Third Quarterly Report of 200

RNS Number : 7162G

Datang Intl Power Generation Co Ld

27 October 2008

 

DATANG INTERNATIONAL POWER GENERATION CO., LTD.

(a sino-foreign joint stock limited company incorporated in the People's Republic of China)

 (Stock Code: 991)

PRICE-SENSITIVE INFORMATION/

OVERSEAS REGULATORY ANNOUNCEMENT

THIRD QUARTERLY REPORT OF 2008

In accordance with the requirements of the China Securities Regulatory Commission, Datang International Power Generation Co., Ltd. (the 'Company') is required to publish quarterly reports for the first and third quarters of the year.

The financial information contained in this quarterly report is unaudited, and were prepared in accordance with the PRC GAAP.

This announcement is made pursuant to Rules 13.09(1) and (2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

• IMPORTANT NOTICE

1.1     The board of directors (the “Board”), supervisory committee and directors, supervisors and senior management of the Company warrant that there are no false representations and misleading statements contained in, or material omissions from, this report, and jointly and severally accept the responsibility for the truthfulness, accuracy and completeness of the contents hereof.

 

1.2     All directors of the Company attended the Board meeting.

1.3     The third quarterly financial report of the Company are unaudited.

1.4     Mr. Zhai Ruoyu, the person-in-charge of the Company, Mr. Wang Xianzhou, the person-in-charge of accounting matters, and Mr. Liu Heping, the person-in-charge of the accounting institution (head of accounting function), hereby make representation in respect of the truthfulness and completeness of the financial statements contained in this quarterly report.

 

2.    BASIC INFORMATION OF THE COMPANY

 

2.1     Major accounting data and financial indicators

                                                                    Currency: RMB

	At the end of the reporting period				At the end of last reporting year		Increase/decrease  at the end ofthe reporting period  as compared  to the end of  last year (%)
Total assets (RMB'000)	151,932,595				119,502,662		27.14
Interests of equity holders (or Interests of shareholders) (RMB'000)	31,031,614				33,948,999		-8.59
Net assets per share attributable to shareholders of the Company (RMB)	2.24				2.53		-11.46
				Beginning of the year to the end of the reporting period (Jan - Sep)			Increase/decrease  as compared to the corresponding period of last year (%)
Net cash flow generated from operating activities (RMB'000)				4,304,179			-57.57
Net cash flow generated from operating activities per share (RMB)				0.37			-57.51
		The reporting period (Jul - Sep)			Beginning of  the year to  the end of the reporting period (Jan - Sep)		Increase/decrease of the  reporting period  as compared to the corresponding period of last year (%)
Net profit/loss attributable to shareholders of the Company (RMB'000)		-432,861			-13,936		-100.52
Basic earnings per share (RMB)		-0.037			-0.001		-100.43
Basic earnings per share after deduction of non-recurring profit/loss (RMB)		-			-0.003		-
Diluted earnings per share (RMB)		-0.037			-0.001		-100.43
Return on net assets (fully diluted) (%)		-1.65			-0.05		a decrease of  9.62 pct. pts.
Return on net assets after deduction of non-recurring profit/loss (fully diluted) (%)		-1.73			-0.14		a decrease of  9.70 pct. pts.
Non-recurring profit/loss items					Amount from the beginning of the year to the end of the reporting period  (Jan - Sep) (RMB'000) Exclusion method: By items
Gains and losses from disposal of non-current assets					18,029
Net amount of non-operating income and expenses excluding the above-mentioned items					4,114
Total					22,143

2.2     Total number of shareholders as at the end of the reporting period and table of shareholding of the top ten holders of shares free of selling restrictions

Unit: share

Total number of shareholders at the end of the reporting period	288,106
Top ten holders of circulating shares free of selling restrictions
Name of shareholder (Full name)		Number of circulating shares free of selling restrictions held as at the end of the reporting period	Class of shares
HKSCC NOMINEES LIMITED		3,305,115,950	Overseas-listed foreign shares
Beijing Energy Investment (Group) Company		1,343,584,800	RMB ordinary shares
Hebei Construction Investment Company		1,303,878,100	RMB ordinary shares
Tianjin Jinneng Investment Company		1,119,654,000	RMB ordinary shares
International Finance - Chartered - CITIGROUP GLOBAL MARKETS LIMITED (國際金融-渣打- CITIGROUP GLOBAL MARKETS LIMITED)		39,982,743	RMB ordinary shares
National Social Security Fund - 006 Composition (全國社保基金零零六組合)		6,988,326	RMB ordinary shares
Industrial and Commercial Bank of China - Shanghai Stock Exchange 50 ETF (中國工商銀行-上證50交易型開放式指數證券投資基金)		6,714,586	RMB ordinary shares

Citic Securities - Industrial and Commercial Bank of China - CREDIT SUISSE (HONG KONG) LIMITED (中信證券-工行-CREDIT SUISSE (HONG KONG) LIMITED)	5,265,300	RMB ordinary shares
Haitong Securities Co., Ltd- Bank of Communications - Nikko Asset Management Co., Ltd - 日興AM中國人民幣A股母基金 (海通-交行-日興資產管理有限公司-日興AM中國人民幣A股母基金)	5,000,728	RMB ordinary shares
Shenyin Wanguo - Chartered - BARCLAYS BANK PLC (申銀萬國-渣打-BARCLAYS BANK PLC)	4,728,940	RMB ordinary shares

3.    SIGNIFICANT MATTERS

3.1     The details of and the reasons for the material changes in the major financial statement items and financial indicators of the Company Applicable    Not applicable

 

(1)      The monetary assets of the Company and its subsidiaries as at the end of the reporting period increased by approximately 118% over the beginning of the reporting period. This was mainly due to the cash inflow from financing activities such as borrowings and sale for lease-back.

(2)      The balance of the notes receivable of the Company and its subsidiaries as at the end of the reporting period decreased by approximately 81% over the beginning of the reporting period. This was mainly because the actual amount received at the end of the reporting period in connection with the income of the Company and its subsidiaries settled by way of notes at the end of the previous reporting year exceeded the amount of the new notes receivable incurred during the reporting period.

(3)      The prepayments of the Company and its subsidiaries as at the end of the reporting period increased by approximately 466% over the beginning of the reporting period. This was mainly due to the requirement of prepayment for the purchase of fuel coal as a result of the tightening supply of coal.

(4)      The balance of other receivables of the Company and its subsidiaries as at the end of the reporting period increased by approximately 143% over the beginning of the reporting period. This was mainly due to an increase in other receivables arising from the transfer of the desulphurisation facilities by Inner Mongolia Datang International Tuoketuo Power Generation Company Limited.

(5)      The balance of inventories of the Company and its subsidiaries as at the end of the reporting period increased by approximately 127% over the beginning of the reporting period. This was mainly due to an increase in fuel prices and an increase in the inventory of fuel coal during the reporting period.

(6)      The balance of available-for-sale financial assets of the Company and its subsidiaries as at the end of the reporting period decreased by approximately 50% over the beginning of the reporting period. This was mainly due to a decline in the market price of the shares of Daqin Railway Co., Ltd. (“Daqin Railway”) held by the Company.

(7)      The balance of construction materials of the Company and its subsidiaries as at the end of the reporting period increased by approximately 74% over the beginning of the reporting period. This was mainly due to continuing investments in the projects under construction.

(8)      The balance of intangible assets of the Company and its subsidiaries as at the end of the reporting period increased by approximately 175% over the beginning of the reporting period. This was mainly due to the acquisition of exploration rights from Ordos Linyang Resources Consultation Co., Ltd. and Shanxi Zhongqiang Trading Company Limited during the reporting period.

 

 

(9)      The goodwill of the Company and its subsidiaries as at the end of the reporting period increased by approximately 359% over the beginning of the reporting period. This was mainly due to the goodwill arising from the acquisitions of Ordos Linyang Resources Consultation Co., Ltd. and Shanxi Zhongqiang Trading Company Limited as well as the acquisition of a 90% equity interest in Zhenxing-AES Power Co., Ltd. by Datang International (Hong Kong) Limited during the reporting period.

(10)    The balance of deferred income tax assets of the Company and its subsidiaries as at the end of the reporting period increased by approximately 423% over the beginning of the reporting period. This was mainly due to the recognition of deferred income tax assets as a result of the losses of certain power plants during the reporting period.

 

(11)    The balance of short-term borrowings of the Company and its subsidiaries as at the end of the reporting period increased by approximately 68% over the beginning of the reporting period. This was mainly due to the fact that the demand for capital increased continually as costs rose and business expanded. To facilitate a smooth and usual cash flow, the Company increased its borrowings substantially to alleviate the relevant pressure.

 

(12)    The balance of financial liabilities held for trading by the Company and its subsidiaries at the end of the reporting period decreased. This was mainly due to the termination of the interest rate swap contract of Inner Mongolia Datang International Tuoketuo Power Generation Company Limited during the reporting period.

 

(13)    Accounts payable of the Company and its subsidiaries at the end of the reporting period increased by approximately 32% over the beginning of the reporting period. This was mainly due to the tight liquidity and a further increase in investment in the projects under construction during the reporting period, resulting in an increase in construction costs of certain power plants.

 

(14)    The balance of taxes payable by the Company and its subsidiaries at the end of the reporting period decreased by approximately 86% over the beginning of the reporting period. This was because, on one hand, the taxes payable for the previous period were paid during the reporting period while the losses at certain power plants led to a substantial decrease in the balance of various taxes payables; on the other hand, the surge of fuel prices resulted in an increase in deductible input value-added tax during the reporting period, which in turn led to a decrease in value-added tax.

 

(15)    The balance of other current liabilities of the Company and its subsidiaries at the end of the reporting period decreased by approximately 100% over the beginning of the reporting period. This was because the short-term debentures of the previous year were due in this reporting period, resulting in nil in the balance at the end of the reporting period. 

 

(16)    The balance of long-term borrowings of the Company and its subsidiaries at the end of the reporting period increased by approximately 41% over the beginning of the reporting period. This was mainly due to a further commencement of the projects under construction. In order to ensure a smooth construction, the Company increased its borrowings substantially to relieve pressure.

 

(17)    The balance of long-term payables of the Company and its subsidiaries at the end of the reporting period increased by approximately 4,244% over the beginning of the reporting period. This was mainly due to the sale for lease-back of equipment at certain power plants during the reporting period.

(18)    The balance of capital reserves of the Company and its subsidiaries at the end of the reporting period decreased by approximately 38% over the beginning of the reporting period. This was mainly due to a decline in the share price of Daqin Railway.

 

(19)    The operating costs of the Company and its subsidiaries for the reporting period increased by approximately 44% over the corresponding period last year. This was mainly due to the rise of fuel coal prices and increase in power generation which led to an increase in the consumption of fuel coal.

 

(20)    The finance costs for the Company and its subsidiaries of the reporting period increased by approximately 76% over the corresponding period last year. This was mainly due to the increase in borrowings during the reporting period and the previously capitalised interests of certain completed power plants being charged into expenses.

 

(21)    The investment income of the Company and its subsidiaries for the reporting period increased by approximately 278% over the corresponding period last year. This was mainly due to the significant increase in the profits from Tongmei Datang Tashan Coalmine Company Limited, an associate of the Company and its subsidiaries, and Kailuan (Group) Yuzhou Mining Company Limited, a jointly controlled entity.

 

(22)    The income tax expenses of the Company and its subsidiaries for the reporting period decreased by approximately 133% over the corresponding period last year. This was mainly due to a decrease in the income tax rate and the losses for certain subsidiaries of the Company.

 

(23)    The net profit attributable to equity holders of the Company and its subsidiaries for the reporting period decreased by approximately 101% over the corresponding period last year. This was mainly due to increases in fuel coal prices and finance costs.

 

(24)    The gain/loss attributable to minority shareholders of the Company and its subsidiaries for the reporting period decreased by approximately 104% over the corresponding period last year. This was mainly due to a decrease in profits of the subsidiaries of the Company.

 

3.2     The analysis and explanation of progress and impact of major events and solutions Applicable    Not applicable

 

3.3     The performance of the undertakings made by the Company, shareholders and the de facto controller Applicable    Not applicable

 

3.4     The warning and explanation in the forecast of the possible aggregate net profits from the beginning of the year to the end of the next reporting period becoming a loss or significant changes over the corresponding period last year Applicable    Not applicable

 

It is anticipated that the net profit attributable to the equity holders of the Company in 2008 may record a decrease of approximately 85% as compared to 2007 due to factors such as surging fuel prices.

 

 

3.5     The investment in securities

 Applicable    Not applicable

Unit: '000 Currency: RMB 

No.	Stock code	Abbreviation	Number of shares held at the end of the reporting period (shares)		Initial investment amount		Book value as at the end of the reporting period		Book value as at the beginning of the reporting period		Accounting item
1	601006	Daqin Railway	167,429,000		496,148.55		2,159,834.10		4,289,530.98		Available-for-sale financial   assets
Total			－		496,148.55		2,159,834.10		4,289,530.98		－

By Order of the Board

    Zhai Ruoyu

    Chairman

Beijing, the PRC, 24 October 2008

As at the date of this announcement, the directors of the Company are:

Zhai Ruoyu, Hu Shengmu, Cao Jingshan, Fang Qinghai, Zhou Gang, Liu Haixia, Guan Tiangang, 

Su Tiegang, Ye Yonghui, Li Gengsheng, Xie Songlin*, Liu Chaoan*, Yu Changchun*, 

Xia Qing* and Li Hengyuan*

* Independent non-executive directors

 

END

 

 

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