Event
Huadian International publishes semi-annual report 2021
According to the semi-annual report released by Huadian International in 2021, the company's operating income in 2021H was 53.478 billion yuan, an increase of 28.77% over the same period last year. The net profit returned to its parent was 3.317 billion yuan, an increase of 39.01% over the same period last year. During the reporting period, the company realized EPS of 0.283 yuan, an increase of 42.93% over the same period last year. The weighted average ROE was 5.71%, an increase of 1.52% over the same period last year.
Brief comment
Investment income has significantly increased the impairment of hedged assets, and the company's performance has maintained high growth. the company is a leading national thermal power enterprise, with cumulative power generation of 113.241 billion kilowatt hours in the first half of 2021, an increase of 21.8% over the same period in 2020. The main reason for the year-on-year increase in power generation of the company is the strong demand for electricity in various service areas of the company, and the rapid increase in power generation promotes the company's operating income to increase by 28.77% compared with the same period last year The company achieved an investment income of 4.264 billion yuan in the first half of the year, mainly due to one-off matters such as increasing investment in Huadian Fuxin (recognizing current income of 2.952 billion) and selling Ningxia regional assets to Huadian Group (recognized current income of 882 million). In May 2021, the company announced that it intends to contribute 21.237 billion yuan (of which the company's price is not more than 13.609 billion and the cash contribution is not less than 7.628 billion) to inject new capital into China Dianfu, and the assets of the relevant new energy companies will no longer be included in the consolidated statement of Huadian International. after the completion of the capital injection, the company will hold a 37.19% equity stake in Fuxin Development. The impairment loss of the company's assets reached 2.106 billion yuan in the first half of the year, mainly due to the overall sale of Maohua Company and the impairment of related assets. Investment income significantly increased the impairment of hedge assets, driving the company's performance to maintain high growth.
High coal prices have an impact on thermal power business, resulting in a significant increase in hourly utilization.
Benefiting from the continuous improvement in power generation demand, the average utilization hours of the company's generating units is 1936 hours, an increase of 298 hours compared with the same period last year, of which the utilization hours of coal-fired generating units is 2245 hours, an increase of 415 hours over the same period last year. In the first half of the year, the company's power supply coal consumption was 283.16 g / kWh, which was 5.36g / kWh lower than the same period last year, and the power supply coal consumption was significantly lower than the national average. Affected by the substantial increase in market coal prices, the company's standard coal price in the first half of the year was 831.66 yuan / ton, an increase of 33.13% over the same period last year. High coal prices have a significant impact on the company's thermal power business, the company's 21Q1, 21Q2 single-quarter gross profit margin of 11.61% and 6.65% respectively, continued to decline month-on-month.
Policy companies should speed up the strategic transformation and maintain the "buy" rating countries of Huadian International to speed up the construction of a new power system with new energy as the main body, with the rapid growth of new energy and the increasing ability of cross-provincial and inter-regional cooperation. The company will speed up the strategic transformation and adhere to the three-pronged development strategy of new construction, M & An and asset injection. The company will vigorously expand domestic hydropower, high-quality gas power and high-efficiency coal power in line with national policy, and actively explore mergers and acquisitions of overseas wind and solar power projects. We estimate that the company's operating income from 2021 to 2023 is 99.64 billion yuan, 94.94 billion yuan and 96.29 billion yuan respectively, and the EPS is 0.17,0.37 and 0.49 yuan respectively, maintaining the "buy" rating.
Risk hint: the risk of a sharp rise in coal prices; the risk of asset impairment.