Group also expanded the water supply capacity of eight existing water projects in Henan Province, Jiangxi Province and Sichuan Province through organic growth and participated in the development of a sewage treatment project in Jiangxi Province.

As at 31 March 2009, total assets of the Group were approximately HK$5,500 million, up 25% year-on-year. Net assets amounted to HK$2,688 million, an increase of 21% year-on-year. Cash and bank balances totaled HK$550 million, up 29% year-on-year.

Looking ahead, Mr. Duan Chuan Liang commented, "With the sustained development of the Chinese economy and accelerating urbanization, the government will continue the policy of integrating water supply in cities and counties so as to strengthen the management of water industry. These favorable factors are set to provide ample room of growth for our core operations such as city water supply, sewage treatment and installation of water facilities. We will strive to look for water projects of good potential and to further improve the scale and efficiency of our water business. Leveraging on our existing platform, we will work hard to integrate water supply and sewage treatment businesses and to further expand the sewage treatment operation. By streamlining the value chain of water business and related operations, we will continue to enhance our overall operating efficiency, service quality and competitiveness."

About China Water Affairs Group Limited

China Water Affairs Group Limited is principally engaged in waterworks investment and operation as well as other related businesses in the PRC. The Group's businesses include urban water supply, water supply systems management, sewage treatment, water ecology preservation and related value-added businesses. Currently, the Group is under undergoing rapid development, with operations extended to over 20 cities in various provinces including Guangdong, Jiangxi, Henan and Jiangsu, etc. With a well established network with the Ministry of Water Resources of the PRC and various local water authorities, the Group achieves a leading position in the PRC water industry.

    For investor and media enquiries:

    PRChina
     Henry Chik
     Tel:   +852-2522-1838
     Email: hchik@prchina.com.hk

    PRChina
     David Shiu
     Tel:   +852-2522-1838
     Email: dshiu@prchina.com.hk