Towngas dividend
MyStockButler's October 2026 analysis: Towngas paid HK$0.35 per share from 2022 through 2025. Its 2025 dividends of HK$6,531.0 million exceeded free cash flow of HK$3,339.4 million.
How much does Towngas pay per share?
The base dividend remains HK$0.35 per share throughout. That matches the distribution record from 2022 through 2025. The bear case holds HK$0.35 in 2027, then cuts it to HK$0.30 and HK$0.25. The bull case keeps HK$0.35 in 2027 before increasing it to HK$0.36 and HK$0.37. The bear reflects funding pressure: 2025 dividends of HK$6,531m exceeded free cash flow of HK$3,339.4m.
| 2025 | 2024 | 2023 | 2022 | 2021 | |
|---|---|---|---|---|---|
| EPS, diluted | 0.30 | 0.30 | 0.32 | 0.26 | 0.27 |
| Real free cash flow per share | 0.18 | 0.00 | -0.00 | 0.00 | 0.07 |
| − Dividends paid, per share | 0.35 | 0.35 | 0.35 | 0.35 | 0.34 |
| = Paid out more than FCF, per share | 0.21 | 0.38 | 0.39 | 0.38 | 0.30 |
What this means. The company paid shareholders more cash than it generated from its business, so it had to use money from elsewhere.
How much would Towngas's dividend pay you?
HK$10,000 invested in Towngas at its 4.8% dividend yield (our report of October 21, 2026) pays HK$480.00 in the first year, before tax. If its dividend per share keeps changing 0.7% a year, as it did from 2021 to 2025, and the dividends are reinvested, year 10 pays HK$790.88, with HK$6,227.21 received in all.
Before tax. Past dividend growth is not a promise. Information only, not investment advice.
Is Towngas’s dividend covered by its cash?
Free cash flow is the cash left after operating and investment needs. When dividends exceed it, the difference must come from reserves, asset sales, borrowing or another financing source. Towngas paid HK$6,531.0 million of dividends in 2025 while its free-cash-flow measure was HK$3,339.4 million. A profitable company can make that choice, but less cash remains for new projects or debt reduction.
In 2025, Towngas generated HK$10,533.0 million from operations. Capital spending was HK$5,096.3 million, leaving free cash flow of HK$3,339.4 million after lease and interest payments. Deducting HK$63.9 million of stock pay produced “real free cash flow,” which treats employee share awards as an economic cost to owners.
| 2025 | 2024 | 2023 | 2022 | 2021 | |
|---|---|---|---|---|---|
| Free cash flow | 3,339.4 | 51.6 | -35.1 | 27.2 | 1,286.4 |
| − Dividends paid | 6,531.0 | 6,531.0 | 6,531.0 | 6,531.0 | 6,326.6 |
| − Share buybacks | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| = Paid out more than the free cash flow | 3,841.2 | 7,073.8 | 7,228.7 | 7,128.3 | 5,652.4 |
| Paid out, % of free cash flow | 195.6% | 12,657.0% | not meaningful | 24,011.0% | 491.8% |
| Paid out, % of real free cash flow | 199.4% | 12,657.0% | not meaningful | 16,046.7% | 506.2% |
What this means. The company paid shareholders more than its free cash flow in every year shown, so it had to use savings or borrow money to cover the difference.
What could change Towngas’s dividend?
Management guides mainland gas-volume growth of 1.0% for 2026. It targets a city-gas dollar margin of RMB0.55/m³. Hong Kong gas volume is guided down 2.3%. Connected PV capacity, solar panels that convert sunlight into electricity, is targeted at 3.8 GW, with generation at 3.05 billion kWh. After the August 2026 tariff increase, Towngas promised no further basic-tariff or monthly maintenance-charge changes for two years.
Through August 2028, the Hong Kong tariff pledge will test how much mature-network earnings can grow without further basic-tariff changes. Weak renewable returns, elevated debt or poor cash conversion would reinforce the bear path.
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| Earnings | 6,400 (6,000 / 6,700) | 6,656 (5,700 / 7,236) | 6,922 (5,415 / 7,815) |
| Shares (millions) | 18,660 (18,660 / 18,660) | 18,660 (18,660 / 18,660) | 18,660 (18,660 / 18,660) |
| Dividends per share | 0.35 (0.35 / 0.35) | 0.35 (0.30 / 0.36) | 0.35 (0.25 / 0.37) |
| Price to earnings | 19.00 (15.00 / 22.00) | 17.00 (13.00 / 22.00) | 15.00 (11.00 / 21.00) |