Press Conference for 2008 Annual Results

Further Consolidates Its Resources And Focuses On Core Environmental Protection Business

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China Everbright International Limited ("Everbright International" or "the Group") announced its audited annual results for the year ended 31 December 2008.

During the year under review, environmental protection business made steady progress with new projects completed and upgrading projects swinging into operation. The environmental business has become more mature contributing to increased turnover and recurring profits. In 2008, the consolidated turnover of the Group amounted to HK$1,862,509,000, representing an increase of 38% from HK$1,347,852,000 as compared with 2007. EBITDA on recurring basis was HK$592,727,000, representing a growth of 39% from HK$425,557,000 for 2007. For the year ended 31 December 2008, the Group recorded non-recurring profit of HK$51,778,000 arising from the disposal of its entire issued shares in two subsidiaries which are engaged in non-core property business. For the year ended 31 December 2007, the Group recorded non-recurring profit of HK$42,885,000 due to the disposal of other financial assets as well as the revaluation of investment properties. The income tax expense for 2008 was HK$95,161,000, representing a significant increase as compared with HK$6,807,000 of 2007. The increase was mainly due to the recognition of withholding income tax in respect of profits derived from the PRC subsidiaries during the year and the one-off write-back of deferred tax in 2007 as a result of the change of PRC tax rate. Profit attributable to equity shareholders of the Company for 2008 was HK$339,018,000, an increase of HK$1,086,000 as compared to HK$337,932,000 for last year. Stripping the impact of the non-recurring profit and the income tax expense, the net profit for the year increased 27% as compared with last year. Basic earnings per share for 2008 were HK10.80 cents, HK0.09 cent less than HK10.89 cents of last year. To reward shareholders for their support and taking into consideration the long-term continual development of the Group, the board of directors has proposed to pay a final dividend of HK1.0 cent per share to shareholders of the Company. Together with the interim dividend of HK0.6 cent per share already paid, the total dividends for the year will be HK1.6 cents per share (2007: HK1.6 cents per share).

TURNOVER OF ENVIRONMENTAL BUSINESS INCREASED 40% TO HK$1,734,676,000
EBITDA OF ENVIRONMENTAL BUSINESS INCREASED 47% TO HK$510,808,000
ENVIRONMENTAL BUSINESS CONTINUES TO GROW RAPIDLY
OPERATING EFFICIENCY CONTINUES TO INCREASE

With processing volume rising and operating efficiency improving, the business has been able to boost its revenue base. During the year under review, turnover of environmental protection business amounted to HK$1,734,676,000 (construction service revenue: 63%, operation service revenue: 22%, and finance income: 15%), an increase of 40% when compared with 2007 and accounting for 93% of the Group's total turnover, 1 percentage point higher than that of 2007. EBITDA amounted to HK$510,808,000, an increase of 47% when compared with 2007 and accounting for 86% of total profits on recurring basis.

The Group had successfully won the tender for a waste-to-energy plant in Jinan City, Shandong Province. The project will be operated on BOT (Build-Operate-Transfer) mode. The total investment of the project is approximately RMB900,853,000 (equivalent to approximately HK$1,021,928,000). The designed daily waste processing capacity of the plant is 2,000 tonnes and it will take about 18 months to build. This project is the Group's first waste-to-energy project in Shandong Province. At present, it is the largest waste-to-energy project built in one phase in the PRC.

The environmental protection projects of the Group has increased to 22 commanding a total investment of RMB5.05 billion (excluding the total investment cost of approximately HK$1,104,378,000 (equivalent to RMB973,535,000) of Jinan Waste-to-energy Project and Jinan Xike Project which the Company has just won the tender at the end of 2008). The designed total annual processing capacity is approximately 1,500,000 tonnes of household waste, capable of supplying an average annual on-grid electricity of approximately 400,000,000 kilowatt-hour, daily waste water treatment of approximately 1,500,000 tonnes and approximately 20,000 m3 of other waste.

Mr. Chen Xiaoping, Chief Executive Officer of Everbright International, said, "The Group repositioned its development focus in the second half of 2008 and split its core environmental businesses into four sectors, namely, environmental energy, environmental water, environmental construction and environmental technology. The environmental energy, environmental water and environmental construction sectors become more mature and boast considerable economies of scale and are serving the Group as a major income source. The Group will actively grasp the opportunities to further develop the environmental protection market, put greater efforts on environmental technology research and development and enhance the transformation of research results to marketable products. The Group will transfer from a single project base (primarily waste-to-energy project and waste water treatment project) to environmental industrialization and from traditional environmental protection company to a new environmental protection enterprise that employs high-end technologies. "

INFRASTRUCTURE AND PROPERTY INVESTMENT BUSINESSES CONTINUE TO GROW STEADILY

During the year under review, traffic on the Qingzhou Bridge continued to grow and generated steady cash flow for the Group. For the year ended 31 December 2008, the average number of standard vehicles crossing the bridge daily increased to 33,742, 7% higher than that in 2007, and brought an EBITDA of HK$98,927,000 to the Group, representing an increase of 15% when compared with 2007. Looking forward, with the maintenance work of the Wulong Longjiang Bridge and Phase II of the North Airport Highway to complete in 2009, traffic on the Qingzhou Bridge is expected to increase further.

During the year under review, Shenzhen Zhongshan Garden, a four-storey commercial complex with a shopping arcade owned by the Group, generated steady rental revenue and cash flow. The property was 97% leased during the year and brought an EBITDA of HK$11,969,000 to the Group, an increase of 14% as compared with 2007. To optimize its business structure, the Company convened an extraordinary general meeting on 18 December 2008 at which a resolution was passed to dispose of Sino Villa Holdings Limited which held the Shenzhen Zhongshan Garden and its management company to Everbright Real Estate Limited for a total consideration of HK$195,907,000. The transaction had been completed. It generated a profit on sale of subsidiaries of HK$51,778,000 for the Group for the year ended 31 December 2008.

Mr. Chen concluded, "With the State Council pledging to increase investment in improving the ecological environment, speeding up construction of urban sewage and waste treatment facilities and step up prevention and treatment of pollution in major rivers, the Group sees enormous room for its business to develop. The exploration of waste recycling such as waste-to-energy, water quality restoration and waste recycling, the widespread use of wind power, solar energy, bio-energy as well as the energy saving and pollutants minimization will become the major environmental protection development trend in the human society and translate into immense growth potential for future development of the environmental protection industry."

"We will grasp every opportunity and continue to develop our core environmental protection business, invest more resources in R&D and step up efforts to train and develop our technical team and strive to enhance our competitiveness through innovation. We will also fully utilize our brand advantage, following the principles of "implementing projects with one success followed by another" and conducting business with integrity, efficiency, innovation and pragmatism. Backed by our parent company China Everbright Holdings Company Limited, we will seek to secure more development projects and strengthen leadership in the environmental protection industry, and ultimately generate more fruitful returns for shareholders." Mr. Chen added.