ENN Energy (2688) Q3 2024 earnings summary

Executive summary

• Retail gas sales volume rose 4.8% year-over-year to 18.819 billion m³ for the first three quarters of 2024, with 1,102 thousand new residential customers added and 53 new projects acquired, including 2 city gas projects.

• Integrated energy business sales volume increased 21.4% year-over-year to 29,668 million kWh, with significant expansion in low-carbon industrial parks, factories, and buildings.

• Value-added business saw home service orders increase by 8.6%, product sales up 23.4%, and revenue per household rising to RMB324.6.

• Newly developed residential households decreased by 19.1% year-over-year to 1,102 thousand.

• Installed designed daily capacity for new commercial/industrial customers fell 12.6% year-over-year to 11,133 thousand m³.

Financial highlights

• Dollar margin maintained at CNY 0.54 for the first three quarters, with a full-year target of 54.5%.

• Revenue for 1H2024 reached RMB54.59 billion, with total assets exceeding RMB100.51 billion as of 30 June.

• ASP in Q3 decreased by CNY 0.10 year-over-year, while dollar margin increased by four cents due to procurement optimization.

• LNG trading revenue reached CNY 280 million before tax, close to the annual guidance of CNY 300 million.

• Natural gas sales volume and revenue have grown significantly since 2000, with a 1,977x and 933x increase respectively by 2023.

Outlook and guidance

• Annual guidance for retail gas sales and integrated energy business growth remains unchanged, with 10% growth targeted for retail gas and 20–30% for integrated energy.

• Management expects steady demand and stable pricing for natural gas in the coming winter, with no major headwinds anticipated.

• Focus remains on hitting annual gas volume targets in Q4 by leveraging flexible strategies, intelligent products, and differentiated customer approaches.

• Continued promotion of cost pass-through for enterprise customers and optimization of operations to improve ROA.

• Plans to leverage intelligent services and diverse products for high-quality growth across business segments.