Kunlun Energy Company (135) H2 2025 earnings summary

Executive summary

• Revenue grew 3.7% year-over-year to RMB 193.98 billion, driven by higher natural gas sales volumes, especially to industrial users and through distribution and trading channels.

• Net profit attributable to shareholders was RMB 5.35 billion, down 10.3% year-over-year, mainly due to asset impairments and higher resource costs.

• Core profit, excluding one-off items, was RMB 5.92 billion, with a core EPS of 68.4 RMB cents, down 6.9% year-over-year.

• Retail gas sales volume reached 33.51 bcm, up 2.3% year-over-year, and new users increased by 738,000, bringing the total to 17.19 million.

• Operating cash flow reached RMB 12.43 billion, supporting future transformation and shareholder returns.

Financial highlights

• EBITDA was RMB 16.89 billion, down 4.3% year-over-year.

• Free cash flow increased 2.7% to RMB 7.21 billion.

• Gearing ratio improved to 18.8% as total borrowings decreased, and average financing cost dropped to 2.54%.

• Basic EPS dropped to RMB 61.74 cents, while core basic EPS was RMB 68.40 cents.

• Dividend payout ratio was 51%, with annual DPS maintained at 31.58 RMB cents.

Outlook and guidance

• Retail natural gas sales volume is guided to grow by 3% in 2026, with 600-700 thousand new users expected.

• LNG terminal utilization rate targeted at 85-90%, and LPG sales volume projected at 5.8 million tons.

• Strategic focus on green, integrated energy supply, digital transformation, and expanding new energy and gas power businesses.

• Dividend and share repurchase plans for 2026–2028 are in place to enhance shareholder value.

• Domestic natural gas consumption is projected to grow at about 5% annually during the "15th Five-Year Plan" period.