TGWC(SH:600116) Mei Ri Jing Ji Xin Wen·2025-07-11 15:14Core Viewpoint - The company, Three Gorges Water Conservancy, anticipates a significant decline in net profit for the first half of 2025, primarily due to reduced water inflow and poor performance from its associate company, Tian Tai Energy [1][2]. Financial Performance - Three Gorges Water Conservancy expects a net profit of 40 million to 52 million yuan for the first half of 2025, representing a year-on-year decline of 82.54% to 77.30% [1]. - The company reported a 7.92% decrease in revenue for the first quarter of this year, with a non-recurring net profit loss of 17.23 million yuan, which has worsened compared to the previous year [2]. - The net profit from the company's electricity business decreased by approximately 71 million yuan due to reduced water inflow, leading to a 23.05% drop in self-generated hydropower output [2]. Operational Challenges - The company faced additional losses of about 4.7 million yuan due to tax payments related to previous years and reduced investment income from Tian Tai Energy, which saw a year-on-year decline of approximately 21 million yuan [3]. - The company is also experiencing delays in receiving funds for rural power network repayment, resulting in unrecouped depreciation and financial costs amounting to about 1.5 million yuan [3]. Asset Management - Three Gorges Water Conservancy plans to sell its 41.0071% stake in Tian Tai Energy, with a minimum transfer price of 641 million yuan, reflecting a 123.60% increase in value [4][5]. - Tian Tai Energy's projected revenue and net profit for 2024 are 4.476 billion yuan and 78.17 million yuan, respectively, but it reported a loss of 25.15 million yuan in the first quarter of this year [4]. Strategic Moves - The sale of Tian Tai Energy shares is aimed at enhancing asset operational efficiency and improving the company's strategic layout by converting equity into more liquid funds [5].