股份代號：902 2024 年度報告 為明天 增添動力 目錄 2 公司簡介 6 二零二四年公司大事回顧 按照國際財務報告準則會計準則 編製的財務報表 境內外財務報表差異調節表 338 境內外財務報表差異調節表 10 財務摘要 12 致股東書函 16 管理層討論與分析 37 企業管治報告 60 投資者關係 64 董事會報告書 100 監事會報告書 104 董事、監事及高級管理人員簡介 111 公司資料 113 名詞釋義 114 獨立核數師報告 121 合併損益及其他綜合收益表 124 合併資產負債表 127 合併權益變動表 129 合併現金流量表 132 財務報表附註 華能國際電力股份有限公司 公司簡介 華能國際電力股份有限公司（「本公司」、「公司」 或「華能國際」）及其附屬公司主要在中國全國 範圍內開發、建設和經營管理發電廠，是中國 最大的上市發電公司之一，是中國境內第一 個實現在紐約、香港、上海三地上市的發電公 司。截至二零二四年十二月三十一日擁有可控 發電裝機容量145,125兆瓦，其中低碳清潔能 源裝機容量佔比為35.82%。公司境內電廠廣 泛分佈在中國二十六個省、自治區和直轄市； 公司在新加坡全資擁有 ...

Investment Rating - The report maintains a "Buy" rating for Huaneng International Power Co., Ltd. with a target price of HKD 5.45 [7][4]. Core Views - The company's 2024 revenue is expected to decrease by 3.5% year-on-year to RMB 245.55 billion, while equity profit is projected to increase by 21.9% to RMB 10.185 billion, slightly below expectations due to higher domestic coal power costs in Q4 2024 [1][2]. - The company plans to add 9.42 GW of new renewable energy capacity in 2024 and aims for an additional 10 GW in 2025, which is expected to drive sustainable growth [1][3]. - The dividend for 2024 is set at RMB 0.27 per share, with a payout ratio of 58.78%, resulting in a dividend yield of 6.4% based on the closing price on March 26 [1][4]. Financial Performance Summary - In 2024, the total profit from domestic coal power is expected to recover to 1.9 cents per kWh, despite a decrease in the tax-inclusive electricity price by 1.09 cents per kWh [2]. - The company’s total profit from wind and solar projects in 2024 is projected to be RMB 94.97 billion, slightly above the forecast of RMB 84.26 billion [3]. - The report forecasts a decrease in the electricity price for thermal power by 3.9% and 4.0% for 2025 and 2026, respectively, leading to a downward adjustment of equity profit for 2025 and 2026 [4][6]. Valuation Metrics - The report estimates the company's 2025 book value per share (BPS) to be RMB 4.57, with a price-to-book (PB) ratio of 1.1x based on 2025 estimates, which is higher than its historical average [4][6]. - The expected earnings per share (EPS) for 2024 is RMB 0.65, with a projected increase to RMB 0.79 in 2025 [6][21].

Financial Performance - The company's consolidated operating revenue for the year ended December 31, 2024, was RMB 245.55 billion, a decrease of 3.48% compared to the previous year[4]. - Net profit attributable to equity holders of the company was RMB 10.185 billion, an increase of RMB 1.827 billion, representing a growth of 21.86% year-on-year[4]. - Earnings per share were RMB 0.46, with a proposed cash dividend of RMB 0.27 per ordinary share (tax included)[5]. - The company's total operating revenue for 2024 was RMB 245.55 billion, a decrease of 3.48% compared to RMB 254.40 billion in the previous year[26]. - Pre-tax profit increased by 42.83% to RMB 17.82 billion, compared to RMB 12.48 billion in the previous year[26]. - The company's net profit for the year reached RMB 14.01 billion, a significant increase of 59.72% from RMB 8.77 billion, attributed to lower fuel costs and growth in new energy operations[39]. - Total comprehensive income attributable to equity holders of the company for 2024 was RMB 10,233.40 million, up from RMB 8,653.95 million in 2023, reflecting a growth of 18.2%[132]. - The company's consolidated net profit attributable to ordinary shareholders for 2024 is RMB 7,260,203,000, an increase from RMB 5,441,180,000 in 2023, representing a growth of 33.4%[187]. Revenue and Costs - Operating costs and expenses amounted to RMB 219.55 billion, down 6.26% from RMB 234.20 billion year-on-year[29]. - The average selling price of electricity from domestic power plants was RMB 494.26 per MWh, a decrease of 2.85% year-on-year[25]. - Fuel costs for domestic thermal power plants were RMB 300.31 per MWh, down 8.00% from the previous year[25]. - The company's fuel costs totaled RMB 142.12 billion, a decrease of 9.23% from RMB 156.57 billion year-on-year[30]. - Maintenance expenses increased by 13.45% to RMB 5.06 billion, compared to RMB 4.46 billion in the previous year[31]. - Depreciation expenses rose by 3.18% to RMB 26.30 billion, up from RMB 25.49 billion year-on-year[32]. Energy Generation and Capacity - The total on-grid electricity generation for domestic power plants was 452.939 billion kWh, an increase of 1.13% year-on-year[8]. - The company added controllable power generation capacity of 9,692.76 MW, including 9,417.71 MW of new energy capacity[11]. - The proportion of low-carbon clean energy installed capacity reached 35.82%[11]. - The company achieved a market share of 19.2% in electricity generation, maintaining a strong position in the Singapore electricity market[13]. - The company plans to achieve an electricity generation volume of approximately 485 billion kilowatt-hours by 2025[17]. - The company anticipates continued growth in renewable energy sources, particularly in solar and wind, as part of its future strategy[21]. - The overall performance indicates a shift towards cleaner energy, with significant increases in solar and wind generation across multiple provinces[21]. Research and Development - The company achieved significant R&D results, with 1,021 invention patents, 746 utility model patents, and 316 international patents granted during the year[12]. - Research and development expenses rose from 1,321,050 in 2023 to 1,524,082 in 2024, marking an increase of approximately 15.4%[185]. Financial Management and Investments - The company is focusing on optimizing its capital structure and controlling financial risks while enhancing shareholder returns through effective financial management[52]. - The company plans to optimize investment areas and power generation mix to maximize economic benefits while upgrading coal-fired power technology[76]. - The company has unused bank credit facilities exceeding RMB 370 billion as of December 31, 2024, indicating strong financing capabilities[49]. - The company plans to distribute a cash dividend of RMB 0.27 per ordinary share, totaling RMB 4.238 billion in cash dividends[53]. Market and Operational Strategy - The company is committed to accelerating the development of new energy and optimizing thermal power development as part of its green low-carbon transformation strategy[15]. - The company is actively expanding its retail market and optimizing retail contract structures to secure higher-margin contracts[13]. - The electricity market is undergoing reforms, with new policies expected to reshape the operational model of renewable energy and enhance market-driven pricing mechanisms[60]. Shareholder Information - The total issued share capital of the company as of December 31, 2024, is 15,698,093,359 shares, with 70.06% held by domestic investors and 29.94% by foreign investors[82]. - The company has distributed a total of RMB 65.827 billion in dividends since 1998, with a policy to distribute at least 50% of the annual distributable profit[83]. - The proposed dividend for the fiscal year 2024 is RMB 0.27 per share (before tax), pending approval at the annual general meeting[84]. Compliance and Governance - The company has complied with all corporate governance codes as per the listing rules during the reporting period[116]. - The board of directors and senior management have confirmed compliance with the management rules and standard codes throughout 2024[100]. - Independent non-executive directors have confirmed their independence as of March 25, 2025[103]. Environmental and Social Responsibility - The company has consistently completed its ESG report for nine consecutive years, highlighting its commitment to sustainability[125]. - The company was selected for the "Central Enterprise Listed Company ESG Vanguard 100 Index (2024)" for the second consecutive year, showcasing its leadership in ESG practices[125]. - The company reported a total of RMB 17.756 million in targeted poverty alleviation expenditures in China during 2024[119].

Financial Performance - Operating revenue for Q3 2024 was CNY 65,589,857,071, representing a year-on-year increase of 0.46%[4] - Net profit attributable to shareholders decreased by 52.69% year-on-year to CNY 2,959,097,093[4] - Net profit attributable to shareholders after deducting non-recurring gains and losses increased by 6.87% year-on-year to CNY 10,040,922,760[4] - Basic and diluted earnings per share were both CNY 0.15, down 57.14% year-on-year[4] - Total operating revenue for the first nine months of 2024 was CNY 184.40 billion, a decrease of 3.84% compared to CNY 191.32 billion in the same period of 2023[22] - Net profit for the first nine months of 2024 was CNY 13.36 billion, slightly down from CNY 13.45 billion in the same period of 2023, representing a decrease of 0.68%[22] - The company reported a basic earnings per share of CNY 0.53 for the first nine months of 2024, down from CNY 0.66 in the same period of 2023[23] Cash Flow and Liquidity - The net cash flow from operating activities for the period was CNY 19,389,849,081, a decrease of 2.57% compared to the same period last year[4] - For the period of January to September 2024, the net cash flow from operating activities was RMB 162,854,506,786, a decrease from RMB 181,782,353,585 in the same period of 2023, representing a decline of approximately 10.4%[24] - The company's cash and cash equivalents decreased to CNY 46.56 billion from CNY 57.23 billion, a decline of 18.8%[18] - The total cash and cash equivalents at the end of September 2024 amounted to RMB 42,992,784,625, an increase from RMB 33,660,023,419 at the end of September 2023, representing a growth of about 27.5%[24] - Cash inflow from investment activities totaled RMB 1,196,197,468, significantly lower than RMB 3,243,266,533 in the previous year, indicating a decrease of about 63.1%[24] - The cash inflow from sales of goods and services was not specified but is part of the total operating cash inflow, which was RMB 205,847,291,411 for the current period[24] Assets and Liabilities - Total assets at the end of the reporting period were CNY 564,902,152,145, an increase of 4.39% from the end of the previous year[4] - Total assets as of September 30, 2024, reached CNY 564.90 billion, an increase of 4.83% from CNY 541.16 billion at the end of 2023[21] - Total liabilities as of September 30, 2024, were CNY 363.44 billion, a decrease of 1.20% from CNY 369.80 billion at the end of 2023[20] - The total current assets as of September 30, 2024, amounted to RMB 101.44 billion, an increase from RMB 90.74 billion at the end of 2023[16] - The total equity attributable to shareholders increased to CNY 137.70 billion as of September 30, 2024, compared to CNY 132.14 billion at the end of 2023, reflecting a growth of 4.3%[21] Shareholder Information - The total number of ordinary shareholders at the end of the reporting period was 100,691[13] - The top shareholder, Huaneng International Power Development Company, holds 5,066,662,118 shares, accounting for 32.28% of total shares[13] Operational Changes - The company reported a decrease in operating income due to a decline in domestic business settlement prices year-on-year[9] - Accounts payable decreased by 11.35% mainly due to a reduction in fuel and freight payables[10] - Derivative financial liabilities increased by 69.16% primarily due to fair value changes in fuel and foreign exchange contracts related to Singapore operations[10] - Contract liabilities decreased by 71.27% mainly due to the end of the residential heating season, resulting in reduced advance heating fees[10] - Investment income decreased by 69.08%, primarily due to losses from the disposal of equity interests in the previous year[11] - Total profit from domestic power segments reached RMB 65.68 billion, a 91.16% increase compared to the previous year[12] Research and Development - Research and development expenses increased to CNY 1.15 billion in the first nine months of 2024, up 31.5% from CNY 875.84 million in the same period of 2023[22] - The company did not report any new product launches or technological advancements during this period, focusing instead on optimizing existing operations and financial management strategies[27] Financing Activities - Cash flow from financing activities increased by 35.19% due to a year-on-year increase in net financing amounts[10] - Long-term borrowings decreased by 6.72% due to a reduction in long-term borrowing scale and reclassification to current liabilities[10] - The net cash flow from financing activities was RMB 155,125,929,956, down from RMB 203,167,623,187 in the same period last year, marking a decline of about 23.6%[26] - The cash flow from financing activities included cash received from bond issuance totaling RMB 52,100,000,000, down from RMB 56,894,089,825 in the previous year, reflecting a decrease of about 8.5%[26]

Financial Performance - For the first half of 2024, the company reported consolidated operating revenue of RMB 118.806 billion, a decrease of 5.73% year-on-year[7]. - Net profit attributable to equity holders was RMB 7.775 billion, an increase of 19.80% year-on-year, with earnings per share at RMB 0.40[7]. - The total operating cost for the first half of 2024 was RMB 103.412 billion, a year-on-year decrease of 8.69%[24]. - Fuel costs amounted to RMB 68.114 billion, a year-on-year decrease of 12.11%[25]. - The operating profit for the first half of 2024 was RMB 14,494,248, an increase of 20.3% from RMB 12,050,363 in the previous year[103]. - The company reported a pre-tax profit of RMB 11,376,144 for the first half of 2024, compared to RMB 8,435,212 in the same period of 2023, an increase of approximately 34.4%[133]. - The comprehensive income attributable to equity holders for the same period was RMB 7,840,389,000, compared to RMB 6,863,532,000 in 2023, reflecting an increase of about 14.2%[106]. - The total comprehensive income for the six months ended June 30, 2024, was RMB 9,598,359,000, compared to RMB 6,763,693,000 in 2023, representing an increase of approximately 42.5%[106]. Electricity Generation and Market Performance - The total electricity generated by domestic power plants was 210.678 billion kWh, a slight decrease of 0.22% year-on-year, with an average utilization hour of 1,680 hours, down 120 hours[9]. - In Q2 2024, the total electricity generated by domestic power plants was 97.643 billion kWh, a year-on-year decrease of 6.24%[17]. - The average electricity price for the first half of 2024 was RMB 498.70 per MWh, down 3.21% year-on-year[18]. - The proportion of market-based electricity transactions for the first half of 2024 was 86.91%, a decrease of 0.77 percentage points year-on-year[18]. - Wind power generation increased by 12.53% year-on-year to 188.80 million kWh in the first half of 2024[18]. - Solar power generation surged by 74.24% year-on-year to 81.98 million kWh in the first half of 2024[18]. - In Singapore, the company’s market share for electricity generation was 20.4%, a decrease of 1.2 percentage points year-on-year, with a pre-tax profit of RMB 1.724 billion, down RMB 1.166 billion[13]. Capacity and Development Plans - The company added controllable power generation capacity of 3,102.19 MW in the first half, with low-carbon clean energy accounting for 32.78% of total capacity[12]. - As of June 30, 2024, the company has a controllable installed capacity of 138,570 MW, with low-carbon clean energy accounting for 32.78% of the total[16]. - The company plans to enhance its renewable energy development and optimize asset structure in the second half of 2024, focusing on high-quality completion of annual targets[14]. - The company anticipates a year-on-year growth of approximately 6.5% in electricity consumption for 2024, with an expected addition of around 300 million kilowatts in installed wind and solar capacity[46]. Financial Position and Cash Flow - The total assets as of June 30, 2024, were RMB 561.273 billion, an increase of 1.99% from the beginning of the year[35]. - Cash generated from operating activities was RMB 23.603 billion, a year-on-year increase of 71.53%[37]. - The net increase in cash and cash equivalents was RMB 4.176 billion, compared to a decrease of RMB 0.232 billion in the previous year[38]. - The company had a total long-term debt of RMB 186.988 billion as of June 30, 2024, compared to RMB 183.424 billion as of December 31, 2023[42]. - The company’s cash and cash equivalents rose to RMB 20,691,486, compared to RMB 16,849,858 at the end of 2023, indicating improved liquidity[99]. - The company’s total equity attributable to owners as of June 30, 2024, was RMB 138,763,115,000, an increase from RMB 115,664,522,000 in the previous year, reflecting a growth of approximately 19.9%[112]. Governance and Compliance - The company has maintained compliance with the corporate governance code and has established a robust governance structure[61]. - The board of directors has implemented measures to enhance corporate governance and operational quality[61]. - The company has established a comprehensive internal control system, including a detailed "Internal Control Manual" that outlines 25 business processes and 19 soft elements to ensure compliance and operational efficiency[67]. - The board of directors consists of 15 members, with Wang Kui as the chairman and Wang Zhijie as the vice chairman[71]. - The company strictly adheres to the regulations regarding insider trading and has implemented measures to prevent insider trading activities[70]. Environmental and Operational Strategies - The company is focusing on green low-carbon development, with continuous growth in wind and solar installed capacity[19]. - The company has implemented ultra-low emission modifications across all coal-fired power plants, achieving compliance with local environmental standards[50]. - The company is actively adapting to the "dual carbon" goals and is accelerating the technological upgrade and transformation of coal power units[46]. - The company is committed to addressing environmental risks by adopting advanced technologies for water conservation and wastewater treatment[50]. Risks and Challenges - The company faces significant pressure on coal supply due to limited domestic coal production growth and fluctuating international coal prices, which remain relatively high[47]. - The company identified risks related to extreme weather and rising labor costs in power construction, and is taking proactive measures to ensure project progress[51]. - The company faced foreign exchange risks due to long-term foreign currency borrowings, particularly in USD and PKR, which could impact financial performance[39].

Investment Rating - The report updates the target price to HKD 5.69, which represents a 23% upside from the current price of HKD 4.62, and assigns a "Buy" rating [6][10]. Core Insights - The Q2 2024 performance was below expectations due to multiple factors, including maintenance of thermal power units, reduced contributions from heating, increased coal consumption, poor wind resources, and rising R&D expenses [2][7]. - The company maintained its annual target of adding 10GW of new capacity despite rising curtailment rates and declining electricity prices in the first half of 2024 [4][8]. - Significant improvement in operating cash flow supports the company's dividend policy, with a cash balance of RMB 203 billion as of June 30, 2024, and a commitment to maintain a cash dividend payout ratio of no less than 50% under normal profit conditions [5][9]. Summary by Sections Financial Performance - In H1 2024, the company reported revenue of RMB 118.81 billion, a year-on-year decrease of 5.73%, while net profit attributable to shareholders was RMB 7.78 billion, a year-on-year increase of 19.8% [2][7]. - Q2 2024 revenue was RMB 53.4 billion, down 12% year-on-year, with net profit around RMB 2.9 billion, down 30% year-on-year [2][7]. Shareholder Information - Major shareholders include Huaneng International Power Development Company (32.28%) and China Huaneng Group Company (9.91%) [3]. Operational Metrics - The average settlement price for wind power in H1 2024 was RMB 511.89 per MWh, down 6.04% year-on-year, while for solar power it was RMB 426.98 per MWh, down 9.77% year-on-year [4][8]. - The wind curtailment rate increased to 5.56%, and the solar curtailment rate rose to 6.05% in H1 2024 [4][8]. Cash Flow and Dividends - Operating cash inflow for H1 2024 reached RMB 23.60 billion, a year-on-year increase of 71.53% [5][9]. - The company has a strong dividend tradition, with expectations for improved cash flow to support dividend payments [5][9].

Financial Performance - The company's consolidated operating revenue for the first half of 2024 was RMB 118.806 billion, a decrease of 5.73% year-on-year[1]. - Net profit attributable to equity holders was RMB 7.775 billion, an increase of 19.80% year-on-year, with earnings per share at RMB 0.40[1]. - Operating revenue for the six months ended June 30, 2024, was RMB 118.81 billion, a decrease from RMB 126.03 billion in the same period of 2023, representing a decline of approximately 5.7%[124]. - Net profit attributable to shareholders for the same period was RMB 7.45 billion, up from RMB 6.31 billion in 2023, reflecting an increase of about 18.1%[126]. - The company reported a total profit of RMB 11.19 billion for the six-month period, compared to RMB 8.35 billion in 2023, indicating a growth of approximately 33.5%[124]. - Basic and diluted earnings per share increased by 22.58% to RMB 0.40 from RMB 0.32[120]. - The company reported a gross profit margin of approximately 10.2% for the first half of 2024, compared to 9.5% in the same period of 2023[81]. - The company achieved a net profit margin of approximately 7.7% for the six-month period, compared to 5.2% in the previous year, indicating improved profitability[124]. Electricity Generation and Utilization - The total electricity generation from domestic power plants was 210.678 billion kWh, a decrease of 0.22% year-on-year, with an average utilization hour of 1,680 hours, down 120 hours[3]. - In Q2 2024, the company's total electricity generation in China was 97.643 billion kWh, a year-on-year decrease of 6.24%[10]. - The decline in electricity generation was primarily due to the optimization of unit operation and maintenance scheduling to ensure power supply during peak summer demand[11]. - The company's coal-fired power generation in Q2 2024 decreased by 9.65% year-on-year, reflecting a shift towards renewable energy sources[14]. - The company has been actively promoting green and low-carbon development, with significant growth in wind and solar power generation capacity[11]. - In Q2 2024, the electricity generation from wind power increased by 1.80% year-on-year, while solar power generation saw a decrease of 9.30%[12]. - The company reported a 67.97% year-on-year increase in solar power generation in Jiangsu province for the first half of 2024[14]. Cost Management and Expenses - Operating costs for the first half of 2024 were RMB 103.412 billion, down 8.69% year-on-year, with domestic costs decreasing by RMB 6.295 billion[19]. - Fuel costs amounted to RMB 68.114 billion, a decrease of 12.11% year-on-year, attributed to enhanced cost control measures[20]. - The company reported a year-on-year increase in labor costs to RMB 8.685 billion, up RMB 1.266 billion, driven by performance bonuses and higher social insurance contributions[22]. - Other expenses, including electricity procurement costs, totaled RMB 12.018 billion, a decrease of RMB 1.994 billion year-on-year[23]. Investments and Financing - The company plans to enhance its new energy development efforts and optimize asset structure in the second half of 2024, focusing on high-quality completion of annual targets[8]. - The company aims to leverage green finance policies to expand financing channels and support energy security and green low-carbon transformation[8]. - The company has over RMB 350 billion in unused bank credit facilities as of June 30, 2024, indicating strong financing capabilities[33]. - The company anticipates a 6.5% year-on-year increase in electricity consumption for the full year of 2024, driven by rapid development in renewable energy[39]. - The company expects to refinance short-term borrowings and bonds, with available unutilized bank credit exceeding RMB 350 billion as of June 30, 2024[84]. Corporate Governance and Compliance - The company has a governance structure that complies with all provisions of the Corporate Governance Code as per the listing rules[53]. - The company has established a comprehensive corporate governance structure, including a shareholders' meeting, board of directors, supervisory board, and management team, ensuring clear responsibilities and effective operation mechanisms[54]. - The company has strengthened its information disclosure management system, forming a committee responsible for reviewing periodic reports and ensuring timely and accurate information disclosure[56]. - The board of directors has taken on additional governance responsibilities, including reviewing corporate governance policies and ensuring their effectiveness[55]. - The company has implemented a strict policy against insider trading, ensuring that no directors or senior management hold shares or significant contracts related to the company[60]. Assets and Liabilities - Total assets as of June 30, 2024, amounted to RMB 561.273 billion, reflecting a growth of 1.99% since the beginning of the year[28]. - Total liabilities increased by 1.64% to RMB 377.057 billion, resulting in a debt-to-equity ratio of 67.18%[28]. - The company's cash and cash equivalents at the end of June 2024 were RMB 20.327 billion, a 24.82% increase compared to the end of 2023[30]. - The company's total current liabilities reached RMB 172,459,758 thousand, an increase of 5.6% from RMB 163,999,354 thousand at the end of 2023[80]. - The company's long-term borrowings stood at RMB 159.98 billion as of June 30, 2024, slightly down from RMB 162.35 billion at the end of 2023, reflecting a decrease of about 0.82%[78]. Strategic Initiatives and Future Outlook - The company plans to continue its market expansion and product development strategies, focusing on sustainable financing options[106]. - The company is actively monitoring national and industry policies to adapt to the evolving electricity market under the "dual carbon" goals[40]. - The company is enhancing its coal procurement strategies to manage costs and improve supply structure amid international market influences[41]. - The company is facing risks in power construction due to extreme weather, rising labor costs, and lengthy land acquisition processes, and plans to enhance organizational coordination to address these challenges[44].

Investment Rating - The report assigns a "Buy" rating for the company with a target price of HKD 7.80, indicating a potential upside of 55.07% from the closing price of HKD 5.00 on April 25, 2024 [1][3]. Core Insights - The company has shown strong performance in Q1 2024, with revenue of CNY 653.67 billion, a year-on-year increase of 0.15%, and a net profit of CNY 45.96 billion, reflecting a significant year-on-year growth of 104.25% [2]. - The decline in fuel costs has been a major driver for the increase in profitability, particularly in the coal and wind power sectors, which contributed profits of CNY 28.25 billion and CNY 24.14 billion, respectively, marking year-on-year growth of 4151.44% and 25.41% [2]. - The company is expected to benefit from a more relaxed coal supply-demand balance in 2024, leading to further reductions in fuel costs and enhanced profitability [2]. - The company's domestic power generation capacity is projected to reach 4850 billion kWh in 2024, with a 5.63% year-on-year increase in Q1 [2]. - The report highlights the implementation of a two-part pricing mechanism for coal power, which is anticipated to improve cash flow and profitability for the company [3]. Financial Summary - For the fiscal years 2023 to 2026, the company’s revenue is forecasted to grow from CNY 254,396.70 million in 2023 to CNY 276,074.44 million in 2026, with growth rates of 3.11%, 4.04%, 2.18%, and 2.08% respectively [1][5]. - The net profit attributable to the parent company is expected to increase significantly from CNY 8,357.46 million in 2023 to CNY 16,828.72 million in 2026, with growth rates of 204.13%, 60.57%, 13.13%, and 10.85% [1][5]. - The earnings per share (EPS) is projected to rise from -0.51 in 2023 to 1.18 in 2026, indicating a strong recovery and growth trajectory [1][5]. - The price-to-earnings (P/E) ratio is expected to decrease from 8.70 in 2023 to 4.32 in 2026, suggesting an attractive valuation as earnings improve [1][5].

Investment Rating - The report updates the target price to HKD 5.89, representing a potential upside of 17% from the current price of HKD 5.03, and assigns a "Hold" rating [5][11]. Core Insights - In Q1 2024, the company reported a net profit of RMB 4.596 billion, a year-on-year increase of 104.25%, with total revenue of approximately RMB 65.367 billion, reflecting a slight increase of 0.15% [2][8]. - The company's coal power segment showed significant profit recovery, with coal machine profits totaling RMB 2.825 billion, compared to a loss of RMB 70 million in Q1 2023, benefiting from a 13% decrease in both benchmark coal prices and fuel costs [2][8]. - The company plans to add 10 GW of wind and solar capacity in 2024, with total installed capacity reaching 30.217 million kW, and the proportion of low-carbon clean energy increasing to 32% [3][9]. - Wind power profits in Q1 2024 reached RMB 2.414 billion, a year-on-year increase of 25.41%, indicating stable growth in this segment [3][9]. - Long-term reasonable returns from coal power are expected to support the company's dividend payout ratio, which reached 57.14% in 2023, with further improvements anticipated in 2024 [4][10]. Financial Summary - The company’s revenue is projected to grow from RMB 254.397 billion in 2023 to RMB 267.329 billion in 2024, with a year-on-year growth rate of 5.1% [5][14]. - The net profit is expected to increase significantly from RMB 8.357 billion in 2023 to RMB 11.980 billion in 2024, reflecting a growth rate of 43.4% [5][14]. - The earnings per share (EPS) is projected to rise from RMB 0.35 in 2023 to RMB 0.7632 in 2024 [5][14].

Investment Rating - The report maintains an "Outperform" rating for Huaneng Power International [3][5][10] Core Views - The company's performance in Q1 2024 is in line with expectations, driven by a significant recovery in thermal power profitability and a decrease in coal prices [7][10] - The report projects net profits for 2024-2026 to be CNY 12,132 million, CNY 13,230 million, and CNY 15,706 million respectively, with a target price set at HKD 5.32 based on a 7x PE valuation for 2024 [10] Financial Performance Summary - In Q1 2024, the company achieved revenue of CNY 65.367 billion, a year-on-year increase of 0.15%, and a net profit of CNY 4.377 billion, a year-on-year increase of 117.98% [7][8] - The coal-fired sector contributed CNY 2.825 billion in profit, a year-on-year increase of 42 times, while the gas-fueled plants contributed CNY 536 million, a year-on-year increase of 64.34% [7][8] - The average on-grid electricity price in Q1 2024 was CNY 498 per MWh, a decrease of approximately 4% year-on-year [8][9] Segment Performance - The company sold 113.036 billion kWh of electricity in Q1 2024, a year-on-year increase of 5.63%, with significant growth in new energy sources [8][9] - New energy capacity increased by approximately 16GW in Q1 2024, a year-on-year increase of 99.7%, with wind power accounting for 54% of the new installations [9][10] Profitability Metrics - The report forecasts gross margins to improve from 12.1% in 2023 to 16.7% by 2026, with net margins expected to rise from 3.3% to 5.7% over the same period [6][10] - The return on equity (ROE) is projected to increase from 7.0% in 2023 to 10.1% by 2026 [6][10]