SHANGHAI, March 31, 2020 /PRNewswire/ -- Wison Engineering Services Co. Ltd. ('Wison Engineering', HKEX Stock Code: 2236), a leading engineering, procurement and construction (EPC) service provider in China, announced its annual results for the twelve months ended 31 December 2019 ("the Period") on 24 March 2020.
Significant growth on new contracts representing a y-o-y increase of 34.1% to RMB 12,777 million
During the Period, revenue of the Group amounted to approximately RMB4,367.3 million, representing a year-on-year increase of 34.1%. It was mainly attributable to the satisfactory progress achieved by the Group's key projects, and the overseas projects in North America and Middle East have entered into the peak construction stage. The gross profit reached approximately RMB408.2 million, representing a year-on-year decrease of 18.2%. Profit attributable to owners of the parent company reached approximately RMB50.6 million, representing a year-on-year decrease of 10.1%. It was mainly due to the implementation of strategic projects in new markets, which had a low gross profit margin in 2019. In addition, the investment increase in research and development, new market expansion, talent and capacity reserves, as well as increase in spending on overseas income tax, resulted in profit decline.
During the Period, the Group's total new contracts reached approximately RMB12,776.6 million, representing a year-on-year increase of 78.3%. As at 31 December 2019, the backlog value was approximately RMB21,868.0 million, representing an increase of 65.7% comparing to the backlog value as of 31 December 2018. The substantial increase in new contracts and backlog value will lay a solid foundation for the Group's future development. For returning the support of shareholders, the Board of directors recommended a final dividend of RMB0.0037 per ordinary share.
Prompt reply to the market change with continual breakthroughs in technology and market development
Responding to the challenges and opportunities, the Group has leveraged its nimbleness as a private enterprise to achieve breakthroughs and innovations. During the Period, the Group established Key Customer Care Division, Emerging Market Division and Strategic Growth Center. In respect to new market development, the Group achieved the breakthrough in securing EPC project for Saudi Aramco, the first Front-End Engineering Design (FEED) Project in Russia, and undertaking the first municipal and environmental project in China. In respect to technology innovation, the Group achieved a full digital delivery of a million-ton ethylene project design, joint licensing C5-C6 Isomerization technology, completing the first integrated MTO and butadiene technology.
Wison Engineering has actively promoted the application of digitalization, smart plant and modularization, which will put the Group in a leading position in the industry transformation. During the period, the Group completed and delivered 3 modularization projects in the United States. Wison Engineering also enhanced the digital capability in EPC, project management and other processes, and the Group's capability of digital delivery has been successfully proven in a million-ton ethylene design project.
Strengthening domestic market share, while expanding global presence
As an engineering company rooted in China with extensive experience in overseas projects, the Group implemented a strategy of strengthening domestic market and expanding into global market. During the Period, the Group secured 65 new domestic projects, with total contract value of approximately RMB12.09 billion. The new projects involved various types of engineering works, including refining and petrochemical integrated complexes, ethylene crackers, coal chemicals, PTA and PDH. For the international markets, the Group secured 10 new projects, mainly from North America and the Middle East. The Group established the North American Operations Center to swiftly respond to the local market demand. In addition to the key regions, the Group has established branch offices in Russia, Southeast Asia, Africa and other regions along the "Belt and Road" initiative, laying the foundation for expanding new markets.
Build on past success, explore new opportunities
Looking toward the future, the pandemic outbreak, trade friction, geopolitical conflicts and clasp of the crude oil will lead to huge uncertainty and volatility to the energy and chemical market. The Group will continue to implement its growth strategy and actively explore new growth opportunities despite current uncertainties and challenges.
Ms. Vicky Rong, the CEO of Wison Engineering, said, "There will be plenty of challenges and opportunities in 2020. Focusing on the market with large potential and high gross margins, the Group will continue to attract top-notch talents, further improve management efficiency, and strengthen research and development and financing capabilities. Meanwhile, we strive to expand business into catalysts, new materials, and energy-saving and environmentally-friendly business. Wison Engineering will devote to increase the Company's overall competitiveness and profitability."
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About Wison Engineering
Wison Engineering (stock code: 02236.HK), as one of the leading chemical EPC service and technology providers in China, Wison Engineering specializes in serving petrochemicals, coal-to-chemical and oil refining industries. From project planning, consultation and technology licensing to FEED, EPC management, as well as start-up and operational services, we provide services covering the entire lifecycle of the project.
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