Xinyi Energy's FY22 Revenue Increased by 0.8% YoY to HK$2,315.3 Million
Proposed Final Dividend of 7.4 HK cents per Share
Dividend Payout Ratio over 100%
(27 February 2023, Hong Kong) – Xinyi Energy Holdings Limited (“Xinyi Energy” or the “Group”; stock code: 03868), a leading non-state-owned solar farm owner and operator in the PRC has today announced its audited consolidated annual results for the year ended 31 December 2022 (“FY2022” or the “Year”).
During the Year, the Group's consolidated revenue increased by 0.8% to HK$2,315.3 million (FY2021: HK$2,296.6 million), mainly due to the full operation of the 2021 Portfolio and the power generation contributed by three of the solar farm projects acquired in the first three quarters of 2022, yet most of it was offset by the one-off deduction of tariff adjustment of about HK$223.8 million that the Group deemed necessary to make in view of the latest guidelines introduced by the PRC on the verification of renewable energy subsidies. Revenue from solar power electricity generation before deduction of tariff adjustment increased by HK$242.6 million or 10.6%. Gross profit recorded a decrease of 2.7% to HK$1,634.2 million (FY2021: HK$1,679.4 million). Gross profit margin slightly dropped 2.5 percentage points to 70.6% (FY2021: 73.1%). If excluding the impact of the one-off deduction of tariff adjustment, the gross profit margin of the Group slightly increased by 0.1 percentage points to 73.2%. Profit for the year attributable to equity holders of the Company decreased by 21.2% to HK$971.5 million (FY2021: HK$1,232.3 million), mainly attributable to the one-off deduction of tariff adjustment, and an increase in the depreciation charge to property, plant and equipment and right-of-use assets, employee benefit expenses, finance costs, income tax expense, and net impairment losses on financial assets. During the Year, basic earnings per share attributable to the equity holders of the Company were 13.33 HK cents (FY2021: 17.33 HK cents).
Although the latest guidelines introduced by the PRC on the verification of renewable energy subsidies has led to the one-off deduction of tariff adjustment made by the Group for the sake of prudence, at the same time, the country has also accelerated the payment of renewable energy subsidy arrears. About 60% (in terms of approved capacity) of the Group's projects under the feed-in-tariff regime were included in the list of the first batch of verified and confirmed compliance projects of renewable energy power generation subsidy, announced at the end of October 2022, and the Group has received approximately HK$2,108.9 million of renewable energy subsidy payment, which greatly exceeded its expectation and prevalent payment amounts of the Ministry of Finance, driving the net cash from operating activities to soar 136.7% YoY to HK$2,899.4 million. The Group's financial position maintained healthy with cash and cash equivalents of HK$1,790.8 million, up 62.1% YoY, and the net debt gearing ratio amounted to 26.9%, down 3.2 percentage points YoY, as at 31 December 2021. The Group intends to maintain a high dividend payout ratio and distribute not less than 90% of the distributable income for each financial year. Mainly due to the one-off deduction of tariff adjustment, Distributable Income decreased by 10.6% YoY to HK$1,110.7 million in FY2022. The Board proposed a final dividend of 7.4 HK cents per share. Together with an interim dividend of 7.7 HK cents per share, total dividend for the year will be 15.1 HK cents per share, with a dividend payout ratio over 100%.
In 2022, the Group's acquisition plan was postponed due to factors such as epidemic prevention and control, rising PV installation cost driven by module cost increase and mandatory energy storage requirements. During the Year, the Group acquired 7 solar farm projects with an aggregate approved capacity of 520 MW. As at 31 December 2022, the Group owned a total of 35 utility-scale centralised solar farms in operation with an aggregate approved capacity of 3,014 MW. In addition, the Group follows the PRC national strategies on the development of distributed PV power generation. In 2022, the Group acquired certain distributed PV power generation projects with an aggregate approved capacity of 44.7 MW in cooperating with well-known domestic leading enterprises in the building materials industry. Looking forward, the Group will continue to focus on utility-scale centralised solar farm projects as its main acquisition target, and pay attention to favourable policies and opportunities for distributed PV power generation projects. In early 2023, the Group completed the acquisition of one utility-scale grid-parity solar farm project with an approved installed capacity of 300 MW from Xinyi Solar. The Group plans to acquire several grid-parity solar farm projects from Xinyi Solar and independent third parties with a total approved capacity in the range between 700-1,000 MW in 2023.
Mr. Lee Shing Put, B.B.S., Chairman and Executive Director of Xinyi Energy concluded, “The energy crisis triggered by the outbreak of the Russia-Ukraine war in 2022 has increased global concern about energy security and the need to actively promote energy transition. China is also emphasizing the promotion of energy transition and the realisation of ‘dual carbon’goals, on the basis of ensuring energy security and economic growth. As a leading pure renewable energy operator in the PRC, Xinyi Energy will firmly seize the opportunities arising from the trend of energy transition, and strive to continuously enhance the scale and operational efficiency of its solar farms, ensuring supply stability and safety, while continuously improving the efficiency and economic benefits of power generation through efficient operation and maintenance. The Group will continue to identify high-quality grid-parity projects, constantly enrich its solar farm project portfolio, to achieve quality growth while ensuring reasonable returns, and create long-term value for shareholders.”