Financial Performance - Total sales revenue for 2023 was RMB 12,989.8 million, a decrease of 9.0% compared to 2022[6] - The gross profit for 2023 was RMB 2,061.0 million, down 18.7% from RMB 2,536.6 million in 2022[6] - The net profit attributable to shareholders for 2023 was RMB 2,381.7 million, an increase of 45.0% compared to RMB 1,642.6 million in 2022[6] - The company achieved a total revenue of RMB 11.946 billion in 2024, with a gross profit of RMB 1.705 billion and a net profit attributable to shareholders of RMB 1.071 billion[21] - The group’s revenue for the reporting period was RMB 11,946.5 million, a decrease of RMB 1,043.3 million or 8.0% compared to RMB 12,989.8 million in 2023, primarily due to fluctuations in the urea market[74] - The revenue from urea sales was RMB 3,710.2 million in 2024, down 20.7% from RMB 4,676.9 million in 2023, attributed to a decrease in sales price and volume[74] - The phosphate and compound fertilizer revenue was RMB 2,687.0 million, a slight decrease of 0.7% from RMB 2,707.0 million in 2023[74] - The group's methanol revenue for the reporting period was RMB 3,090.7 million, an increase of RMB 57.3 million or 1.9% compared to RMB 3,033.4 million in 2023, primarily due to a price increase of RMB 66.2 per ton[75] - The group's acrylonitrile series products generated revenue of RMB 2,010.6 million, a significant increase of RMB 707.4 million or 54.3% from RMB 1,303.2 million in 2023, driven by a sales price increase of RMB 738.1 per ton and a volume increase of 66,191.8 tons[75] Production and Sales - The total production volume for fertilizers in 2024 was 1,917,802 tons, a decrease of 4.4% from 2,005,933 tons in 2023[8] - The total sales volume for chemical products in 2024 was 1,425,991 tons, a decrease of 1.2% from 1,443,602 tons in 2023[9] - The company sold 1.888 million tons of urea, 1.426 million tons of methanol, 509,000 tons of phosphate fertilizer, 295,000 tons of compound fertilizer, and 226,000 tons of acrylonitrile products during the year[24] - The company’s production output included 1.918 million tons of urea, 855,000 tons of compound fertilizer, and 1.438 million tons of methanol, reflecting strong operational performance[23] - The total sales of phosphate and compound fertilizers in 2024 were 803,838 tons, down from 826,695 tons in 2023[59] - The company exported 0.4 million tons of urea, 126,000 tons of diammonium phosphate, 9,000 tons of methanol, and 9,000 tons of acrylonitrile in 2024[53] Assets and Equity - The total assets as of December 31, 2024, were RMB 24,076.0 million, a slight decrease from RMB 24,317.3 million in 2023[7] - The total equity as of December 31, 2024, was RMB 19,507.0 million, an increase from RMB 19,407.1 million in 2023[7] Dividends - The board proposed a final dividend of RMB 0.1208 per share for the 2024 fiscal year, resulting in a payout ratio of 52%[12] - The board proposed a final dividend of RMB 556.9 million for the year 2024, equating to a dividend of RMB 0.1208 per share, subject to shareholder approval[91] - The company has adopted a dividend policy that allows shareholders to receive declared dividends, with all shareholders having equal rights to dividends and distributions[192] - The company will continuously review its dividend policy and retains the sole discretion to update, revise, or modify the policy at any time[197] Safety and Environmental Practices - The company maintained a safety production record with zero employee fatalities and zero environmental pollution incidents for three consecutive years[23] - The company will continue to implement its green development strategy, achieving leading energy efficiency indicators in the industry and receiving international certifications[25] - The company’s methanol production facility has been recognized as an "energy efficiency leader" for 13 consecutive years, showcasing its commitment to sustainable practices[25] - The company is committed to energy conservation and environmental protection, gradually replacing low-efficiency equipment[112] - The management team emphasized a commitment to sustainability, with plans to reduce carbon emissions by 20% by 2025[175] Future Plans and Strategies - The company plans to expand its production capacity for methanol and other chemical products in the coming years[3] - The company plans to focus on enhancing the quality of "plant nutrition solutions" and expanding its international development space through overseas natural gas resource projects[16] - The company plans to deepen research on the application of low-carbon natural gas and CO2 resource utilization technologies in 2025[111] - The company is enhancing its market expansion initiatives and innovating sales models to ensure price realization[112] - The company is exploring potential acquisitions to enhance its product portfolio, targeting firms with complementary technologies[174] - Market expansion plans include entering three new international markets by Q3 2024, aiming for a 10% market share in each[175] Governance and Board Structure - The board consists of six members, including two executive directors, one non-executive director, and three independent non-executive directors, ensuring compliance with corporate governance regulations[125] - Independent non-executive directors constitute half of the board, meeting the requirement of at least one-third as per listing rules[128] - The company has implemented training programs for all directors to enhance their knowledge and skills, including updates on regulatory trends and ESG compliance[132] - The board has conducted training and professional development for directors and senior management[133] - The company has a diversity policy that considers various factors, including gender, age, and professional experience, in board member selection[125] Risk Management - The company has implemented a comprehensive risk management system, including a risk management committee and department to identify and report significant risks[161] - The board has conducted reviews of the company’s risk management and internal control systems, ensuring their effectiveness and adequacy[161] - The internal audit department plays a crucial role in supporting the board and management in risk management and internal control systems[161] Financial Management - The group's financing income decreased to RMB 351.1 million, down RMB 6.8 million or 1.9% from RMB 357.9 million in 2023, attributed to lower interest rates on large certificates of deposit and deposits[85] - The group's financing costs increased to RMB 52.8 million, an increase of RMB 18.6 million or 54.3% from RMB 34.2 million in 2023, primarily due to increased costs associated with long-term borrowings[85] - The group's administrative expenses rose to RMB 629.1 million, an increase of RMB 26.3 million or 4.4% from RMB 602.7 million in 2023, primarily due to higher labor costs[83] Market Conditions - The domestic urea market is expected to see supply and demand growth, but still faces pressure due to existing supply-demand gaps[105] - The average market price of urea in 2024 was RMB 2,099 per ton, down RMB 348 per ton or 14% compared to 2023[33] - The average price of compound fertilizers fell to RMB 2,820 per ton in 2024, a decline of about 7.3% from 2023, despite a slight decrease in production to 5.084 million tons[36] - The total domestic methanol production in 2024 was approximately 78.96 million tons, reflecting a year-on-year increase of 8.7%, while imports decreased by 7.5% to 13.47 million tons[44] Employee Development - The company trained 107,508 employees during the reporting period, with a total training duration of 1,086,419 hours[96]

Core Viewpoint - The company reported strong financial performance for 2024 and Q1 2025, with significant year-on-year growth in revenue and net profit, aligning with market expectations [1] Financial Performance - For 2024, the company achieved revenue of 2.97 billion, a year-on-year increase of 33.4%, and a net profit attributable to shareholders of 340 million, up 31.7% [1] - The non-GAAP net profit for 2024 was 330 million, reflecting a substantial increase of 73.9% year-on-year [1] - In Q1 2025, revenue reached 850 million, a 28.0% increase year-on-year, with a net profit of 135 million, up 22.1% [1] Development Trends - The company continues to deepen its single product strategy, with rapid growth across all channels. The main brand, Marubi, generated revenue of 2.06 billion in 2024, a 31.7% increase, with key products achieving significant sales growth [2] - Online revenue for 2024 was 2.54 billion, accounting for 85.5% of total revenue, reflecting a 35.8% year-on-year increase, while offline revenue was 430 million, up 21.0% [2] Product Structure and Cost Control - The gross margin improved due to optimized product structure and cost control, with gross margins for 2024 and Q1 2025 increasing by 3.0 and 1.4 percentage points to 73.7% and 76.1%, respectively [3] - The company experienced an increase in sales expense ratio due to rising online traffic costs, while management and R&D expense ratios decreased [3] Brand and Product Expansion - The company plans to expand its product matrix and enhance brand content marketing, with new product launches scheduled for April, including the Super Mask and various new items under the Love Fire brand [4] Profit Forecast and Valuation - The company maintains its net profit forecasts for 2025-2026, with the current stock price corresponding to a P/E ratio of 35/29 for those years. The target price has been raised by 32% to 50, indicating a potential upside of 21% [5]

Core Viewpoint - The company reported strong financial performance for 2024 and Q1 2025, with significant year-on-year growth in revenue and net profit, indicating robust operational momentum and brand strength [1][6]. Financial Performance - In 2024, the company achieved revenue of 2.97 billion yuan, a year-on-year increase of 33.4%, and a net profit attributable to shareholders of 340 million yuan, up 31.7% [1][2]. - For Q1 2025, the company reported revenue of 850 million yuan, reflecting a 28% year-on-year growth, and a net profit of 140 million yuan, which is a 22.1% increase [2][6]. - The company proposed a cash dividend of 0.5 yuan per share for 2024, resulting in a total payout ratio of 88% for the year [1]. Brand and Product Performance - The main brands, Marubi and Lianhuo, experienced substantial growth, with Marubi's revenue reaching 2.055 billion yuan (69% of total revenue) and a growth of 31.7%, while Lianhuo's revenue was 905 million yuan (30% of total revenue) with a growth of 40.7% [3]. - Key product categories such as eye care, skincare, cleansing, and beauty products saw significant revenue contributions, with eye care growing by 60.8% and skincare by 21.6% in 2024 [3][4]. Gross Margin and Cost Control - The gross margin for 2024 improved by 3.0 percentage points to 73.7%, driven by product mix optimization and cost control [4][5]. - The company maintained a good control over expenses, with the expense ratio decreasing by 0.2 percentage points to 60.7% in 2024 [5]. Inventory and Receivables Management - Inventory at the end of 2024 increased by 27.9% to 220 million yuan, with inventory turnover days of 90 days [5]. - Accounts receivable rose by 42.9% to 450,000 yuan at the end of 2024, with turnover days of 4 days [5]. Future Outlook - The company is expected to continue its strong growth trajectory, with projected net profits of 450 million yuan, 570 million yuan, and 680 million yuan for 2025, 2026, and 2027, respectively [6]. - The company’s strategic focus on product innovation and brand strength is anticipated to enhance its market position and profitability [6].

Investment Rating - The report does not explicitly state an investment rating for China BlueChemical Core Views - The recurring net profit for 2024 decreased by 28.33% year-on-year, with total sales revenue of 11.946 billion yuan, down 8.40% year-on-year, and net profit of 1.071 billion yuan, down 55.02% year-on-year [2][3] - The decline in revenue is primarily attributed to fluctuations in the urea market, leading to a significant drop in sales prices [2][3] - The company plans to distribute a cash dividend of approximately 557 million yuan, with a dividend payout ratio of 51.98% and a dividend yield of 6.09% [2][3] Summary by Product - Urea sales revenue was 3.711 billion yuan, down 20.70% year-on-year, due to a decrease in sales price by 382.9 yuan per ton and a reduction in sales volume by 103,832 tons, with a gross profit margin of 19% [4] - Phosphate and compound fertilizers sales revenue was 2.687 billion yuan, down 0.70% year-on-year, with an increase in sales price by 67.1 yuan per ton but a decrease in sales volume by 22,605.8 tons, maintaining the same gross profit margin as the previous year [4] - Methanol sales revenue was 3.091 billion yuan, up 1.90% year-on-year, driven by an increase in sales price by 66.2 yuan per ton, despite a decrease in sales volume by 17,611.3 tons, with a gross profit margin of 27% [4] - Acrylonitrile series products sales revenue was 2.011 billion yuan, up 54.30% year-on-year, due to an increase in sales price by 738.1 yuan per ton and an increase in sales volume by 66,191.8 tons, with the gross profit margin turning positive [4] Strategic Developments - The company is expanding its phosphate rock resources through its subsidiary Hubei Dayukou Chemical Co., Ltd., which is constructing a mining project with an annual capacity of 1.6 million tons, expected to commence production in 2026 [5] - The company holds a 33.99% stake in Guizhou Jinlin Chemical Co., Ltd., which is expected to generate significant annual operating income and profit once its phosphate mine project is fully operational [5] - The company signed a memorandum of understanding with BASF to establish a Joint Laboratory for Advanced Green C1 Chemical Technology, focusing on sustainable and low-carbon solutions [6]

Investment Rating - The report does not explicitly state an investment rating for China BlueChemical Core Insights - The recurring net profit for 2024 decreased by 28.33% year-on-year, with total sales revenue of 11.946 billion yuan, down 8.40% year-on-year, and net profit down 55.02% year-on-year to 1.071 billion yuan [2][3] - The company plans to distribute a cash dividend of approximately 557 million yuan, with a dividend payout ratio of 51.98% and a dividend yield of 6.09% [2][3] Summary by Product - Urea sales revenue was 3.711 billion yuan, down 20.70% year-on-year, primarily due to a decrease in sales price by 382.9 yuan per ton and a reduction in sales volume by 103,832 tons, with a gross profit margin of 19% [4] - Phosphate and compound fertilizers sales revenue was 2.687 billion yuan, down 0.70% year-on-year, with an increase in sales price by 67.1 yuan per ton but a decrease in sales volume by 22,605.8 tons, maintaining the same gross profit margin as the previous year [4] - Methanol sales revenue was 3.091 billion yuan, up 1.90% year-on-year, due to an increase in sales price by 66.2 yuan per ton, despite a decrease in sales volume by 17,611.3 tons, with a gross profit margin of 27% [4] - Acrylonitrile series products sales revenue was 2.011 billion yuan, up 54.30% year-on-year, driven by an increase in sales price by 738.1 yuan per ton and an increase in sales volume by 66,191.8 tons, with the gross profit margin turning positive [4] Strategic Developments - The company is extending its industrial chain upstream by securing phosphate rock resources through its subsidiaries, including a 1.6 million tons per year underground mining project expected to commence production in 2026 [5] - The company has signed a memorandum of understanding with BASF to establish a Joint Laboratory for Advanced Green C1 Chemical Technology, focusing on sustainable and low-carbon solutions [6]

Core Viewpoint - China National Chemical Corporation (中海石油化学) experienced a significant decline in its stock price, dropping over 5% in early trading due to a substantial decrease in urea sales prices and a sharp decline in annual net profit [1] Financial Performance - The company reported a revenue of 11.946 billion RMB for the fiscal year 2024, representing an 8% year-on-year decrease [1] - Gross profit was 1.705 billion RMB, down 17.3% compared to the previous year [1] - Net profit fell to 1.071 billion RMB, a staggering 55% decline year-on-year, with earnings per share at 0.23 RMB [1] - The final dividend was set at 0.1208 RMB, down from 0.207 RMB in the previous year [1] Market Dynamics - The decline in revenue was primarily attributed to fluctuations in the urea market, with urea sales revenue dropping to 3.71 billion RMB, a decrease of 20.7% year-on-year due to lower sales prices and reduced sales volume [1] - Conversely, revenue from acrylonitrile products saw a significant increase, reaching 2.011 billion RMB, up 54.3% year-on-year, driven by both higher sales prices and increased sales volume [1]

Financial Performance - Revenue for the year ended December 31, 2024, was RMB 11,946 million, a decrease of 8.03% from RMB 12,990 million in 2023[5] - Gross profit for 2024 was RMB 1,705 million, down 17.3% from RMB 2,061 million in 2023[5] - Net profit attributable to the owners of the company was RMB 1,071 million, a decline of 55.1% compared to RMB 2,382 million in 2023[7] - Basic earnings per share for 2024 were RMB 0.23, down from RMB 0.52 in 2023[7] - The company reported a pre-tax profit of RMB 1,467 million for 2024, down 44.8% from RMB 2,664 million in 2023[5] - The pre-tax profit for 2024 was RMB 1,071,273 thousand, a significant decline of 55.1% compared to RMB 2,381,681 thousand in 2023[36] - The group's net profit for the reporting period was RMB 1,151.1 million, a decrease of RMB 1,223.0 million compared to RMB 2,374.1 million in 2023[100] Dividends - Proposed final dividend per share is RMB 0.1208, compared to RMB 0.2072 in the previous year[4] - The proposed dividend for 2024 is RMB 0.1208 per share, down from RMB 0.207 per share in 2023, totaling RMB 556,888 thousand compared to RMB 954,270 thousand in 2023[35] - The group proposed a final dividend of RMB 556.9 million for the 2024 fiscal year, equating to a dividend of RMB 0.1208 per share, pending approval at the 2024 annual general meeting[102] - The final dividend is expected to be paid to shareholders around June 30, 2025[132] Assets and Liabilities - Total assets as of December 31, 2024, amounted to RMB 24,075 million, a slight decrease from RMB 24,317 million in 2023[10] - Total liabilities decreased to RMB 4,569 million in 2024 from RMB 4,910 million in 2023[10] - The total liabilities of the group as of December 31, 2023, were RMB 4,910,188,000, with the phosphate and compound fertilizer segment having liabilities of RMB 420,843,000[21] - The group's capital debt ratio increased to 9.8% as of December 31, 2024, up from 9.4% in the previous year, primarily due to an increase in lease liabilities and interest-bearing bank loans by RMB 97.7 million[105] Cash Flow and Financing - Cash and cash equivalents increased to RMB 679 million in 2024 from RMB 597 million in 2023[9] - Financing costs increased to RMB 52,759 thousand in 2024 from RMB 34,185 thousand in 2023, representing a rise of 54.5%[28] - The income tax expense for 2024 was RMB 316,092 thousand, compared to RMB 289,887 thousand in 2023, reflecting an increase of 9.0%[31] - Financing income decreased to RMB 351.1 million, down RMB 6.8 million or 1.9% from RMB 357.9 million in 2023, due to lower deposit rates[94] - Financing costs increased to RMB 52.8 million, up RMB 18.6 million or 54.3% from RMB 34.2 million in 2023, primarily due to increased long-term borrowing costs[94] Production and Sales - In 2024, the company produced 191,800 tons of urea, 85,500 tons of compound fertilizer, 143,800 tons of methanol, and 23,000 tons of acrylonitrile series products[66] - The total sales volume of urea reached 1,887,910 tons in 2024, down from 1,991,707 tons in 2023, resulting in a revenue of RMB 3,710.2 million, a decrease of 20.7% compared to RMB 4,676.9 million in 2023[72][78]. - The sales volume of phosphate and compound fertilizers was 803,838 tons in 2024, down from 826,695 tons in 2023, with a revenue of RMB 2,687.0 million, a slight decrease of 0.7% from RMB 2,707.0 million in 2023[73][78]. - The company achieved a production operation rate of 104.2% for urea in 2024, compared to 109.0% in 2023[67] - The domestic urea production in 2024 is approximately 66 million tons, a year-on-year increase of 5.8%, while the average market price is projected to be RMB 2,099 per ton, down 14% from 2023[57] Market Conditions - The global economic recovery is slower than expected, impacting the chemical industry, particularly traditional basic chemicals facing cost pressures and weak demand[60] - The domestic urea market is expected to see both supply and demand growth in 2025, although the market may remain under pressure due to supply-demand imbalances[122] Corporate Governance - The company has complied with the Corporate Governance Code as of March 18, 2025, following the appointment of a new CEO and President[129] - The board confirmed that all directors and supervisors adhered to the standard code of conduct for securities trading during the reporting period ending December 31, 2024[131] Employee and Training - The group trained 107,508 employees during the reporting period, with a total of 1,086,419 training hours, including safety training for contractors[108] Future Plans - The group plans to enhance safety management systems and innovate sales models to ensure price realization as part of its key initiatives for 2025[127] - The group aims to deepen research on carbon-rich natural gas and CO2 resource utilization technologies to drive key project advancements[127]

Financial Performance - The company reported revenue of RMB 6,007 million for the six months ended June 30, 2024, a decrease of 2.7% compared to RMB 6,176 million in the same period of 2023[4]. - The net profit attributable to equity holders of the company was RMB 687 million, down 60% from RMB 1,715 million in the previous year[4]. - The gross profit margin for the period was approximately 16.7%, compared to 17.2% in the same period last year[4]. - The company's revenue for the reporting period was RMB 6,006.6 million, a decrease of RMB 169.1 million or 2.7% compared to RMB 6,175.7 million in the same period of 2023[20]. - The net profit for the period was RMB 743,374,000, a significant decrease of 56.96% compared to RMB 1,725,473,000 in the previous year[51]. - The pre-tax profit for the group was RMB 898,719, compared to RMB 1,840,358 for the same period in 2023, reflecting a decline of 51.1%[64]. - The group recorded a net loss from foreign exchange of RMB 5.9 million, a reduction of RMB 7.3 million from a loss of RMB 13.2 million in the same period of 2023[28]. - The group’s net profit for the reporting period was RMB 743.4 million, a decrease of RMB 982.1 million or 56.9% compared to RMB 1,725.5 million in the same period of 2023[31]. Assets and Liabilities - Total assets as of June 30, 2024, were RMB 24,120 million, a slight decrease from RMB 24,317 million at the end of 2023[5]. - The company maintained a total equity of RMB 19,105 million, down from RMB 19,407 million at the end of 2023[5]. - The company's total liabilities rose to RMB 5,015,557 thousand as of June 30, 2024, compared to RMB 4,910,188 thousand at the end of 2023, marking an increase of about 2.1%[55]. - The company's total equity as of June 30, 2024, was RMB 19,104,774,000, compared to RMB 19,407,158,000 at the end of the previous period, reflecting a decrease of approximately 1.6%[58]. - As of June 30, 2024, the group had total interest-bearing liabilities of RMB 2.262 billion, with a capital debt ratio of 10.6%[34]. Production and Sales - Production volume for the fertilizer segment decreased by 6.7% to 973,476 tons compared to 1,043,916 tons in the same period last year[6]. - The sales volume of the fertilizer segment was 1,003,262 tons, a decrease of 4.0% from 1,044,993 tons in the previous year[7]. - The company achieved a production rate of 105.8% for the fertilizer segment, compared to 113.5% in the same period last year[6]. - In the first half of the year, the company produced 973,000 tons of urea, 707,000 tons of methanol, 445,000 tons of phosphate and compound fertilizers, and 97,000 tons of acrylonitrile series products, with all products except urea showing year-on-year increases[9]. - The company's online direct sales increased by 54% year-on-year, with total sales of 1,003,000 tons of urea, 668,000 tons of methanol, 401,000 tons of phosphate and compound fertilizers, and 88,000 tons of acrylonitrile series products[9]. Pricing and Market Conditions - The average price of urea in the first half was RMB 2,395 per ton, a year-on-year decrease of RMB 264 per ton, representing a decline of approximately 10%[13]. - The average price of domestic phosphate monoammonium in the first half was RMB 3,053 per ton, with a year-on-year decline of 0.72%[14]. - The average price of domestic acrylonitrile was RMB 9,828 per ton, with a year-on-year increase of 2.11%[17]. - The overall supply of urea is expected to exceed demand in the third quarter, leading to weaker domestic prices, while the phosphate market is anticipated to remain relatively strong due to robust demand[10]. - Methanol supply is expected to be relatively ample in the second half of 2024, with a potential increase in imports and downstream demand[37]. Environmental and Sustainability Efforts - The CEO highlighted the company's commitment to green and sustainable development, receiving multiple industry accolades for energy efficiency and water management[8]. - The company achieved 100% compliance in online pollutant emissions data for two consecutive years, with zero environmental pollution incidents reported[9]. - The company plans to enhance production safety and stability, optimize resource allocation, and strengthen brand building in the second half of the year[10]. Expenses and Financial Management - Administrative expenses increased to RMB 281.5 million, up RMB 8.8 million or 3.2% from RMB 272.7 million in the same period of 2023, driven by higher labor and travel costs[25]. - Financing income rose to RMB 172.6 million, an increase of RMB 11.1 million from RMB 161.5 million in the same period of 2023, while financing costs increased significantly to RMB 27.0 million, up RMB 17.0 million from RMB 10.0 million[27]. - The group's other income for the reporting period was RMB 32.6 million, a decrease of RMB 24.9 million or 43.3% compared to RMB 57.5 million in the same period of 2023, primarily due to a reduction in government subsidies received[22]. - The group’s capital commitments as of June 30, 2024, included RMB 224,316,000 for the purchase of machinery and RMB 2,028,000 for land and buildings[121]. Employee and Training Information - As of June 30, 2024, the group had a total of 3,676 employees, with total wages and allowances amounting to approximately RMB 239.6 million in the first half of 2024[36]. - The group conducted training for 43,359 participants, totaling 128,384 training hours, with safety training sessions amounting to 3,377 times and 72,391 participants[36]. Dividends and Shareholder Information - The group did not recommend the payment of an interim dividend for the six months ended June 30, 2024, having distributed RMB 954.3 million in cash dividends for 2023[32]. - The company declared no dividends for the current period, compared to RMB 954,270 thousand declared in the previous year[54]. - The company declared a dividend of RMB 0.207 per share for the fiscal year 2023, an increase from RMB 0.178 per share in the previous year, resulting in total dividends paid of RMB 954,270,000 for the six months ended June 30, 2024, compared to RMB 820,580,000 for the same period last year[110].

Investment Rating - The report initiates coverage with an "OUTPERFORM" rating for China BlueChemical [3][4]. Core Views - China BlueChemical is a leading player in the domestic fertilizer and methanol industry, with significant contributions from acrylonitrile capacity release to profits [2][4]. - The company has a total designed capacity of 1.84 million tons of urea, 1 million tons of phosphate compound fertilizer, 1.4 million tons of methanol, and 270,000 tons of acrylonitrile products as of December 31, 2023 [6][8]. Financial Performance - Revenue for 2024 is projected at RMB 12.84 billion, a decrease of 2% from the previous year, with net profit expected to drop by 50% to RMB 1.20 billion [4][11]. - The company reported a net profit of RMB 6.22 billion in the first half of 2024, a year-on-year decline of 19.79% due to lower sales volumes and prices of key products [11][12]. - The gross profit margin (GPM) is expected to remain stable at around 15.9% for 2024, with a gradual increase to 16.9% by 2026 [4][24]. Product Performance - The company’s main products include urea, phosphate compound fertilizers, and methanol, which together accounted for approximately 81.72% of total revenue in the first half of 2024 [15][16]. - The acrylonitrile project was successfully completed in 2023, achieving a capacity utilization rate of 70.60% in the first half of 2024, generating sales revenue of RMB 825 million, a 258% increase year-on-year [17][18]. Market Position - China BlueChemical is a subsidiary of China National Offshore Oil Corporation (CNOOC), which provides it with favorable conditions for stable and cost-effective raw material sourcing [8][10]. - The company actively explores international markets, with fertilizer exports increasing by 80% in 2023 [17][18]. Shareholder Information - As of December 31, 2023, CNOOC holds a 59.41% stake in China BlueChemical, making it the largest shareholder [10][19]. - The company has a history of returning value to shareholders, with a dividend payout ratio averaging around 40% in recent years [10][19].

Financial Performance - Revenue for the six months ended June 30, 2024, was RMB 6,007 million, a decrease from RMB 6,176 million in the same period of 2023, representing a decline of approximately 2.7%[2] - Gross profit for the same period was RMB 1,003 million, down from RMB 1,064 million in 2023, indicating a decrease of about 5.7%[3] - Net profit attributable to the company's owners was RMB 687 million, significantly lower than RMB 1,715 million in the previous year, reflecting a decline of approximately 60%[3] - Basic earnings per share decreased to RMB 0.15 from RMB 0.37, a drop of about 59.5% year-on-year[3] - The company reported a total comprehensive income of RMB 739 million for the period, compared to RMB 1,725 million in the same period last year, a decrease of approximately 57.2%[4] - The group's pre-tax profit for the six months ended June 30, 2024, was RMB 686,827,000, a decrease from RMB 1,715,398,000 for the same period in 2023, representing a decline of approximately 60%[22] - The total income tax expense for the six months ended June 30, 2024, was RMB 155,345,000, compared to RMB 114,885,000 for the same period in 2023, indicating an increase of about 35%[20] - The company's net profit for the reporting period was RMB 743.4 million, a decrease of RMB 982.1 million or 56.9% compared to RMB 1,725.5 million in the same period of 2023[60] Assets and Liabilities - Total assets as of June 30, 2024, were RMB 24,120 million, slightly down from RMB 24,317 million at the end of 2023[6] - Current assets amounted to RMB 15,547 million, compared to RMB 15,577 million at the end of 2023, showing a marginal decrease[6] - The company's total equity attributable to owners was RMB 18,029 million, down from RMB 18,301 million at the end of 2023[6] - The company’s liabilities totaled RMB 5,016 million, up from RMB 4,910 million at the end of 2023, indicating an increase of approximately 2.2%[7] - As of June 30, 2024, the total interest-bearing debt was RMB 2.262 billion, all at floating interest rates, with a capital debt ratio of 10.6%[63] Revenue Breakdown - Total revenue for the six months ended June 30, 2024, was RMB 6,006,640 thousand, a decrease of 2.74% compared to RMB 6,175,701 thousand for the same period in 2023[17] - Sales revenue from product sales was RMB 5,840,931 thousand, down from RMB 5,986,489 thousand year-on-year, reflecting a decline of 2.43%[17] - The urea segment generated revenue of RMB 2,102,435 thousand with a pre-tax profit of RMB 372,632 thousand[13] - The methanol segment reported revenue of RMB 1,478,553 thousand and a pre-tax profit of RMB 314,302 thousand[13] - The phosphatic fertilizer and compound fertilizer segment achieved revenue of RMB 1,336,512 thousand with a pre-tax profit of RMB 81,232 thousand[13] - Urea revenue decreased by RMB 417.6 million or 16.6% to RMB 2,102.4 million due to a price drop of RMB 315.9 per ton and a sales volume decrease of 41,731 tons[50] - Phosphate and compound fertilizer revenue increased by RMB 142.9 million or 12.0% to RMB 1,336.5 million, driven by a sales volume increase of 49,033 tons[50] - Methanol revenue rose by RMB 78.6 million or 5.6% to RMB 1,478.6 million, attributed to a price increase of RMB 73.5 per ton and a sales volume increase of 13,770 tons[50] Expenses and Costs - The cost of goods sold for the six months ended June 30, 2024, was RMB 5,003,497,000, down from RMB 5,112,084,000 in the same period of 2023, reflecting a decrease of approximately 2%[19] - The depreciation and amortization expenses for the six months ended June 30, 2024, totaled RMB 362,856,000, compared to RMB 267,824,000 for the same period in 2023, marking an increase of around 36%[19] - Other income for the six months ended June 30, 2024, was RMB 32,550 thousand, a decrease from RMB 57,476 thousand in the same period of 2023[17] - Other income decreased by RMB 24.9 million or 43.3% to RMB 32.6 million, primarily due to a reduction in government subsidies[52] - Financing income increased by RMB 11.1 million to RMB 172.6 million, while financing costs rose by RMB 17.0 million to RMB 27.0 million due to increased interest expenses[56] - Income tax expenses increased by RMB 40.4 million or 35.2% to RMB 155.3 million, mainly due to a decrease in pre-tax operating profit[59] Operational Highlights - The company produced 973,476 tons of urea and sold 1,003,262 tons in the first half of the year, with an operating rate of 105.8%[49] - The production of compound fertilizers was 445,081 tons, with sales of 401,005 tons in the first half of the year[49] - The group produced 8,300 tons of BB fertilizer and sold 9,242 tons in the first half of 2024[50] - The company achieved a 54% year-on-year increase in e-commerce direct sales[47] - The company maintained a 100% compliance rate for online pollutant emissions for two consecutive years[48] - The company successfully completed major repairs on its urea and methanol production facilities ahead of schedule, ensuring stable operations[47] Market Trends - The fertilizer market in China showed a recovery trend in the first half of 2024, influenced by domestic supply and demand changes and related policies[41] - The average price of urea in the first half of 2024 was RMB 2,395 per ton, a decrease of RMB 264 per ton or approximately 10% year-on-year[42] - The average domestic price of monoammonium phosphate in the first half of the year was RMB 3,053 per ton, a year-on-year decrease of 0.72%[43] - The average domestic price of diammonium phosphate was RMB 3,651 per ton, a year-on-year decrease of 0.49%[44] - Domestic methanol production in the first half of the year was approximately 39.36 million tons, an increase of 12.4% year-on-year[45] - The average market price of methanol was RMB 2,520 to RMB 2,760 per ton in the second quarter, reflecting a strong market trend[45] - Domestic acrylonitrile production was approximately 1.689 million tons, a year-on-year increase of 6.83%[46] Corporate Governance - The company appointed Mr. Hou Xiaofeng as acting chairman and president following the resignation of Mr. Wang Weimin on March 30, 2022[74] - The board confirmed that all members and supervisors complied with the securities trading standards as of June 30, 2024[75] - There were no purchases, sales, or redemptions of the company's listed securities by the company or its subsidiaries during the six months ending June 30, 2024[76] - The company has no significant contingent liabilities or major litigation matters during the reporting period[69][70] Future Outlook - The company anticipates a weaker domestic urea price in July-August 2024 due to increased supply, while the phosphate fertilizer market is expected to remain in a tight balance with relatively strong demand[70] - Key focus areas for the second half of 2024 include ensuring stable production operations, optimizing resource allocation, and enhancing brand building for green agriculture[71] - The company maintains a strong liquidity position to meet operational and future development funding needs[64]