Provision for Asset Impairment
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DATANG INTERNATIONAL POWER GENERATION CO. LTD
(a sino-foreign joint stock limited company incorporated in the People's Republic of China)
(Stock Code: 00991)
PROVISION FOR ASSET IMPAIRMENT
This announcement is made by Datang International Power Generation Co., Ltd. (the "Company")
pursuant to provisions on Inside Information Provisions (as defined under the Rules Governing
the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules"))
under Part XIVA of the Securities and Futures Ordinance (Chapter 571, Laws of Hong Kong) and
Rules 13.09(2)a and 13.10B of the Listing Rules.
The following announcement is made by the board of directors (the "Board") of the Company in
respect of provision for asset impairment.
I. SUMMARY OF PROVISION FOR IMPAIRMENT
(1) Reason for provision for impairment
Pursuant to the requirement under the "Notice about the Execution of Closedown of
Coal-fired Power Generation Units in Beijing by Beijing Municipal Commission of
Development and Reform", Datang International Power Generation Co., Ltd. Beijing
Gao Jing Thermal Power Plant (the "Gao Jing Thermal Power Plant"), an enterprise
owned by the Company, will shut down all of its coal-fired power generation units
by 2014, and indicators of impairment of its assets are shown.
(2) Basis of determining the provision for impairment
Pursuant to the requirements of the PRC Accounting Standard, when assets of an
enterprise indicate that "they have or will become idle, their usage has been
terminated or they are disposed of ahead of planning", provision for impairment
of such corresponding asset groups should be made. As a result, the Company
conducted an impairment assessment on the corresponding asset groups of the
coal-fired power generation units of Gao Jing Thermal Power Plant, which shows
indicators of impairment. The time of the assessment was 31 October 2013, and the
assessment result shows that a provision for impairment of approximately
RMB646 million on the corresponding asset groups of the coal-fired power
generation units of Gao Jing Thermal Power Plant should be made.
II. IMPACT OF THE PROVISION FOR IMPAIRMENT ON THE FINANCIAL POSITION OF THE COMPANY
The Company contemplates to make provision for impairment on the corresponding asset
groups of the coal-fired power generation units of Gao Jing Thermal Power Plant in the
amount of not more than RMB646 million before the end of 2013 (the exact amount is
subject to assessment result by then), and the net profit attributable to equity
holders of the Company in the consolidated financial statements of the Company for
the year 2013 is expected to decrease by not more than RMB646 million.
III. PROCEDURES FOR CONSIDERATION AND APPROVAL OF THE PROVISION FOR IMPAIRMENT
The Company convened the fifth meeting of the eighth session of the Board, which
considered and approved the "Resolution of Provisions for Impairment of Gao Jing
Coal-fired Power Generation Units" on 6 December 2013.
The Board is of the view that according to the PRC Accounting Standard, the provision
for asset impairment is conducted basing on a prudent approach, is well-founded, and
fairly reflects the condition of the Company's assets, and therefore approved the
provision for the impairment.
IV. OTHERS
In order to meet the load demand from the power grids in Beijing and the demand for
heating in the Beijing area, the Company convened the twenty-fifth meeting of the seventh
session of the Board on 6 June 2012 and considered and approved the "Resolution on
Investment in Constructing the Beijing Gao Jing Gas Thermal Power Project", approving the
investment in the construction of the Beijing Gao Jing Gas Thermal Power Project. The
Beijing Gao Jing Gas Thermal Power Plant project is located at the western side of the
Company's Beijing Gao Jing Thermal Power Plant, with a construction scale of three 9F-grade
gas-steam combined cycle back-pressure heating generating units with a total installed
capacity of 1,380 MW. It was expected that the project would commence production in
succession by the end of 2014. After commencing production, the project would help optimise
the Company's power sources structure, consolidate its development status in the Beijing
area and strengthen its profit base.
By Order of the Board
Zhou Gang
Secretary to the Board
Beijing, the PRC, 6 December 2013
As at the date of this announcement, the Directors of the Company are:
Chen Jinhang, Hu Shengmu, Cao Jingshan, Fang Qinghai, Zhou Gang, Li Gengsheng, Cao Xin,
Cai Shuwen, Liu Haixia, Guan Tiangang, Dong Heyi*, Ye Yansheng*, Li Hengyuan*, Zhao Jie*,
Jiang Guohua*
* Independent non-executive Directors