senior executives of the company
qiao baoping delivers a speech
li enyi introduces business performance
china longyuan power group corporation limited held a conference in hong kong to announce its 2014 interim results. qiao baoping, chairman of the board of directors and secretary of party leadership group of china guodian corporation and chairman of the board of directors of china longyuan power attended and addressed the meeting. xie changjun, vice president and member of party leadership group of the group corporation and chairman of the supervisory board of china longyuan power attended the meeting. li enyi, president assistant of the group corporation, president and executive director of china longyuan power attended the meeting and introduced the company’s operating results in the first half of 2014. secretary of the board of directors, president assistant and principals of relevant departments of the group corporation and directors, supervisors, secretary of the board of directors and chief accountant of china longyuan power attended the meeting.
in his speech, qiao baoping pointed out that, in the first half year, longyuan power closely focused on the “five-articles”, pragmatically carried forward every work and thus had obtained ideal operation performance. in order to return the eager anticipation of investors, release the high pressure from energy saving and emission reduction and meet the urgent demand on energy structure adjustment, we should persistently develop new energy industry; under the direction of scientific development strategy in the new era, reinforce operation management, deepen reform and innovation and deeply boost the third business venture; we should do our best to operate, manage and develop longyuan power well; we should wholly promote the comprehensive strength, core competitiveness and risk resistance of the company; and we should also speed up constructing longyuan power a world-leading listed new energy company, so that we can return all shareholders and investors with better performance and make more new contributions to coping with global climate change and constructing a beautiful china.
in the first half of 2014, the company achieved remarkable results in the following perspectives:
(i)increasing the benefits through in-depthexploration of the potential, and sustaining a sound momentum in the operation. the company proactively coped with the severe and complex operating environment, and adopted several measures to explore the potential of profitability. in the first half of the year, the company recorded operating revenue of rmb8,987 million, among which electricity sales and other revenue of wind power business amounted to rmb5,610 million, representing a year-on-year increase of 9.6%. the profit before taxation amounted to rmb2,176 million, net profit attributable to shareholders of the company amounted to rmb1,365 million, and earnings per share was rmb0.1699. in the first half of the year, facing with the stable yet tightened monetary policy, the company took the initiative and committed itself to introduce low-cost funds at home and abroad via multiple channels. the company successfully issued 3 terms of privately raised corporate bonds of rmb8,000 million in total, all the interests of which recorded the lowest in the market. through hero asia investment limited, a subsidiary of the company in hong kong, the company obtained over rmb3,000 million low-cost fund. by taking advantage of frequent replacement of finance and structure optimization, the ratio of average cost of fund decreased in the first half of the year as compared to 2013, a leading position in the industry. the average on-grid tariffs for wind power amounted to rmb583 per mwh (vat inclusive), generally the same as compared with rmb582 per mwh (vat inclusive) for the corresponding period of 2013. the wind power tariff remained stable.
(ii)sparing no efforts to acquire quality resources, and improving the development quality continuously. in the first half the year, the company adhered to its strategic guidance, promoted joint development, strengthened and deepened the preliminary work and accelerated the increase of quality resources reserve, which contributed to the continuous optimization of the wind power layout. in the first half of the year, the company obtained approvals for 8 wind power projects with total capacity of 527.8 mw, all being located in regions not subject to grid curtailment. 28 projects of the company with gross capacity of 1,542.9 mw were included in the fourth batch of wind power projects approved plan released by the national energy administration in february 2014, among which, the capacity located in regions not subject to grid curtailment took up over 90%. as of 30 june 2014, the company had wind power projects of 5.3 gw capacity which were approved but not yet put into operation as planned and wind power projects of 9.6 gw capacity which were included in the national plan but not yet put into operation, while the total wind power project reserves accumulated to 68.5 gw. the company strengthened the cooperation with branches (subsidiaries) of guodian group and renowned local enterprises. leveraged the advantages of regional resources of the counterparties as well as the company’s professional platform, both parties achieved win-win cooperation. as at the end of june, there were total of 23 additional projects under joint development which covered 7 provinces with gross capacity of 1,874.2 mw. after four years of exploration and practice, the scale development of offshore wind power of the company was gradually speeded up. in the first half of 2014, the company promoted the preliminary work of the expansion project (planned capacity of 200 mw) of jiangsu rudong offshore 200,000 kw demonstration project, accelerated the construction of offshore pilot project of large turbines in rudong jiangsu (planned capacity of 49 mw), and successfully carried out the stepped experimental work of offshore wind power project in fujian nanri (planned capacity of 400 mw). all three offshore wind power projects are expected to be put into operation in the near future.
(iii)focusing on the management of safe production, and improving the power generation effectively. in the first half of the year, the company effectively counteracted the adverse effect attributed to lower wind resources through strengthening the internal production management and strict external sales. the company made great efforts in equipment optimization, comprehensively summarized the past experiences and results, optimized the operation of equipment in the company’s 97 wind farms, carried out research on controlling strategies such as adjusting the cut-in and cut-out wind speed through the research group, transformed and improved the performance of spare parts of the generating units, which effectively raised the power generation capacity, representing an increase of 57 million kwh in the first half of the year. the company took the lead in extending the centralizing supervision mode at provincial level in the nation. currently, it has established four supervision centers at the provincial level, developed upgraded far-end centralized supervision and informatisation in the industry of wind power, boosting the overall operation management and efficiency of electricity generation in power plants. the company reinforced the benchmarks of power generation, optimized the measures of benchmark value, implemented the comparative benchmarks, scientifically defined the range of capacity of benchmark generating units, and carried out the regional benchmarks at the provincial level to enhance the comparability of benchmarks, highlighting the benchmarking in management. it actively responded to power curtailment with a focus on supervising backward units on the improvement of measures and reinforcement of implementation to further alleviate power curtailment. the company innovated the assessment mechanism. it formulated the three-tier assessment of power generation covered by regional company, project company and wind power farm, breaking down the assessment index of power generation at different levels. with strengthened tracking and supervision, it stimulated the initiative and awareness on work of production staff. in the first half of 2014, the company completed the accumulated power generation of 16,730 million kwh, of which electricity generated from our wind power business accounted for 11,624 million kwh, representing an increase of 4.86% year on year. the company’s daily electricity output exceeded 100 million kwh for 8 times, continuously hit the record.
(iv)maintaining lean management whilst promoting quality project construction. in order to achieve the production plan for 2014, the company enhanced the lean management at all levels while steadily carried forward with engineering construction. the tendering procedure of equipment was speeded up while project management was enhanced through continued progress in workflow optimization, which enabled the company to enter into the kickoff phase and investment decision stage ahead of the schedule, and thus gained time for accomplishing the production plan. the bidding of production project for the yearhad completed up to 70% in the first quarter this year, which further expandedup to 95%in the first half of the year. the project progress was under more rigorous supervision by improving the measures on appraisal management of project process, pursuant to which, the company specified more than 2,000 key points of planned production projects in details, detailed the construction plan on a daily basis and implemented “daily process tracking, weekly plan verification as well as monthly appraisal and supervision”, in a bid to accelerate the construction progress while effectively ensure the smooth connection between the supply of equipment and constructionprogress. with an aim to deliver quality projects, efforts were made to established consciousness for the best through insisting on high standard operation, top-level construction and quality production. the offshore wind power project inrudong, jiangsu and the wind power project in matang, yunnan developed by thecompany were granted “premium quality power construction in china”while the offshore wind power project in rudong, jiangsu was alsorecommended as a candidate of “national premium quality construction”.as of 30 june 2014, the company had 15 projects with gross installedcapacity of 1,594 mw honored as “premium quality power construction in china”, 4 projects with gross installed capacity of 648 mw honoredas “national premium quality construction” and 1 project with gross installedcapacity of 150 mw honored as “china construction and engineering lubanaward”.
(v)speeding up the implementation of “going-global” strategy with phased results in overseas business. in the first half of the year, the company steadily carried out its overseas business asscheduled.the canadian dufferin wind powerproject was in smooth progress. pouring of wind turbine was almost finished; theproject of road access, grid, the integrated building and switch station were almostfinished; and assembly of wind turbines and the construction of transmission lineswere comprehensively commenced, which were expected to be put into productionin the second half of the year.the company will take this opportunity to extend its operation to america, mexico andsouth american countries, so as to soon achieve the breakthrough in the countriesand regions above.project obtained in october 2013 in south africa is proceeded in accordanceto the requirements on bidding documents provided by the government of southafrica. the approval examination on project financing is expected to be completedin the second half of the year while the preparation work for construction will commence upon the execution of grid connection agreement, electricity purchaseand sales agreement and other contracts. the company will continue to follow thebasic principle on overseas investment to develop projects with high returns in keyregions, to the extent of risks under control.
(vi)enhancing technical innovation while sparing no effort to establish core platform for wind power business. in the first half of the year, the company optimized the technical management mechanism, which not only improved the level of professional management by strengthening the technical management functionof the technical center in the headquarters but also replenished the company with strong research capability.the company took the new energy technological research institute as a platform to further integrate technology resources and promote the application of new achievements by leveraging the “two centers and two institutions” (兩中心兩所). national, industrial, guodian group and company projects were carefully organized and carried out at all levels. in the first half of the year, projects contracted by the company included 6 “863” and “973” state-level technological projects, 5 additional technological projects of guodian group and 6 independent projects of the company.in addition, the company initiated and organised the work ofdrafting 2 industry standards and completed the approval application for 2 nationalstandards.the “longyuan zhenhua no. 2”, an 800-tonne jack-up offshore windfarm construction platform, was delivered and put into operation in the first half of the year. as thefirst rack-and-pinion offshore wind farm construction vessel with capability to meet the requirements ofoffshore wind farm development to a depth of 30 meters, it is the mostcomprehensive professional offshore wind farm construction platform with besthoisting capacity, widest applicability and most advanced lifting system, indicating that the company independently owns an integrated construction platform for tidal-flat wind power and offshore wind farm which represents the most advanced equipment in the industry.the business scope and the main focus of companies engaged in technical services were further specified. efforts were made to improve the integrated services at all business sectors of new energy development while strengthening the consciousness of market services, so as to serve the guodian group and expand in the industry with longyuan as its foothold.
in order to ensure the completion of the annual operation targets for the year of 2014, emphasis willbe laid on the followings in the second half of the year: 1. to enhance the operation of stock assets and improve the corporateprofitability; 2. to optimize the development of earned assets and improve thequality of corporate development; 3. to deepen the reform of systems and mechanisms and improve business management standard; 4. to promote cultural and ideological progress and enhance the soft power of the enterprise.