Jiangsu Expressway Company Limited: history, ownership, mission, how it works & makes money

A Brief History of Jiangsu Expressway Company Limited

Established in 1996, Jiangsu Expressway Company Limited (JEC) operates and manages a large network of toll expressways in Jiangsu Province, China. The company was incorporated under the laws of the People's Republic of China. As of June 30, 2023, JEC is noteworthy for its strategic location along the economically vibrant Yangtze River Delta.

Initially, Jiangsu Expressway focused on the construction and operation of the Jiangsu section of the National Highway Network. The company rapidly expanded its operations through the acquisition of several toll road projects throughout the province. By 2000, JEC had already established itself as a key player in China's expressway sector.

As of December 31, 2022, JEC managed approximately 870 kilometers of expressways. This management includes several major routes such as the G2 Beijing-Shanghai Expressway and the G40 Shanghai–Xi'an Expressway.

In terms of financials, JEC reported a revenue of approximately RMB 5.26 billion (about USD 0.79 billion) for the year ending December 31, 2022. The revenue reflects a 6.1% increase from the previous year. The net profit attributable to shareholders for the same period was approximately RMB 1.89 billion (around USD 0.28 billion), indicating a margin of about 35.9%.

In 2018, JEC implemented road toll price adjustments, which contributed positively to its revenue growth trajectory. The toll revenue model significantly influenced the company’s financial performance. In 2022, toll revenue accounted for approximately RMB 4.98 billion, equating to about 94.7% of total revenue. The rise in vehicle traffic, reported at approximately 500 million vehicles in 2022, further strengthened the company’s earnings.

Moreover, JEC’s strategic partnerships with local and regional governments have facilitated the advancement of infrastructure development projects, enhancing operational efficiency. The company has a strong focus on modernizing its toll collection systems, integrating the use of electronic toll collection (ETC) to improve user experience and streamline operations.

As of September 2023, Jiangsu Expressway Company Limited continued to exhibit resilience in financial performance despite challenges such as economic fluctuations and regulatory changes. The company’s stock is listed on the Hong Kong Stock Exchange under the ticker 1776.HK. As of the latest trading session, the share price was approximately HKD 6.50, reflecting a market capitalization of around HKD 28 billion.

Overall, Jiangsu Expressway Company Limited has carved a significant niche within China’s expressway sector, benefiting from the robust growth of transportation infrastructure in the region. The commitment to enhancing operational capacity and financial stability positions JEC favorably for future growth opportunities.

A Who Owns Jiangsu Expressway Company Limited

Jiangsu Expressway Company Limited, listed on the Hong Kong Stock Exchange under the stock code 01777, is primarily engaged in the construction and operation of expressways in Jiangsu Province, China. Ownership of the company is divided among various institutional and individual investors.

As of the latest filings in 2023, the largest shareholder of Jiangsu Expressway Company Limited is the Jiangsu Provincial Expressway Group Company, which holds approximately 54.80% of the total shareholding. This entity is a state-owned enterprise, indicating significant government interest and control within the company.

Below is a table summarizing the major shareholders and their respective ownership percentages:

The company’s capital structure reflects a strong backing by governmental entities, which lends stability to its operations and strategic initiatives. In terms of financial performance, Jiangsu Expressway Company Limited reported a revenue of approximately CNY 9.4 billion for the year 2022, with a net profit margin of around 28.5%.

The presence of institutional investors points to a sustained interest in the company’s growth potential. Institutional investors typically include mutual funds, pension funds, and insurance companies, reflecting a broad confidence in Jiangsu Expressway's operational capabilities and infrastructure projects.

Furthermore, Jiangsu Expressway’s financial ratios can provide insights into its operational efficiency. As of mid-2023, the company reported a current ratio of 1.8, indicating a solid liquidity position, while the debt-to-equity ratio stood at 0.4, illustrating prudent financial leverage.

In 2023, the company’s stock performance showed a year-to-date increase of 12%, outperforming the Hang Seng Index, which rose by 8% in the same period. This performance can be attributed to an increase in toll revenues as traffic volumes rebounded following the easing of pandemic restrictions.

Overall, Jiangsu Expressway Company Limited’s ownership structure is predominantly influenced by state ownership, with considerable backing from institutional investors, enhancing its stability and growth prospects within the expressway sector in China.

Jiangsu Expressway Company Limited Mission Statement

Jiangsu Expressway Company Limited (JEC), primarily involved in the investment and operation of expressways in Jiangsu province, adheres to a mission statement that emphasizes quality, efficiency, and sustainable development. The company aims to provide excellent transportation services while ensuring safety and environmental protection.

The mission statement can be summarized through their focus on the following key areas:

• Quality Services: Provide high-quality and efficient expressway operations to enhance the travel experience.
• Safety: Prioritize safety measures in all aspects of their operations, ensuring a secure environment for users.
• Sustainability: Commit to sustainable practices that minimize environmental impact and promote social responsibility.

In the context of financial performance, as of the end of 2022, Jiangsu Expressway reported a total revenue of approximately RMB 9.5 billion, representing an increase of 8.3% year-over-year. The operating profit was around RMB 4.3 billion, which translates to a profit margin of 45.3%.

The company's performance metrics reflect their adherence to their mission statement. Below is a table summarizing key financial data:

The company underscores its commitment to maintaining a robust operational structure, ensuring that the expressways not only facilitate economic growth but also serve the community effectively. Jiangsu Expressway Company Limited continues to align its operational strategies with its mission statement, focusing on innovation and service excellence.

As of the end of September 2023, traffic volume on the expressways operated by JEC reached approximately 100 million vehicles, evidencing their central role in regional transportation infrastructure.

Jiangsu Expressway's ongoing projects and expansions underscore their dedication to future growth, with over RMB 2 billion allocated for upcoming expressway developments that align with their mission of quality and efficiency. This expansion is anticipated to increase capacity by 20% over the next three years, further enhancing their operational footprint.

How Jiangsu Expressway Company Limited Works

Jiangsu Expressway Company Limited operates a network of expressways in the Jiangsu province of China. The company primarily engages in the investment, construction, operation, and management of toll roads.

As of December 31, 2022, the company managed a total of approximately 1,070 kilometers of expressways. Jiangsu Expressway primarily derives its revenue from toll collections, which fluctuates based on traffic volume.

The expressway system is divided into different segments, with varying toll rates based on the distance traveled. The company uses both electronic toll collection (ETC) systems and manual collection methods.

In 2022, Jiangsu Expressway expanded its infrastructure investments, with capital expenditures amounting to approximately RMB 1.5 billion. This investment was focused on improving existing road quality and expanding capacity to meet growing traffic demands.

The company has also implemented advanced technologies to enhance operational efficiency, including smart traffic management systems that optimize traffic flow and reduce congestion. These systems have contributed to an overall increase in toll revenue.

In terms of financial health, the company recorded a current ratio of 1.5, indicating a stable liquidity position, which is essential for meeting short-term obligations.

Furthermore, Jiangsu Expressway is listed on the Hong Kong Stock Exchange under the ticker 177. The stock has shown resilience, with a year-to-date growth of approximately 15% as of October 2023.

Jiangsu Expressway has also been proactive in addressing environmental concerns. The company is committed to reducing carbon emissions through sustainable practices, such as integrating renewable energy sources at its facilities and promoting electric vehicle usage.

In its strategic outlook, Jiangsu Expressway aims to explore opportunities in adjacent markets and diversify its business model. This includes potential expansions into logistics and transportation services, which could provide additional revenue streams in the future.

The company's focus on leveraging technology, coupled with its robust financial metrics, positions it well for continued growth in the toll road sector. Its ability to adapt to changing market dynamics and consumer preferences will be crucial for sustaining its competitive edge.

How Jiangsu Expressway Company Limited Makes Money

Jiangsu Expressway Company Limited, a key player in China's transportation sector, primarily generates revenue through toll collection on its network of expressways. The company operates about 1,325 kilometers of highways, making it one of the largest expressway operators in the region.

In the fiscal year 2022, Jiangsu Expressway reported total revenue of approximately RMB 12.8 billion, with toll income accounting for about 88% of this total. The remaining revenue sources include the sale of land-use rights and ancillary services associated with its infrastructure.

Traffic volume directly influences toll income. In 2022, the company saw an average daily traffic volume of about 820,000 vehicles. This represented a growth of 6.3% year-over-year, demonstrating a rebound after previous impacts from the COVID-19 pandemic.

Jiangsu Expressway also focuses on efficiency improvements and cost management. The company reported a net profit margin of 39% in 2022, reflecting effective control over operational expenditures, which were approximately RMB 5.1 billion.

Additionally, the company's strategic positioning allows it to benefit from economic growth in Jiangsu province, which boasts a GDP of approximately RMB 10.4 trillion and continues to see substantial infrastructure development, enhancing traffic on its expressways.

Jiangsu Expressway is also involved in investments related to the construction and management of expressway projects, diversifying its revenue streams. The company has collaborated on several partnerships, leading to a projected investment of around RMB 3 billion across new projects in the next five years.

In terms of financial health, as of the second quarter of 2023, Jiangsu Expressway had a total asset value of approximately RMB 50.3 billion and a debt-to-equity ratio of 1.2, indicating solid leverage while maintaining financial stability.

Furthermore, the company boasts a consistent dividend payout policy, providing investors with returns driven by its stable income from tolls. In 2022, the dividend declared was RMB 0.98 per share, reflecting a yield of approximately 3.5% at that time.