Financial Performance - Revenue for the year ended December 31, 2024, reached HK$8,624,272, an increase of 17.2% compared to HK$7,359,952 in 2023[16] - Operating profit for 2024 was HK$936,017, up 37.5% from HK$680,436 in 2023[16] - Profit before taxation increased to HK$814,211, representing a 48.4% rise from HK$548,972 in 2023[16] - The Company reported a profit for the year of HK$341,981, a decrease of 31.2% compared to HK$497,099 in 2023, primarily due to losses from discontinued operations[16] - The Group's profit for 2024 was HK$342 million, a year-on-year decrease of 31% from HK$497 million in 2023[159] - The Group's income tax expense surged by 361% to HK$287 million in 2024, compared to HK$62 million in 2023, largely due to rising tax costs in Kazakhstan[185] Assets and Liabilities - Total assets as of December 31, 2024, amounted to HK$7,842,287, a growth of 16.1% from HK$6,750,363 in 2023[17] - Total liabilities increased to HK$3,920,581, up 36.6% from HK$2,870,172 in 2023[17] - The gearing ratio increased significantly to 99.97% in 2024 from 73.97% in 2023, indicating a rise in financial leverage[154] - The Group's net current liabilities were HK$292 million as of December 31, 2024, a decrease of 136% compared to net current assets of HK$823 million at the end of 2023[197] Market and Industry Trends - The global nuclear energy development is in good shape, with countries focusing more on energy security and transition amid geopolitical risks[18] - The IAEA forecasts that global investment in nuclear power will reach US$100 billion by 2050, with installed capacity expected to increase to 950 GWe under high-case scenarios[46] - Japan plans to build 18 new nuclear reactors by 2032, adding an expected 13.8 GWe of newly installed capacity[49] - The US Senate allocated USD2.7 billion from the Civil Nuclear Credit program to fund domestic uranium enrichment capacity in response to sanctions against Russia[52] - The UK aims to increase its installed nuclear capacity to 24 GWe by 2050, which is four times the level in 2023[55] - Kazakhstan decided to construct its first nuclear power reactor following a referendum held in October 2024[55] Production and Operations - Global natural uranium production in 2024 amounted to approximately 58,846 tU, representing an 8.2% increase compared to 2023[69] - Kazatomprom reported attributable production of 12,286 tU in 2024, accounting for 21% of global primary production, which is 10% higher than in 2023[69] - The Semizbay Mine achieved an actual uranium extraction of 976tU, meeting 100% of its annual production target, with a production cost of US$32/lbU3O8[78] - The Irkol Mine produced 569tU of uranium at a cost of US$24/lbU3O8, contributing to a total annual production of 964tU after processing losses[80] - The Group achieved revenue of HK$8,624 million from natural uranium trading, an increase of 17% compared to 2023[93] Challenges and Risks - The company is facing challenges in 2025 due to geopolitical tensions, inflation, and rising raw material costs, which may impact business development[26][28] - The company faces production risks due to insufficient domestic supply of sulfuric acid in Kazakhstan and adjustments in production volume by Kazatomprom[148] - Global conditions, including rising energy prices and geopolitical conflicts, pose risks to the company's operations and capital market performance[149] Strategic Initiatives - The company plans to focus on mergers and acquisitions as well as exploration and development in 2025, aiming for substantial progress in resource extraction and investment returns[24][25] - The company aims to enhance its core capabilities and competitiveness while implementing a new pricing mechanism for international uranium trades[30] - The company updated its ESG targets, reinforcing its commitment to a green, low-carbon, and responsible corporate image[19][21] - The company will pursue high-quality uranium project opportunities globally and establish strategic partnerships with renowned uranium producers[136] Investor Relations and ESG - The company strengthened investor relations through dual "offline + online" channels, achieving satisfactory results[100] - The company's ESG rating was upgraded from B to A in March, achieving its first-ever A rating, which was further upgraded to AA in May[109] - Several institutions upgraded their ratings, with BOCI Securities raising its target price to HK$2.30, CITIC Securities to HK$2.70, and CICC to HK$2.51[108]

Investment Rating - The investment rating for the company is "Outperform the Market" [5] Core Views - The company's revenue for 2024 is projected to be 8.624 billion HKD, representing a year-on-year increase of 17.05%. However, the net profit attributable to shareholders is expected to decline by 31.2% to 342 million HKD due to increased dividend withholding tax and fair value changes [8][20] - The increase in uranium prices has significantly boosted the company's pre-tax performance, but the net profit has decreased due to new tax regulations in Kazakhstan and losses from the exchange of shares with Paladin [8][20] - The average sales price of uranium is 75.04 USD/lb U3O8, while the average production cost has risen to 80.80 USD/lb U3O8, reflecting a 4 USD increase year-on-year [12][13] Summary by Sections Financial Performance - In 2024, the company achieved a revenue of 86.24 billion HKD, with a pre-tax profit of 8.14 billion HKD, marking a 48.3% increase year-on-year. However, the net profit attributable to shareholders fell to 342 million HKD, a decrease of 31.2% [8][20] - The company's uranium trading revenue was 86.24 billion HKD, with a segment loss of 0.95 billion HKD. Investment income from other segments was 10.16 billion HKD, with significant contributions from Fission Uranium and Paladin [8][20] Production and Costs - The company self-traded 1,294 tons of uranium in 2024, maintaining production levels from the previous year. The production cost increased to an average of 80.80 USD/lb U3O8 due to rising raw material prices and increased underground resource usage tax [12][13] - The average production cost across mines rose to 24 USD/lb U3O8, primarily due to a supply shortage of sulfuric acid and increased taxes linked to higher sales prices [12][13] Market Trends - The spot price of natural uranium peaked above 100 USD/lb U3O8 at the beginning of 2024 but subsequently declined, with a 27.7% decrease in trading volume year-on-year. Long-term contract prices, however, showed a stable upward trend, rising from 58 USD/lb U3O8 to 80 USD/lb U3O8 [14][20] - The report anticipates a downward adjustment in profit forecasts due to declining spot prices and increased resource usage tax rates, projecting net profits of 635 million HKD, 785 million HKD, and 836 million HKD for 2025-2027 [20]

Investment Rating - The report maintains a "Buy" rating for China General Nuclear Power Corporation (CGN) Mining [1][5][6] Core Views - The company is expected to benefit from its low-cost uranium resources and the global nuclear power expansion, which highlights its long-term value despite short-term pressures [1][5] - Revenue for 2024 is projected to grow by 17% to HKD 8.624 billion, while net profit is expected to decline by 31% to HKD 342 million due to increased tax expenses and one-time losses [2][5] - The report emphasizes the resilience of the trading business and anticipates a recovery in profit margins with new pricing frameworks expected to be signed in the second half of the year [2][3] Financial Summary - In 2024, CGN Mining achieved revenue of HKD 8.624 billion, a 17% year-on-year increase, but reported a gross loss of HKD 66.12 million due to unfavorable uranium pricing [2][9] - The company’s pre-tax profit rose significantly by 48% to HKD 814.21 million, while net profit fell to HKD 342 million, reflecting a 31% decrease [2][9] - The expected revenue for 2025-2027 is projected at HKD 10.358 billion, HKD 11.732 billion, and HKD 12.329 billion respectively, with net profits forecasted at HKD 666 million, HKD 1.158 billion, and HKD 1.306 billion [5][9] Uranium Resource Segment - The company benefits from a cost advantage in its uranium mining operations, with overseas uranium investment income increasing by 71% to HKD 1.016 billion in 2024 [3][5] - The production from the company's key mines is expected to sustain for 5-6 years at current extraction rates, with significant contributions to joint profits [3][5] Industry Outlook - The global nuclear power sector is projected to grow steadily, with 417 operational reactors worldwide and a capacity of 377 GW, indicating a robust demand for uranium [5][9] - The report forecasts a positive trend in uranium prices and nuclear power expansion, reinforcing the long-term investment case for CGN Mining [5][9]

Investment Rating - The report maintains a "Buy" rating for China General Nuclear Power Corporation (1164.HK) with a target price of HKD 2.25 [6][5]. Core Views - The company is expected to benefit from its low-cost uranium resources and the global nuclear power expansion, which will enhance its long-term value despite short-term pressures [1][5]. - Revenue for 2024 is projected to grow by 17% to HKD 8.624 billion, while net profit is expected to decline by 31% to HKD 342 million due to increased tax expenses and one-time losses [2][5]. Financial Performance Summary - In 2024, the company achieved revenue of HKD 8.624 billion, a 17% year-on-year increase, but reported a net profit of HKD 342 million, down 31% from the previous year [2][5]. - The gross profit margin was negative at -0.8% due to unexpected increases in international uranium prices, leading to a loss of HKD 66.12 million [2][5]. - The company plans to distribute a dividend of HKD 0.007 per share, with a payout ratio of 23% [2]. Uranium Resource Segment - The company reported a 71% increase in overseas uranium investment income, reaching HKD 1.016 billion, benefiting from high natural uranium prices [3]. - The production from the company's key mines, including the Xie and Yi mines, was 964 tons in 2024, with a unit cost of USD 28 per pound, contributing HKD 399 million in joint profits, a 46% increase year-on-year [3]. - The total remaining reserves for the Xie and Yi mines are 7,700 tons of uranium, which can sustain production for 5-6 years at current extraction rates [3]. One-time Impact from Terminated Business - The acquisition of Fission Uranium by Paladin Energy resulted in a one-time loss of HKD 170 million due to the decline in Paladin's share price [4]. - The report indicates that these one-time impacts are not expected to affect future profits [4]. Industry Outlook - The global nuclear power sector is expected to see steady growth, with 417 operational nuclear reactors worldwide and a capacity of 377 GW as of the end of 2024 [5]. - Revenue projections for the company from 2025 to 2027 are HKD 10.358 billion, HKD 11.732 billion, and HKD 12.329 billion, respectively, with net profits expected to rise significantly during this period [5][9].

Core Viewpoint - China General Nuclear Power Corporation Mining (CGN Mining) reported a revenue of HKD 8.624 billion for 2024, reflecting a 17% year-on-year increase, while net profit attributable to shareholders decreased by 31% to HKD 342 million [1] Group 1: Financial Performance - The company achieved a revenue of HKD 8.624 billion in 2024, a 17% increase compared to the previous year [1] - Net profit attributable to shareholders was HKD 342 million, down 31% year-on-year [1] - Earnings per share were HKD 0.045, with a proposed final dividend of HKD 0.007 per ordinary share [1] Group 2: Operational Highlights - The company's subsidiaries, Xie Company and Ao Company, maintained stable operations, with a 4% increase in annual production despite challenges such as tight sulfur supply [2] - The average production cost for the mines was USD 24 per pound, consistent with the first half of the year, achieved through effective cost control measures [2] - Investment income totaled HKD 1.016 billion, a 71% increase year-on-year, driven by rising market prices and improved production efficiency [2] Group 3: Strategic Developments - The company is advancing its mining construction work as planned, expecting to complete the first phase by 2025 and reach a production capacity of 50 tons by 2027 [3] - The acquisition of Fission by Paladin, a leading uranium producer, is expected to enhance the development of the PLS project, one of the most promising uranium mining projects globally [3] - CGN Mining aims to strengthen its management, control cost risks, and optimize resource structure to maintain its leading position in the global uranium market [4] Group 4: Future Outlook - For 2025, CGN Mining plans to continue its dual-driven development model of "resource development + capital operation" to ensure steady progress in overseas uranium resource development [4] - The company aims to become an internationally leading uranium supplier by optimizing management processes and expanding business scale [4]

Group 1 - Core viewpoint: China General Nuclear Power Corporation (CGN) Mining's stock dropped over 4% due to one-time factors affecting last year's net profit attributable to shareholders, while short-term momentum for uranium prices is lacking [1] - CGN Mining reported a revenue of approximately HKD 8.624 billion for 2024, representing a year-on-year increase of 17.18% [1] - The profit attributable to shareholders for the year was approximately HKD 342 million, a decrease of 31.2% year-on-year, primarily due to the accrual of dividend withholding tax and losses from the termination of Fission's operations [1] Group 2 - Citing a 15% future dividend withholding tax and recent declines in uranium prices, Zheshang International has lowered its price assumptions for 2025E/26E by 18%/16% to USD 75/83 per pound, with profit forecasts reduced by 28%/35% [2] - Despite the adjustments, the significant contract/spot price differential (USD 80/65 per pound in February) is expected to limit further declines in spot prices [2] - The company anticipates a decrease in relevant tax rates under Kazakhstan's new mineral resource tax mechanism set to take effect in 2026 [2]

Group 1 - The core viewpoint of the news is that CGN Mining (01164) experienced a decline of over 4% due to one-time factors affecting its net profit, while short-term momentum for uranium prices is lacking [1] - CGN Mining reported a revenue of approximately HKD 8.624 billion for 2024, representing a year-on-year increase of 17.18% [1] - The profit attributable to the company's owners for the year was approximately HKD 342 million, a decrease of 31.2% compared to the previous year, primarily due to the accrual of dividend withholding tax and losses from the termination of Fission's operations [1] Group 2 - Huatai Securities noted that while short-term momentum for natural uranium prices is lacking, the medium to long-term outlook remains positive due to supply-demand gaps that could drive uranium prices upward [1] - The current strong financial attributes of natural uranium spot prices may lead to a rapid decline in prices, influenced by minimal actual impacts from the US-Russia enrichment uranium ban and easing international conflict expectations following Trump's presidency [1] - Zhaoyin International has adjusted its price assumptions for 2025E/26E down by 18%/16% to USD 75/83 per pound, and lowered its earnings forecasts by 28%/35% [2]

Summary of CGN Mining Conference Call Company and Industry Overview - **Company**: CGN Mining - **Industry**: Uranium Mining and Nuclear Power Key Points and Arguments Financial Performance - In 2024, CGN Mining reported a significant increase in investment income, totaling HKD 1.016 billion, a 71% year-on-year growth, driven by a recovery in the uranium market and rising oil prices [2][3] - The company's revenue for 2024 was HKD 340 million, a 31% decline, while the profit before tax reached HKD 800 million, a 48% increase [4][15] - The gross profit margin decreased due to previously locked-in contract prices being lower than current market prices, leading to a negative impact on asset trading [16] Market Dynamics - The global nuclear power sector is experiencing positive growth, with multiple governments implementing supportive policies. The International Atomic Energy Agency has raised global nuclear power growth forecasts for four consecutive years [2][5] - By 2050, global nuclear power capacity is expected to reach 950 GW under high scenarios and 514 GW under baseline scenarios, which will steadily increase the demand for natural uranium [2][5] Uranium Supply and Demand - The natural uranium market is expected to face tight supply-demand dynamics in 2024, with uncertainties on the supply side, such as shortages in Kazakhstan and slow progress on new projects [2][6] - The long-term price of natural uranium is projected to maintain a stable upward trend, reaching USD 51 per pound by 2024 [2][6] Cost Management - CGN Mining has implemented measures to optimize procurement channels, enhance production efficiency, and strengthen supply chain management, keeping the average production cost at USD 24 per pound [2][7] - The company is actively pursuing diversified financing and cost control strategies to mitigate inflationary pressures [7] Future Development Plans - For 2025, CGN Mining plans to continue its dual-driven development model focusing on resource development and capital operations, with an emphasis on cost control and overseas uranium resource development [4][8] - The company proposes a stable dividend policy, suggesting a dividend of HKD 0.7 per share [4][9] Operational Insights - CGN Mining holds rights to four mining areas with a total resource of approximately 24,000 tons of uranium and an annual production capacity of about 1,300 tons [2][12] - The Zhalbak project is expected to complete its first phase of expansion by 2025, increasing capacity to 500 tons, with plans to reach 900 tons by 2030 [2][12] Challenges and Risks - The company faces challenges from global economic changes, trade protectionism, geopolitical risks, and supply chain fluctuations, which it addresses through optimized operational strategies [3] - Increased tax rates and regulatory changes in Kazakhstan have raised operational costs, impacting profit margins [17][45] Shareholder Engagement - CGN Mining emphasizes the importance of shareholder support and aims to maintain a stable dividend policy to reward investors [9][10] Strategic Partnerships - The company is exploring further collaboration opportunities with Paladin, particularly in the context of uranium resource development [46][47] Geopolitical Considerations - Global geopolitical changes are prompting CGN Mining to diversify its resource acquisition strategies beyond Kazakhstan to include other uranium-producing countries [49] Market Strategy - The company maintains a conservative market strategy focused on risk control while participating in the uranium market, ensuring a stable operational framework [41] Additional Important Insights - The long-term outlook for uranium prices is positive, supported by rising production costs and increasing demand for nuclear energy [48] - The company is closely monitoring the impact of AI and small modular reactors (SMRs) on the nuclear energy landscape, which may influence future resource acquisition strategies [39][50]

Financial Performance - The company's revenue for the year ended December 31, 2024, was HKD 8,624,272,000, representing a 17.2% increase from HKD 7,359,952,000 in 2023[3] - The gross loss for the year was HKD 66,120,000, compared to a gross profit of HKD 128,755,000 in the previous year[3] - The profit before tax increased to HKD 814,211,000, up from HKD 548,972,000 in 2023, marking a 48.4% increase[3] - The net profit attributable to the owners of the company was HKD 341,981,000, down from HKD 497,099,000 in 2023, reflecting a decrease of 31.2%[4] - Basic earnings per share from continuing operations increased to HKD 0.0693, compared to HKD 0.0640 in the previous year[4] - The income tax expense for 2024 was HKD 287,485,000, significantly higher than HKD 62,369,000 in 2023, indicating increased tax liabilities[36] - The company reported a profit of HKD 341,981,000 for 2024, a decrease of 31.2% compared to HKD 497,099,000 in 2023[49] Assets and Liabilities - Total assets as of December 31, 2024, amounted to HKD 7,842,287,000, an increase from HKD 6,750,363,000 in 2023[5] - Current liabilities increased significantly to HKD 3,732,188,000 from HKD 1,391,228,000 in 2023, indicating a rise of 168.5%[5] - The total liabilities rose to HKD 3,920,581,000 in 2024 from HKD 2,870,172,000 in 2023, primarily driven by the natural uranium trading segment[24] - The company's equity increased slightly to HKD 3,921,706,000 from HKD 3,880,191,000 in 2023[6] - The total current liabilities rose by 168% to HKD 3,732 million as of December 31, 2024, compared to HKD 1,391 million as of December 31, 2023, mainly due to increased bank borrowings and reclassification of long-term loans from a subsidiary to short-term loans[147] Revenue Sources - Revenue from continuing operations for 2024 reached HKD 8,624,272,000, a 17.1% increase from HKD 7,359,952,000 in 2023[33] - The group reported a significant increase in revenue from external customers in mainland China, reaching HKD 1,987,964,000 in 2024, up 17.8% from HKD 1,687,603,000 in 2023[31] - The group’s revenue from the Hong Kong Special Administrative Region surged to HKD 2,386,244,000 in 2024, compared to HKD 385,815,000 in 2023, marking a substantial increase[31] - The total trading volume of natural uranium reached HKD 8,624 million, a 17% increase from 2023, with sales from the Xie and Ao companies amounting to HKD 1,957 million, up 16%[97] Operational Highlights - The segment loss for the natural uranium trading division was HKD (94,598,000), while the other investment segment reported a profit of HKD 1,016,278,000, leading to a total segment profit of HKD 921,680,000[22] - The company achieved a uranium production of 976tU in 2024, completing its annual plan at 100.1%, with production costs of $32/lbU3O8 for the Xie mine and $24/lbU3O8 for the Yi mine[90] - The company produced 1,783tU in the second half of 2024, exceeding its annual plan by 1.9%, with production costs of $22/lbU3O8 for the Zhong mine and $31/lbU3O8 for the Zha mine[93] Market and Industry Trends - The global nuclear power market is projected to see an increase in installed capacity to 950 GWe by 2050 under high-case scenarios, up 7% from previous forecasts[76] - The global natural uranium production in 2024 is estimated at 58,846 tU, an 8.2% increase from 2023, with major producers like Kazatomprom and Cameco contributing significantly[86] - The long-term contract price for uranium increased from $72/lbU3O8 in January to $81/lbU3O8 in November 2024, reflecting ongoing demand despite a decrease in trading volume[86] Corporate Governance and Strategy - The company is focused on maintaining a strong governance structure with a diverse board composition[174] - The company plans to continue focusing on cost control measures and market risk management to ensure stable operations amid fluctuating market conditions[97] - The implementation of stock incentive policies is aimed at enhancing the sense of belonging and loyalty among management and core employees[114] Dividends and Shareholder Information - The company declared an interim dividend of HKD 0.3 per share, totaling approximately HKD 22,802,000 for the year ending December 31, 2024[48] - The board of directors proposed a final cash dividend of HK$0.007 per share for the year ending December 31, 2024, compared to no dividend for 2023[160] - An interim cash dividend of HK$0.003 per share was declared and paid for the six months ending June 30, 2024, while there was no interim dividend for the same period in 2023[160] Future Outlook - The company is actively enhancing its resource base through exploration and development projects, including drilling activities to increase recoverable resources[94] - The company aims to actively explore new business models and trade opportunities while maintaining strict control over operational risks[112] - The company will closely monitor international geopolitical developments and their impact on capital market performance and resource development[117]

Investment Rating - The investment rating for China General Nuclear Power Corporation (1164 HK) is maintained as "Buy" with a target price of HKD 2.00 [7][8]. Core Views - The company has issued a profit warning, expecting a net profit of HKD 317 to 367 million for 2024, representing a year-on-year decline of 26% to 35%. This is primarily due to the accrual of dividend withholding tax and losses from the termination of operations related to the Fission acquisition. However, the tax-adjusted operating profit is expected to grow by 41% to 50%, reaching HKD 790 to 840 million, driven by rising uranium prices [1][2]. - The report expresses optimism regarding the recovery of uranium prices, supported by policies promoting nuclear energy in the US and Europe, which are expected to create a supply-demand gap that will drive prices upward in the medium to long term [1][3]. Summary by Sections Earnings Forecast and Valuation - The earnings per share (EPS) forecast for 2024 has been revised down by 35% to HKD 0.05 per share, while the EPS for 2025 and 2026 remains at HKD 0.10 and HKD 0.14 respectively. The target price is set at HKD 2.00, based on a price-to-earnings (PE) ratio of 20x for 2025 [4][12]. Revenue and Profitability - The projected revenue for 2024 is HKD 9,919 million, with a year-on-year growth of 34.72%. The net profit attributable to the parent company is expected to be HKD 364.07 million, reflecting a decrease of 26.76% compared to 2023. The company anticipates a recovery in profitability with a projected net profit of HKD 764.89 million in 2025 [6][17]. Uranium Market Outlook - The spot price of uranium is expected to stabilize, having dropped from USD 76 to USD 65 per pound, while long-term contract prices have increased to USD 81 per pound, indicating ongoing supply-demand tensions in the industry. Key drivers for future uranium demand include regulatory changes in the US and potential shifts in Germany's nuclear policy [3][4].