Hilong (1623) H2 2023 earnings summary

Executive summary

• Revenue rose 38.4% year-over-year to RMB 4,251.5 million, driven by strong growth in oilfield equipment manufacturing and offshore engineering services.

• Net profit reached RMB 171.5 million, up 55.3% year-over-year, with profit attributable to equity owners at RMB 148.7 million, up 40.8%.

• Significant contract wins and market expansion in the Middle East, US, Canada, and Asia enhanced brand image and position.

• Advanced R&D and digital transformation led to new high-tech product launches and operational improvements.

• No dividend was recommended for 2023.

Financial highlights

• Total revenue reached RMB 4,251.5 million in 2023, a 38.4% increase compared to 2022.

• Net profit rose to RMB 171.5 million, up 55.3% year-over-year.

• Gross profit increased to RMB 915.5 million, with gross margin at 22.3%.

• Gearing ratio changed to 37.06% from 42.36%.

• Inventory turnover days improved to 128 from 177; trade receivable days at 146.

Outlook and guidance

• Focus on expanding high-end product offerings and market share in US, Canada, Middle East, and emerging markets.

• Accelerate automation, digitalization, and R&D for advanced drilling tools and offshore engineering solutions.

• Continue to develop integrated turnkey project services and enhance operational efficiency.

• Target new business opportunities in Africa, Southeast Asia, Central Asia, and Europe.

• Offshore engineering and oilfield services are targeted for growth, with emphasis on turnkey projects and new energy business.