On March 19, Gelonghui Gas (01407.HK) announced that the company expects net profit for the year ended December 31, 2023 to record a decrease of RMB 52.0 million compared to net profit of RMB 52.0 million for the year ended December 31, 2022. The range of reduction is estimated to be between RMB 24 million and RMB 28 million.
The reduction was mainly due to the following reasons: (i) a decrease in gross profit of approximately RMB 33 million to RMB 38 million, due to (a) a decrease in gas usage by end users of industrial pipelines and an increase in pipeline gas procurement costs; and (b) due to the downturn in the overall property market in China, a decrease in revenue from providing construction and installation services and selling gas appliances; and (ii) fines, fines and compensation related to the accident.