AAG Energy Holdings Limited reported unaudited consolidated earnings results for the six months ended June 30, 2018. For the period, the company reported revenue of RMB 430,501,000 compared to RMB 225,631,000 a year ago. Profit from operations was RMB 290,939,000 compared to RMB 128,847,000 a year ago. Interest income was RMB 11,923,000 compared to RMB 3,405,000 a year ago. Profit before income tax was RMB 289,143,000 compared to RMB 119,562,000 a year ago. Profit attributable to owners of the company for the period was RMB 205,698,000 compared to RMB 63,694,000 a year ago. Basic and diluted earnings per share was RMB 0.061 compared to RMB 0.019 a year ago. Net cash generated from operating activities was RMB 75,349,000 compared to RMB 191,612,000 a year ago. Purchases of property, plant and equipment and intangible assets were RMB 229,417,000 compared to RMB 281,479,000 a year ago. EBITDA was RMB 367,554,000 compared to RMB 176,126,000 a year ago. Adjusted EBITDA was RMB 380,068,000 compared to RMB 189,693,000 a year ago. The increase in EBITDA was primarily due to increased revenues (which included directly attributable pass through costs billed to customers), subsidy and VAT refund for Panzhuang and Mabi, offset by increased materials, services and logistics expenses for Panzhuang and Mabi as a result of the new accounting standard to include directly attributable pass through costs, and Mabi recognizing more operating expenses after the signing of the exploration sales contract with effect from 1 July 2017. Interest income increased by 250.0%, primarily due to more interest earned as result of cash deposited into longer periods and higher interest rates. Profit before income tax increased by 141.7% due to the factors affecting EBITDA and reduced finance costs, but partially offset by increase in depreciation and amortization expense.

During the first half of 2018, the group's gross gas production increased by 30% to 381.2 million cubic meters (‘MMCM') (13.5 billion cubic feet (‘bcf') (comprising Panzhuang's gross production of 331.3 MMCM or 11.7 bcf and Mabi's gross production of 49.9 MMCM or 1.8 bcf) compared with first half of 2017. Total average daily production was 2.11 MMCMD compared to 1.62 MMCMD a year ago.

The group's 2018 planned capex will decrease from the original plan of approximately RMB 890 million (comprising approximately RMB 320 million in Panzhuang and RMB 570 million in Mabi), to approximately RMB 490 million (comprising approximately RMB 320 million for Panzhuang and RMB 170 million for Mabi).