JEP(SZ:000875) Zheng Quan Zhi Xing·2025-07-11 09:26Core Viewpoint - The credit rating of Jilin Electric Power Co., Ltd. is affirmed at AAA with a stable outlook, supported by strong backing from its actual controller, advantages in renewable energy scale, and robust profitability and cash generation capabilities [3][4][9]. Financial Overview - Total assets of Jilin Electric Power increased from 668.25 billion in 2021 to 810.46 billion in 2024 [4][28]. - Total liabilities rose from 524.72 billion in 2021 to 600.28 billion in 2024, indicating an upward trend in debt levels [4][28]. - Operating revenue decreased from 149.55 billion in 2022 to 144.43 billion in 2023, reflecting a year-on-year decline of 3.42% [4][10]. - Net profit increased from 11.84 billion in 2022 to 15.63 billion in 2023, showing a growth of 32.5% [4][10]. Operational Strength - The company has a significant installed capacity of 1,342.12 MW as of 2023, with a high proportion of renewable energy [7][18]. - The average utilization hours for thermal power units were 3,849 hours in 2022, which decreased to 2,697 hours in 2023, indicating operational challenges [21][19]. - The company’s renewable energy projects are distributed across 30 provinces, enhancing risk diversification [17][19]. Industry Context - The overall power supply and demand in China is expected to remain balanced in 2024, with a continued trend towards cleaner energy sources [15][16]. - The average utilization hours of power generation equipment are declining due to rapid growth in installed capacity outpacing demand [15][16]. - The industry is facing challenges such as high coal prices and uncertainties in water resources, which may impact the balance of power supply and demand [15][16]. Debt and Financing - The company’s debt levels are increasing, with total debt reaching 592.60 billion by 2024, reflecting a high financial leverage [4][28]. - The company has a strong financing capability, with total credit facilities from financial institutions amounting to 41.85 billion [29][32]. - The debt structure is primarily long-term, which is considered reasonable [27][28]. Cash Flow and Profitability - Operating cash flow decreased to 54.45 billion in 2023 from 73.28 billion in 2022, indicating a decline in cash generation [31][29]. - The company’s profitability has improved due to lower coal prices and reduced financial costs, with EBIT increasing to 33.59 billion in 2023 [4][26]. - The EBITDA interest coverage ratio improved to 4.48 in 2023, reflecting enhanced debt servicing capacity [31][30].