Core views
In 2024, Q1 achieved revenue of 5.672 billion yuan, a year-on-year decrease of 11.33%; realized net profit of 475 million yuan, an increase of 5.96% over the previous year; realized net profit of 400 million yuan after deduction, an increase of 23.35% over the previous year. In '23, we achieved revenue of 30.752 billion yuan, up 4.75% year on year; realized net profit of 1,621 billion yuan, up 11.08% year on year; realized net profit after deduction of 1,237 billion yuan, an increase of 44.85% year on year. Q1 of '24 benefited from the high oil price environment and steady growth in market development; full workload and good quality control; continued cost reduction and efficiency; stable capital structure and abundant capital.
occurrences
On April 24, the company released its report for the first quarter of 2024: in Q1, the company achieved revenue of 5.672 billion yuan, a year-on-year decrease of 11.33%; realized net profit of 475 million yuan, an increase of 5.96% over the previous year; realized net profit of 400 million yuan after deduction, an increase of 23.35% over the previous year.
Brief review
Overall operation was steady in '23, and Q1 performance continued to grow year on year 24. In Q1, the company achieved revenue of 5.672 billion yuan, down 11.33% year on year; realized net profit of 475 million yuan, up 5.96% year on year; realized net profit after deduction of 400 million yuan, up 23.35% year on year. Benefiting from the high oil price environment, market development has grown steadily; full workload, good quality control; continuous cost reduction and efficiency; stable capital structure and abundant capital.
The company achieved revenue of 30.752 billion yuan in 2008, an increase of 4.75% over the previous year; achieved net profit of 1,621 billion yuan, an increase of 11.08% over the previous year; realized net profit of 1,237 billion yuan after deduction, an increase of 44.85% over the previous year. In 23 years, the company's workload and market development have reached a record high, and various fields have gone hand in hand to achieve breakthroughs; accelerate the transformation of market identity and actively promote the commissioning of new projects.
Actively promote engineering construction and increase market development
In 2024, Q1 achieved a contract amount of 6.517 billion yuan, an increase of 11% over the same period last year, including 6.110 billion yuan in China and 407 million yuan overseas. A total of 63 projects above the operating scale were completed and delivered. By the end of the reporting period, the total number of orders in hand was about 40.5 billion yuan, providing strong support for the continued development of the company's business. The domestic oil and gas business market has maintained steady development. Major projects include the EPCI turnkey project for the Bozhong 26-6 oilfield development project and the EPCI turnkey project for the Bozhong 19-2 oilfield development project. In terms of overseas business, the first batch of 6 conduit racks for the Saudi CRPO122 project was loaded at the Qingdao site and officially entered the maritime transportation and installation stage; the CPF equipment and pipe gallery infrastructure for the Ugandan KingFisher project has been fully advanced, and storage tank installation work has begun. In terms of the clean energy business, the “HNOOC Guanlan” completed the annual power generation target of 22 million kilowatt-hours ahead of schedule; the “Dongfang Fudao Distributed Photovoltaic Project” officially started construction; and the first storage tank of the Zhuhai LNG Phase II project completed the hydraulic pressure test.
Pay attention to shareholder returns and promise that the dividend ratio for the next three years will not be less than 30%. On April 24, the company issued the “Shareholder Return Plan for the Next Three Years (2024-2026)”, promising that if the basic conditions for cash dividends are met, the profit distributed in cash for the next three years (2024-2026) will be no less than 30% of the net profit of the parent company's shareholders in the consolidated statement achieved in the current year. The year-on-year change in the cash dividend amount will be adjusted moderately according to changes in the company's main business profit and the company's available capital situation. Under the terms of cash dividends, the company shall pay a cash dividend once a year. If conditions are available, the company can distribute profits in the medium term.
Profit forecast and valuation: The company's net profit for 2024, 2025, and 2026 is estimated to be 20.5/23.7/2.77 billion yuan, EPS 0.46 yuan, 0.54 yuan, and 0.63 yuan respectively; corresponding PE is 13.8X, 11.9X and 10.2X, respectively.
Risk analysis
(1) International business risks
The company has been in the international market for a relatively short period of time, and there is a relative shortage of international talents, and international project operation experience and risk prevention and control capabilities need to be further improved. Faced with a complex environment where geographical conflicts are escalating and the industry landscape is being adjusted at an accelerated pace, the company still faces great risks in terms of international development and overseas project execution.
(2) Project life cycle management risk
The company's oil and gas field projects are moving towards waters above 300 meters or even 1,500 meters deep. Due to the company's relatively weak technical, management and construction experience in the field of deep-water engineering, the project may have various risks such as quality, safety, schedule, cost, compliance, legal disputes, exchange rates, and accounts receivable during the entire life cycle management process.
(3) Exchange rate fluctuation risk
The company's bookkeeping base currency is RMB. As the scale of the company's overseas business expands, foreign currency revenue increases, and exchange rate fluctuations may have a certain impact on the company's profit and loss.