Greentech Lead America: Tri-Tech Holding, a provider of water and wastewater treatment, industrial safety and pollution controlsolutions, announced its revenue for the year 2012 declined by 15.4 percent to $72.6 million compared to $85.9 million in FY 2011.
While the revenue from Water Resource Management System and Engineering Service (WRME) and Industrial Pollution Control and Safety (IPCS) increased by 72.6 percent and 64.2 percent respectively, revenue from Water, Wastewater Treatment and Municipal Infrastructure (WWTM) declined by 55.3 percent to $26.0 million from $58.1 million.
The wastewater treatment plant projects in Bihar India contributed 13.2 percent of revenues for Tri-Tech during 2012.
Gavin Cheng, CEO of Tri-Tech Holding, said, “Despite a noteworthy increase in sales in both the WRME and IPCS segments, we sustained significant reduction in sales in WWTM segment which hindered our performances.”
The decline in WWTM revenue was partially attributed to the company’s decision to avoid Build & Transfer projects to ease cash pressures and instead focus on Engineering Procurement & Construction (“EPC”) projects which usually feature a lower profit margin compared to that of BT projects. Another reason for this decline was due to the delays in implementation in major projects in the WWTM segment.
In 2012, Gross Profit declined by 19.9 percent to $17.5 million compared to $21.9 million in FY 2011. Gross Margin dropped to 24.1 percent from 25.5 percent from a year ago.
The company’s expense increased as it increased headcount to compete for more business early in 2012. As the company encountered challenges in the WWTM segment, it also shifted expenditures to grow revenues in the WRME and IPCS segments.
One of the major projects of Tri-Tech in 2012 was the construction of a wastewater treatment plant and a wastewater pipeline network in Dawangdian Industrial Park in Xushui County, Hebei Province in China. To implement the project the company established a project company in Xushui County. The Xushui project contributed more than 13.8 percent of revenues during 2012.
In 2013, the company plans to partner with established companies in the water and waste water treatment segment to maintain competitiveness and to fuel a sustained growth. Tri- Tech will also device new marketing strategies to improve gross margin especially in WWTM and WRME segment.
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