1. The company's net profit returned to mother in 2023 was 800 to 850 million
The company issued the “2023 Annual Results Advance Notice”. The net profit for 2023 is expected to be 80 million yuan to 85 million yuan. Compared with the same period last year, it will increase by 296.67.2 million yuan to 346.72 million yuan, an increase of 58.9% to 68.9% over the previous year.
The main reason for this is the increase in the company's crude oil production. In 2023, the company's Wensu Oilfield achieved crude oil production of 581,000 tons, an increase of 147,000 tons over the same period in 2022, an increase of 33.82% over the same period last year.
2. The Wensu project achieved new results
The company announced on January 3, 2024 that the Kekeya Oilfield in Wensu has proven 10.924 million tons of petroleum geological reserves through preliminary internal estimates. Referring to the situation in the Wen7 block, we expect Kekoja to provide the company with an increase of about 150,000 tons/year of crude oil.
3. Kazakhstan project to be completed at the end of 2023
According to an announcement issued by the company on December 12, 2023, the company has included the tenge block in the scope of the company's consolidated statements.
Tenge situation: According to a third-party reserve assessment agency, the 2P (confirmed reserves+estimated reserve) crude oil geological reserve of the Tenge block is 64.414 million tons, and the 2P economic recoverable reserve is 5.953 million tons. Referring to Wen7's situation, we believe that there is still plenty of room for growth in tenge block production.
4. Centralized bidding and buyback, demonstrating the company's confidence
On January 25, 2024, the company issued the “Report on the Repurchase of Shares Using Centralized Bidding Transactions”. The total amount of the proposed repurchase capital is between RMB 80 million and RMB 160 million, and the repurchase price does not exceed 27.57 yuan/share.
The controlling shareholders, actual controllers, shareholders holding 5% or more of the shares and their co-actors, and all directors, supervisors, and senior management of the company have no clear plans to reduce their holdings during the company's current share repurchase period or for the next 3 or 6 months.
5. Profit forecast
According to the performance forecast, the company's net profit for 2023 was raised from 790 million yuan to 830 million yuan, corresponding EPS was 2.07 yuan/share, and net profit to mother remained at 12.8/1.68 billion yuan for 24/25, and corresponding EPS was 3.21/4.21 yuan/share, maintaining the “increase” rating.
Risk warning: Russia and Iraq lift the ban at the same time, and there is a risk of a sharp drop in oil prices; the risk that crude oil production from the Coca Project falls short of expectations; the performance forecast is a preliminary calculation result, which is subject to the company's disclosure of the annual report.