Minsheng Securities·2024-03-21 16:00Investment Rating - The report maintains a "Recommended" rating for the company [12][9]. Core Insights - The company demonstrated resilience in performance, achieving a record high in reserves despite a 1.33% year-on-year decline in revenue to 416.609 billion yuan in 2023 and a 12.60% drop in net profit to 123.843 billion yuan [9][18]. - The company’s net proven reserves reached 6.784 billion barrels of oil equivalent, with a replacement rate of 180%, indicating strong growth potential [9]. - The company plans to maintain production growth, targeting an output of 7.0-7.2 billion barrels of oil equivalent from 2024 to 2026 [9]. - The company’s cost control measures led to a 5.13% decrease in major costs per barrel, enhancing operational efficiency [9]. - A dividend payout ratio of 43.6% was noted, with a total dividend of 1.25 HKD per share for 2023, reflecting strong shareholder returns [9]. Financial Performance Summary - In 2023, the company reported an operating income of 416.609 billion yuan, with a net profit of 123.843 billion yuan, and an EPS of 2.60 yuan [18][20]. - The projected net profits for 2024, 2025, and 2026 are 137.340 billion yuan, 148.786 billion yuan, and 157.900 billion yuan respectively, with corresponding EPS of 2.89, 3.13, and 3.32 yuan [9][18]. - The company’s PE ratios are projected to be 11 for 2023, decreasing to 9 by 2026, indicating a favorable valuation trend [20]. Production and Reserves - The company achieved a net production of 678 million barrels of oil equivalent in 2023, marking an 8.7% increase year-on-year [9]. - Significant projects are set to commence production in 2023 and early 2024, contributing to future output growth [9]. Cost Management - The company has effectively reduced major costs, with specific reductions in operational expenses, depreciation, and other costs per barrel [9]. Capital Expenditure - The company completed capital expenditures of 129.6 billion yuan in 2023, with plans for 125-135 billion yuan in 2024, indicating a stable investment strategy [9]. Dividend Policy - The company’s dividend yield is noted at 4.00% for A shares and 6.86% for H shares, reflecting a strong commitment to returning value to shareholders [9].