New | China's ENN Energy sticks to profit goal despite cutting sales volume growth target
Mainland gas supplier to boost recurring net income by up to 20 per cent through reducing costs and getting new customers
ENN Energy Holdings, one of the mainland's largest city natural gas distributors, will strive to fulfil its goal set early this year to grow recurring net profit by 18 to 20 per cent despite revising down its sales volume target, mainly by cutting costs and growing new businesses.
The company aimed to achieve this by procuring cheaper gas in chilled and liquefied form in the spot market to serve new customers not connected to pipelines and enhancing operating efficiency, deputy chairman Cheung Yip-sang said.
"Chairman Wang Yusuo has given an order, which is that we must fulfil the profit growth target no matter what," Cheung said.
After posting last week a 17.8 per cent growth in recurring first-half profit, excluding gains and losses on convertible bonds, foreign exchange and receivables impairment, ENN, based in Hebei province, said it had lowered the non-wholesale gas sales growth target for the year to between 10 and 15 per cent from 15 to 20 per cent.
This came after demand for gas - a cleaner burning fossil fuel - was hit by an economic slowdown and sharp falls in market-based crude oil and coal prices that made mainland regulated gas prices more costly than alternative fuels.
Gas demand grew just over 2 per cent in the first half, much slower than the growth of 8.6 per cent seen in the year-ago period and the average of 15.3 per cent in the past 15 years.