At China Communications Cons­truction Company (CCCC)’s annual general meeting (AGM) held in Hong Kong’s Shangri-La Hotel on June 18 2008, many shareholders showed concern about the share price. The price had plunged from a record high of HK$26 (US$3.33) last October to HK$15.28 as of that date. On October 8, the day stocks plummeted globally, the share price closed further down at HK$5.35, a mere 20% of its peak price.

But the chairman is relaxed, assuring that “when the market turns around, our share price will rebound immediately”. He also promises a growth of 0.8 percentage points in gross margin this year. CCCC reported revenue of 75.75 billion renminbi during the first six months, representing a 29.1% rise from a year ago. However, the company’s profit attributable to equity holders was down 19.8% to 2.2 billion renminbi. Profit margin with respect to profit attributable to equity holders was 2.9%, as compared to 4.7% in the same period of 2007.

In 2007, the company’s net profit jumped 88.6% to 6 billion renminbi while its revenue climbed 31.1% to 150 billion renminbi. However, its gross margin for the whole year has stayed at 10.3% since last year. The largest bulk, 63.8%, of the company’s revenue was generated from its infrastructure construction business, one of the four main business areas of CCCC, which brought in 49.2 billion renminbi in the six months ended June 30. The other three business areas include infrastructure design, dredging and port machinery manufacturing.

In his presidential suite at the hotel after the AGM, chairman Zhou – who received a total remuneration, including basic salary, allowances and discretionary bonus of 847,000 renminbi in 2007 – admits to The Asset that two years after going public it is stressful to oversee the giant company and be held responsible to shareholders. Still, he is confident about the fundamentals and the different businesses of CCCC.

Today, the company owns 37 solely-invested and shareholding subsidiary companies, down from over 100 before the restructuring. Zhou says the company has hired a consultant to further refine the internal structure and is expected to come up with a strategic plan this year.

In 2005, China Harbour Engineering Corporation merged with China Road & Bridge Group to form the China Communications Construction Group. Within nine months, the company restructured a total of 609 subsidiaries and reformed 117 corporations.

On October 8 2006, CCCC was founded on the basis of China Communications Construction Group with a registered capital of 10.8 billion renminbi. On December 15 2006, it raised US$2.4 billion through an initial public offering in Hong Kong.