Datang Power Announces 2011 Interim Results

Datang International Power Generation Co., Ltd. ("Datang Power" or the "Company") (HKEx: 991; SSE: 601991; LSE: DAT; ADR: DIPGY) announced the unaudited consolidated operating results of the Company and its subsidiaries (the "Group") for the six months ended 30 June 2011 (the "Period").

During the Period, operating revenue of the Group was approximately RMB33,322 million, representing an increase of approximately 15.12% over the corresponding period of 2010. Net profit attributable to equity holders of the Company was approximately RMB932 million, an increase of approximately 2.17% year-on-year. Basic earnings per share attributable to equity holders of the Company amounted to approximately RMB0.0747 (2010: RMB0.0757 per share). The board of directors of the Company did not recommend any distribution of 2011 interim dividend.

Mr. Liu Shunda, Chairman of Datang Power, said, "During the Period, the macro-economy performed satisfactorily as a whole, demonstrated by an overall robust demand for power nationwide. However, the problem regarding structural power shortage remained, competition in the power market was as intense as before, and the continuously rising thermal coal prices stayed at high levels, thereby exerting tremendous pressure on power enterprises for their production operation and power supply. Under the market conditions where opportunities co-existed with pressures, the Group leveraged its management advantages and adopted pragmatic and effective measures, thereby having succeeded in maintaining safe and stable operation and a sound development of the Group’s power generation businesses, and achieving a year-on-year steady rise in profits during the Period."

During the Period, total power generation of the Group amounted to approximately 96.1569 billion kWh, an increase of approximately 19.05% year-on-year. Total on-grid power generation of the Group amounted to approximately 90.6614 billion kWh, an increase of approximately 19.27% year-on-year. Significant year-on-year increases in both total power generation and on-grid power generation were mainly attributable to a continued sound macro-economy of the country, an increase in power consumption of the whole society, and an increase in the capacity of the Group’s operational generating units and their safe and steady operation.

During the Period, the Group’s generating units with a total capacity of approximately 1,208.14MW commenced power generation successfully. Of such new capacities, coal-fired projects included Linfen Hexi Thermal Power Company with new capacities totalling 600MW; hydropower projects included Chongqing Wulong Hydropower Company, Yuneng Group and Sichuan Jinkang Electricity Development Co., Ltd. with new capacities totalling 301.89 MW; and wind power and photovoltaic generating units projects included Liaoning Wind Power Generation Company, Inner Mongolia Wind Power Company, Zuoyun Wind Power Company and Qingtongxia Photovoltaic Co. Ltd. with new capacities totalling 306.25 MW. As compared to the corresponding period last year, the proportion of capacity in clean and renewable energy increased to 13.36%, making the power generation structure further optimised on an ongoing basis.

In addition, the Group’s energy saving and emissions reduction reaped remarkable results. Coal consumption of the Group amounted to approximately 319.67g/kWh, representing a decrease of approximately 5.25g/kWh year-on-year, while the consolidated electricity consumption rate of power plants was approximately 5.80%. The coal-fired generating units of the Group continued to achieve a desulphurisation facilities installation rate of 100%. Emission rates of sulphur dioxide, nitrogen oxides, smoke ash and waste water were approximately 0.382g/kWh, 1.329g/kWh, 0.118g/kWh and 65.91g/kWh respectively, representing decreases of approximately 17%, 5.7%, 9.9% and 23% respectively. Emission rates of various pollutants were lower than the national average levels.

During the Period, preliminary works on projects of the Group proceeded steadfastly, with five farm projects of a total capacity of 986MW being approved by the State: one hydropower project with a total capacity of 850MW; two wind power projects with a total capacity of 96MW; and two photovoltaic power generation projects with a total capacity of 40MW.

In addition, the Company continued to push ahead its expansion in power-related upstream and downstream projects. The Phase 1 project of the Shengli Open-cut Coal Mine East Unit 2 has commenced operation, and the Phase 2 project was approved with an annual production capacity of 20 million tonnes. The Group is carrying out preliminary development works on the Wujianfang Coal Mine, the Kongduigou Coal Mine and the Changtan Coal Mine. The Duolun Coal Chemical Project produced qualified methanol at the end of June 2011. The project was planned to produce qualified end-product polypropylene before the end of 2011. The Keqi Coal-based Natural Gas Project is proceeding at an accelerated speed with a target for commencement of operation in 2012. The construction of major plant zones for gasification, air separation, rectisol and power island of the Fuxin Coal-based Natural Gas Project has commenced successively, with a target for commencement of operation in 2013. The High-Aluminium Pulverised Fuel Ash Integrated Use Projects of Inner Mongolia Datang International Renewable Energy Resource Development Company Limited is expected to commence a long-cycle and stable operation before the end of 2011.

During the Period, the Group also successfully issued 10-year corporate bonds in a total amount of RMB3,000 million bearing a coupon rate of 5.25%, thereby having effectively optimised the debt structure and reduced the financing costs of the Group.

Looking towards the second half of 2011, Mr. Liu said, "In the second half, nationwide power demand will maintain a relatively rapid growth momentum, while nationwide power supply and demand for the year will be tight on the whole. The overall prices of coal will stay high, which will create a great impact on power generation and supply as well as on the profitability of the enterprise. Meanwhile, the State has adjusted the energy structure by devoting more efforts to the promotion of clean and renewable energy development, which has imposed more stringent requirements on the development of new projects of the Group. Faced with such complex and volatile situations, the Group will continue to adhere to the strategy of "focusing in the power generation business whilst complementing with synergistic diversifications". It will further reinforce the management of production safety, continue improving the rational assets deployment, actively push forward capital operation, continuously intensify energy conservation and emissions reduction, and contain coal prices by applying various measures, with a view to enhancing the profitability of the Group."

Datang International Power Generation Co., Ltd. is one of the largest independent power producers in China. As at 30 June 2011, the Company’s total installed capacity in operation amounted to 37,258MW. The Company has been listed on The Stock Exchange of Hong Kong Limited and the London Stock Exchange respectively since March 1997. Since September 2001, the Company’s American Depositary Receipts (ADRs) have been traded in the U.S. over-the-counter market. The Company has been successfully listed on the Shanghai Stock Exchange since December 2006.