So, you may have noticed a few minor changes to the theme. I spent an unreasonable amount of time building the elements for it. What do you think? Like it? Got improvement suggestions? You can add comments in when you leave a feedback rating.

In this edition, we will go through the PetroChina 24Q1 financial statement. By reading this, you can quickly visualise how PetroChina makes money and its financial health. And you’ll learn the answer to the age-old question: what they do with all their money.

Today in a Snapshot

📈Financial Performance: U$7.2B in net profit with a total margin of 6.2%, down from 6.5% (U$6.8B) in 23Q1.
💵Cashflow: Dominated by operations activities, however, consumed U$2.4B of their cash reserves.
⚖️Balance Sheet: No equity official walk, but a net increase in total equity approximate to the net income.

PetroChina has done well, increasing both its revenue and net profit margin for the quarter. This is impressive as 23Q1 had a considerably higher average realisation price on oil and natural gas. Overall, PetroChina achieved a profit margin of 6.2%, a slight reduction of 6.5% from 23Q1

Oil, Gas & New Energy: Crude oil output grew +1.4%^Y/Y with a focus on natural gas growing production by +3.9%^Y/Y. Despite a reduction in revenue, this sector grew its profit by +4.8%^Y/Y. This is primarily due to a decrease in operational expenses.

Refining, Chemicals & New Materials: This segment saw massive production improvements across the board.

This resulted in a considerable increase in revenue generated. However, an erosion of margin resulted in an overall reduction of profit by -4.2%^Y/Y.

Marketing: This is the portion of the business that sells petrol, kerosene, & diesel, as well as operates petrol stations and convenience stores. Overall, this segment saw an increase in sales of +4.5%, resulting in a +9% margin increase. However, the competitiveness of the international market resulted in lower margins, netting a reduction in overall profit -17%^Y/Y.

Natural Gas Sales: This segment benefited from the increased natural gas production. An increase in production, coupled with a reduction in procurement costs, saw an overall profit increase of +21%^Y/Y.

I have seen some weird cashflow charts. However, this one stands out. PetroChina seems to be very much focused on its core operations and not interested in financing and investing activities. Most of this cashflow is spent on goods and services. Notably, PetroChina withdrew 6% (U$2.4B) from its cash reserves this quarter.

PetroChina has a L/A ratio of 38%. This is slightly below its peers, who operate around the 45%-60% range.

Despite me introducing it in the last edition, PetroChina didn’t officially include the information to produce an equity walk. We can, however, make an estimated guess. We know they generated profit and paid dividends. As such that leaves a small portion that has been marked as ‘unknown’. Here is my best guess:

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Cheers,

Connor

All data can be found on the PetroChina Investors website. Reports are issued in RMB; I have used a flat 0.14 to USD exchange.