WASTEWATER treatment company SIIC Environment posted a 90.1 per cent fall in net profit to 20.6 yuan million (S$3.9 million) for the fiscal fourth quarter ended Dec 31, 2023, from 209.2 million yuan a year earlier.

This comes as revenue for the quarter tumbled 51.4 per cent to 1.2 billion yuan, from 2.5 billion yuan in the year-ago period, the company disclosed on Monday (Feb 26).

Earnings per share for the quarter stood at 0.8 renminbi cents, versus 8.12 cents in the previous corresponding period.

The board has proposed a final cash dividend of S$0.006 per ordinary share, with the payable date to be announced later.

For the full year, net profit fell 22.6 per cent to 604 million yuan, from 780.2 million yuan a year earlier, while revenue fell 8.8 per cent to 7.6 billion yuan, from 8.3 billion yuan a year earlier.

The drop in revenue came as construction revenue fell 37.1 per cent to 1.9 billion yuan in FY2023 since the group completed construction activities for its solid waste treatment and power generation project, Shanghai Baoshan Renewable Energy Utilization Centre, and started operations for it.

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The centre, in turn, contributed to the rise in wastewater treatment and water supply volume, an increase in average treatment and supply tariff per tonne, and higher gross profits for FY2023, which rose 2.7 per cent to 2.7 billion yuan on the year.

Finance expenses further weighed down the group’s financials. The component rose 16.6 per cent to 834.3 million yuan in FY2023, up from 715.2 million yuan a year earlier.

The increase was mainly contributed by the interest rate hikes in certain markets outside of mainland China since May 2022. This eventually increased the finance expenses of the floating rate borrowings, the group said.

The group also noted an increase in the outstanding balance of bank and other borrowings, which were injected to support the ongoing projects in construction and upgrading.

In the year ahead, the group said it will focus on high-quality new project opportunities to strengthen business development momentum and consolidate its industry leadership.

This comes as the Qingpu Xicen Water Purification Plant – described as the group’s “guidepost” wastewater treatment plant project – nears completion. Its raft foundation is done, and the pool walls of its wastewater treatment filters were 90 per cent complete by 2023’s end, the group pointed out.

Meanwhile, the company is looking to score green financing on the back of policies that encourage financial institutions to finance and invest in environmental protection projects.

It further said it has an “added advantage” in broadening its financial channels to help expand its wastewater, sludge and solid waste treatment business.

Shares of SIIC Environment rose 1 per cent to end at S$0.198 on Monday, before the announcement.