The Hong Kong and China Gas Company (3) H2 2023 earnings summary

Executive summary

• FY2023 operating profit rose 14% and attributable profit rose 16% YoY, while revenue declined 7%; higher profit was supported by utility, renewable and extended businesses.

• Priorities for 2024 include expanding gas supply coordination, growing PV and energy services, and completing Extended Business restructuring.

Financial highlights

• Revenue was HK$56,971 million, down 7% YoY; profit from operations was HK$7,348 million, up 14%.

• Core profit reached HK$5,894 million, up 11%; profit attributable to shareholders was HK$6,070 million, up 16%.

• Basic EPS was 32.5 HK cents, up 16% YoY.

Outlook and guidance

• 2024 targets include Hong Kong gas sales of 27,396 TJ, up 1%, and Mainland utility gas sales of 37.3 billion m³, up 8%.

• 2024 plans include a 2.8 GW accumulated PV grid-connected target, Towngas Lifestyle revenue of HK$4.6 billion, up 12%, and EcoCeres production of 310,000 tonnes, up 17%.

• Guidance includes expanding gas supply coordination, LNG imports and long-term contracts; targeting 14 billion m³ of additional gas supply through contracts with the three major suppliers.

• PV development, EPC and O&M expansion, plus energy and carbon services, are expected to support profit growth; strategic investors and partners are intended to ease funding pressure.

• Plans include 12% revenue growth from Hong Kong and Mainland consolidation, 35% gross margin growth from gas supply chain initiatives, and Towngas Lifestyle IPO planning after restructuring.