Drinking water supplier China Water Affairs Group plunged into a net loss of HK$185.97 million in the six months to September from a net profit of HK$211.72 million a year ago as its financial assets sank in value and finance costs surged. The poor performance reflected a HK$175.24 million loss in fair value on financial assets such as listed securities against a HK$262.45 million gain previously while finance costs surged 124 per cent to HK$42.46 million. The utility, which supplies drinking water, treats sewage and runs hydropower plants as far north as Shandong and as far south as Hainan, saw its gross profit drop 4 per cent to HK$136.64 million, dragged down by the acquisition of two loss-making water projects in Daya Bay. However, the gross profit of mainstay drinking water supply rose 26 per cent to HK$63.96 million and sewage treatment was up 27 per cent at HK$4.44 million. Revenue climbed 6 per cent to HK$385.96 million. Chairman Duan Chuanliang said performance of the core operations would improve in the second half when the effect of an average tariff rise of 8.3 per cent to 1.3 yuan (HK$1.47) per tonne kicked in. Loss per share stood at 15.14 HK cents compared with earnings per share of 17.36 HK cents. No interim dividend was proposed.