Sichuan Expressway Company Limited reported mixed first-quarter 2026 results: top-line momentum accelerated, but higher operating expenses compressed margins and eroded profitability.

Revenue and Profitability • Operating revenue rose 21.25% year on year to RMB 2.41 billion, supported by the first-time consolidation of Hubei Jingyi Expressway and steady toll-road traffic recovery. • Total profit edged up 2.13% before restatement but, after adjusting for the common-control consolidation of Jingyi, fell 7.59% to RMB 587.70 million. • Net profit attributable to shareholders declined 6.06% to RMB 456.78 million; basic and diluted EPS both slipped to RMB 0.142. • Excluding RMB 54.68 million in non-recurring gains—dominated by Jingyi’s pre-consolidation profit of RMB 50.51 million—core net profit contracted 14.81% to RMB 402.10 million. • Weighted average ROE softened by 0.10 percentage point to 2.35%.

Cost Pressure Operating costs surged 45% to RMB 1.57 billion, outpacing revenue growth and driving margin compression. Finance costs remained broadly stable at RMB 154.47 million, marginally below the prior-year level of RMB 158.92 million.

Cash Flow and Liquidity Net cash generated from operating activities jumped 184.55% to RMB 902.38 million, aided by receivable recoveries and the inclusion of Jingyi Company. However, heavy capital expenditure of RMB 2.36 billion and investments of RMB 2.45 billion pushed investing cash outflows to RMB 4.85 billion, resulting in a RMB 2.00 billion decrease in cash and cash equivalents to RMB 2.55 billion at 31 March 2026.

Balance-Sheet Movements Total assets inched up 0.20% from end-2025 to RMB 67.77 billion. Long-term loans expanded to RMB 38.48 billion (up RMB 2.08 billion), lifting total liabilities to RMB 45.54 billion. Shareholders’ equity declined 8.76% to RMB 20.57 billion, reflecting a RMB 2.41 billion reduction in capital reserve and lower fair-value reserves.

Project Investment Update Ongoing infrastructure projects continue to absorb significant capital: 1. Chengle Expressway expansion – cumulative spend reached RMB 15.89 billion by 31 March 2026. 2. Tianqiong Expressway BOT – cumulative investment totaled RMB 7.20 billion; the full line opened to traffic in September 2024. 3. Chengya Expressway expansion – RMB 562.00 million invested to date following the August 2025 project launch.

Shareholder Structure State-owned Shudao Investment Group remains the largest shareholder with a 39.86% stake, followed by HKSCC Nominees at 29.08% and China Merchants Expressway at 21.73%.

Outlook With multiple large-scale expansion projects progressing and debt levels climbing, Sichuan Expressway’s near-term earnings will hinge on its ability to control construction costs and sustain traffic growth while managing leverage and cash flows.