Shenzhen International's profit rises 36pc in 2011 on organic growth

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SHENZHEN International Holdings Limited has announced that profit attributable to shareholders in 2011 rose by 36 per cent compared to the previous year to HK$1,745 million (US$224.74 million).

The significant growth of the logistics business was mainly attributed to the successive openings and improved operational performance of new logistics centres as well as economies of scale benefiting from the expanded operating scale. In addition, enhanced operating efficiency and control of operating expenses were said to have enhanced the competitive edge of the group's logistics business.

Revenue for the 12-month period ending December 31 (excluding construction service revenue from toll roads) increased by 18 per cent year on year to HK$4.9 billion.

Profit before finance costs and tax from its core business amounted to HK$3,100 million, representing a growth of 35 per cent over 2010.

Within this total profit from its core business grew by 62 per cent over 2010 to a record HK$1,482 million, the group said in a statement posted by PRNewswire-Asia.

The increase in toll revenue was attributed to the "stable growth of the Chinese economy, the increase in the ownership of small-displacement vehicles, together with the completion of conversion works on existing roads and opening of extension section," the statement said.

With the group holding a 25 per cent stake in Shenzhen Airlines since April 2010, the carrier last year contributed a profit of HK$424 million to the group, up from HK$143 million in 2010. The group increased its equity interest in the airline to 49 per cent in January this year with the completion of the acquisition of an extra 24 per cent stake.

Of the future, Shenzhen International chairman Guo Yuan said: "The group will continue to increase its investment and explore in logistics sector and strive to turn the logistics business to become the main driver of the group's future growth. As the toll road business has become mature, the group will focus on developing the newly-completed projects so as to bring in relatively stable investment returns and adequate cash flow."

Source Shipping Gazette - Daily Shipping News

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