Shenzhen Energy Group Co., Ltd. (000027),China’s first sizeable joint-stock enterprise in the electric power industry listed on the Shenzhen Stock Exchange as well as the first listed public utility company in Shenzhen, released its pre-audited financial report for 2017 last Saturday.
The report shows that despite a 36.8 percent year-on-year increase in its operating revenue, which reached over 15.48 billion yuan in 2017, its net profit was down by up to 42.07 percent last year to finish at 780.36 million yuan. Itsearnings per share also dropped by as much as 42.08 percent on a yearly basis to 0.1968 yuan in 2017.
The company cited the increase in its power sales and the sale of its residential property named Dianli Garden as the reasons for the year-on-year increase in its operating revenue. In the meantime, it blamed the dramatic surge in fuel costs; the decline in the power price, the increase in the financial expenses, as well as the drop in the investment income for the sharp plunge in its net profit.
Also, according to the report, a combination of factors including the investments in and acquisition of new projects as well as the increase in its debt led to the growth of the company’s total assets from the beginning of the year.
In addition to its poor financial performance, the company was also embroiled in a controversy recently, in which one of its subsidiaries, Dafeng Zhenghui, which isengaged in solar power generation, was alleged to have built its solar power plant in a natural reserve area in Jiangsu Province without obtaining the necessary administrative approval from the local government in advance.
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