【CLP003 EARNINGS】China Gas: Pricing Pressure This Year, Difficult to Assess Specific Increase for Now; 2025 Final Dividend Maintained at 23 Cents

China Gas (00003) Executive Director Huang Weiyi was asked at the 2025 full-year results briefing whether there are plans to raise local user gas prices this year. Huang Weiyi stated that there is pressure to increase prices, noting that Hong Kong’s CPI has risen by 5% to 6% over the past two years. The rising prices, along with wage increases, development work in the Northern Metropolis, and other factors, have put pressure on the gas company to raise prices. He said it is difficult to comment on the specific increase at this time. The company is maintaining good communication with the government, which is also aware of the pricing pressure.

China Gas’s net profit after tax and core business profit for 2025 are expected to be HKD 7.5 billion and HKD 6 billion respectively, representing year-on-year increases of 2% and 4%. After accounting for non-operating gains and losses and property revaluation adjustments, the attributable profit to shareholders is HKD 5.69 billion, a slight decrease of 0.4% year-on-year. The proposed final dividend is HKD 0.23 per share, unchanged from last year. Total dividends for 2025 are HKD 0.35 per share, also unchanged.

China Gas reported a consolidated revenue of HKD 54.33 billion for 2025, down 2% year-on-year. The company explained that the revenue was affected by several factors, including the standard tariff adjustment for Hong Kong gas in August last year, continued improvement in the pricing of pipeline gas in Mainland China, and the sluggish property market in Mainland China, which led to fewer new gas connection customers.

In 2025, the company’s non-operating gains and losses resulted in a net loss of HKD 310 million, a 6.1-fold increase from the previous year. Basic earnings per share for 2025 declined slightly by 0.3% to HKD 0.305.

Hong Kong gas sales volume in 2025 was approximately 27,181 million gigajoules, roughly flat year-on-year; Mainland city gas sales volume was 36,348 million cubic meters, also roughly flat. As of December 31, the number of customers in Hong Kong was 2.056 million, up 0.9% year-on-year; Mainland city gas customers numbered 44.265 million, up 4%.

Regarding Hong Kong’s gas business, China Gas indicated that 2025 experienced more frequent typhoons and cooler weather after the autumn, leading to a 2.4% year-on-year increase in residential gas sales. Over 19,000 new customers were added in Hong Kong in 2025. The industrial and commercial sector benefited from the opening of the third runway at the airport and the southward movement of the Guangdong-Hong Kong-Macao Greater Bay Area, contributing to sales in tourism-related industries such as hotels, theme parks, and laundry factories. However, changing consumer habits among Hong Kong residents continued to impact the local market, with a 2.6% decline in industrial and commercial gas sales, offsetting some residential growth. Overall, gas sales volume in Hong Kong increased slightly by 0.1% in 2025.

For Mainland China’s gas business, including its subsidiary Towngas Smart Energy Limited (01083), the group’s total number of urban gas projects in Mainland China reached 325 across 23 provincial-level regions in 2025, with 1.78 million new customers. The total gas sales volume for the year was 36.35 billion cubic meters, roughly the same as the previous year.

Regarding water and environmental services, the group’s water and environmental businesses continued to grow during the year, boosting profits. Water sales volume reached 1.66 billion tons, up 0.6% year-on-year, and solid waste treatment volume was 1.72 million tons, an increase of 7%.