Kunlun Energy Company (135) H1 2025 earnings summary

Executive summary

• Revenue increased 4.97% year-over-year to RMB 97.54 billion, driven by higher natural gas sales volume, while net profit attributable to shareholders declined 4.36% to RMB 3.16 billion.

• Retail gas sales volume rose 2.23% year-over-year to 16.67 bcm, with 399,000 new users added, reaching 16.85 million users; total natural gas sales volume up 10.05% to 29,095 million cubic metres.

• Free cash flow was RMB 3.06 billion, supporting long-term value growth.

• Interim dividend declared at RMB 16.60 cents per share, up 1.16%, with a payout ratio of 45.47%.

• Earnings per share (basic) decreased 4.35% to RMB 36.51 cents.

Financial highlights

• EBITDA decreased 3.95% year-over-year to RMB 9.52 billion; profit before tax fell 7.06% to RMB 6.74 billion.

• Capex dropped 31.6% year-over-year to RMB 1.93 billion.

• Gearing ratio improved to 18.32% from 21.46% at year-end.

• ROE at 4.7%, net profit margin at 3.2%, and asset-liability ratio at 35.3%.

• Employee compensation costs fell 10.07% to RMB 2,850 million; interest expenses decreased 21.41% to RMB 323 million.

Outlook and guidance

• Global natural gas demand expected to grow slowly in H2 2025 amid economic pressures and supply chain fragility.

• Domestic market faces structural adjustments and intensified competition, but long-term fundamentals remain positive.

• Strategic focus on urban gas expansion, LNG/LPG profitability, green transformation, and digital upgrades.

• Targeting 600,000–700,000 new connected users and 10 new urban gas projects.

• LNG terminal utilization rate guidance at 85–90%; LPG sales volume guidance at 5.8 million tons; crude oil equity sales volume at 8 million barrels.