Longyuan Power Announces 2015 Interim Results



  China Longyuan Power Group Corporation Limited held a presentation for its 2015 interim results in Hong Kong.Qiao Baoping, Chairman of the Board, Secretary of Party Leadership Group of China Guodian Corporation and Chairman of the Board of China Longyuan Power attended the meeting and delivered an address. Xie Changjun, Deputy President and member of the Party Leadership Group of China Guodian Corporation and Chairman of the Board of Supervisors of China Longyuan Power, also attended the meeting; Li Enyi, General President Assistant of China Guodian Corporation, General President and Executive Director of China Longyuan Power attended the meeting and briefed the attendees on the business performance of the Company in the first half of 2015. Personnel present at the meeting were also secretary of the Board of Directors, General President Assistant and related department heads of China Guodian Corporation as well as directors and supervisors, secretary of the Board of Directors, chief accountant of China Longyuan Power.


  In his address, Qiao Baoping pointed out that China Longyuan Power had conscientiously implemented the core strategy of “One Objective, Five Chapters and Five Guodian New Strategy and New Concept,” positively dealt with the new normal of the business development and spared no efforts to boost all kinds of work. As a result, it had maintained the good business development momentum. The Company will continue devoting itself to the sound development of the new energy industry, the global energy conservation and emission reduction and the low carbon economy, as well as the protection of ecological environment and the construction of the Beautiful China. It will promote its project development, constantly enhance its development quality and economic benefits and comprehensively increase its operating management level and general strength. It will speed up the listing of itself as a internationally first-rate new-energy company to return all shareholders and investors with better benefits.

  In the first half of 2015, the Company achieved notable results in the following aspects:


1)  the efforts to maximise potential profitability led to remarkable business results. In the first half of 2015, the Company adopted multiple measures to develop potentials and increase profits such as innovative budge management, strengthened financial management and effective marketing, thus achieving a significant growth in profits. In the first half of this year, the operating revenue of the Group amounted to RMB10,541 million, representing a year-on-year increase of 17.0%; profit before taxation amounted to RMB3,238 million, representing a year-on-year increase of 48.7%; net profit attributable to shareholders amounted to RMB2,207 million, representing a year-on-year increase of 61.6%; and earnings per share amounted to RMB0.2746. Responding to the changing monetary market at home and abroad in the first half of this year, the Group keenly grasped the favourable opportunity to aggressively conduct replacement of existingloans with an aim to gear down the interest rate. Meanwhile, the Group put great efforts to raise low-cost funds at home and abroad, and successfully issued the ultra short-term debentures of RMB13 billion and registered private issuance of debt financing instruments of RMB10 billion. Hero Asia Investment Limited, a subsidiary of the Company, successfully completed the interest rate swap for the existing borrowings of US$890 million in Hong Kong market, which reduced the interest rate by over 25%. The Company's issuer rating was raised from BBB+ to A- by Standard & Poor's and from Baa3 to Baa1 by Moody's, which increased the financing competitiveness of the Company in international capital markets.


2)  the improving safety production management secured the industry-leading wind power production indicators. Production safety performance was stabilised as a wholein the first half of this year, as the Group strengthened the management of production safety, improved management rules and system for production safety, conducted the program to implement anti-accident measures, and stepped up safety inspection and rectification. The Company reinforced the benchmarking of power generation through refined output assessment, multiple measures to address grid curtailment, continuous equipment optimisation and effective “fine maintenance” for equipment. As a result, the industry-leading production indicators were sustained. In the first half of this year, the Company cumulativegross electricity output reached 19,383 GWh, of which electricity generated from our wind power business was 14,191 GWh, representing a year-on-year increase of 22.09%. The average utilisation hours of the wind power business was 1,085 hours, representing a year-on-year increase of 49 hours, which was primarily attributable to the increase in wind resources, coupled with the on-going effective management measures of the Company.


3)  the steadily progressing preliminary work sharpened our edge to further expand. In the first half of this year, focusing on economic benefits, the Company pushed forward project development in an active and sound manner, striving to acquire quality resources and maximise the inputs for preliminary works. These efforts resulted in full enhancement of development quality and continuous optimisation of our wind power project portfolio. In the Fifth Batch of Wind Power Projects Approval Plan (第五批風電項目核准計劃) promulgated by the National Energy Administration, 28 projects of the Company with gross capacity of 1,557,200 KW were included, among which, the capacity located in regions not subject to grid curtailment accounted for over 95%. In the five batches of wind power projects approval plan, one batch of supplementary approval plan and one batch of offshore wind power construction plan promulgated by the National Energy Administration, projects of the Company with gross capacity of 13,231,100 KW were included, accounting for 8.74% of the total capacity of projects included in these plans and ranking first among the peers. Under an innovative joint development model, the Company established the first provincial-level investment platforms for cooperative development in Chongqing and Guangdong to cover all its wind power projects within relevant provinces. Meanwhile, the Company entered into new cooperation agreements with the members of Guodian Group in regions such as Gansu, Hainan, Jiangxi and Guizhou. Up to today, the Company has entered into a total of 33 projects under joint development which covered 11 provinces with gross capacity of 2,870 MW. As at the end of June, the Group had wind power projects of 6,107,100KW which were approved but not yet put into operation, or 10,609,500KW if taking into account those included in the national plan but not yet approved, indicating an abundant project reserve.


4)  with effective promotion of project progress, the installed capacity achieved a historic breakthrough. In the first half of this year, the Company satisfied the conditions for commencing production in advance, strengthened project schedule control, and coordinated equipment supply. The Company witnessed the commencement of operation of its projects with capacity of over one million KW, amounting to 1,025.5 MW, a record high in project construction for the first half of a year. As at the end of June, the consolidated installed capacity of the wind power business was 14,568,200KW. The Company earnestly carried out the infrastructure “double enhancements” work, improved the delicacy management level across infrastructure construction, and strived for Excellence Project and Benefit Project. The 150MW Jiyangshan Mountain Wind Power Project in Shenchi, Shanxi (山西神池繼陽山150MW風電工程) of the Company was awarded the “Premium Quality Power Construction in China” (中國電力優質工程獎) in 2015. The Company strictly reviewed ceiling price of biddings, took full advantage of scale superiority, and lowered the procurement price of towers and electrical equipment through centralised bid packagestobring project cost under strict control.


5)  overseas business progressed in an orderly manner in light of the “going-global” strategy. Benefiting from the favourable on-grid tariffs, sound wind resources, relatively low financing cost and preferential tax policy on accelerated depreciation, the Canadian Dufferin project developedby the Company achieved desirable profitability. In the first half of 2015, generator units in wind farms operated well with 134 GWh gross power generated and average utilisation hours reaching 1,471 hours. The wind power project in South Africa (南非德阿風電) developed by theCompany, after closing the financing process as required by South Africa government in February 2015, has entered the preparation stage for construction and will break ground as scheduled in the second half of 2015. The Group will stick to the basic principle for overseas investment and continue to prioritise projects with attractive returns in key regions such as “One Belt and One Road”, subject to risks being under control.


6)    research and development in key technologies helped to consolidate the cutting-edge technology leadership. In the first half of this year, the Group capitalised on its strengths to keep paces with technology trends. As the first domestic wind power operator to initiate wind power Big Data project, the Company secured a favourable technological commanding height for future wind power development in a timely manner. The state-backed project has been filed successfully for inclusion into the list of national energy independent innovation projects. As one of the pacesetters in renewable energy, the Company co-edited the Energy Technological Innovation Programme of the National Energy Administration under the “Thirteenth Five-year Plan” as well as the proposal for a national new energy collaborative innovation community in Beijing, Tianjin and Hebei. As such, the Group aligned itself effectively with national blueprint and strategies, while further cementing its leadership and voice in domestic wind power development. According to its needs in wind power development, construction and operation, the Company filed 9 technological projects to Guodian Group and identified 13 in-house projects, as screened out from its programme for 2015 after strict review. In the first half of this year, the Company obtained 1 invention patent, 4 patents for utility models and 9 software copyrights. The Group took full advantage of technology as the supporting platform. The five subsidiaries specialising in technical services, while focusing on core businesses to further strengthen service awareness, stepped up their technological endeavours in monitoring centre capacity improvement, technological supervision services, offshore wind power design consulting and EPC project development so as to upgrade technological level and business capability.


  In the second half of 2015, Longyuan Power will take the “One, Five and Five (一五五)” core strategy as guidance, stress “double enhancements (雙提升)”, stick to “eight focuses (八個注重)”, pursue “four first-classes (四個一流)” and carry out the campaign of “the year for improvement through normalised and standardised management” in a deep-going way, so as to strengthen management, deepen reform and innovation, promote advantageous development, enhance the Company's comprehensive strength and competitiveness in an all-round way, and speed up building a top tier international listed new energy company. In order to meet the annual targets, emphasis will be laid on the following aspects in the second half of this year: first, to comprehensively deepen “double enhancements” and improve operation of stock assets; second, to strengthen efficiency awareness and enhance the development quality of incremental assets; third, to intensify reform of systems and mechanisms and upgrade corporate management standards; and fourth, to strengthen ideological and political work for Party building and create harmonious atmosphere.