Consolidated Net Profit Increases by 443.94% to RMB1.87 billion
BEIJING, Aug. 11 /PRNewswire-Asia/ -- Huaneng Power International, Inc. (the "Company") (NYSE: HNP; HKEx: 902; SSE: 600011) today announced the unaudited operating results for the six months ended 30 June 2009.
For the six months ended 30 June 2009, the Company and its subsidiaries recorded consolidated operating revenue of RMB33.61 billion (equivalent to approximately USD4.92 billion), representing an increase of 9.07% as compared to the same period of 2008. The profit attributable to equity holders of the Company was RMB1.87 billion (equivalent to approximately USD274 million), representing an increase of 443.94% as compared to the same period last year. The earnings per share was RMB0.16, and the profit per American Depositary Share (ADS) amounted to RMB6.21 (equivalent to approximately USD0.91).
During the first half of 2009, under the macroeconomic control policies of "promoting domestic demand, maintaining growth and readjusting structure", the national GDP grew at a rate of 7.1%, indicating that the national economy began to pick up steadily. However, the outlook of the international economy is still uncertain and so the external environment for the PRC's economic development is still severe. The Company actively coped with the new changes of the national and international economic situations and achieved new developments in various aspects including production safety, cost control, energy saving, environmental protection, project development and capital operation.
Power Generation
During the first half of 2009, the Company's power plants within China achieved a total power generation of 86.107 billion kWh based on a consolidated basis, a decrease of 5.84% over the same period of last year. The decrease in power generation was mainly due to the following factors: the declining power demand in the domestic power market due to the impact of the international financial crisis; and a negative growth of the Company's power generation due to the reduction of average power generation utilization hours for a majority of areas in the PRC as a result of the continued commencement of operation of new generating units. As at 30 June 2009, Tuas Power Ltd. in Singapore achieved a total power generation of 4.723 billion kWh, representing a decrease of 6.32% compared to the same period of last year.
Cost Control
Since 2009, coal supply tended to be eased from a tight situation. There were slight price fluctuations in the domestic coal market, and coal prices were clearly lower than those of the same period of last year. International demand for coal was weak and prices continued to fall. Under the circumstance that key contracts have not been signed up, the Company adopted various measures including optimizing the coal supply structure, increasing imported coal purchase volume and rationalizing inventories arrangements according to production requirements, with an aim to reduce average coal purchase prices. The unit fuel cost for the domestic business of the Company for the first half of the year was RMB220.82/MWh, representing a decrease of 2.63% compared to the same period of last year.
Energy Saving and Environmental Protection
The Company attaches great importance to energy saving and environmental protection work. All the newly built generating units are equipped with flue-gas desulphurization facilities and the Company has strengthened renovation of environmental protection facilities on the existing generating units. As at 30 June 2009, the installed desulphurized generating units of the Company accounted for approximately 93% of the installed capacity of the existing coal-fired units of the Company.
Project Development and Construction
To date, three projects of the Company have obtained the approval of the National Development and Reform Commission, namely, two 300MW-level co-generating units at Yingkou Co-generation Power Plant Project, one 200MW generating unit at Ganhekou Second Wind Power Plant Project and the second 600MW coal-fired generating unit of Jinggangshan Power Plant Phase II Project. The Company has made smooth progress on its construction projects and preparation work of other proposed projects.
Capital Operation
On 21 April 2009, the Company entered into the Yangliuqing Co-generation Power Plant ("Yangliuqing Co-generation") Equity Interest Transfer Agreement and Beijing Co-generation Power Plant ("Beijing Co-generation") Equity Interest Transfer Agreement ("Transfer Agreements") with China Huaneng Group ("Huaneng Group") and Huaneng International Power Development Corporation ("HIPDC"), respectively. According to the Transfer Agreements, the Company will be transferred a 55% equity interest in the registered capital of Yangliuqing Co-generation and a 41% equity interest in the registered capital of Beijing Co-generation. The transfers were approved at the shareholders' meeting of the Company on 18 June 2009. Currently, the transactions are waiting for the approval by the State-owned Assets Supervision and Administration Commission. After the completion of the transfers, the Company's operating scale and service areas will be enlarged and its profitability will be increased, thereby further consolidating the position of the Company as one of the largest independent power generation companies in the PRC. The Company's installed capacity will be increased by 1,006.45MW on an equity basis.
In the second half of 2009, the national economy will continue to grow at a relatively fast pace, thus providing a favourable external environment for the Company. The State will continue to deepen electricity tariff reforms, gradually improve the pricing mechanism of on-grid electricity tariffs, electricity transmission and distribution tariffs and electricity selling tariffs, and timely rationalize the contradiction between coal and electricity, thereby creating the conditions for easing the operating pressure of the Company.
Meanwhile, the Company still faces various difficulties and challenges in its operation. Given that there is an increase in the number of newly operated generating units nationwide in 2009, the power supply and demand situation will be further eased, the utilization hours of coal-fired generating units nationwide will continue to decline, and internal competition of the power generation industry will intensify, thus further increasing the operating pressure of the Company. Coal prices will still hover at high levels and annual key contracts have not been signed up, and these uncertain factors will, to a certain extent, affect the production safety and profitability of the Company. Meanwhile, with the continued strengthening of environmental protection by the State, environmental protection standards are upgraded continuously, which will exert pressure over the control of the production and operating costs of the Company. Lastly, the State is in the process of adjusting the energy structure by focusing on the development of clean energy and renewable energy, thus putting forward stricter requirements for the development of new projects of the Company in the future.
While the Company will fully leverage its own advantages in terms of resources, scale, geographical coverage and costs, it will actively expand the room for development, strengthen marketing work, strive to fulfill the annual power generation plan, strictly control costs, endeavour to control unit fuel costs and increase the Company's profitability.
The major tasks of the Company for the second half of 2009 include: to strengthen safe production and management and to ensure stable operation of its generating units; to strengthen the sales force and to endeavour to increase the power output of the Company; to use the best endeavours to ensure a safe, stable and effective fuel supply and to strive to enlarge fuel supply channels and effectively control fuel purchase prices; to promote energy saving and emissions reduction work in full force and to actively carry out detailed management of energy consumption indices and an optimized operation of generating units; to strengthen internal management and to effectively control production costs; to actively push forward preliminary work of projects; to seize the opportunities of the State's adjustment of energy and transport strategy deployment by further optimizing power plants structure and adjusting their deployment; to strengthen the management of infrastructure construction, and to ensure safe, stable and economical operation of newly operated generating units whilst meeting the requirements of energy-saving and environmentally friendly generating units; to actively explore financing channels so as to ensure funding support for the scale development of the Company.
Huaneng Power International, Inc. wholly owns 17 operating power plants, and has controlling interests in 13 operating power companies and minority interests in 5 operating power companies in the PRC. The Company's power plants are extensively located in 12 provinces and 2 municipalities. In addition, the Company wholly owns one operating power company in Singapore. Currently, the Company has a controlling generation capacity of 40,939MW and a total generation capacity of 39,203MW on an equity basis and is one of the largest listed power producers in China.
For any details regarding the interim results, please refer to the following websites:
Hong Kong Stock Exchange: http://www.hkexnews.com.hk
The Company: http://www.hpi.com.cn and http://www.hpi-ir.com.hk
For the unaudited consolidated balance sheet and consolidated statement of comprehensive income of the Company and its subsidiaries as at and for the six months ended June 30, 2009, prepared in accordance with International Financial Reporting Standards, please visit: http://www.prnasia.com/sa/attachment/2009/08/20090811-914028.pdf
For enquiries, please contact:
Ms. Meng Jing / Ms. Zhao Lin
Huaneng Power International, Inc.
Tel: +86-10-6649-1856 / 1866
Fax: +86-10-6649-1860
Email: zqb@hpi.com.cn
Ms. Janet Lai / Ms. Christy Lai
Rikes Hill & Knowlton Limited
Tel: +852-2520-2201
Fax: +852-2520-2241