Phnom Penh Water Supply Authority (PPWSA) – the first listed company on the Cambodian stock exchange – has recorded a profit of $1.33 million for the first quarter, a decrease of 60 per cent from the same period last year, according to audited financial statements released yesterday.
Ros Kimleang, chief of PPWSA’s accounting and financial department, told the Post yesterday that the reduced profit is due mainly to lower revenues from water consumption and increased spending on the Nirot Water Treatment Plant, where a solar power-generation system is being installed.
“Our instalment budget is higher than our expectation, so it makes net profit down after instalment and paying the interest rate,” he said.
Political turmoil also played a part, according to Kimleang,
who said that construction projects had slowed, meaning weakened commercial demand for water.
PPWSA’s share price closed at 4,760 riel ($1.17) yesterday, up from 4,700 riel ($1.16) on Monday.
Lamun Soleil, deputy director of the market operations department of Cambodia Securities Exchange, said PPWSA’s stock price increase during trade yesterday indicated that investors were not overly concerned about the profit downturn recorded in the first quarter.
Soleil said that whether slow growth by PPWSA’s would have an effect on the company’s stock price came down to expectations.
“If it [PPWSA’s growth] is not much under investors’ expectation, it would not much affect their confidence.”
Svay Hay, president and CEO of Acleda Securities, said he was confident that the firm’s share price was unlikely to be affected by the first-quarter results.
Hay said that PPWSA’s share value was currently near its support price – the level that a stock usually does not fall below, as buyers at that point tend to purchase the stock.
“When the share price of a company reaches the support price, the share is [unlikely to] seriously fluctuate further,” he said.
With the stock hovering around the support price, Hay said investors’ main focus was PPWSA’s annual dividend, which would be based on the firm’s performance over four quarters. PPWSA predicts a rise in profits to $2.4 million in the second quarter, the company’s chief accountant Kimleang said.