Modern Water announces strong growth in China
Water technology and desalination provider Modern Water (MW) has revealed strong market growth in China, a £0.5m contract to build the first of its kind commercial desalination plant and the impact of latest acquisition in its interim results.
Figures for the six months to June 30 2011, shows a gross revenue of £430,000, compared with £1,000 for the first half of 2010 and just £27,000 gross revenue for the whole of 2010.
Gross profit margin for this period was 33%, an increase the company attributes to its growth in China, and though net profit will undoubtedly be affected by the successful acquisition of environmental and process monitoring business Cogent in February 2011. MW said the acquisition has allowed it to more effectively monitor its water quality and wastewater.
In addition, MW was recently awarded the contract to build and operate a commercial desalination plant in Oman by Oman's Public Authority for Electricity and Water (PAEW). The plant will be capable of producing 200cum of fresh water per day, using a process of forward osmosis, which has been trialled by MW at its other sites in Gibraltar and Oman.
Commenting on the results, MW executive chairman, Neil McDougall, said the group had made "excellent progress in the first half of 2011", and added that the desalination plant contract marked a "major breakthrough" that would help it bring lower energy, cost-saving technology to the marketplace.
Mr McDougall said: "Accelerating sales in China of our water monitoring systems helped us to achieve our first significant revenues and gross profit.
"MW has excellent technology, a strong and growing market presence and a sound balance sheet, with £16.7m cash in hand. The second half of 2011 has started well and we look forward to reporting further strong progress at the end of the year."
As a result of its market growth in China, MW has now appointed Simon MacKinnon as new non-executive chairman to run its operations there.
The interim report can be viewed here.