ENN Natural Gas (600803) H2 2024 earnings summary

Executive summary

• FY2024 revenue declined 5.5% year-over-year to RMB 135,910 million, with net profit attributable to parent down 36.6% to RMB 4,493 million.

• Direct Gas Sales by Platform volume rose 10.3% to 5.568 bcm, and Zhoushan LNG terminal unloading volume increased 53.4% year-over-year to 2.41 million tons.

• Moody's upgraded credit rating to Baa3, S&P and Fitch to BBB, reflecting improved financial structure and net debt ratio at 25.6%.

• Dividend per share set to rise to at least RMB 1.14 by 2025, with payout ratio from 2026-2028 at no less than 50% of core profit.

• MSCI ESG rating improved to AAA, the first and only Chinese utility to achieve this level.

Financial highlights

• Gross profit fell 11.8% year-over-year to RMB 19,541 million; core profit dropped 19.4% to RMB 5,143 million.

• Operating cash flow increased 2.9% to RMB 14,162 million; free cash flow was robust at RMB 8,671 million.

• Net profit after deducting non-recurring items rose 50.9% to RMB 3,711 million.

• CAPEX decreased, supporting abundant free cash flow.

Outlook and guidance

• Global and Chinese natural gas demand expected to grow steadily, with Asia driving over 50% of global increment by 2030.

• LNG import volume in China projected to reach 82 million tons in 2025 and 133 million tons in 2030.

• Company targets over 3 bcm of commercial demand by 2025, with secured contracts exceeding 1 bcm.

• Dividend per share guidance: RMB 1.14 in 2025, payout ratio of at least 50% of core profit from 2026.