BEIJING ENT(00392)2024-04-29 12:07Financial Performance - Beijing Enterprises Holdings Limited reported a revenue increase of 3.7% to RMB 82,313,331,000 for the year ended December 31, 2023[5]. - The company's net profit attributable to shareholders decreased by 15.6% to RMB 5,498,290,000, with basic earnings per share dropping to RMB 4.36[5]. - The total assets of the company grew by 5.1% to RMB 204,454,706,000, while cash and cash equivalents increased by 4.6% to RMB 28,858,361,000[5]. - The gross profit margin slightly decreased to 13.0% from 13.3% year-on-year[6]. - The overall gross margin for 2023 was 13%, slightly down from 13.3% in the previous year, primarily due to increased costs in Beijing Gas[42]. - The company reported a total comprehensive income of RMB 4,287,763 thousand for the year, compared to RMB 3,303,433 thousand in 2022, reflecting an increase of 29.8%[152]. - The company’s retained earnings increased significantly, contributing to the overall equity growth[160]. - The company reported a significant increase in financial expenses, totaling RMB 2,644,327,000, compared to RMB 1,781,883,000 in the previous year[162]. Business Segments - The gas distribution business showed steady growth, with the successful commissioning of the Tianjin Nangang LNG project, enhancing supply capabilities in the Beijing-Tianjin-Hebei region[10]. - Despite a decline in profit contribution from China Gas Holdings Limited, the overall gross margin improved due to the implementation of a pricing mechanism in multiple regions[10]. - Beijing Gas recorded operating revenue of RMB 61.47 billion in 2023, an increase of 2.7% year-on-year, with a pre-tax profit of RMB 4.79 billion[18]. - Natural gas sales volume reached 24 billion cubic meters, with a year-on-year increase of 1.7% in pipeline gas sales within Beijing to 18.1 billion cubic meters[18]. - The beer sales volume of Yanjing Beer reached 3.94 million kiloliters, representing a year-on-year growth of 4.5%, exceeding the industry average[13]. - Beijing Enterprises Water Group reported a 14.1% increase in revenue to RMB 24.52 billion, with net profit attributable to shareholders rising by 60% to RMB 1.896 billion[24]. Dividends and Shareholder Returns - The company maintained a dividend of HKD 1.60 per share, with a payout ratio of 33%[9]. - The company plans to adjust its dividend distribution strategy based on future performance growth to reward long-term shareholder support[9]. - The company declared an interim dividend of HKD 0.93 per share on October 27, 2023, and proposed a final dividend of HKD 0.67 per share for the year ending December 31, 2023, subject to shareholder approval[73]. - The company aims to gradually increase shareholder returns to the industry average, with a dividend policy that considers financial conditions and capital needs[135]. Debt and Financing - The average financing cost rose to 3.7% from 2.8% in the previous year, indicating increased borrowing costs[6]. - Cash and bank deposits amounted to RMB 28.86 billion as of December 31, 2023, with total borrowings of RMB 76.25 billion, including RMB 33 billion in bank loans[49]. - Net borrowings increased by 17% to RMB 47.39 billion compared to the previous year[49]. - The asset-liability ratio was 45%, up from 43% in 2022, indicating a slight increase in financial leverage[52]. - The group issued a total of RMB 9.25 billion in Panda bonds, setting multiple issuance records for national and local state-owned enterprises[29]. Environmental, Social, and Governance (ESG) - The ESG rating of Beijing Holdings was upgraded from "BB" to "A" by MSCI, reflecting a leading position in the industry[14]. - The group improved its ESG rating from "BB" to "A," reflecting significant advancements in environmental management and biodiversity protection[30]. - The company has established 39 subsidiaries certified under the ISO 14001 environmental management system, enhancing its environmental management framework[68]. - The company has published its first climate change progress report, setting key targets to strengthen its resilience against climate change risks[67]. - The company is committed to responding to climate change risks and has initiated analyses and assessments in its gas business segment[67]. Strategic Initiatives and Future Outlook - The company is focused on optimizing its debt structure and enhancing shareholder returns amid challenging economic conditions[8]. - The company plans to deepen reforms in its beer business and aims to develop the Yanjing U8 into a super product with a production capacity of one million tons by the end of the 14th Five-Year Plan[15]. - The company aims to optimize its core asset structure and enhance operational efficiency in 2024, focusing on sustainable development[34]. - The company plans to expand its market presence and invest in new product development to drive future growth[160]. - Strategic acquisitions are being considered to bolster market position and operational capabilities[160]. Corporate Governance - The board of directors has undergone changes, with Mr. Geng Chao appointed as an executive director on July 8, 2023[86]. - The board has a clear separation of roles between the chairman and the CEO, enhancing governance practices[110]. - Independent non-executive directors provide independent opinions on the group's development and performance[111]. - The company has established a comprehensive training policy for new directors to ensure they understand their roles and responsibilities[109]. - The attendance rate for board meetings and shareholder meetings was consistently high, with all executive directors attending their respective meetings[107]. Financial Reporting and Compliance - The financial statements are prepared in accordance with the Hong Kong Financial Reporting Standards and are presented in Renminbi, rounded to the nearest thousand[176]. - The company’s financial statements must be prepared in accordance with Hong Kong Financial Reporting Standards and the Companies Ordinance, ensuring no significant misstatements due to fraud or error[144]. - The auditors assessed the appropriateness of the going concern basis of accounting and identified any significant uncertainties that may affect the company's ability to continue as a going concern[146]. - The company has established a comprehensive internal control and risk management system, which is reviewed at least annually to ensure its effectiveness[123].