Interim Results

Beijing Datang Power Generation Com
15 August 2002


                     BEIJING DATANG POWER GENERATION CO. LTD
       (A Sino-foreign Joint Venture Limited Company incorporated in the 
                          People's Republic of China)

                     Announcement of 2002 Interim Results

I. INTERIM RESULTS

   The board of directors (the 'Board') of Beijing Datang Power Generation 
   Company Limited (the 'Company') hereby announces the unaudited operating 
   results of the Company and its subsidiaries tor the six months ended 30th 
   June 2002 (the 'Period') prepared in conformity with International Accounting 
   Standards ('IAS'). Such results have been reviewed and confirmed by the Audit  
   Committee of the Company.

   The Company's operating revenue for the Period amounted to approximately 
   Rmb3,491,543,000. Net profit was approximately Rmb601,318,000. Earnings per 
   share amounted to approximately Rmb0.12.

   The Board is satisfied with the above results. Please refer to the unaudited  
   condensed consolidated income statement extracted from the unaudited 
   condensed financial statements, set out below for detailed operating results.

   CONDENSED CONSOLIDATED INCOME STATEMENT (Unaudited)
   FOR THE SIX MONTHS ENDED 30TH JUNE 2002
   (Amounts expressed in thousands of Rmb, except per share data)

                                                     Six months ended 30th June
                                           Note            2002            2001

Operating revenue                            2        3,491,543       3,134,598
Operating costs                              6       (2,473,133)     (2,039,859)

Operating profit                                      1,018,410       1,094,739
Share of profit of associates                             3,718               -
Interest income                                          48,153          76,242
Financial costs                              6         (236,584)        (84,568)
  
Profit before taxation                                  833,697       1,086,413
Taxation                                     3         (277,565)       (363,854)

Profit after taxation                                   556,132         722,559
Minority interests                                       45,186           5,721

Net profit                                              601,318         728,280

Earnings per share, basic (Rmb)              4             0.12            0.14



1.  Principal accounting policies

    The condensed consolidated financial statements are prepared in accordance 
    with IAS 34 'Interim Financial Reporting' and Appendix 16 of the Rules 
    Governing the Listing of Securities on The Stock Exchange of Hong Kong
    Limited (the 'Listing Rules').

    The principal accounting policies adopted for the preparation of the 
    condensed consolidated financial statements as at and for the six months 
    ended 30th June 2002 are consistent with those adopted for the preparation 
    of the financial statements as at and for the year ended 31st December 2001.

2.  Operating revenue

    Operating revenue represents amount of tariffs billed for electricity  
    generated and transmitted to the substantial shareholder. North China Power 
    Group Company ('NCPGC'). Tariff revenues are recognised upon billing
    and transmission of electricity to the power grid controlled and owned by 
    NCPGC.

3.  Taxation

                                                     Six months ended 30th June
                                                           2002            2001
                                                           '000            '000

PRC enterprise income tax
 - Current tax                                          339,918         363,854
 - Deferred tax                                         (62,353)              -                   

                                                        277,565         363,854
                                                                   

    Enterprise income tax it provided on the basis of the statutory profit for  
    financial reporting purposes, adjusted for income and expense items which 
    are not assessable or deductible for income tax purposes. The applicable  
    enterprise income tax rate in the People's Republic of China (the 'PRC') for 
    the Company and its subsidiaries is 33%.

4.  Earnings per share

    The calculation of basic earnings per share for the six months ended 30th 
    June 2002 was based on net profit of approximately Rmb601,318,000 (2001 - 
    Rmb728,280,000) and on the weighted average number of 5,162,849,000 shares
    which is calculated on the basis of 3,732,180,000 domestic shares and 
    1,430,669,000 overseas shares.

    No diluted earnings per share was presented, as there were no dilutive  
    potential ordinary shares outstanding for the six months ended 30th June 
    2002 and 2001.

5.  Profit appropriations

    Dividends

    On 5th March 2002, the Board proposed a dividend of Rmb0.17 per share, 
    totalling approximately Rmb877,684,000 for the year ended 31st December 
    2001. The proposed dividends distribution was approved by the shareholders
    of the Company in the general meeting held on 23rd April 2002.

    Reserves

    The following reserve transfer have been made for the six months ended 30th 
    June 2002:
                                          
    a)  approximately Rmb65,693,000 which represented 10% of the profit after 
        taxation determined based on the financial statements prepared in 
        accordance with the PRC accounting standards and regulations ('PRC
        GAAP'), have been appropriated to each of the statutory surplus reserve 
        and statutory public welfare fund:

    b)  approximately Rmb16,180,000 has been transferred from the restricted 
        reserve which is specifically set up to reflect the reduction of the 
        statutory public welfare fund under PRC GAAP, to retained earnings. This
        amount represented amortisation of deferred housing benefits for the 
        period; and

    c)  approximately Rmb480,685,000 has been appropriated from the retained 
        earnings to the discretionary surplus reserve as it is the Company's
        current policy to transfer all unappropriated retained earnings to the
        discretionary surplus reserve.
                        
6  Supplemental financial information

                                                     Six Months ended 30th June
                                                            2002           2001
                                                            '000           '000

Interest expenses                                        243,108        218,032
Less: amount capitalised in property, plant and 
 equipment                                              (103,756)      (133,464)
                                                         139,352         84,568
Fair value loss on financial instrument                   97,232              -
 
  Financial costs                                        236,584         84,568
Cost of inventories
  - fuel costs                                         1,094,233        932,600
  - materials and supplies                                22,723         15,380
Depreciation and amortisation                            666,358        524,685
Dividend income                                           (7,107)        (5,479)


II. MANAGEMENT DISCUSSION AND ANALYSIS

    The PRC recorded a GDP growth of 7.8% during the Period. Driven by domestic
    economic growth, power demand increased substantially, with the aggregate 
    power consumption having grown by 8.91% as compared to the corresponding 
    period last year. Power generation by the Company and its subsidiaries 
    during the Period increased by 12.84% as compared to the corresponding 
    period last year, while operating revenue grew by 11.39%  as compared to the 
    corresponding period last year. Operating profit of the Company decreased by 
    7.0%, due to the increase of power generation costs caused by coal price 
    increase and depreciation of new generation units of the Company and its 
    subsidiaries. Coupled with the factors of additional interest expenses for 
    newly commissioned generation units and the fair value loss relating to 
    interest spreads in US Dollar swap contract, consolidated net profit of the 
    Company and its subsidiaries decreased by Rmb126,962,000 during the Period.


1. Operating conditions

   During the Period, the Company and its subsidiaries' operating installed
   capacity was 6,170MW and total power generation amounted to 14,045,672MWh,
   representing a 12.84% growth as compared to the corresponding period last 
   year. On-grid power generation during the Period amounted to 13,067,932MWh,
   representing a 13.01% growth as compared to the corresponding period last 
   year. The increase in power generation and on-grid power generation was 
   mainly attributable to: (1) the increase in power generating capacity with 
   the commercial operation of Unit 8 (300MW)  at Zhang Jia Kou Power Plant 
   ('Zhang Jia Kou') and Unit 1 (600MW) at Datang Panshan Power Plant ('Datang 
   Panshan'); (2) rising power demand in the Beijing-Tianjin-Tangshan ('BTT') 
   area marked by a 6.89% increase during the Period; and (3) safe and stable 
   operation of existing units with high operating levels reflected by an 
   equivalent availability factor of 93.89% for the Period.


2. Business expansion

   The Company continued to implement a pro-active expansion strategy during 
   the Period, while enhancing management of construction in progress ('CIP') 
   and preparatory works.  The current status of CIP and preliminary works in
   which the Company owns controlling stakes is as follows:

   • Units 1 and 2 of Datang Panshan (2X600MW) commenced commercial operation 
     in January and July 2002, respectively.

   • The two units of Datang Tuoketuo Power Plant ('Datang Tuoketuo') Phase 1
     (2X600MW) in Inner Mongolia are currently undergoing installation, with 
     the first unit expected to integrate into the power grid in 2003. The 
     feasibility study report and project commencement report of Phase II
     (2X600MW) has been approved by the State Planning and Development 
     Commission ('SPDC') and construction is expected to begin on 20th August
     2002.

   • The feasibility study report and project commencement report for Datang 
     Shentou Power Plant (2X500MW) has been approved by SPDC and construction 
     is expected to begin on 20th August 2002.

   • The feasibility study report for Datang Pingwang Thermal Power Plant 
     (2x200MW) has been approved by the State Economic and Trade Commission 
     ('SETC') and construction is expected to begin within the year.

   • Phase 1 of the technological upgrade works of one 300MW unit at Datang 
     Tangshan Thermal Power Plant has been approved by SETC and construction is 
     expected to begin within the year.

   • The feasibility study report for Datang Liancheng Power Plant (2X300MW) 
     has been submitted to SPDC far approval.

   • The project proposal for Datang Honghe Power Generation (2X300MW) was 
     approved last year and the project is currently undergoing feasibility
     study.


3.  Financial Analysis

  (1) Operating Results

      During the Period, the Company and its subsidiaries recorded consolidated 
      operating revenue of approximately Rmb3,491,543,000, net profit of
      approximately Rmb601,318,000 and earnings per share of approximately 
      Rmb0.12.

      The four wholly-owned power plants (with a total operating capacity of 
      4,950MW) maintained a relatively high profit level as a result of
      increased power generation as well as tariff adjustments for Units 6-8
      of Zhang Jia Kou and other profit-enhancing factors such as reduction in 
      water consumption. However, the increased depreciation of fixed assets
      during the Period after Unit 8 of Zhang Jia Kou and Unit 1 of Datang 
      Panshan had been commissioned and the increase in coal price have offset 
      the continuous profit growth of the Company. As a result, operating profit
      of the Company showed a 7.0% decrease as compared to the corresponding 
      period last year.  In addition, taking into account the additional
      interest expenses for newly commissioned generation units and the fair 
      value loss relating to interest spreads in US Dollar swap contract of 
      Datang Tuoketuo, the combined net profit of the Company and its 
      subsidiaries for the Period decreased by approximately Rmbl26,962,000.
 
   (2) Financial Conditions

       As at 30th June 2002, total assets of the Company and its subsidiaries
       amounted to approximately Rmb24,921,772,000, representing an increase 
       of approximately Rmb1,731,729,000 as compared to that as at 31st December
       2001. Total liabilities amounted to approximately Rmb10,660,969,000, 
       representing an increase of Rmbl,853,167,000 as compared to that as at
       31st December 2001. Minority interests amounted to Rmb684,818,000,
       representing an increase of Rmbl54,928,000 as compared to that as at 
       31st December 2001. Shareholders' equity amounted to approximately
       Rmbl3,575,985,000, representing a decrease of Rmb276,366,000 as compared
       to that as at 31st December 2001. The growth in the Company's total
       assets mainly reflected the implementation of the Company's development
       strategy and the increase in investments in CIP by the Company.

  (3) Liquidity

       As at 30th June 2002, the Company's asset-to-liability ratio (i.e. the 
       ratio between total assets and total liabilities, excluding minority
       interests) was 42.78%. The net debt-to-equity ratio (i.e. (total debt - 
       cash and cash equivalents - short term  bank deposits for over 3 months 
       - investments held for trading)/shareholders' equity) was 27.77%.

  (4) Cash

       As at 30th June 2002, the Company had total cash and cash equivalents and
       short-term bank deposits for over 3 months amounted to approximately 
       Rmb3,974,831,000, among which the equivalent of approximately
       Rmb2,136,842,000 of deposits was held in foreign currencies.  The Company 
       had no trust deposits or overdue fixed deposit during the Year.

  (5) Borrowings

       As at 30th June 2002, the Company had short-term loans of approximately 
       Rmb547,500,000  at an annual interest rate of 5.04% to 5.85%. Long-term 
       loans (excluding those repayable within 1 year) amounted to approximately
       Rmb7,035,268,000 and long-term loans repayable within 1 year amounted to 
       approximately Rmb368,974,000 at annual interest rates of 2.87% to 6.21%, 
       including US Dollars loans equivalent to approximately Rmbl,688,932,000.

       As at 30th June 2002, the Company provided guarantee of approximately
       Rmb3 billion for loan facilities granted to its subsidiaries. The Company
       did not provide any form of guarantee for any company other than its 
       subsidiaries.

4. Future Prospects

   The current economic growth is supported by the PRC's pro-active financial
   policy, a prudent monetary policy and flexible economic leverages and 
   adjustments, and the upturn of the global economy, which have also laid solid
   foundations for long-term growth in the future. The positive effects of the 
   PRC's entry into WTO and the hosting of the 2008 Olympic Games have begun to
   emerge. The implementation of strategies for 'West China development' and  
   'West-to-East power transmission'  will be conducive to the sustained 
   economic growth in the PRC. The Company's business expansion shall also 
   benefit from the continued domestic economic growth, although its results  
   might be affected by the increase in fuel costs and the increase of 
   depreciation of fixed assets caused by  the  commission of new generation 
   units. In view of this, the Company shall proceed with its projects in a 
   pro-active manner in accordance with the operating targets set by the Board 
   at the beginning of the year and leverage on our advantages by fully 
   utilising the market environment and the reform of the power industry in  
   order to procure ongoing expansion both in the domestic  and international  
   market. Meanwhile, we will continue to consolidate corporate fundamentals in 
   a pragmatic manner by controlling costs, enforcing production safety, and 
   ensuring fulfillment of annual power generation plans, with a view to seeking 
   better profitability.


III.  SHARE CAPITAL AND DIVIDENDS

1 Share Capital

  No new shares were issued by the Company during the Period. As at 30th June 
  2002, the total share capital of the  Company amounted to Rmb5,162,849,000,  
  divided into 5,162,849,000  shares each with a nominal value of Rmb1.00.

2 Substantial Shareholders

  Substantial shareholders who were interested in more than 10% of the shares of 
  the Company during the Period were as follows:

                                                                     Percentage
Name of shareholder                    Class of       Number          of shares
                                       shares         of shares    capital held
                                                                            (%)

                                       Domestic
North China Power Group Company        Shares       1,828,768,200        35.43
Beijing International Power 
 Development and Investment            Domestic
   Company                             Shares         671,792,400        13.01
                                       Domestic
Hebei Construction Investment Company  Shares         671,792,400        13.01
                                       Domestic
Tianjin Jinneng Investment Company     Shares         559,827,000        10.84


3 Dividends

  Pursuant to a resolution at the Board meeting on 5th March 2002 and as 
  approved at the Annual General Meeting held  on  23rd April 2002, the Company 
  declared a dividend of  Rmb0.17  for the year 2001 payable to the shareholders
  of the Company whose names appear on the Company's register of members as at 
  21st March 2002. Such dividend has  been distributed before 28th June 2002.  
  Dividends paid to domestic shares shareholders were declared and paid in Rmb.  
  Dividends paid to overseas shares ('H Shares') shareholders were declared in 
  Rmb and paid in Hong Kong Dollars.

  The Board does not recommend the payment of any interim dividend for 2002.


4 Shareholdings of the directors and supervisors

  At any time during the Period, none of the directors, supervisors, their 
  spouses and children under 18 years old held or owned the interest of any  
  equity or debt securities of the Company or any of its associated corporations 
  (as defined in the Securities (Disclosure  of Interests) Ordinance) or was  
  granted the right to subscribe for or purchase equity or debt securities of 
  the Company or any of its associated corporations.

IV. PURCHASE, SALE AND REDEMPTION OF THE COMPANY'S LISTED SECURITIES

  During the Period, the Company had not purchased, sold or redeemed any of the 
  its listed securities.

V. SIGNIFICANT MATTERS

  At the Annual General Meeting 2001 held on 23rd April 2002, the Board was 
  granted the authority to issue new shares in the Company not exceeding 20%  
  of its share capital.

  At the Extraordinary General Meeting 2002, Class Meeting for holders of H 
  Shares and Class Meeting for holders of domestic shares held on 10th May 2002, 
  the Board were granted the authority to issue US Dollars overseas convertible 
  bonds of up to US$300 million.

VI. CODE OF BEST PRACTICE

  During the Period, the Company had complied with the Code of Best Practice set 
  out in Appendix 14 of the Listing Rules.

VII. THE AUDIT COMMITTEE

  The Audit Committee has reviewed together with the management the accounting   
  principles, accounting standards and practices adopted by the Company, and has
  discussed internal controls and has reviewed the unaudited condensed 
  consolidated financial statements for the six months ended 30th June 2002.

                                                      By Order of the Board
                                                           Zhai Ruoyu
                                                            Chairman


Beijing, 14th August 2002

The interim report of the Company for the six months ended  30 June 2002 
containing all the information required by paragraph 46(1) to 46(6) inclusive of 
Appendix 16 to the Listing Rules will be published on the website of The Stock
Exchange of Hong Kong Limited (http://www.hkex.com.hk) within 21 days 
after publication of this announcement.



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