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Yuexiu Transport Infrastructure Announced 2012 Interim Results and its Toll Revenue Achieved Another Record High
Release Date:2012-08-17 14:52:00

On August 15, Yuexiu Transport Infrastructure Limited (1052) announced the unaudited consolidated results of the Company and its subsidiaries ( the Group) for the past six months as of 30 June 2012 (within the Reporting Period).Driven by the strong growth of the mid-west projects, the toll revenue of the Group in the reporting period grew to RMB 701 million, up by 12.5% on a year-on-year basis.The total profit before income tax amounted to RMB 455 million, up by 9.3% on a year-on-year basis.The profit attributable to shareholders amounted to RMB 243 million, down by 4.5% on a year-on-year basis.The Board has recommended the payment of an interim dividend for 2012 of HK$0.09, equivalent to about RMB 0.0736 per share ( the interim dividend for 2011 was HK$0.10, equivalent to about RMB 0.0825 per share.

The traffic volume and toll revenue grew in the whole

During the reporting period, under complex and harsh economic situation at home and abroad, Chinese government implemented a proactive fiscal policy and a prudent monetary policy  and intensified the policy presetting and fine-tuning . As a result, the overall national economy realized steady development, which led to the stable aggregate national traffic demand and consistent growth in passenger and freight traffic volumes on highways. The economic development continued to maintain a rapid growth in Shaanxi, Tianjin, Guangxi, Hunan, Hubei, Henan and other regions, where the Group has controlling projects, and GDP growth rates in those regions in the first half of the year were higher than the national average in the same period.

During the reporting period, Han-Xiao Expressway, Changzhu Expressway and Weixu Expressway (on May 28, 2012, the Group accomplished the acquisition) maintained strong double-digit growth in terms of daily average traffic volume and toll revenueonly the GNSR Expressway had a slight decrease in terms of daily average toll revenue due to the influence of a slowing economy, the implementation of standardized charges and other factors; the opening of Binbao Expressway changed the traffic flow structure in the region, so the gain for the long-way vehicles declined and the toll revenue of Jinbao Expressway was affected. 

Some achievements have been made in the work of special rectification on toll roads and Guangdong Province has unified the standardization of the toll fees of expressways 

Since June 14, 2011, five ministries including the Ministry of Transport of China, China National Development and Reform Commission and the Ministry of Finance of China have jointly carried out the work of rectification on the toll road industry. Up to now, some achievements have been made and various provinces have implemented specific rectification measures.

On May 31, 2012, the Price Control Administration of Guangdong Province and the Department of Communications of Guangdong Province jointly issued the Notice on the Implementation of the Unified Standardization of the Toll Fees of Expressways in Guangdong Province (No. 20121 of Guangdong Charge), which stipulates that , since zero hour on June 1, 2012, the toll fees of expressways in Guangdong Province shall be charged in accordance with the unified standardization.

The expressway projects of Yuexiu Transport Infrastructure invested and operated in Guangdong Province shall generally comply with the provisions in the Notice. The toll revenues for some of the projects slightly decreased because their charging must comply with “the provision that the charging mileage for the interchange ramp shall be calculated by half of the average length”.

Weight charges are implemented in the Guangdong Province comprehensively and vehicle licensing restrictions are implemented in Guangzhou 

Since zero hour on June 1, 2012, the toll fees of expressways in Guangdong Province shall be charged in accordance with the unified standardization. Besides, Guangzhou is combined into the central district for implementing network toll collection. Thus, the processes of network toll collection andweight charges in the whole Guangdong Province are further accelerated, which are expected to be implemented at the end of this year and early next year.

Besides, in order to safeguard the effective passage of city traffic, improve and protect the atmospheric environment quality, realize reasonable and orderly growth of small and medium-sized passenger carsand effectively alleviate traffic congestion, Guangzhou municipal government announced that, since zero hour on July 1, 2012, some specific measures for moderately controlling the small and medium-sized passenger cars shall be tried out.  Some relevant authorities are actively studying the integrated traffic control policy as supporting measures, including some moderate controlling measures targeting at the vehicles from other place driving in the urban area of Guangzhou (specific contents have not yet been officially announced). It is preliminarily estimated that the Group’s GNSR Expressway and GWSR Expressway, located in Guangzhou, will benefit from this.

Yuexiu Transport Infrastructure said, “In the face of changes in industry policy, the Group will continue to closely monitor market developments and implement sound business philosophy with cautious approaches.”  During the reporting period, relevant approval procedures on the share transfer of Weixu Expressway were accomplished and the business license for the new project company was obtained on May 28, 2012, which became a subsidiary wholly owned and fully controlled by the Group.Meanwhile, in accordance with the established strategic goals, the Group will continue to intensify the efforts of investment and development, look for and reserve a number of expressway projects, and selectively promote the acquisition.”

Looking ahead, it is estimated that Yuexiu Transport Infrastructure is estimated to have such relatively mature projects as GNSR Expressway, Humen Bridge, Xian Expressway, Guangzhou Northern Ring Road, Cangyu Expressway, Shantou Bay Bridge and Jinbao Expressway, which will continue to be the main source of stable profit.  During the reporting period, Han-xiao Expressway, Changzhu Expressway and Qinglian Expressway maintained strong double-digit growth in toll revenue, which will be the important profit growth point of the Group in the future. Han-xiao Expressway has realized breakeven for two consecutive years, while Changzhu Expressway and Qinglian Expressway are still at the incubation period, but Qinglian Expressway has significantly reduced the losses. Henan Weixu Expressway will also contribute more satisfactory profit in the second half of 2012.

NextYuexiu Transport Infrastructure will remain focused on investment and management of high-quality expressway assets and pay close attention to the investment opportunities in the following areas: (1) the economically developed Pearl River Delta Region; (2) the fast growing central and western provinces, which have shown great potential in economic development and benefit from the central government’s huge support and the migration of industries from eastern coast of the country.

The senior managers of Yuexiu Transport Infrastructure concluded, “Upon accomplishment of the acquisition of Wei Expressway, the Group will continue to closely follow and investigate some relevant projects, strive to acquire high-quality expressway project at the appropriate time, further deepen the business mode of integrating investment, finance with control, and enhance the long-term return ability of the overall portfolio of Yuexiu Transport Infrastructure.