Dear investors, dear analysts, good afternoon. Welcome to join us at China Gas Holdings FY 2022, 2023 Annual Results Announcement, Webcast, and Live Stream Meeting. Let me briefly introduce the management team with us. Mr. Liu Ming Hui, Chairman and President. Executive Director, Executive President, Mr. Huang Yong. Executive Director, MVP, Kevin Zhu. Executive Director, Vice President, Madam Cathy Liu. Vice President, Frank Li. Let's give the floor to Chairman President Liu Ming Hui for a few opening remarks.
Dear analysts, investors joining us online and offline, greetings. Welcome to join me at China Gas FY 2022, 2023 Announcement of Annual Results. It's such a pleasure to see you in person and over the cloud.
It's been three years. Once again, we're gathered here in Grand Hyatt for such an offline, face-to-face session. I know it's been three years apart. Great honor and pleasure to see many familiar faces here and offline. The communication had been impacted by COVID-19 in the last three years. I'm particularly happy to have the opportunity today to speak to you. I will report to you our annual results. Also our interpretation of the whole industry landscape. Not long ago, we have had a 20-year celebration event. At that occasion, we were really eager to invite many fund managers and analysts to join us in Shenzhen headquarter. I know many of you have managed to be there. Many more have not.
Back 20 years ago, I found the business, and the business went listed in Hong Kong, and it's been tremendous transformation over the last two decades. As a founder and frontline witness of the business, I've really eyed the business from zero to one, and the whole industry gradual expansion, as well as ups and downs throughout the past two decades. With our maturity, the industry also matures, and every time when I give an opening remarks, I know we're going to announce the annual results. Speaking of the occasion of a 20 anniversary this year, looking at the ups and downs, I think we have one more particular reason to celebrate, because we haven't seen each other in the last three years, and I thought today would be a deja vu.
However, after being in the industry for two decades, I'm very happy to see a major accomplishment of this industry, such a game-changing policy. A lot of the insiders call this game-changing policy an atomic bomb in the industry, many of us in the industry interpreted this latest policy as the price for the finished oil and gas price setting back many years ago. This policy has been well formulated, so taking the occasion of today's annual results announcement, we're going to have two sessions. In the first part, I'm going to give the floor to Mr. Huang to help us understand deeply about this game-changing policy, what it means for us, for the industry. In the second part, Kevin Zhu, as usual, will walk you through our annual results in the last financial year, as well as the guidance for the future.
Thank you very much. On behalf of China Gas Holdings, a great welcome and heartfelt appreciation, too.
We would like to have Mr. Zhu Weiwei to talk about our performance in the last financial year.
Good evening. Mr. Huang has spent a lot of time to interpret the very important policy that we have, and then I will talk about the performance. I will try my best to simplify my presentation, because the dollar margin side has already been thoroughly talked about. Let's look at the theme of the day. I would like to report the financial year of 2022 to 2023, and I will talk about our financial performance as well. First, let's look at the contents of the day. First, I would like to talk about the highlight of the company. Second, operational performance. Third, financial performance. 4, outlook of the company, we'll provide guidance. 5, references that we provide but are not elaborate on the reference part.... First, let's look at our business highlight. China Gas, in this financial year, has embraced good growth.
First, our net operating cash flow is good. Our net operating cash flow has reached HKD 10 billion. This is the best, our strongest in history. In the last 20 years, we always announced our annual result and talked about our cash flow and operating cash flow, but this year, we are reaching HKD 10 billion. Also, free cash flow, we are turning to positive, amounting to HKD 2.5 billion, which is also the highest in history. Last year, we are looking at negative HKD 2.3 billion. In the last financial year, in terms of management of cash flow, we have made a lot of effort, and that has yielded result. Compared to the previous financial year, we have a very strong growth for operating cash. This is the first highlight.
Second, we have Smart Living spin-off IPO. Smart Living focus on China's fastest-growing product and services to meet demand, expanding from kitchen-centered to household-oriented ones with significant potential. In the last three years, Smart Living has rapid growth and impressive performance. Now, with the spin-off in progress, as you have already noticed, our Smart Living IPO has already been granted by Hong Kong Exchange. We already made the disclosure on June 10th. That is the second highlight. Third, we have steady growth of natural gas business, despite the challenges that we mentioned in the financial year of 2022, as Mr. Huang has thoroughly explained. Our sales volume grew by about 7%. It is 6.9% year-on-year to 39.3 billion cubic meters. Also, our customer base continually grew. In this financial year, our residential users grew by 2.3 million.
Commercial and industrial users grew by 33,971, our cumulative residential customers has reached over 50 million, C&I customers, we recorded over 400,000. Our natural gas business grew steadily. Let's look at natural gas. In terms of sales volume, as you can see, that the context is that China's natural gas consumption, for the first time, decreased, China Gas sales volume grew by 6.9%. Let's look at the mix. First, city and township gas, we grew by 5% to 23 billion cubic meters. For direct supply pipeline and trade, we increased from 14.7 billion to 16.25 billion cubic meters. Let's look at the mix of users. Residential grew by 14%, reaching 8.38 billion cubic meters.
Industrials grew by 3.8% to 11.21 billion cubic meters. Commercial, down by 2.1% to 2.89 billion cubic meters, while gas stations down by 35.6% to $0.52 billion . You can see that for residential and industrial users, it is growing, but commercial and gas station, it is below the average of the company, mainly driven by pandemic's implications. As we all know, financial year of 2022 to 2023, the country was affected by the pandemic, and that has posed negative implication to the economy. We are looking at the Spring Festival and also the implication for heating season, that it has posed some implications for our growth. Gas station decrease, that is common in the industry because that it is affected by the growth of new energy vehicles.
Also, in the last financial year, gas station decreased quite deeply. That is also partly due to the pandemic and the economic downturn. That has posed some negative impact. Now, let's look at those gas sales breakdowns. 48.7% comes from industrials, 12.6% comes from commercial, 36.4% comes from residential users, and 2.3% comes from gas stations. Let's look at dollar margins. Last year, our residential, commercial, industrial, and CNG, LNG stations combined has posed 2.71, 3.63, 3.69, and 4.31. Our average selling price is CNY 3.32, and average procurement unit cost, CNY 2.9. Average dollar margin is only CNY 0.42. Compared to the CNY 0.50 last year, it is down by CNY 0.08.
There are various reasons for the drop of dollar margin, as Mr. Huang has talked about. There is a price hike of procurement cost. We have a gap for the lack of contract-based volume. We have to procure expensive gas source. It is difficult to pass through the cost. I can give you some numbers. In the last financial year, during the heating seasons, the average procurement cost increased by 41%. Non-heating season, it had increased by 27.5%. The supply of LNG takes up of about 10% of the supply. The procurement cost for LNG is a different story. It is CNY 6,445 per ton. It has increased by about 25%. That is a very dramatic increase.
That has affected our consolidated procurement costs and further affect our dollar margin. We also have some positive upside for the dollar margin growth in the future. First, the natural gas price is stabilizing and moderating, and the upstream companies have also adjusted their contract-based volume, so our procurement cost is decreasing, and we are also looking at frequent introduction of favorable policies, as Mr. Huang mentioned. The most important one is the NDRC's notice on medium and long-term contracting of natural gas in 2023. Hubei and Hebei provinces have already initiated the pass-through mechanism. They have released their local policies, and if we're looking at Hebei, they have the work plan of natural gas supply security in heating season. Also, we are looking at the upstream, downstream pass-through of natural gas prices on a nationwide. These policies are favorable upside for the company.
NDRC has made the notice and states that separate contract of natural gas for residential use between upstream and downstream gas companies are required, and coal to gas supply in rural areas should be incorporated in residential supply. In addition to that, as Mr. Huang has elaborate on that, I will not give further explanation. In terms of the pass-through mechanism, that will help us to stabilize and increase our dollar margins. This mechanism, this policy, is recently introduced to the market. Hubei and Hebei start to implement the policy, and in addition to that, I would say, Inner Mongolia, Hunan, Anhui, Chongqing, Nanjing, these localities already revise up their residential gas price. There is a price increase of CNY 0.40 already in place. Another CNY 0.10 are expected for the heating season. In Nanjing, it is increased by CNY 0.42.
We already asked our subsidiaries in different localities to obtain such mechanism and also to improve the mechanisms to pass through the cost. We fully promote cost reviews to keep our distribution returns in line with the 7% return guidance. We also work to obtain subsidies from local governments for the pass-through delays of residential gas prices. These are the holistic approaches that we have taken to improve and recover our dollar margins. With all these efforts, we expect that we'll be able to pass through the cost and to form a long-term mechanism for timely reflections of changes in procurement cost. There will be a new normal for frequent price adjustment and fair dollar margin for downstream companies, with reasonable distribution returns can be guaranteed. There will be a good dollar margin for residential gas use in the future.
As I said, residential use takes up a huge proportion. It is above 30% of our gas mix now. With these policies in place, I believe that China Gas will be the biggest beneficiary. Let's look at our LNG business. In LNG, we are looking at resources coordination, prioritize for constant growth. China Gas is one of the China's largest LNG distributors. In the last financial year, we have worked with our partners to improve our supply and also expand our market. First, in terms of import, we built our own LNG resource pool of international import. We signed SPAs with Energy Transfer LP. We signed a SPA lasting 20-25 years, with a total LNG supply of 1.7 million tons per year.
We also signed with another US supplier, Venture Global, for two SPAs, with a total LNG supply of 2 million tons per year. In total, it is 3.7 million tons of supply. With SPAs, you might be also looking at other aspect.
Port terminals, and also right of use of terminals and window period. Right now, we have Beihai and West Port of Yantai. We have the right of use of the LNG terminals there. We have also applied for and was granted 12 mid and long-term windows at the PipeChina's LNG terminals. We also signed agreement with Beijing Gas Group and obtained stable slot at Nangang Port of Tianjin LNG terminals. This is what we have achieved in terms of facilities and infrastructure.
As you can see, these arrangements do not really increase our CapEx and our fixed asset investment. All of them are light assets, and we never have actually spent such heavy investment on the fixed access, so it's very successful investment, how we build our resource pool.
In terms of international traders, we now have already built a trade platform in Singapore to engage in global trade business. A lot of these long-term contract are in fluctuation. It will be linked to the energy index. We're going to have the domestic market versus the international market to properly allocate our resource. We definitely will not resort to the import model 100%. We're going to develop a trade platform to engage in LNG global trade. We will develop a long-term agreement, plus spot goods linked with price indexes against risks in international procurement. In the future, we're going to have linked with other price indexes. Not only with the Henry Hub, we will offset the risks in international procurement by signing and linking with more price indexes.
Now, speaking of creating a vertically integrated industry chain, we expanded the retail market, now we have supply of LNG to nearly 1,000 external C&I users and third-party city gas companies. We have the largest hazardous goods truck fleet for higher efficiency of transport, and we will continue to fine-tune that. With that as a foundation, now, with the full price pass-through, if by relying on import to further decrease the procurement cost, we will definitely get additional dollar margin and higher distribution return. Now let's look at connections. As I said, for residential users, we have a new connection of 2.3 million, down by 640,000, by 22%. Among which, urban connections, 2.1 million, township rural connections, 227,000 households. Where are the decrease?
It's from the township and rural coal to gas. All of together, we have over 45 million connections. In term of the industrial users, we increased by 2,300 new industrial users. Altogether, we have 22,108 industrial users this year versus the 19,000 last year. Speaking of the cumulative commercial users, we have 31,671 new industrial users, making the total of 329,000. Now, if you look at the residential connection fee, it's quite stable. For city gas project, it is over CNY 2,400, and for rural township gas projects, it's about CNY 3,000, so with no major changes.
If you look at all of our connectable residential users, it's about 53 million, with a penetration of almost 70%, 68.6%, to be exact, for the city gas projects. You're possibly looking for a reason for a 22% down for the connections. Why? First, I have to say COVID-19 pandemic had hit hard on our business and connections. Second, we have proactive shrinkage of business to better manage our cash flow. In order to have better accounts receivable, we proactively controlled our investment, in particularly on the township and rural coal to gas connections, which also contributed to the downwardness. For the 40% down of the construction rate in the real estate developing, that of course has impacted on our business in the new connections.
That's are the reasons for the 20%+ decrease for the reductions in new connections. Here on this map, you see that we have 661 piped gas projects in 15 provincial capital cities. Let's talk about VAS. Smart Living, as I said, it has now been listed as a spin-off. We have a Smart Living and the traditional platform. The traditional platform, of course, works with the government, sales, the value-added products, as well as the maintenance for the households. This is not part of the Smart Living business. Let's look at the VAS as a whole. From HKD 4.79 billion last year, the revenue have a 28% down to HKD 3.46 billion this year.
The VAS profit before tax only went down by 6.5%, from HKD 1.6 billion to this year's HKD 1.5 billion. Why? Yes, the pandemic is definitely there to hit hard on the revenue. Some of the businesses for VAS had not been fully implemented because of quarantine of COVID-19 for almost 2 months. There are about HKD 310 million of impact from that. Second, rural coal to gas, basically, no new connections, and the connections went down. That has slowed down the business growth for VAS. That contributed for about HKD 430 million, and the new connections went down, especially impacted on the connections in new households, developing projects by 110%, HKD 110 million. There's a RMB depreciation of 7% against Hong Kong dollars.
You ask why the VAS revenue went down so much, but the VAS profit before tax didn't go down that much. Why? First, we continue to fine-tune our Smart Living business, especially the mix of the security and smart lives products. These are high-premium products. We continue to change the business model of the VAS. Versus the past, now we're building more grid-based new retail of private domain stores, the community stores. We have invested in a digitalization platform. Given the adversity of COVID-19, we also have seen increased transportation and logistic costs. All that combined, the VAS profit before tax only go down by 6.5%.
For Smart Living, I guess it is now focusing on kitchen appliances and safety products and high-frequency products, including services like the home services, gas services, well-mounted furnace cleaning and wrench hood cleaning, and low-carbon solutions. Speaking of the safety products, we also provide the integrated IoT platform to make sure these kitchen appliances, the smart meters, and the pipeline equipment, the fleets, can all be well connected on our IoT for smart control. That's for Smart Living. What kind of services does it do, and what's the business model? For Smart Living, in addition to these businesses, we also have full coverage, and we even have restructured Smart Living's businesses. The VAS business for China Gas has been so mature over 20 years of development, and now we have almost become the benchmark in the whole industry.
For VAS management, supply chain, services, training, and digitalization, we continue to provide solution to other users. In the mid and short-term goal, we want to become a VAS operator and service provider in Guangdong, Liaoning, Guangxi, Shandong. In these provinces, including Beijing, Tianjin, Hebei, we have signed with 50 extra domain users. Our mid-long-term goal is to become a VAS operator and service provider for the public utility sector, to gradually expand our market from local gas companies to other utility users. You can see from the map the coverage of our extra domain businesses, including Beijing, Tianjin, Hebei, Sichuan, Chongqing, Yangtze River Delta, and Pearl River Delta. Across these regions, the companies we work have been so vast in numbers. That's on Smart Living, on the basic products and services, as well as extra domain. Now, let's move on to LPG.
LPG, of course, China Gas is China's only operator with resources and distribution network. In the last three years, the sales volume were quite stable. Last financial year, 4.26 million, among which we have wholesale and retail. We have 735,000 for retail, and we have 3.39 million for wholesale. If you look at the revenue versus the previous financial year, it went down by 2.5%. Why? Because of the prices for LPG and operating profit, we definitely make improvement from HKD 32 million to HKD 70 million. In terms of resources, businesses, we, in the last financial year, have done much work, including the terminals resources, the VLGC warehouses building, the vessels and logistic resources.
Speaking of the upstream, midstream, downstream coordination, we have definitely expanded our international procurement and domestic contribution competitiveness. We also built our retail network and customer service capability. Of course, you have looked at the LPG favorable policies from the Chinese government relating to safety and workplace safety, the government, of course, is now fine-tuning the bottled LPG market that provides us some expansion opportunities in the downstream market. Definitely, we can achieve scalable business operations through light assets investment, and that will further improve our LPG sales in the future. That's for LPG. Here, you see a map reflecting three of the latest added warehouses, as well as the storage and sales volume. These projects are located in Taixing, Jiangsu, Quangang in Fujian, and Dongying in Shandong.
All these three projects in construction and operation will bring us almost 3.5 million tons a year of increase, among which Taixing and Quangang, in this financial year, had already been in operation, contributing to sales volume. Taixing is now having a pilot, and Quangang terminal is going to function in August. Taixing is about 1.5 million, and Quangang about 1.3 million tons a year or so. As you notice from the statistics, over the three years of LPG sales, it's quite stable, standing at 4 something million. After these three terminals and port, definitely, we're going to further increase the sales volume of LPG. That's a briefing on new project.
We are working on vertical C&I integration to boost sales and volume and DM of LPG. In the upstream, we work on channels for direct procurement in places of origin. We boost our cooperations with domestic oil majors and traders to increase supply. In addition to that, we have seven LPG terminals and preferential access to storage facilities and import terminals. We have enhanced our purchasing and storage capabilities and expanded business coverage. We also kept procurements, schedules, and proportions flexible to boost international procurement and trade. Here, it will helps us for the cost control. In the midstream, we are looking at building domestic transport and trade platform to boost domestic distribution. We are also working on raw material gas supply. The three terminals that I mentioned, first, will supply the industrial use, especially in raw material gas.
We also enhance our cooperation with deep processing companies to become more competitive in the trading and also to improve our infrastructure. We will utilize this infrastructure to conduct residential and commercial trading. We have also worked with our suppliers to increase our bargaining power because we have more capacity. It also further helps us to cut operational cost and improve our distribution and network. In the downstream, we have innovative business models. We are promoting our end market with asset light method. We also expand our fuel truck networks and broadened business footprint. These are the measures that we have taken up in LPG. Integrated energy service. In this segment, we have coordinated supply and closed loop management among gas, heating, and electricity in source, network, loading, storage, and more. First, distributed PV. Second, smart parks and energy efficiency. Third, green transport. four, electricity.
These are the four project highlights that we have achieved in the last financial year. In addition to that, we have also made headway in zero-carbon policy. We built the Carbon Research Institute with Shanghai Environment and Energy Exchange. Its priority is to integrate top-gap resources and work with other parties, as well as governments, to build industrial chain and to demonstrate our dual carbon strategy. We'll build a green ecosystem. In terms of heating in Southern China, we are also adjusting our strategies, working toward green transformations and carbon reductions. We're primarily looking at the knit to downstream of Yangtze River to provide heating and consolidated services. These are the achievements in the integrated energy services. I would like to talk about the carbon management platform. In the future, we want to become China's operator of green cities.
Operator of green cities, meaning that China Gas aims to improved for the connectivity of human resources, facilities, and materials to improved our capabilities, and further, to provide a platform for green cities buildings. We will facilitate the low carbon and sustainable development for different parts. In addition to that, we have different scenarios. We will combined energy, urban rejuvenations, and other segment together. We'll cut into this segment from resources and energy, and we'll combine the different element together. We are promoting a D+E carbon meter system to power dual carbon businesses, and this will also power the project development. D means digitalization, E means energy. This is a consolidated platform. With this platform, we cut into the business from energy's perspective to promote full resources, full cycle development. We will be able to serve industrial parks and other similar customers.
That is our vision and explanation on green cities. You may ask, what is carbon meter? The definition is that we are actually doing the calculations of carbon emissions. We also have pipes business. As you understand, pipe industries has gas meters, electricity business has electricity meters, while heating industries provides heat meters. All these meters combined are carbon meters. We'll use our own calculation formula for the calculation of carbon emissions, and we can consolidate clients' data to proactively provide similar research and development. This is our understanding on carbon meters. The final goal, as I mentioned, is to build green cities. We want to be operators of green cities, this is the segment explanation of our performance. Let's look at the financial performance, I believe it is to many of your interest. First, let's look at consolidated income statement.
We increased our revenue by 4.3% to HKD 91,988 million. As you can see, among that, we have reached HKD 57,550 million for natural gas sales, up by 13.9%. Gas connection, HKD 5,686 million, down by 21.3%. Engineering design, HKD 1,089 million, up 85%. LPG sales, HKD 22,499 million. Value-added services, HKD 3,455 million. Other business contributes to HKD 1,706 million. Gross profit for the last financial year is down by 23.5% to HKD 12,034 million. The reasons has already been explained previously.
With the substantial DM declined, it is affecting our companies, in total, it is impact on gross profit of HKD 1.75 billion. Among that, fifth point, HKD 0.56 billion is coming from coal to gas. Dollar margin declined. If we look at the decline of the segment, the majority is coming from DM declined, and the second reason is the decline of connection growth, and the third reason is exchange rate. Depreciation to RMB has an impact of gross profit of HKD 990 million. Let's look at the indicators. Our profit for the year, HKD 5.114 billion. Profit attributable to the owners of the company, HKD 4.293 billion. We also have factors influencing net profit growth. Financial costs, of course.
In the second half of this financial year, we have experienced the eight consecutive interest rate hike from US Fed. We have about 27% of foreign currency debt. There is a year-on-year increase of HKD 399 million, owing to the general surge in the cost related to foreign currency debt. In addition to that, we have operating cost increase. As I mentioned, that the dollar margins, the implication for the consolidated and standalone income statement. If we look at a decrease of about 1.2%, HKD 1.2 billion of decrease, that is also due to decline of connection growth and also due to Zhongyu Gas. Its profit is down dramatically. About HKD 550 million comes from foreign exchange loss.
share of Zhongyu's revenue also went down. Its implication is about HKD 200 million. In combined, it's HKD 1.2 billion. JVs and subsidiaries' performance also affect the consolidated income statement, and it is down for several reasons, as mentioned. If you look at the consolidated income statement, the EPS is about CNY 0.8. The full year dividend per share is HKD 0.50. Last year, it was HKD 0.55. If we also take into account the foreign exchange, we are flat with last year. In this financial year, as the board has granted, we will give the full year dividend of HKD 0.50, and the dividend payout ratio is 62.5%, which is among the highest in the industry, up by 23 percentage points compared to last year.
It fully reflect that the board has confidence for the resumption of business in the future. I would say the payout ratio has made a huge industry record, despite the profit decrease. After adjusting the foreign exchange implication for the dividends, we are flat with last year. This is the return for shareholders. Let's look at the balance sheet. Our total asset is HKD 157 billion. Total equity, HKD 64 billion, and cash at hand, HKD 10.617 billion. Short-term bank and other borrowing, HKD 21.9 billion. After deducting the foreign exchange implication, you can see the net gearing ratio stands at 76%.
The total asset, net asset, has decreased also due to foreign exchange lot, because we have made the money, but still, after 8%, the gap is 8%. It has resulted in the decrease that you can observe from the balance sheet. Cash flow, as we mentioned just now, we have very strong cash flow, which is up. If you look at net cash from operating activity, it's up 1.5%. Net cash using investing activity is down by 38.5% year-on-year. We are comparing on different benchmark. We are increasing our cash flow because we have a very good management of operating cash. Among that, we have AR and AP, and contracted sales.
Account receivable and contract assets decreased by HKD 3.98 billion year-on-year, of which account receivable of rural coal to gas project substantially reduced by 46.1%. We have made effort on the AR collections. If you look at investing activities, we only have HKD 7.51 billion this year compared to the HKD 12.21 billion. It is down by 38.5%. As you can see from the slide, we have reduced the investment for fixed asset. We also have the one-off investment for HKD 1.37 billion last year, we don't have it now. That is my explanation on net cash used in investing activities. In result, we have a very good operating cash this year compared to last year. It is positive this year.
Let's turn to the management of foreign currency debt. As I also mentioned previously, the percentage of foreign currency debt is down from 30.7% to 26.1%. We are basically have all paid off the short-term foreign currency debt, and we are still working on the rest. The cost related to Hong Kong dollar and US dollar denominated debt is high, so we'll further suppress that percentage to below 20% in the upcoming financial year. That is our prudent foreign debt management. Let's look at other element. Because of the increasing cost related to foreign debt, our consolidated financial cost has increased. That is also partly due to the HKD 300 million increase of financial cost, but now we have abundant financial resources, standby credit of HKD 111.4 million of credit.
For the looks, Mr. Huang, when we introduced the policy, we shared with everyone that the darkest moment is behind us, and we have in front of us a bright future. Let's look at the guidance. dollar margin will be CNY 0.56 per cubic meter. I know that all of you are very interested to see April and May, what's the dollar margin during that period? In April, dollar margin restored to CNY 0.48 from CNY 0.42. In May, we have restored to a level of CNY 0.54, so it's a very good recovery. For the sales volume, about 10%. Of course, that has been quite in line with other peers for new residential connections between 1.8 million-2.0 million households.
VAS gross profit or profit before tax growth, 25% up, and LPG sales volume, 4.5 million tons. Given that guidance, our profit growth will have 30% in this coming financial year. Where does that 30% profit growth come from? Let me break down for you on the calculation of the gross profit. Let's say, if the dollar margin reached RMB 0.56, with the 10% growth of city and township gas sales volume, we know that we will increase the gross profit. For VAS, if it grows by 25%, we're going to have HKD 500 million gross for the revenue. For LPG, of course, we will have increase of revenue.
For the connections, if we have 1.8 million households, that's about RMB 840 million. The last year, it was RMB 2.3 million, right? If we have a connection of 1.8 million, we're going to see the revenue amounting to RMB 8.4 million. All of that combined will contribute to a profit growth of 30%. In this financial year, you're going to see the full recovery of the business with the price pass-through favorable policy. I know you all are concerned about CapEx. Last financial year, about RMB 7 billion. This financial year, our CapEx will be below RMB 8 billion, RMB 4.5 billion for city gas projects. In M&A, RMB 500 million-RMB 1 billion. Comprehensive energy, RMB 1 billion-RMB 2 billion. LPG, RMB 500 million.
The total CapEx, below HKD 8 billion. That's our forecast and outlook for the financial year 2023 to 2024. Thank you. Thank you.