Clp Holdings Limited · HKEX:2
Clp — H1 2024 Earnings Presentation
56 slides from Clp's earnings presentation, Aug 5, 2024
Slide 1: 2024 Interim Results Presentation
CLP Holdings 2024 Interim Results Presentation 5 August 2024
Slide 2: Disclaimer
Disclaimer Potential investors, analysts and shareholders of CLP Holdings Limited (the Company) and other recipients of this document are reminded that this document and any oral discussion made together with this document (the presentation) are provided for your information purposes only and you ma
Slide 3: Agenda
Agenda Overview TK Chiang, Chief Executive Officer Financial Performance and Outlook Alex Keisser, Chief Financial Officer Strategy and Roadmap TK Chiang, Chief Executive Officer Questions and Answers Appendices Black Point Power Station in Tuen Mun, Hong Kong. 2
Slide 4: Overview
Overview CCGT D2 gas-fired generation unit at Black Point Power Station, Hong Kong. 3
Slide 5: 1H2024 highlights
1H2024 highlights Strong financial performance with solid growth in earnings and improved results from EnergyAustralia. Operational delivery on projects and fleet contributing to energy security and energy transition. Growth momentum focussed on Scheme of Control business and zero carbon investments
Slide 6: 1H2024 highlights
1H2024 highlights Financial Highlights Operational Highlights Change Change Operating Earnings Safety & Customers (before Fair Value Movements) HK$5,683 million 22% Total recordable injury rate (2) 0.17 0.01 Unplanned customer minutes lost 6.05 min 0.33 min Total earnings HK$5,951 million 18% in Hon
Slide 7: Financial Performance and Outlook
Financial Kidston pumped hydro energy storage project in Queensland, Australia. Performance and Outlook 6
Slide 8: 1H2024 financial overview
1H2024 financial overview Strong start to 2024 driven by solid delivery across the Group Operating Earnings (1) EBITDAF (1) before Fair Value Movements Total Earnings HK$12,990 million 17% HK$5,683 million 22% HK$5,951 million 18% Capital Investment (2) Dividend per share (DPS) Second Interim DPS De
Slide 9: EBITDAF by business unit
EBITDAF by business unit Solid growth in earnings and improved results from EnergyAustralia 2,010 (18%) HK$M 15,000 80 15 1,754 12,990 80 13,000 202 ( 17 ) 2,224 102 11,082 502 11,000 124 481 ( 102 ) ( 324 ) 1,947 1,524 9,000 7,000 Taiwan Region & Thailand Apraava Energy 5,000 8,926 9,424 EnergyAust
Slide 10: Operating earnings by business unit
Operating earnings by business unit Strong first half financial performance HK$M 1H2024 1H2023 Change Hong Kong energy and related activities 4,291 4,170 3% Stable contribution from SoC average net fixed asset growth, slightly offset by higher interest costs. Mainland China 988 1,372 28% Reduced nuc
Slide 11: Hong Kong Operating Earnings
Hong Kong Continued stable contribution from capital investments 5,000 3% 4,170 197 4,291 4,000 ( 113 ) 41 (4) Operating Earnings 3,000 (HK$M) 2,000 1,000 - 1H2023 FX Return on higher fixed Higher Others * 1H2024 assets interest costs * Others include non-SoC items and CLPe operations in Hong Kong P
Slide 12: Mainland China Operating Earnings
Mainland China Solid underlying performance impacted by nuclear scheduled maintenance outages 22% 1,500 1,372 ( 77 ) 988 16 Operating Earnings 900 ( 306 ) ( 10 ) (7) 351 (HK$M) Renewables 300 836 Nuclear 12 Thermal (211) (300) Corporate expenses 1H2023 FX Nuclear Renewables Thermal Corporate expense
Slide 13: EnergyAustralia Operating Earnings
EnergyAustralia Uplift in earnings led by delivery on generation assets and improved customer performance 201% 3,000 EBITDAF 630 2,000 538 Operating Earnings 1,374 21 2,340 1,000 ( 158 ) 611 Customer EBITDAF ( 184 ) (HK$M) (406) - Energy EBITDAF 16 (746) (1,000) (590) Enterprise EBITDAF (1,613) Inte
Slide 14: Apraava Energy Operating Earnings
Apraava Energy Profitable growth, strong operating performance, and healthy pipeline of non-carbon projects 250 61% 17 203 Operating Earnings 200 38 56 Thermal 22 (HK$M) 150 1 127 Transmission & AMI (2) 59 100 Renewables 54 Group adjustment 50 Corporate expenses 32 - 2 1H2023 FX Renewables Thermal T
Slide 15: Cash inflows and outflows
Cash inflows and outflows Strong free cash flow to support growth and dividends HK$ billion 6.8 8.0 Cash inflows Proceeds from divestment 1.6 Healthy cash inflow from increased funds from operations. 8.0 5.2 Free cash flow (deducted maintenance capex) 1H2023 1H2024 Cash outflows HK$ billion Capital
Slide 16: Financial structure and liquidity
Financial structure and liquidity Sound balance sheet and low risk profile Net Debt Net Debt/Total Capital Liquidity Position Undrawn bank facilities Bank balances HK$58.8 billion 34.0% HK$27.3 billion HK$2.9 billion (31 Dec 2023: HK$52.3b) (31 Dec 2023: 31.6%) (31 Dec 2023: HK$30.9b) (31 Dec 2023:
Slide 17: Strategy and Roadmap
Sidhpur wind farm located in the state of Gujarat, India. Strategy and Roadmap 16
Slide 18: Areas of strategic focus
Areas of strategic focus Decarbonise our Sustainable portfolio and prosper capital in the energy allocation transition Power Brighter Tomorrows Uplifting Invest in growth capability and electrification 17
Slide 19: Development Plan lays foundation for growth and decarbonisation
Development Plan lays foundation for growth and decarbonisation Building a Powering Hong Kong’s resilient smart city economic growth & Continuing new industries Delivering 2.8 million smart decarbonisation meters. 2024-28 Powering 18 data centres and Reinforcement and upgrade of Completion o
Slide 20: Accelerating our zero carbon development pipeline
Accelerating our zero carbon development pipeline Battery Energy Storage System (BESS) ~5-6GW ~1-2GW Renewables ~0.6GW Strict investment Mainland China ~1.4GW (in CLP equity GW) ~2GW criteria • Double existing RE portfolio in the medium term (1) Jun 24 Execution Construction Leads Medium term Strate
Slide 21: Uplifting our capability
Uplifting our capability Digital and data capability A safe, future-ready workforce Digital fully embedded into our business Refreshed values, new way of working culture Strategic workforce development Care Excellence Responsibility We look after We seek to deliver We do the people and planet better
Slide 22: Questions and Answers
Question , and Answers ALR OE
Slide 23: Appendices
Tallawarra gas-fired power stations A & B in New South Wales, Australia. Appendices 22
Slide 24: Financial highlights
Financial highlights 1H2024 1H2023 Change Revenue (HK$M) 44,086 43,302 +2% Operating Earnings (before Fair Value Movements) (HK$M) 5,683 4,657 +22% Operating Earnings (HK$M) 5,855 4,674 +25% Total Earnings (HK$M) 5,951 5,060 +18% Operating Earnings per share (HK$) 2.32 1.85 +25% Total Earnings per s
Slide 25: Operating highlights
Operating highlights 1H2024 1H2023 Change Safety (Total recordable injury rate) (1) 0.17 0.16 (1) +0.01 Reliability in Hong Kong (minutes lost pa) (2) 6.05 5.72 +0.33 Customer accounts (Thousand) Hong Kong 2,814 2,771 +43 Australia 2,418 2,439 -21 Electricity sent out (TWh) (3) 37.6 38.2 -1.6% Gener
Slide 26: Items affecting comparability
Items affecting comparability HK$M 1H2024 1H2023 Hong Kong Profit from sale of properties Hong Kong – Profit from sale of properties 23 88 Sale of properties relating to Argyle Street redevelopment since Nov 2022. Hong Kong – Revaluation loss on investment (33) - property Hong Kong Revaluation loss
Slide 27: Reconciliation of EBITDAF and Operating Earnings
Reconciliation of EBITDAF and Operating Earnings HK$M 1H2024 1H2023 Change Net finance costs (1) Recurring EBITDAF 12,990 11,082 17% • Increase in net finance cost attributable to higher market Less: interest rate in Hong Kong. (4,554) (4,358) Depreciation and amortisation Income tax expense Net fin
Slide 28: Reconciliation of EBITDAF and Operating Earnings by business units
Reconciliation of EBITDAF and Operating Earnings by business units Hong Kong energy and Taiwan Region and Other earnings & HK$M Mainland China EnergyAustralia Apraava Energy Group total related activities Thailand unallocated items 2024 Interim Recurring EBITDAF 9,424 1,524 2,224 202 80 (464) 12,990
Slide 29: Operating earnings before fair value movements
Operating earnings before fair value movements HK$M 23% 8,000 2,010 6,000 ( 97 ) 5 5,683 ( 606 ) 79 ( 233 ) 203 101 4,657 611 127 988 4,000 ( 53 ) 1,372 Taiwan Region & Thailand 2,000 4,291 4,170 Apraava Energy EnergyAustralia - Mainland China (590) (489) Hong Kong (523) Other earnings & (2,000) una
Slide 30: Cash flow and financial structure
Cash flow and financial structure Free Cash Flow • Hong Kong: Improvement in operating cash inflow from SoC operations (+HK$0.7 billion) attributable to the higher basic tariff revenue and more units sold, partially offset by the under- recovery of fuel cost (1H2023: partial recovery of fuel costs);
Slide 31: Dividends
Dividends A history of returning cash to shareholders CLP Ordinary Dividend* 1987 – 1H2024 and Shareholding by Category HK$ 3.50 Retail Interests 3.10 3.10 3.10 3.10 investors associated with 3.02 3.08 Kadoorie Family 2.91 3.00 34% 35% 2.80 As at 2.70 2.62 31 Dec 2023 2.50 1.19 1.21 1.21 1.21 1.21 1
Slide 32: Financial obligations at a glance
Financial obligations at a glance HK$M 30 Jun 2024 31 Dec 2023 HONG KONG Total borrowings of CLPH, CLPP, CAPCO & PSDC 52,160 47,968 Increase in the Group’s net Minus: Bank balances and liquid funds (1,085) (2,806) debt to total capital was Net debt – Hong Kong 51,075 45,162 driven by higher net debt
Slide 33: Credit ratings
Credit ratings CLP Holdings CLP Power CAPCO EnergyAustralia S&P Moody’s S&P Moody’s S&P Moody’s Moody’s Long-term Rating The credit ratings and rating outlooks had remained unchanged in the first half Foreign Currency A A2 A+ A1 AA- A1 Baa2 of 2024. Outlook Stable Stable Stable Stable Stable Stable
Slide 34: Highlights of financing activities
For more information on Highlights of financing activities CLP Climate Action Finance Framework CLP Holdings: Ample liquidity in the Group at 30 June 2024 Scheme of Control: Cost effective financing • The Group maintained adequate liquidity with undrawn bank facilities of HK$27.3 July 2024 billion a
Slide 35: Loan balances by type and maturity
Loan balances by type and maturity Loan Balance – Type Proportion of Debt on Fixed and Loan Balance – Maturity (1) Floating Rate HK$M HK$M 70,000 70,000 60,000 5% 60,000 4% 22% 50,000 50,000 22% 33% 32% 43% 52% 16% Jun 2024 11% 48% 40,000 40,000 57% 30,000 30,000 27% 24% Dec 2023 20,000 57% 54% 20,0
Slide 36: Hong Kong – Growing business scale
Hong Kong – Growing business scale Generation Transmission Distribution Retail 9,399 MW > 17,000 km of transmission and 244 primary and > 15,600 16,743 GWh sold and generation portfolio high voltage distribution lines secondary substations 2.814 million customer accounts During 1H2024: • Local elect
Slide 37: Hong Kong – Electricity sales, earnings and capex
Hong Kong – Electricity sales, earnings and capex Electricity sales Capital expenditure (Accrual basis) HK$M 1H2024 1H2023 Change GWh 1H2024 1H2023 Change Proportion Residential 4,375 4,216 3.8% 26% CLP Power 3,209 2,805 14.4% Commercial 6,610 6,481 2.0% 39% CAPCO * 851 1,938 56.1% 2.8% 30% Total Ca
Slide 38: Hong Kong – Tariff, reliability, fuel prices and environmental improvement
Hong Kong – Tariff, reliability, fuel prices and environmental improvement Low tariff Residential Tariff % Increase from Jan 2021 to Jan 2024 High reliability (FY2023) Unplanned customer minutes lost per year HK$/kWh London +74% 4.0 40 3.0 Singapore +47% 30 26 20 2.0 13 New York +25% 6.0* 10 10 1.0
Slide 39: Mainland China – Financials
Mainland China – Financials Operating / Total Earnings HK$M RMB M 1H2024 1H2023 1H2024 1H2023 Renewables 351 347 325 308 - Wind 228 226 211 201 - Hydro 36 12 33 10 - Solar 87 109 81 97 Nuclear 836 1,168 774 1,039 - Daya Bay 344 520 318 463 - Yangjiang 492 648 456 576 Thermal 12 23 11 21 - Shandong 4
Slide 40: Mainland China – Earnings, performance and opportunities
Mainland China – Earnings, performance and opportunities Earnings and performance Business development opportunities • Less earnings from nuclear because of carrying out major • Solar: The up to 100MW Huai’an Nanzha (former known as outages in Daya Bay and Yangjiang in 1H. “Caoyun”) solar project an
Slide 41: Mainland China – Market sales in 1H2024
Mainland China – Market sales in 1H2024 Province Projects with Market Sales (Equity MW) Yunnan Xundian Wind (99.5MW) Xicun Solar (84MW) Dali Yang_er Hydro (50MW) Inner Mongolia Zhungeer Thermal (257MW) Hebei Sanhe Thermal (219MW) Tianjin Panshan Thermal (207MW) Liaoning Lingyuan Solar (17MW) Suizhon
Slide 42: EnergyAustralia – Financials
EnergyAustralia – Financials Operating / Total Earnings HK$M A$M 1H2024 1H2023 1H2024 1H2023 EBITDAF (before items affecting comparability) Customer (Retail) 630 94 123 18 Energy (Wholesale) 2,340 988 454 188 Enterprise (Corporate) (746) (601) (145) (115) Total EBITDAF 2,224 481 432 91 Depreciation
Slide 43: Wholesale Market Conditions
Wholesale Market Conditions Physical Supply and Demand: Financial Spot Price: 1. Increase in Operational Demand 3. Spot Market eased in 2023 with various high prices events in 1H 2024 Despite continued growth of rooftop PV capacity, operational demand has After prices easing in 2023, the first half
Slide 44: EnergyAustralia Outlook
EnergyAustralia Outlook Calendar Year Swap Prices Over Time – VIC 300 CAL21 CAL22 CAL23 CAL24 250 CAL25 CAL26 CAL27 Swap Prices A$/MWh 200 150 The Market 100 • Australia targeting 82% of renewable energy by 2030. 50 • Wholesale price easing. 0 2018 2019 2020 2021 2022 2023 2024 • Retail pricing risi
Slide 45: EnergyAustralia – Customer operations
EnergyAustralia – Customer operations Customer account numbers Sales volume & revenue June 2024 June 2023 1H 2024 1H 2023 Customer Account Numbers (000s) Sales Volume & Revenue Electricity Electricity Electricity Gas Total Electricity Gas Total Gas (PJ) Gas (PJ) (TWh) (TWh) Mass Market 1,579.2 835.0
Slide 46: EnergyAustralia – Customer operations
EnergyAustralia – Customer operations Supporting customers experiencing hardship 22 Ombudsman complaints/10k accounts • 57k customers utilising • Ombudsman Complaints volumes 67% EnergyAssist programme reduction since 1H2015 • EA % Share of Ombudsman Complaints 18% reduction since 1H2023 Behind the
Slide 47: Apraava Energy – Financials
Apraava Energy – Financials Operating / Total Earnings HK$M Rs M 1H2024 1H2023 1H2024 1H2023 Renewables 54 54 575 566 Thermal (Jhajjar) 56 34 596 357 Transmission 60 21 639 220 Smart meter (1) - (11) - Group adjustment & 34 18 362 188 Corporate expenses (1) Operating earnings 203 127 2,161 1,331 One
Slide 48: Apraava Energy – Performance and projects
Apraava Energy – Performance and projects Performance Expanding our renewable generation portfolio • Renewables: Generation from Apraava Energy’s existing wind energy • Renewables: Post winning an auction to build a 300MW wind farm in the portfolio fell marginally year-on-year because of lower wind
Slide 49: Taiwan Region and Thailand – Operating Earnings
Taiwan Region and Thailand – Operating Earnings Lower generation at Ho-Ping due to outages and expiry of tariff adder at Lopburi solar 120 17% 101 100 (5 ) Operating Earnings 80 (8 ) 79 (6 ) (3 ) (HK$M) 60 Thermal 40 79 Solar 20 Corporate expenses - 4 (4) (20) 1H2023 FX Thermal Solar Corporate expen
Slide 50: Taiwan Region and Thailand – Financials
Taiwan Region and Thailand – Financials HK$M Local Currency (M) 1H2024 1H223 1H2024 1H2023 HK$M HK$M M M Thermal 79 91 NT$325 NT$356 Renewables 5 12 THB25 THB53 Corporate expenses (1) (4) (1) EBITDAF 80 102 Thermal 79 91 NT$325 NT$356 Renewables 4 11 THB21 THB48 Corporate expenses (1) (4) (1) Operat
Slide 51: CLP Group – Generation and energy storage portfolio – Jun 2024
CLP Group – Generation and energy storage portfolio(i) – 30 Jun 2024 17,721 Equity MW and 4,855 MW Long Term Purchase (total 22,575 MW) ENERGYAUSTRALIA total 5,859MW* HONG KONG total 7,222MW* Operational Operational Yallourn 1,480 / 1,480 (c) Castle Peak – A & B (iv) 3,058 / 3,058* (c) Mount Piper 1
Slide 52: CLP Group – Renewable generation portfolio – Jun 2024
CLP Group – Renewable generation portfolio(i) – 30 Jun 2024 3,174 Equity MW and 861 MW Long Term Purchase (total 4,036MW) - 17.9% of CLP total generation portfolio MAINLAND CHINA 2,400 MW ENERGYAUSTRALIA 889 MW* APRAAVA ENERGY 712 MW Operational Operational Operational Wind 1,059 MW Wind 595 MW Wind
Slide 53: CLP Group – Generation and energy storage capacity by fuel mix
CLP Group – Generation and energy storage capacity(i) by fuel mix 22,575 MW Attributable to CLP Group Operational Under construction Capacity by Total MW % MW % MW % Energy Type (a) + (b) (a) (b) Coal 8,669 38% 8,669 38% - - Gas 6,093 27% 6,093 27% - - Nuclear 2,685 12% 2,685 12% - - Wind 2,491 11%
Slide 54: CLP Group – Energy sent out – 1H2024
CLP Group – Energy sent out(1) – 1H2024 TWh 20 CLP 1H2024 Generation as Sent Out (1) 15.9 15 12.6 13.5 40% 43% 22% 10.3 28% 1H2024 10 8.7 8.5 1H2023 10% 10% 22% 25% 1H2023: 38.2 TWh 5 1H2024: 37.6 TWh 2.3 2.3 0.9 0.6 0 -5 1H2023 1H2024 1H2023 1H2024 1H2023 1H2024 1H2023 1H2024 1H2023 1H2024 Hong Kon
Slide 55: Additional Resources
Additional Resources Scan or click on the QR codes to go to appropriate pages Interim Report * Annual Report Sustainability Report Climate Vision 2050 Introductory Pack 2024 2023 2023 2024 Edition August 2024 Annual Results Presentation February 2024 * To be published in August 2024. 54
Slide 56: Thank you
Thank you You can access this presentation and other materials through our website or CLP IR App which can be downloaded onto your mobile device by clicking here or by If you have any questions, scanning this code below. please contact IR team or email ir@clp.com.hk 55