HONG KONG, Nov 22, 2024 - (ACN Newswire) - Tat Hong Equipment Service Co., Ltd. ('Tat Hong' or the 'Company', together with its subsidiaries, the 'Group') (Stock Code: 2153), the first foreign-owned tower crane service provider established in the PRC, has announced its interim results for the six months ended 30 September 2024 (the 'Period').
During the Period, the Group recorded revenue of approximately RMB340.9 million (2023: RMB358.6 million). Loss attributable to equity shareholders of the Company was RMB36.2 million (2023: RMB20.4 million). Such increase in loss was mainly attributable to the decrease in the average monthly service price of tower cranes per tonne metres in use from RMB225 toRMB208, thereby affecting the Group's revenue.
Total tonne meters in use by the Group increased to 1,637,740 for the Period from 1,594,911 in the previous same period. As at 30 September 2024, the Group had 327 projects in progress with total outstanding contract value at approximately RMB444.6 million and 47 projects on hand with expected total contract value at approximately RMB235.1 million.
For the six months ended 30 September 2024, global economic recovery had slowed down and the mainland China economic downward pressure had been significant. Due to insufficient market demand and decline in the average monthly tower crane service price per TM, market competition was intense for the construction machinery industry. To cope with the slow recovery of the domestic construction industry and the persistently weak macro economy, plus to boost future income, the Group had actively adjusted its strategies, restructured business layout and expanded business overseas during the Period.
Responding to the national and international calls to promote green energy and support enterprises in accelerating transformation, the Group set up a Clean Energy Division in 2023 to focus on expanding clean energy businesses including nuclear power plants. At the same time, the Group had actively shifted to focus on thermal power plant projects. It expects revenue generated from these projects on hand to be reflected in its future results. With the new subsidiary in Guangzhou, the Group had deepened coverage in the Greater Bay Area. The Group also speeded up expansion in Indonesia, with a joint venture with a local partner in 2024 after years of careful strategic planning. With rich experience in operating business in Indonesia, the partner is expected to give the Group the support it needs to expand the Indonesian market.
During the Period, the Group continued to expand its medium-to-large tower crane fleet. As at the end of the Period, it managed a total of 1,193 tower cranes, the second largest fleet in the PRC tower crane service market. With such a strong tower crane fleet, the Group has been able to focus on medium-to-large construction projects, providing them with comprehensive services with tower cranes that afford a wide range of lifting capacities. The considerable number of medium-to-large tower cranes the Group owns also give it advantage in bidding for larger and more complicated projects, and as such, allowing it to increase revenue from and the profit margins of future projects.
Mr. Sean Yau, CEO of Tat Hong Equipment Service Co., Ltd., said: 'Recently, the Chinese government has introduced a comprehensive package of incremental policies to expand effective investment, stimulate consumption demand, attract investment, support industrial upgrade, ease enterprises'difficulties and issues, implement fiscal and financial measures, and stabilize the real estate market. It is evident that the country is increasing fiscal support and charting a clear course of recovery for all industries. Moreover, there is still strong demand in the domestic infrastructure and energy sector. That plus the fast-growing infrastructure markets in the Greater Bay Area and Southeast Asia have provided the Group with huge business development opportunities.'
Mr. Roland Ng, Chairman of Tat Hong Equipment Service Co., Ltd., said: The present pace of market recovery in China is sluggish, but with the new focus on high-quality growth, it is expected to gradually get back on track. We will keep our eyes on the fast-changing global market environment and adjust our operational and geographical strategies accordingly. At home in the PRC, we will seize the new opportunities brought by the rapid development of clean and green energy. Abroad, as the first foreign-funded tower crane service provider set up in the PRC, we will continue to take advantage of our brand reputation, rich industry experience, mature execution skills, profound technical strength and solid customer base to help us 'go global'. With support from the 'Belt and Road' initiative and other policies encouraging enterprises to venture overseas, the Group will push to expand into more overseas markets.'
About Tat Hong Equipment Service Co., Ltd. (Stock Code: 2153)
Tat Hong Equipment Service Co., Ltd. is the first foreign-owned tower crane service provider established in the PRC. Since 2007, the Group has established as a tower crane service provider for one-stop tower crane solution services from consultation, technical design, commissioning, construction to after-sales services primarily to Chinese Special-tier and Tier-1 EPC contractors. Guided by its core values, 'Virtue, Safety and Excellence', the Group has successfully established its market position and maintained stable, reputable and loyal customer base in the construction industry in the PRC.
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Source: Tat Hong Equipment Service Co., Ltd
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