Core Viewpoint - New Oriental Holdings plans to privatize New Oriental Energy through its wholly-owned subsidiary, New Energy Hong Kong, offering a combination of share exchange and cash payment to shareholders [1][2] Group 1: Transaction Details - The proposed transaction involves a total of 743 million shares, with shareholders receiving 2.9427 new H-shares and HKD 24.50 in cash per share [1] - The estimated total amount involved in the transaction is approximately HKD 595.19 billion, assuming all stock options are not exercised [1] - If all stock options are exercised, the total amount involved would be approximately HKD 599.24 billion [2] Group 2: Share Structure and Control - Post-transaction, New Oriental Holdings will issue up to 2.188 billion H-shares, increasing total shares from 3.097 billion to 5.285 billion, representing 41.58% of the total post-transaction share capital [2] - Wang Yushuo and his concerted parties will hold 2.243 billion shares, reducing their ownership from 72.44% to 42.32%, while still remaining the controlling party [2] Group 3: Financial Performance - New Oriental Holdings reported a revenue of HKD 135.84 billion for 2024, a decrease of 5.5% year-on-year, with a net profit of HKD 4.49 billion, down 36.6% [2] - New Oriental Energy's revenue for 2024 was HKD 109.85 billion, with a net profit of HKD 5.99 billion; post-transaction, New Oriental Holdings' net profit could increase to HKD 8.14 billion [3] - The transaction will be financed entirely through bank loans, leading to an expected increase in the debt-to-asset ratio to 67% [3]

Core Points - The company reported a net profit attributable to shareholders of 5.987 billion yuan, a decrease of 12.2% year-on-year, and proposed a final dividend of 2.35 HKD per share [1] - The company achieved a total revenue of 109.853 billion yuan, a decline of 3.5% compared to the previous year [1] Group 1: Industrial and Commercial Development - The company added 12.17 million cubic meters per day of new industrial customer gas volume, reaching a cumulative industrial customer gas volume of 185 million cubic meters per day, resulting in a 5.2% increase in gas volume for industrial users [1] - The company developed 25,000 commercial users, with a cumulative total of 227,000 commercial users and a gas volume of 2.93 million cubic meters per day, leading to a 4.5% increase in gas volume for commercial users [1] Group 2: Residential and Retail Performance - The company installed gas services for 1.617 million new residential users, bringing the total number of residential users to 31.38 million, which supports the development of smart home business [2] - The company completed approximately 63% of the cumulative residential gas price adjustment by the end of 2024 [2] - The company achieved a 4.2% year-on-year increase in natural gas retail sales volume, with revenue and gross profit increasing by 0.2% and 2.9% to 60.749 billion yuan and 6.225 billion yuan, respectively [2] Group 3: Impact of Market Conditions - The company faced a 15.3% and 91.4% decrease in revenue and gross profit from gas wholesale business, totaling 25.143 billion yuan and 0.94 billion yuan, respectively, due to declining international natural gas prices [2] - The engineering installation business experienced a decline of 23.3% and 31.6% in revenue and gross profit, amounting to 4.095 billion yuan and 1.895 billion yuan, respectively, due to pressures from the real estate downturn [2] Group 4: Energy Projects and Performance - The company completed 60 large-scale projects during the year, with a cumulative total of 356 operational projects, resulting in a total installed capacity of 13.3 GW and a total energy sales volume of 41.57 billion kWh, a year-on-year increase of 19.8% [2] - The company's energy business revenue and gross profit grew by 5.2% and 16.4% to 15.273 billion yuan and 2.22 billion yuan, respectively, with a gross margin increase to 14.5% [2]

Financial Performance - Total revenue decreased by 3.5% to RMB 109,853 million in 2024, down from RMB 113,858 million in 2023[6] - Profit attributable to the company's owners fell by 12.2% to RMB 5,987 million in 2024, compared to RMB 6,816 million in 2023[6] - Gross profit for 2024 was RMB 13,405 million, down 6.5% from RMB 14,338 million in 2023[32] - Net profit for 2024 was RMB 6,876 million, a decline of 11.1% from RMB 7,732 million in 2023[32] - Basic earnings per share for 2024 was RMB 5.35, compared to RMB 6.05 in 2023, reflecting a decrease of 11.5%[32] - The company reported a total comprehensive income of RMB 7,057 million for 2024, down from RMB 7,843 million in 2023, a decrease of 10%[32] - The company's tax expense for 2024 was RMB 2,125 million, a decrease from RMB 2,286 million in 2023, indicating a reduction of 7.03%[41] Operational Highlights - Natural gas retail sales volume increased by 4.2% to 26,200 million cubic meters in 2024, compared to 25,144 million cubic meters in 2023[3] - Core profit from domestic infrastructure business rose by 10.2% to RMB 6,712 million in 2024, up from RMB 6,091 million in 2023[6] - The number of new industrial users increased by 48.5% to 27,775 locations in 2024, compared to 18,706 locations in 2023[6] - The cumulative number of residential users reached 31,379 thousand in 2024, reflecting a 5.4% increase from 29,775 thousand in 2023[6] - The pipeline gas vaporization rate improved to 65.8% in 2024, up from 65.2% in 2023[6] - The total sales volume of energy projects increased by 60 to 356 projects in 2024, compared to 296 projects in 2023[6] Financial Position - The company achieved a net debt ratio of 23.2% in 2024, a decrease of 2.1 percentage points from 25.3% in 2023[6] - As of December 31, 2024, the company’s cash and cash equivalents amounted to RMB 76.93 billion, a decrease of RMB 1.996 billion from the previous year[17] - The company's current liabilities net value recorded approximately RMB 10.318 billion as of December 31, 2024, supported by stable operating cash flow and quality liquid assets[21] - Current liabilities decreased to RMB 32,502 million in 2024 from RMB 34,923 million in 2023, a reduction of 6.9%[33] - The company’s reserves increased to RMB 44,984 million in 2024 from RMB 42,543 million in 2023, reflecting a growth of 5.7%[34] Strategic Initiatives - The company plans to continue expanding its customer base and enhancing operational efficiency through smart innovation and customer-focused strategies[5] - The company plans to add 1.7 GW of new operational capacity, with 0.5 GW from park customers and 1.2 GW from factory and building customers in 2024[11] - The company aims to enhance operational efficiency and reduce costs through the application of intelligent technologies and data analytics[31] - The company plans to leverage its customer base of 31.38 million households and 270,000 business clients to drive sustainable development and business performance growth in 2025[30] Sustainability and Governance - The company achieved natural gas sales of 33.651 billion cubic meters in 2024, reducing carbon dioxide emissions by 45.2 million tons[27] - The company maintained an MSCI ESG rating of AA for three consecutive years and was recognized as one of the "Best 5%" companies in the S&P Global Sustainable Development Yearbook 2024[27] - The company has established a comprehensive safety management system, successfully eliminating three types of safety hazards in 2024[24] - The company has formed joint R&D centers with top universities to address industry challenges and achieved significant breakthroughs in pipeline robotics technology[26] - The company has complied with all provisions of the Corporate Governance Code as of December 31, 2024[62] Dividend and Shareholder Information - The total dividend declared and paid for 2024 was RMB 3,015 million, slightly higher than RMB 2,977 million in 2023, marking an increase of 1.28%[43][45] - The proposed final dividend for 2024 is HKD 2.35 per share, up from HKD 2.31 in 2023, equating to approximately RMB 2.19 per share, with a total annual dividend of HKD 3.00, representing a payout ratio of 45% of core profit[54] - The company plans to propose a final dividend of RMB 2.19 per share for the year ending December 31, 2024, totaling approximately RMB 2,658 million, pending shareholder approval[46] - The company's distributable reserves as of December 31, 2024, amount to RMB 8.376 billion, allowing for dividend distribution while retaining sufficient reserves for future development[54] Debt and Risk Management - The company has hedged USD 820 million of its debt, achieving a hedging ratio of 78.9% for long-term USD debt as of December 31, 2024[20] - In 2024, the company hedged an amount of USD 751 million, achieving a hedging ratio of 46.9% to mitigate trade risk exposure[23]

ENN Energy Holdings (02688) Q4 2024 Earnings Call March 26, 2025 04:00 AM ET Speaker0 Welcome to the ENN Energy Holdings Limited Annual Results. And I am Karen, the IR and ESG Director. First of all, I would like to introduce the CEO, Mr. Zhang Yueying. And we have Mr. Gonglo Jian, Executive Director and President. We have Mr. Wang Dong Zhi, the Executive Director and CFO. And we have Ms. Cheng Lu, Executive Vice President and also Ms. Liu Min Karen and also the Deputy CFO, Mr. Dong Bo. For 2024, the global ...

Investment Rating - The report assigns a rating of "Accumulate" to the company with a target price of HKD 58.81, representing a potential upside of 7.9% from the current price of HKD 54.5 [3][11]. Core Insights - The company has demonstrated solid growth in its core business, with a significant reduction in debt levels, indicating improved financial health [2][11]. - The company operates in 260 cities, serving a population of 140 million, and is one of the largest clean energy distributors in China [1]. - The company’s revenue for the first half of 2024 was RMB 54.59 billion, a year-on-year increase of 0.9%, while net profit attributable to shareholders decreased by 22.8% to RMB 2.57 billion [2]. Financial Performance - The gross profit for the first half of 2024 was RMB 6.47 billion, a decrease of 9.7% year-on-year, primarily due to reduced opportunities in the international market and a decline in gas wholesale business [2]. - The company reported a core profit of RMB 3.26 billion, down 16.6% year-on-year, with domestic core business showing a growth of 9.5% to RMB 3.08 billion [2]. - The company’s operating cash inflow was RMB 3.27 billion, with free cash flow reaching RMB 630 million, indicating a stable cash position [2]. Business Segments - The gross profit margin from the company's natural gas sales, energy services, and smart home businesses accounted for 87.3% of total gross profit, reflecting an improvement of 8.6 percentage points year-on-year [2]. - The company has a robust customer base and continues to expand its operational reach, indicating significant growth potential [2]. Debt and Capital Expenditure - The company has effectively optimized its debt structure, reducing interest-bearing liabilities to RMB 19.83 billion from RMB 21.92 billion in 2023, with a comprehensive financing cost of 3.4% [2]. - Capital expenditures were RMB 2.74 billion, a significant decrease of 20% year-on-year, reflecting a prudent investment strategy to maintain stable cash flow [2]. Future Outlook - The company projects a 5% growth in natural gas retail volume and a 10%+ increase in gross profit from the natural gas retail business for the year [11]. - The report anticipates that the company will benefit from the seasonal increase in natural gas demand during winter, which may offset the decline in summer sales [11].

Investment Rating - The report updates the target price to HKD 71.5, corresponding to 11 times and 10 times PE for 2024 and 2025, respectively, indicating a 27% upside potential from the current price, and assigns a "Buy" rating [6][10][32]. Core Insights - The company projects a 5% growth in gas volume for the entire year, with a 20-30% increase in sales volume for its diversified energy business [4][8][30]. - In Q3, the procurement cost decreased by HKD 0.1 per cubic meter, maintaining a gross margin of HKD 0.54 per cubic meter for the year, with retail gas gross profit expected to grow by 10% annually [5][9]. - The company plans to utilize up to HKD 300 million for share repurchases, which will enhance earnings per share (EPS) as the repurchased shares will be canceled [15][31]. Financial Performance - For 2024, the company expects total revenue to reach RMB 123.782 billion, with a net profit of RMB 8.373 billion, reflecting a 10.9% growth [16]. - The gross margin for gas sales is guided at RMB 0.54 per cubic meter, with expectations of achieving an 80% pricing alignment in core cities by year-end [14][18]. - The company anticipates a stable increase in dividend payout, with a projected dividend yield of approximately 5.6% for 2024 [15][19]. Market Position - As of the report date, the company has a market capitalization of HKD 636 billion and a total asset value of RMB 100,509 million [2][22]. - The company has a significant number of operational diversified energy projects, totaling 347, with a sales volume increase of 21.4% year-on-year [30][34]. Shareholder Information - Major shareholders include New Hope Group (34.00%) and BlackRock (6.27%) [2].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 65.10 [2][8]. Core Insights - The company's Q3 operational data aligns with expectations, with retail gas sales volume increasing by 5.5% year-on-year, driven by residential and commercial sales growth of 4.6% and 6.2% respectively [1]. - The management anticipates that the overall sales volume for retail gas will grow by 5% and segment gross profit will increase by 10% for the full year of 2024 [1]. - The diversified energy segment is expected to achieve a year-on-year growth of 20% for the full year, supported by new projects transitioning to operations and additional management services contributing to revenue [2]. Summary by Relevant Sections Retail Gas Sales - Q3 retail gas sales volume reached 5,793 million cubic meters, with residential sales at 714 million cubic meters and commercial sales at 4,973 million cubic meters [4]. - The gross margin for gas sales was reported at RMB 0.54 per cubic meter, consistent with the annual guidance [1][5]. Capital Expenditure and Financials - Capital expenditure for the first three quarters was RMB 4.6 billion, significantly below the annual guidance of RMB 8 billion, with management prioritizing debt repayment over additional buybacks or dividends [2]. - The LNG trading segment reported a pre-tax profit of RMB 280 million for the first three quarters, within the guidance range of RMB 200-300 million [2]. Future Guidance - The company has set ambitious targets for 2024, including a 20-30% growth in energy usage scale and a 20-30% increase in smart home business gross profit [4]. - The annual target for new commercial users is set at 1,200 to 1,400 million cubic meters per day, with residential user additions expected to be between 140,000 to 160,000 households [4].

Investment Rating - The report maintains an "Outperform" rating for ENN Energy Holdings with a target price of 73.99 HKD per share [3][11] Core Views - ENN Energy's revenue grew by 0.9% YoY to 54.587 billion yuan in H1 2024, while net profit declined by 22.8% to 2.573 billion yuan [3] - The company's natural gas business showed steady growth, with retail gas volume increasing by 4.5% YoY to 12.71 billion cubic meters [3][8] - The pan-energy and smart home businesses experienced significant growth, with pan-energy sales volume increasing by 26% YoY to 197.4 billion kWh [9] Financial Performance - Domestic core profit increased by 9.5% YoY to 3.08 billion yuan, while basic earnings per share decreased by 0.66 yuan to 2.29 yuan [3] - Gross margin declined by 1.38 percentage points to 11.84%, and operating profit margin fell by 2.59 percentage points to 7.15% [3] - The net debt ratio decreased from 25.3% to 24.3%, reflecting efforts to optimize the debt structure [10] Business Segments - Industrial and commercial retail gas volume grew by 5.4% YoY, accounting for 75.2% of total retail gas volume [8] - The company added 775,000 new household users and achieved a daily opening gas volume of 7.262 million cubic meters [8] - The smart home business saw a 23% YoY increase in gross profit, with transaction customers reaching 2.683 million and an average unit price of 325 yuan per customer [9] Future Outlook - The report forecasts FY24-26 main business revenue at 122.475 billion yuan, 132.386 billion yuan, and 143.859 billion yuan, respectively [11] - Net profit attributable to the parent company is expected to be 8.134 billion yuan, 8.633 billion yuan, and 9.357 billion yuan for FY24-26 [11] - The company expects a 20%-30% growth in smart home business gross profit in H2 2024 [9]

Investment Rating - The report assigns a "Buy" rating to the company, with a target price of HKD 65.10, indicating a potential upside of 22.8% from the current price of HKD 53.00 [1][3][9]. Core Insights - The report highlights that the company's share price decline post-interim results is due to market concerns over its dividend policy, which the report considers to be an overreaction. Despite a 17% year-on-year decline in core earnings, the company increased its interim dividend by 1.6% and raised its payout ratio by 3.5 percentage points to 20.6% [1][2]. - The company has initiated a share buyback plan of HKD 600 million, which is expected to bolster investor confidence and support the stock price amid low valuations [2]. - The report anticipates a recovery in earnings, projecting a return to growth in 2025 and 2026, with expected dividend yields of 6% and 7% respectively, the highest among its peers in the gas sector [2][3]. Financial Summary - Revenue is projected to grow from RMB 110,051 million in 2022 to RMB 134,944 million by 2026, with a compound annual growth rate (CAGR) of approximately 7.1% [3][10]. - Net profit is expected to increase from RMB 5,865 million in 2022 to RMB 8,328 million by 2026, reflecting a recovery in profitability after a dip in 2023 and 2024 [3][10]. - The company aims for a dividend payout ratio of approximately 44% for the year, with a medium-term target of 50% over the next 3-4 years [1][2]. Operational Guidance - The company has set ambitious operational targets for 2024, including a 20-30% growth in its energy business and a retail gas volume growth exceeding 5% [6][8]. - The report projects that the gross margin for the retail gas segment will improve, maintaining around 11% from 2024 to 2026 [2][8]. Market Position - The company is positioned as a leader in the gas distribution sector, with a market capitalization of approximately HKD 59.6 billion and a significant trading volume [5][9]. - The report notes that the company's stock has underperformed relative to the Hang Seng Index, providing a potential buying opportunity for investors [4][5].

Investment Rating - The report provides a positive outlook on Xin Ao Energy, indicating that the stock buyback and equity incentive plans are likely to boost market confidence [1]. Core Viewpoints - The implementation of stock buyback and equity incentive plans is expected to enhance investor sentiment and support the company's stock price [1]. Summary by Relevant Sections - The report highlights that Xin Ao Energy's recent initiatives, including stock buybacks, are strategic moves aimed at reinforcing market confidence and potentially increasing shareholder value [1].