CHINA GAS HOLDINGS (384) H2 2025 earnings summary

Executive summary

• Achieved record free cash flow of HK$4.66 billion, up 8.7% year-over-year, and maintained a high dividend payout ratio of 83.3%.

• Profit attributable to owners rose 2.1% to HK$3.25 billion, with basic EPS up 1.7% to 60 HK cents.

• Value-added services and LPG segments delivered double-digit operating profit growth, though LPG profit was pressured by margin compression.

• Continued expansion in international LNG trading and integrated energy, with significant growth in energy storage and green electricity sales.

• The group maintained 662 piped gas projects, with cumulative residential user connections up 3.0% year-over-year, despite a 15.5% drop in new residential connections.

Financial highlights

• Revenue declined 2.6% year-over-year to HK$79.26 billion, mainly due to lower natural gas sales volume.

• Gross profit was HK$11.26 billion, down 0.4% year-over-year, with gross margin improving to 14.2% from 13.9%.

• Sales of LPG increased 8.9% to HK$19.58 billion, while value-added services revenue grew 2.1% to HK$3.73 billion.

• Finance costs decreased 15.1% to HK$1.80 billion; income tax expense rose 30.8% to HK$993 million.

• Net gearing ratio improved slightly to 78.8% (0.788).

Outlook and guidance

• Expects dollar margin from gas sales to reach RMB0.55/m³ in FY2025/26.

• Forecasts over 2% growth in natural gas sales volume from urban projects and 1.0–1.2 million new residential connections.

• Anticipates value-added services gross profit or profit before tax to grow by over 10%.

• The group expects continued opportunities from China’s green energy transition, urban pipeline upgrades, and supportive government policies.

• The group will focus on prudent investment, cost control, and expanding integrated energy and value-added services.