Towngas Smart Energy Company Limited · HKEX:1083
Towngas Smart Energy — H1 2023 Earnings Presentation
28 slides from Towngas Smart Energy's earnings presentation, Aug 14, 2023
Slide 1: Towngas Smart Energy (1083.HK) 2023 Interim Results
Towngas Smart Energy (1083.HK) 2023 Interim Results 14 August 2023
Slide 2: Opportunities and Challenges in 2023
Opportunities and Challenges in 2023 Urge for Carbon Reduction Cost-saving & Efficiency Enhancement Carbon peak and carbon Opportunities and challenges neutrality businesses • China’s post-pandemic economic recovery • Strategically coordinate natural gas fell short of expectations. resources. • Geop
Slide 3: 2023 Interim Business Highlights
2023 Interim Business Highlights City Gas Renewable Energy Gas Sales Volume Accumulative 8.23 billion m³ 9% * 91 zero-carbon industrial parks 11 City Gas Projects # 185 projects 3 PV Customers Contracted:2.20 GW 16.36 million 430,000 Grid-connected: 1.12 GW Dollar Margin 0.50 RMB/m 3 Remained unchan
Slide 4: Agenda
AGENDA Financial Highlights P. 5 Business Review ▪ Gas Business P. 9 ▪ Renewable Energy P. 15 ESG P. 22 Business Guidance P. 25
Slide 5: Financial Highlights
s235 AREA BRAG Towngas Smart Energy Company Limited Financial Highlights
Slide 6: 2023 Interim Results – Towngas Smart Energy (1083.HK)
2023 Interim Results – Towngas Smart Energy (1083.HK) (Unit: HK$ million) 1H2022 1H2023 Changes Revenue 10,160 9,883 -3% Operating Profit (RMB million) 715 742 4% Operating Profit 864 835 -3% Gas Business Net Profit 917 832 -9% Renewable Energy Net Profit (53) 3 106% Corporate Financial Expenses (31
Slide 7: Healthy Financial Position
Healthy Financial Position (Unit: HK$ billion) 31 Dec 2022 30 Jun 2023 Total Assets 52.9 54.6 Net Assets 23.9 23.7 Cash and Bank Balances 4.0 4.2 Total Borrowings 19.7 21.3 Net Gearing Ratio 39.7% 41.9% Headquarter Average Cost of Debt 3.8% 3.8% Credit Rating: BBB+ Baa1 AAA Towngas Smart Energy Limi
Slide 8: 2023 Interim Results – Towngas Smart Energy (1083.HK)
2023 Interim Results – Towngas Smart Energy (1083.HK) 1H2022 2H2022 1H2023 Gas Sales Volume (billion m3) 7.54 7.71 8.23 Dollar Margin (RMB/m³) 0.50 0.49 0.50 Unit OPEX (RMB/m³) 0.38 0.44 0.38 Shared connection margin 872 1,103 715 (RMB million) (HK$ million) Gas Business Net Profit 917 916 832 Renew
Slide 9: Business Review: Gas Business
Business Review ▪ Gas Business ▪ Renewable Energy
Slide 10: Continuous Growth in Gas Volume, Stable Gas Sales Mix
Continuous Growth in Gas Volume, Stable Gas Sales Mix Gas Sales Volume (Unit: billion m3) 9%* 8.23 7.54 3.95 48% Industrial 3.72 50% 0.96 12% Commercial 0.93 12% 1.73 21% Residential 1.73 23% Wholesale 1.59 National natural gas consumption 1.16 15% 19% and Others 2022: 366.3 billion m3 2040: 700.0 b
Slide 11: Rising Gas Margin; Connection Business Under Pressure
Rising Gas Margin; Connection Business Under Pressure Selling Price, Cost and Dollar Margin Dollar Margin • Volume control and price increase by upstream lead to (Unit: RMB/m³) 1H2022 1H2023 Changes residential gas cost increase by more than 10%. • Resilient procurement of LNG and unconventional gas
Slide 12: Joint Strategy with Parent Company in Gas Sourcing
Joint Strategy with Parent Company in Gas Sourcing ➢ By 2025/26, gas coordinated by the Group will reach 5 million tonnes to meet internal demand and for trading purposes. ➢ Cost saving will be at least RMB0.32 billion/year through resilient procurement. ➢ Through well-planned scheduling, storage bu
Slide 13: Continued Growth in Revenue from Gas+ Energy Management
Continued Growth in Revenue from “Gas+” Energy Management Rapid Business Development Extensive of Services ➢ Accumulated 201 projects have been developed, Grade A tertiary hospital A vocational school in with 21 new contracts signed this year and energy sales equivalent to 80 million m3 of NG. in Hu
Slide 14: Progress on Shanghai Gas
Progress on Shanghai Gas ➢ Signed Capital Reduction Agreement with Shanghai Gas and Shenergy Group on 23 May 2023. ➢ Exit of 25% equity interest in Shanghai Gas for a consideration of RMB4.66 billion (HK$5.04 billion), which was received on 2 August 2023. ➢ Net gain of HK$600 million from exit of Sh
Slide 15: Business Review: Renewable Energy
Business Review ▪ Gas Business ▪ Renewable Energy
Slide 16: PV Investment
PV Investment ➢ Continue to increase investment in high-quality zero-carbon industrial parks; growth of contracted and installed capacity is significantly ahead of peers. PV Accumulative Contracted and Zero-carbon Industrial Parks (80+11) Grid-connected (GW) • Potential rooftop area: 130 million m2
Slide 17: Operating Environment
Operating Environment ➢ Economic recovery fell short of expectations; financing costs under pressure. ➢ Favourable dual-carbon policies; green financing driving development. Economy Prices Financing Policies • Shift from dual control Environment • Weaker growth in some • PV module prices • Rising gl
Slide 18: Business Strategies
Business Strategies ➢ Focus on zero-carbon industrial parks, green finance expansion, strict risk management of PV investments, and accelerate the development of asset-light energy & carbon management services. 1. Focus on zero-carbon industrial parks • Meet the energy saving and carbon reduction ne
Slide 19: Project Performances
Project Performances Return exceeded forecast Exceptional risk management • PIRR: Actual was 0.7% higher than forecast. • Project screening & evaluation and account (123 grid-connected projects under operation receivables management outperform peers. over 3 months) • Benchmarking financial institute
Slide 20: Energy & Carbon Management Services
Energy & Carbon Management Services ➢ “Towngas Seven Stars” one-stop energy & carbon management services to meet customers’ demands. Business synergies are growing rapidly. Energy & carbon management services for corporate customers Zero-carbon Green Power in emission controlled industries Technolog
Slide 21: Demonstration Cases
Demonstration Cases ➢ Demonstration of national-level exemplification and excellent dual-carbon solutions to industry, large-scale replication amongst gas and PV customers. Zero-carbon Public Zero-carbon Industrial Shenzhen VPP Organization China Southern Power Grid Park Futian District Committee Ha
Slide 22: ESG
s235 AREA BRAG Towngas Smart Energy Company Limited ESG
Slide 23: Carbon Neutrality Targets Set
Carbon Neutrality Targets Set Chinese Mainland Business 2045 Three Major Initiatives to Achieve Carbon Neutrality Adopt Renewable Reduce Emissions Apply Emerging Carbon Energy from Operating Units Reduction Technologies Management of Green Carbon Fugitive Methane Buildings Capture Blending Hydrogen
Slide 24: Ranked Top 1% Chinese Companies in ESG Globally
Ranked Top 1% Chinese Companies in ESG Globally ▪ Top 1% S&P Global ESG Score ▪ The only company in the industry to be named an “Industry Mover” ▪ Included in Sustainable Development Yearbook (China Edition) 2023 Towngas Smart Energy Limited | 2023 Interim Results 24
Slide 25: Business Guidance
s235 AREA BRAG Towngas Smart Energy Company Limited Business Guidance
Slide 26: 2023 Business Guidance
2023 Business Guidance City Gas Renewable Energy Gas Sales Volume Zero-carbon Industrial Parks 9% To achieve 120 40 Customers Accumulated PV 800,000 Grid-connected Capacity Dollar Margin 0.51 RMB/m 3 2.3 GW Towngas Smart Energy Limited | 2023 Interim Results 26
Slide 27: Thank You
s235 AREA BRAG Towngas Smart Energy Company Limited THANK YOU
Slide 28: Disclaimer
Disclaimer This presentation and corresponding discussion may contain certain forward-looking statements, including statements regarding our intent, belief or current expectations with respect to Towngas Smart Energy’s businesses and operations, market conditions, results of operation and financial
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