Financial Performance - For the six months ended June 30, 2024, the Group recorded a revenue of RMB 40.8 million, a decrease from RMB 49.1 million for the same period in 2023, representing a decline of approximately 17.0%[2] - The Group generated a gross profit of RMB 16.3 million from oil exploration and storage, down from RMB 20.3 million in the comparative period, indicating a decrease of about 19.7%[2] - Loss attributable to equity holders of the Company was RMB 345.2 million for the period, an improvement from a loss of RMB 444.8 million in the comparative period, reflecting a reduction of approximately 22.5%[2] - The total comprehensive loss for the period was RMB 315.8 million, down from RMB 396.8 million in the comparative period, with a loss attributable to equity holders of RMB 328.7 million compared to RMB 394.0 million previously[31] - Revenue from the Energy Business was approximately RMB19.1 million, down 4.3% from RMB19.9 million in the Comparative Period[23] - Nantong Zhuosheng generated revenue of RMB21.7 million, reflecting a decrease of approximately 25.5% from RMB29.2 million in the Comparative Period[27] - The Group's cost of sales decreased by approximately 14.9% to RMB24.4 million from RMB28.7 million in the Comparative Period[29] - The management anticipates that oil exploration performance will continue to be restrained by a sluggish global economy, with oil prices unlikely to recover substantially in the near future[24] - The Group recorded a net foreign exchange loss of RMB 118.0 million during the period, compared to a loss of RMB 222.9 million in the comparative period, showing a decrease of about 47.0%[2] Financial Position - As of June 30, 2024, the Group had a total deficit of RMB9,336.4 million, with current liabilities exceeding current assets by RMB8,345.9 million[31] - Total borrowings amounted to RMB4,066.7 million as of June 30, 2024, compared to RMB3,934.7 million at the end of 2023[32] - The gearing ratio decreased from approximately 77.4% as of December 31, 2023, to approximately 77.2% as of June 30, 2024[32] - The Group had contingent liabilities of RMB999.9 million, an increase from RMB985.0 million as of December 31, 2023[33] - The Group's cash and cash equivalents amounted to RMB3.6 million as of June 30, 2024, up from RMB2.1 million as of December 31, 2023, with approximately 85.2% in RMB[33] - The Group's liquidity measures include refinancing operations and restructuring debts to alleviate financial pressure[31] - The Group's total liabilities reached RMB10,757,783,000, up from RMB10,425,805,000, representing an increase of approximately 3.18%[57] - The Group's cash flow forecast covers at least a 12-month period starting from June 30, 2024, indicating sufficient operating funds to meet financial obligations[97] Guarantees and Loans - As of June 30, 2024, financial guarantees of approximately RMB 2,210,636,000 had been discharged, representing 37.17% of the total financial guarantees as of the Disposal Day[6] - The Group recognized financial guarantee contracts of RMB 5,118.6 million, up from RMB 5,036.9 million as of December 31, 2023, which will be released upon the discharge of the Relevant Guarantees[13] - The Company intends to utilize a USD 250 million interest-free facility from a shareholder to repay the outstanding secured bank loan by the end of 2024[15] - The secured bank loan was bundled with Relevant Guarantees D and has been transferred to an independent financial institution[15] - The Group has drawn down USD120,387,000 (approximately RMB874,879,000) from a loan facility of up to USD250,000,000 (approximately RMB1,816,800,000) for oilfield operations[90] - The Group is negotiating with lenders regarding overdue borrowings of RMB1,734,691,000, including extensions and waivers[107] Operational Developments - The Group has drilled a total of 81 wells across five oilfields, with 76 wells currently in production as of June 30, 2024[23] - The Group has acquired approximately 50.46% equity interest in Nantong Zhuosheng Petrochemical Co., Ltd., enhancing its oil storage capabilities[26] - The acquisition of Nantong Zhuosheng Petrochemical Co., Ltd. in January 2021 is expected to enhance the Group's oil storage and logistics capabilities[111] - The Group is actively exploring and expanding into other business types to seek more stable and diversified revenue sources[35] - The Group expects to increase oil output through further development in Kyrgyzstan, aiming for steady operating cash flows[110] Employee and Governance - The Group had 155 employees as of June 30, 2024, compared to 143 employees as of December 31, 2023[33] - The Group has complied with the Corporate Governance Code during the reporting period[37] - The Board has resolved not to declare an interim dividend for the six months ended June 30, 2024[42] - The company is committed to corporate governance and transparency in its operations[194] Market Outlook - Demand for oil is expected to grow in emerging economies, particularly in Central Asia, indicating a promising outlook for oil field development in Kyrgyzstan[34] - The Chinese economy is anticipated to recover in 2024 due to favorable monetary and real estate policies, which the Group is prepared to navigate[35] - The company expects to resume expenditures in the Energy Business by 2025 at the earliest, due to ongoing geopolitical conflicts affecting oil prices[19] Financial Management - The net finance cost decreased by approximately 28.2% to RMB261.4 million compared to RMB364.3 million in the previous period[30] - The company reported a net finance cost of RMB 261,392,000, a decrease from RMB 364,253,000 in 2023, indicating improved financial management[59] - The Group's financial risk management focuses on minimizing potential adverse effects from market unpredictability[104] - The Group's ability to continue as a going concern is contingent on achieving its plans; failure to do so may require asset value adjustments[99]
华荣能源(01101) - 2024 - 中期财报