Dear Valued Shareholders,
On behalf of the Board of Directors, I am pleased to announce the results of SIIC Environment Holdings Ltd. (“SIIC Environment” or the “Company”, together with its subsidiaries, the “Group”) for the 12 months ended 31 December 2025 (“FY2025”) . In FY2025, the Group firmly grasped the industry development trends, adhered to the bottom line of steady operation, strengthened innovation-driven leadership, continuously optimized the capital structure, actively expanded its market presence, and achieved new breakthroughs in project construction, business operation, financial management and other aspects. In FY2025, the Group’s revenue amounted to RMB7.073 billion, and its net profit attributable to shareholders reached RMB610 million. The net increase of high-quality wastewater treatment capacity during the year exceeded 400,000 tonnes per day, further enhancing the Group’s overall competitive strength and industry influence.
Standing firm amid stability, and seizing momentum to pursue growth
In 2025, uncertainties surrounding the global economic recovery continued to escalate, while the Chinese economy sustained a steady rebound. Green and low-carbon development emerged as a key orientation for economic and social advancement, and investment in the green upgrading of infrastructure kept expanding, ushering in a new strategic window of opportunity for the development of the water and environmental protection industry. China successively introduced a raft of policies, including the Implementation Opinions on Building Pilot Zones for a Beautiful China and the Healthy China Initiative – Implementation Plan for the Healthy Environment Promotion Action (2025–2030). These policies attached great importance to the protection and governance of rivers and lakes, the improvement of water environment quality, and the refinement of ecological protection compensation mechanisms, and explicitly mandated accelerating the comprehensive green transition of economic and social development. Coupled with the institutional dividends generated by the formal implementation of the Ecological Environment Code, these developments have laid a solid policy and legal foundation for the high-quality development of the industry. In the meantime, the industry was confronted with new challenges, including intensified competition for existing projects, higher requirements for refined operation and management, and the pressing need for digital transformation. Industrial upgrading and model innovation thus became core priorities for the industry’s development.
Faced with the evolving landscape of the industry, the Group remained focused on the core track of the environmental health industry, adhered to the principle of steady operation, strengthened innovation-driven development, deepened the synergy and linkage across all business segments, and continuously enhanced its brand influence and core competitiveness. While consolidating the competitive advantages of its traditional water treatment business, the Group actively expanded into emerging sectors such as industrial water treatment, promoted the in-depth integration of business development with industry trends, and has further consolidated its leading position in the first echelon of China’s water and environmental protection industry.
In FY2025, the Group’s operating indicators maintained a sound and steady trend, cementing a framework for high-quality development. The Group recorded revenue of RMB7.073 billion. Revenue from operation and maintenance under service concession arrangements and related financial income remained stable, the asset-light business achieved explosive growth, and service revenue rose by 49.6% year on year. Net profit attributable to shareholders reached RMB610 million, representing a year-on-year increase of 0.9%. This has demonstrated the resilience and potential of the Group’s operation and development, and effectively delivered on the development objectives of pursuing efficiency through management and vitality through institutional optimization.
Controlling risks and strengthening foundations, expanding presence and enhancing efficiency
The Group is committed to building a solid financial foundation and mitigating potential risks through proactive management of fund liquidity, in line with the management requirements of prudent operation and controllable risks. In FY2025, the Group continued to optimize its financing structure, resulting in a substantial reduction in financial costs. Financial expenses for the reporting period amounted to RMB671 million, representing a year-on-year decrease of 13.9%. The capital structure has been continuously optimized, with the total liabilities to total assets ratio ratio dropping from 64.2% to 62.5% and the current ratio rising from 1.16 to 1.62, significantly enhancing the Group’s financial robustness and risk resilience. In response to challenges in payment collection, the Group has made comprehensive and focused efforts on the recovery of accounts receivable, leading to a marked improvement in collection efficiency. Cash flow generated from operating activities surged from RMB565 million to RMB1.694 billion, providing solid financial support for the advancement of the Group’s strategies.
In terms of market expansion and project operation, the Group has achieved simultaneous growth in scale and efficiency through three pathways: new contracts, mergers and acquisitions, and optimization of existing projects. Six high-quality projects, including those in Chenzhou, Hunan and Fengxian, Shanghai, were newly signed or awarded, with a combined capacity of approximately 380,000 tonnes per day. Major breakthroughs were made in mergers and acquisitions, with two projects in Dalian, Liaoning secured and two projects in Anshan to be signed, adding a locked-in capacity of 290,000 tonnes per day. One project in Guangxi obtained an extension of its concession right, further consolidating the existing project base. Meanwhile, newly built and upgraded projects in Shanghai, Shandong and other regions have been commissioned one after another, with continuous improvement in project construction and commissioning efficiency. Shanghai Baoshan Renewable Energy Utilization Center (the “Baoshan Project”), a flagship solid waste treatment project, has maintained stable and efficient operation with all indicators reaching advanced industry levels. The Qingpu Xicen Water Purification Plant (the”Xicen Project”), a key wastewater treatment project, has officially commenced commercial operation. As of the end of FY2025, the Group owned more than 250 wastewater treatment, water supply, waste-to-energy and sludge treatment projects.
Safety production is the core bottom line of operation. Throughout the year, the Group has meticulously implemented various safety measures covering the entire process of project construction and daily operation, ensuring the safe and stable operation of environmental protection facilities and effectively fulfilling the livelihood security role of municipal infrastructure.
Fostering innovation, and embracing green growth
In FY2025, keeping abreast of industry trends and its innovation strategy, the Group has taken technological innovation as the core, digital and intelligent empowerment as the focus and green development as the goal, promoting the transformation of the Company into an innovation-driven, green and low-carbon enterprise and fostering new quality productive forces.
At the end of 2025, the Group’s technology center was inaugurated, further integrating and optimizing technical resources, focusing on process optimization and R&D in segmented fields such as domestic sewage and industrial wastewater, and exploring the path to commercialization of technological achievements. The Group has formulated and launched the implementation of a big data center plan, and commenced the establishment of a digital operation and management system to achieve standardized and intelligent project operation, effectively enhancing efficiency and reducing costs, and actively applied advanced technologies including environmental protection robots and remote operation and maintenance. Meanwhile, keeping pace with the “dual carbon” goals, the Group has optimized wastewater treatment processes to reduce carbon emission intensity, and continued to make efforts in water resource conservation and water environment governance, driving green transformation.
The Group has deeply integrated the ESG concept into its development strategy and corporate governance core, improved the ESG governance system, optimized relevant management systems, and embedded ESG requirements into the entire process of project expansion, production and operation, and financial management. It has actively fulfilled its social responsibilities, assisted local ecological governance with professional capabilities, and achieved resonance between corporate development, ecological protection and social responsibility.
Appreciation
On behalf of the Board of Directors, I would like to express my sincere gratitude to all shareholders, customers, and business partners for their trust and support, and my highest respect to all employees for their dedication to the development of the Group.
Going forward, the Group will continue to uphold the philosophy of “achieving breakthroughs through mergers and acquisitions, and enhancing quality and efficiency” . Taking the market as the orientation, innovation as the driving force and management as the support, the Group will strategically deploy high-quality projects, capture market-driven M&A opportunities and continuously expand its business scale. Meanwhile, the Group will strengthen technological innovation and digital-intelligent empowerment, strive to achieve differentiated breakthroughs in the new track of industrial water treatment, continuously optimize its cash flow and risk management system, enhance its core competitiveness, elevate the Group’s development to a new level and deliver sustainable and robust investment returns to shareholders.
Mr. Zhou Yuding
Chairman of the Board and Executive Director