The business growth and market expansion were remarkable, and the diversification strategy paid off. The steady growth of Hong Kong's China Gas's integrated energy business, particularly its urban combustion business in the mainland, achieved 8% year-on-year growth, which not only strengthened its market position, but also demonstrated the effectiveness of its diversification strategy. In 2023, the company increased the number of gas projects in the mainland by 5 to 320, and the number of users increased by 2.9 million to 40.19 million. This increase was due to the company's deep cultivation in East China and other regions and the continuous improvement of service quality. Furthermore, the steady growth of the water business and innovative experiments in environmental business, such as converting food waste treatment into biogas, have further broadened the company's business scope and profit model.

Breakthroughs have been achieved in green energy transformation, and initial results have been achieved in the environmentally friendly fuel market layout. Hong Kong China Gas has made significant progress in the green energy transition. In particular, after the restructuring of the EcoCeres business, it successfully developed and produced SAF and HVO. The production of these environmentally friendly fuels reached 0.15 million tons and 115,000 tons respectively in 2023, opening up a new source of revenue for the company. This transformation not only responds to the global trend of low-carbon development, but also provides strong support for the company's sales in the European market. At the same time, the company upgraded its methanol plant in Inner Mongolia, used waste tires to produce green methanol, achieved an output of 2 thousand tons, and obtained ISCC certification, which marks the company's technological progress and market competitiveness in the field of bioenergy.

Financial performance is steady, and profitability continues to improve. Despite a 7% year-on-year decline in turnover for the full year of 2023, Hong Kong and China Gas achieved excellent results of increasing core profit by 11% year on year and net profit attributable to shareholders of 16% year on year by improving operating efficiency. This increase in profitability is due to the company's effective management of cost control, market expansion, and business innovation. As of 2023, the company's total assets reached HK$162 billion, net assets of HK$71.1 billion, and cash and bank deposits of HK$9 billion, indicating the company's good financial position and liquidity, providing a solid financial foundation for future business development and capital expenditure.

Capital expenditure focuses on renewable energy, and investment strategies reflect long-term development considerations. In 2023, Hong Kong's China Gas's capital expenditure was HK$10.2 billion, mainly for investment in renewable energy businesses, particularly photovoltaic projects. This investment strategy reflects the firm determination and strategic investment of the company in energy transformation and green development. The capital expenditure is expected to be adjusted to HK$7.1 billion in 2024. Among them, the capital expenditure of Hong Kong China Smart Energy is expected to be drastically reduced to HK$3.3 billion, reflecting the company's prudent investment and flexible response to market changes. At the same time, the company expects to reduce its debt by HK$10 billion over the next 5 years, and the company continues to optimize its asset structure and improve capital efficiency.