Towngas finances projects via external investors, easing cash and capital burdens, CIO says

Hong Kong and China Gas Company (0003), or Towngas, has entered a mature stage of new business development and will finance projects through external investors rather than raising capital, said its executive director and chief investment officer, Alan Chan Ying-lung.

Chan said the company has been actively developing new businesses in recent years, including green methanol, hydrogen energy, sustainable aviation fuel, and extended businesses.

He said the renewable energy business has received US$300 million (HK$2.34 billion) in investment and US$900 million to US$1 billion for SAF. Towngas' extended business arm, Towngas Lifestyle, which specializes in kitchen appliances, home appliances, and related products, has also secured US$45 million in financing. Chan added that bringing in third-party investors as supervisors can speed up business development and reduce cash-flow pressure.

He further stated that new businesses such as green methanol, Towngas Lifestyle, and SAF have now been established as independent companies, each at different stages of development. If there are new capital plans, they will be announced at an appropriate time when the conditions are right.

Chan also noted that Towngas receives approximately one thousand project proposals every year. The company also nurtures young companies through investments, but he emphasized that new projects will not impose cash or capital pressure on the company.

Edmund Yeung Lui-ming, chief financial officer at Towngas, stated that Towngas's operations are currently divided into two main categories: core businesses and growth businesses, which account for 90 percent and 10 percent of profits, respectively. He anticipated that in about four to five years, the contribution from growth businesses would rise to 20 percent to 25 percent.
 

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