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In a country marred by geopolitical tensions and economic uncertainties, CITIC Resources Holdings Limited has not only weathered the storm but emerged stronger. The company recently announced its unaudited interim results for the first half of 2024, showcasing a staggering 93.1% surge in revenue, climbing to approximately HK$3.94 billion from HK$2.04 billion in the same period last year. This growth story is a testament to the Group’s strategic focus and operational resilience.
At the heart of this remarkable performance is CITIC Resources’ newly established oil and gas trading business. This venture has been the main driver behind the revenue spike, contributing approximately HK$2.21 billion with a trading volume of around 3.35 million barrels. The Group’s overall operating results have remained stable, with an adjusted EBITDA of approximately HK$1.10 billion, slightly below the HK$1.14 billion recorded in the first half of 2023. Net profits attributable to ordinary shareholders stood at HK$350 million, down from HK$380 million last year.
Central to CITIC Resources’ success are three core strategies: resolving risks, improving quality and efficiency, and optimizing management and governance. These pillars have guided the Group’s efforts to enhance its oil and gas business. During the first half of 2024, CITIC Resources achieved an operating output of 4.722 million barrels, marking a year-on-year increase of 1.1%. Despite stable revenue from oil and gas production and sales at approximately HK$730 million, net profit in this segment dipped to HK$340 million from HK$430 million in the previous year.
The group has been relentless in its pursuit of increased reserves and production, aiming to stabilize profitability and enhance asset value. Significant milestones include the development of Hainan Block 20 in Yuedong Oilfield and the expansion of the Caspian Bitumen Plant. The commercialization of natural gas in the Lofin Area is progressing at minimal cost. Through the continuous introduction of new processes and technologies, and strategic production enhancement measures, CITIC Resources has consistently improved production volumes and economic benefits.
In non-oil-and-gas sectors, the Group reported a net profit attributable to ordinary shareholders of HK$54.76 million, down from HK$65.94 million in the first half of 2023. Efforts to optimize management and shareholder affairs in projects such as the Portland Aluminium Smelter and the Coppabella and Moorvale coal mines joint venture have been pivotal. Additionally, the Group advanced a share swap transaction between Alumina Limited and Alcoa Corporation to maximize shareholder interests.
Reflecting on the company’s journey, Hao Weibao, Executive Director, Chairman, and CEO of CITIC Resources, remarked, “In the first half of 2024, affected by prevailing geo-political tensions and weakening economic growth momentum, the macro environment was extremely challenging. Nevertheless, adhering to its three main strategies, namely ‘resolving risks, improving quality and efficiency, and optimizing management and governance’, and the Group adopted effective and refined management measures in all aspects of production and sales, and vigorously promoting applicable new technologies and processes, and building up a technological foundation and cost advantage for sustainable development.”
Looking ahead, CITIC Resources is poised to seize industry opportunities through dual drivers in investment and trading. The Group is exploring investment opportunities in the upstream aluminium business and new energy sectors, aiming to cultivate a second growth curve. The goal is to increase the annual trading volume of its oil trading business to 10 million barrels. As Hao emphasized, “The Group aspires to become an influential listed company specializing in resources and energy with ‘dual drivers in energy and mineral product investment and commodity trading’ to the end of creating yet longer-term value for all stakeholders.”
Conclusively, CITIC Resources’ journey through the first half of 2024 underscores a narrative of strategic foresight, operational excellence, and an unwavering commitment to sustainable growth. As the Group continues to navigate the complexities of the global market, its focus on innovation and efficiency sets a strong foundation for future success.