Corporate | 29 April 2008 09:16
ZhongDe Waste Technology AG / Final Results
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Press Release
ZhongDe Waste Technology AG presents its audited full year results for
fiscal year 2007: net profit more than doubled – order intake increased by
90% to €44.4 million
- Revenues increase by 64% to €31.1 million in 2007
- EBITDA for the full year 2007 rose by 56% compared to full year 2006
- Substantial increase in order intake and order backlog
- Net profit increased to €19.1 million in 2007, an increase of 138%
compared to the previous year
- Earnings per share rise by 137% in 2007 to €1.47 from €0.62 in 2006
- Management Board and Supervisory Board will propose dividend of €0.15
per share
Hamburg, 29 April 2008 – ZhongDe Waste Technology AG ('ZhongDe', 'the
Company', Ticker symbol 'ZEF') today presents its audited results for the
fiscal year 2007: ZhongDe`s sales rose strongly in the year under review,
revenues increased by €12.1 million or 64% in 2007 to €31.1 million. This
revenue growth was a direct reflection of the Company’s shift in emphasis
to focus on the rising demand for municipal waste incinerators which
accounted for 70% of sales in 2007. Against the backdrop of buoyant Chinese
GDP growth, the market for incinerators continued to boom.
Gross profit in 2007 increased substantially by €8.3 million or 62% to
€21.6 million. This was reflected in EBITDA which rose by 56% in 2007 to
€18.7 million versus €11.9 million in 2006 and EBIT which also rose by 56%
to €18.6 million, a margin of 60%. The increase in revenues, gross profit
margin, EBITDA and EBIT are in the same trend demonstrated two things: it
showed that the Company healthily expanded its top line through the market
exploration and that the capital expenditure and expense level have been
kept well in check. Annual net profit increased to €19.1 million in 2007
(2006: €8.0 million) – more than doubling the profit for the period
(change: 138%). The net profit margin rose by 19 basis points from 42% in
2006 to 61% in 2007. The increased and high net profit margin is a result
of the full tax exempt status granted by the China government for the
Company`s Chinese main operating subsidiary.
In 2007, ZhongDe`s gross profit margin remained strong at 69% (2006: 70%).
The increase in percentage of sales in municipal waste incinerators, which
is considered to be a lower margin sector between the two areas, did not
drop significantly overall because the Company was able to bargain for
higher margins in the municipal waste sector. The gross profit margin of
medical incinerators has also seen an increase – achieving an average of
78% while for municipal waste incinerators 66% was achieved. Although an
increasing focus in municipal waste incinerators may lower the Company`s
margin, every effort is made to commit to this market and capture the
growing momentum for the Company. Both the EBITDA and EBIT margins of the
Company slightly declined from 63% in 2006 to 60% in 2007. This is mainly
attributable to certain IPO expenses incurred during the second half of
2007. Aside from the above, the Company`s selling, distribution,
administrative and R&D expenses all grew at the same level when compared to
the previous year.
Order intake and backlog reflect a strong market demand. In the financial
year 2007 order intake was at the highest ever at €44.4 million. This was a
substantial rise of €21.0 million versus 2006, or 90%, directly linked to
the strategic plan of focusing on municipal waste incinerators, especially
models LCH-200, LCH 150 and LCH 100 which have higher disposal capacities.
Revenues from the municipal sector rose by 528% to €21.7 million, and the
corresponding profit for municipal incinerators went up by 576%. During the
same period, revenues from medical incinerators, which has much lower
average selling price per unit when compared to municipal incinerators,
went down to €9.4 million or by 39%. This is in line with the strategy to
stronger focus on the municipal waste sector, even though the Company will
continue to profit from the future opportunities in the medical waste
segment due to its established technology. As at 31 December 2007,
ZhongDe’s order backlog amounted to €20.5 million, exceeding the figure for
2006 by €12.9 million or 171%. This is in line with our expectations and
reflects the surge in interest for advanced incinerator technology which
can be attributed to the Chinese government’s commitment to its
environmental policies.
Furthermore, the Company achieved a strong rise in EPS resulting from the
strong sales growth, continued tight cost controls and tax exemption for
2007. EPS amounted to € 1.47 in 2007, up from € 0.62 in 2006.
The Company`s net cash position as at 31 December 2007 was €83.8 million
compared to €9.2 million as at 31 December 2006. This is directly
attributable to the proceeds of the IPO which raised €75 million in July
2007.
The Company`s Management Board and Supervisory Board will propose at the
Annual General Meeting of the Company, that, based on the net profit of
€3,486,204.03 of ZhongDe Waste Technology AG in FY 2007 as reflected in the
German statements, €1,950,000.00 (€0.15 per share) will be distributed
among its shareholders and €1,536,204.03 will be carried forward to 2008.
The Company`s AGM is scheduled for 22 July 2008 in Hamburg.
The Company’s growth strategy, defined before the IPO, has been to enhance
its solid market position for small to medium-sized municipal solid waste
incinerators by selling equipment with larger processing capacities and
implementing BOT (build - operate - transfer) projects. The strategy is
continuing on track the solid progress made in 2007 is already in evidence
in 2008 with the signing of the Datong project, which has an approximate
contract value of 30 million, and also the Xinjiang BOT project where
favourable terms have been negotiated.
CEO Mr. Zefeng Chen comments: '2007 was an exceptional year for ZhongDe.
Pivotal to this success was clearly the successful listing of the Company
on the Frankfurt Stock Exchange in July 2007. Importantly, the IPO helped
us to establish ZhongDe as an international brand, strengthening our
corporate image in the Chinese waste incinerator market and also enabled us
to finance our expansion plans. Earnings continued to increase in a market
experiencing huge growth in demand due to the Chinese government’s
environmental policies. The shift in the sales mix from 82% in the medical
waste segment in 2006 to 70% in the municipal waste segment in 2007 is in
line with our strategy to grow the business in the municipal waste sector.
We expect our business environment to remain strong and the Company is set
to make further progress over 2008.'
For FY 2008 the management expects revenues to be above €50 million with a
net profit margin of above 45%. With the newly signed and expected
contribution of revenue of the large size equipment selling project (Datong
project) and the further strategic objective to focus on larger projects,
the gross margin of the Company is expected to converge slightly lower to
55%.
Key Financial Highlights
Key figures in k€ FY2007 FY2006 Change
Order intake 44,351 23,358 +90%
Order backlog 20,494 7,573 +171%
Revenues 31,133 18,995 +64%
Gross profit 21,637 13,383 +62%
Gross profit margin 69% 70%
Cost of sales 9,496 5,611 +69%
EBITDA 18,685 11,942 +56%
EBITDA margin 60% 63%
EBIT 18,612 11,903 +56%
EBIT margin 60% 63%
Net profit 19,058 8,022 +138%
Net profit margin 61% 42%
Earnings per share 1,47 0,62
About ZhongDe Group:
ZhongDe Group designs, manufactures and installs pyrolytic, grate and
rotary kiln waste incinerators for the disposal of solid medical, municipal
and industrial (including hazardous) waste. Since 1996, ZhongDe Group has
installed approximately 180 waste incinerators in about 13 provinces, and
more than 120 waste incinerators in the last three financial years alone.
Its waste incinerators are principally constructed for operators of medical
disposal centres in the hospital and healthcare industry, as well as for
small and midsized Chinese cities in developed areas of the People’s
Republic of China. ZhongDe Group is one of the leading suppliers of small
and midsized solid waste incinerators in China, supplying state-of-the-art
products.
This document constitutes neither an offer to sell nor a solicitation to
buy securities of ZhongDe Waste Technology AG. The securities have already
been sold.
This document is not an offer of securities for sale in the United States
of America. Securities may not be offered or sold in the United States of
America absent registration or an exemption from registration under the
U.S. Securities Act of 1933, as amended. The shares in ZhongDe Waste
Technology AG have not been and will not be registered under the U.S.
Securities Act of 1933, as amended, and are not being and will not be
offered or sold in the United States of America.
This document is directed at and/or for distribution in the U.K. only to
(i) persons who have professional experience in matters relating to
investments falling within article 19(5) of the Financial Services and
Markets Act 2000 (Financial Promotion) Order 2005 (the 'Order') or (ii)
high net worth entities falling within article 49(2)(a) to (d) of the Order
(all such persons being together referred to as 'relevant persons'). This
document is directed only at relevant persons. Any person who is not a
relevant person should not act or rely on this document or any of its
contents. Any investment or investment activity to which this document
relates is available only to relevant persons and will be engaged in only
with relevant persons.
Contact
Matthias Link
Director
Citigate Dewe Rogerson GmbH
Goethestraße 26-28
60313 Frankfurt am Main
Tel: 0049-69 90 500-150
Fax: 0049-69 90 500-102
E-Mail: matthias.link@citigatedr.de
Internet: www.citigatedr.de
29.04.2008 Financial News transmitted by DGAP
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Language: English
Issuer: ZhongDe Waste Technology AG
Stadthausbrücke 1-3
20355 Hamburg
Deutschland
Phone: +49 40 37644 745
Fax: +49 40 37644 500
E-mail: cornelia.dieker@zhongdetech.de
Internet: www.zhongdetech.de
ISIN: DE000ZDWT018
WKN: ZDWT01
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in Berlin, Düsseldorf, Hamburg, München, Stuttgart
End of News DGAP News-Service
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