China Communications Construction reports mixed H1 results, strategic divestment

China Communications Construction Company Limited (CCCC) announced interim results for the six months ended June 30, 2025, reporting a 5.8% decrease in revenue to RMB335,450 million and a 16.9% drop in profit attributable to owners of the parent to RMB9,990 million compared to the same period in 2024. Basic earnings per share were RMB0.58, down from RMB0.70. Despite this, the company secured new contracts worth RMB991,054 million, a 3.1% increase year-on-year, with a backlog amounting to RMB3,428,988 million as of June 30, 2025.

In a separate connected transaction, CCCC Second Highway Engineering and Seventh Highway Engineering entered a Capital Increase Agreement on August 29, 2025. CIWE, a subsidiary of controlling shareholder CCCG, will make a capital increase of RMB346.3443 million in cash into Seventh Highway Engineering. Post-transaction, Seventh Highway Engineering will no longer be a CCCC subsidiary, with the company’s equity interest reduced to 45% and CCCG holding 55% via CIWE, triggering an expected gain of RMB141.8226 million for CCCC.

This capital increase aims to combine CIWE's strengths in water conservancy and new energy with Seventh Highway Engineering's regional market presence to enhance the latter's business segments. This strategic move is subject to announcement requirements but exempt from independent shareholders’ approval under Hong Kong Listing Rules.