<Results first take> 1Q22 net profit dropped 23% yoy, largely in line
- 1Q22 net profit dropped 23% yoy to Rmb2.26bn, largely in line
- Operating margin squeezed almost 9ppts to 41.9% due to high coal prices
- Both revenue and power generation climbed 4.8% yoy during the period
- Current rating is BUY with TP of HK$22 (H-shares) and Rmb30 (A-shares)
China Longyuan Power reported a 23% yoy decline in 1Q22 net profit to Rmb2.26bn, largely in line. The profit drop was due to higher coal prices and 22.7% increase in operating expenses which squeeze operating margin by almost 9ppts to 41.9%. Both total revenue and power generation climbed 4.8% yoy. Although wind installed capacity increased 15%, wind power generation climbed only 5% yoy due to weaker wind resources. On a positive note, power generation of other renewable energy (including solar) jumped 59% yoy on the back of 93% yoy increase in installed capacity.
More to follow after results briefing on Thursday. Our current rating is BUY with TP of HK$22 (H-shares) and Rmb30 (A-shares)