Hong Kong and China Gas Posts 23% Profit Jump, Green Fuel Business Drives Growth
SingTao · 1 SOURCESabout 1 hour ago7 MIN
Summary
Hong Kong and China Gas (Towngas, stock code: 003) announced impressive first-half 2024 results, with net profit reaching HK$3.64 billion, representing a 22.8% year-on-year increase . The growth was primarily attributed to breakthrough developments in growth-oriented businesses, whose operating profit surged threefold compared to the same period last year . The company maintained its interim dividend at HK$0.12 per share, demonstrating confidence in its financial strength . Revenue for the period rose 7.3% year-on-year to HK$29.526 billion, with Mainland China operations contributing HK$22.663 billion, up 9.8%, while Hong Kong revenue grew 2.9% to HK$6.443 billion .
Key Points
- Hong Kong gas sales volume declined 3.5% year-on-year to 14.414 billion megajoules, as high temperatures and residents travelling abroad weighed on residential demand, though commercial customers including restaurants and hotels saw slight increases amid tourism recovery
- The green fuel business turned around dramatically, recording HK$553 million in profit from associates compared to a HK$210 million loss in the same period last year, with sustainable aviation fuel (SAF) sales volume jumping approximately 100% year-on-year to 320,000 tonnes
- 怡斯萊 (ECOLIVE), the company's SAF subsidiary, signed an investment意向 agreement with Dongguan city government to build a production chain with annual capacity of approximately 450,000 tonnes of SAF and hydrotreated vegetable oil (HVO) in the Greater Bay Area, bringing total怡斯萊 capacity to 1.22 million tonnes
- Green methanol capacity expanded to 300,000 tonnes following upgrades at the Inner Mongolia facility, while a new Foshan plant is scheduled to commence construction this year with planned capacity of 200,000 tonnes, creating a dual-base layout totalling 500,000 tonnes
- Distributed solar photovoltaic grid connections increased by 0.2 gigawatts during the period, bringing cumulative installed capacity to 3 gigawatts, with the company identifying photovoltaic asset management and market-based electricity sales as core drivers for future performance
Why It Matters
Towngas' strong first-half performance illustrates how traditional utilities are successfully pivoting toward green energy businesses that offer higher growth margins, potentially setting a template for Hong Kong's energy sector transformation . The company's strategic positioning in hydrogen, SAF, and green methanol aligns with both the mainland's energy transition policies and Hong Kong's Northern Metropolis development plan, creating new revenue streams that could buffer against fluctuations in core gas sales .
Towngas' strong first-half performance illustrates how traditional utilities are successfully pivoting toward green energy businesses that offer higher growth margins, potentially setting a template for Hong Kong's energy sector transformation . The company's strategic positioning in hydrogen, SAF, and green methanol aligns with both the mainland's energy transition policies and Hong Kong's Northern Metropolis development plan, creating new revenue streams that could buffer against fluctuations in core gas sales .