Wing Lee Development (09639) Mid-term performance in 2025: Steady growth driven by dual engines, leading the new direction of growth in new energy business.

Received on November 26th, WING LEE DEV (09639) announced its interim performance for the period ending September 30, 2025, with a revenue of 252 million Hong Kong dollars and a net profit of 19.21 million Hong Kong dollars. Overall, the performance has seen a temporary adjustment due to the project cycle and financial return period, with a deviation between the reported data and actual business progress. However, the stable foundation and growth potential of the core business continue to be evident. The core reasons for the performance adjustment are mainly twofold: on one hand, some large-scale projects in the civil engineering sector are nearing completion, resulting in a natural decline in revenue, while new projects that have been awarded are still in the preparatory and initiation stages, thus not generating substantial revenue yet. This has led to a short-term "gap" in the financial statements. On the other hand, trade receivables increased from approximately 24.54 million Hong Kong dollars at the end of March to approximately 44.67 million Hong Kong dollars at the end of September, with the new receivables primarily in the short-term "within 30 days" aging category, posing minimal repayment risks. The difference in these receivables can fully cover the adjustment in profit margin. It is worth noting that the company's diversified business structure has shown optimization effects, with steady growth in cable engineering, new energy business, and leasing machinery business serving as important support for the performance. The company's three major business sectors have seen fruitful additions to projects, with continued deepening of its layout. In the new energy business sector, the company successfully undertook the Hong Kong Blue Earth Quarry Mixing Plant project, providing comprehensive civil and supporting installation services. This project, as the first intelligent mixing plant in Hong Kong, plans to have seven production lines and once completed, will be the largest intelligent mixing plant in the country. Moreover, the company has secured multiple orders for new energy equipment since October, with a total value exceeding 150 million Hong Kong dollars, leading to a steady increase in profitability. Additionally, the company, in collaboration with leading companies such as Sany Group and Contemporary Amperex Technology, has established the "Zero Carbon Smart Alliance" to create a full industrial chain solution for light storage, charging, and recycling, building a demonstration base for "Zero Carbon Smart Space" and has already achieved technological implementation and income conversion. These developments will be reflected in the upcoming performance reports. With its professional advantages, the civil engineering sector has secured key public projects such as the Hong Kong International Airport's Parking Lot No. 5, the Kowloon City Road Administration Project, and the Lamma Island Power Plant supporting projects, solidifying its position in the Hong Kong infrastructure market. In the electromechanical engineering sector, the company won the 8-year main contract for laying power cables in Kowloon and the New Territories, and secured projects related to China Power, serving as an important partner in electricity projects with multiple regions, thus enhancing the stability of its business. Looking ahead, the dual-drive strategy of "new energy + green building" will unleash sustained growth momentum. The new energy business, as the core engine, will promote integrated service solutions and deepen cooperation with industry giants through the alliance, undertaking more green infrastructure projects. With the "dual carbon" goals and Hong Kong's carbon neutrality plan, it is poised to enter a period of scalable growth. The civil engineering sector will seize opportunities in the Hong Kong infrastructure market, with the Special Administrative Region government allocating 120 billion Hong Kong dollars annually for basic projects and an additional reserve of 30 billion Hong Kong dollars, coupled with progress on key projects in the northern metropolitan area, providing the company with a stable profit space. The electromechanical engineering sector will expand its market share by taking advantage of China Power's 529 billion Hong Kong dollars investment over five years and the construction demand for the Northern Metropolis Science and Technology Center, focusing on upgrading cables and smart grid projects. In summary, the company's core business is stable, with sufficient order reserves, and the effects of strategic transformation are beginning to show. With the confirmation of revenue from new projects, the scaling up of the new energy business, and the release of policy dividends, the company is expected to achieve steady revenue and profit growth, bringing long-term sustainable returns to shareholders.