Xinyi Energy’s 1H2023 Revenue Increased by 2.4% YoY Ample Project Pipeline with Expected Yield Increased
(31 July 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 unaudited interim results for the six months ended 30 June 2023 (the “1H2023” or the “Period”).
During the Period, the Group’s revenue increased by 2.4% to HK$1,288.6 million (1H2022: HK$1,257.8 million), primarily due to contribution of the 2022 Portfolio (520 megawatts (“MW”), all belong to grid-parity solar farm projects), partially offset by the depreciation of the Renminbi (“RMB”) against the Hong Kong Dollar (“HKD”) in 1H2023. Compared with the same period last year, the Group's revenue contributed by sales of electricity increased by 17.2% to HK$727.5 million, accounting for more than 56% of the total revenue. The impact of subsidy arrears of subsidised projects has gradually narrowed, and cash flow has continued to improve.
The Group’s gross profit slightly decreased by 1.1% to HK$904.6 million (1H2022: HK$914.5 million), mainly because some expenses were reallocated from administrative expenses to cost of sales as compared to 1H2022. The overall gross profit margin was 70.2% (1H2022: 72.7%).
Net profit attributable to equity holders of the Group during the Period was HK$566.9 million, representing a decrease of 9.0%, as compared to HK$623.1 million during 1H2022. Net profit margin was 44.0% in 1H2023 (1H2022: 49.5%). Basic earnings per share attributable to the equity holders of the Company was 7.49 HK cents (1H2022: 8.66 HK cents).
The Board proposed to distribute an interim dividend of 3.4 HK cents per share (1H2022: 7.7 HK cents per share). Dividend payout ratio is 49%.
The Group’s financial position remained healthy, with cash and cash equivalents of HK$780.2 million and net debt gearing ratio of 34.9% as at 30 June 2023. During 1H2023, net cash generated from operating activities was HK$176.0 million. As at 30 June 2023, the Group has successfully obtained bank borrowings from PRC domestic banks to finance its acquisition of solar farm projects with much lower interest rates as compared to those offshore bank loans. In the future, the Group will continue to expand the amount of the PRC domestic bank loan balances in order to reduce the overall bank loan interest costs.
As at 30 June 2023, the Group owned 36 utility-scale solar farm projects, with an aggregate approved capacity of 3,314 MW. In 1H2023, the Group completed the acquisition of a utility-scale solar farm project from Xinyi Solar Holdings Limited (“Xinyi Solar”), which is located in Hainan Province, with an approved capacity of 300 MW and has begun to generate revenue for the Group. In 2023, the Group targets to acquire utility-scale solar farms with total approved capacity of 700-1,000 MW. The Group has ample project pipeline, with about 2.1 gigawatts (“GW”) of projects in the pipeline avaialbe for the Group to acquire, of which 1.8 GW are grid-parity projects. Those projects have stable cash flow. As PV module prices drop significantly in the second quarter, expected yield of the projects will improve
Mr. Lee Shing Put, B.B.S., Chairman and Executive Director of Xinyi Energy, concluded, “In the first half of 2023, China economy has been gradually recovering from the pandemic, and has seen new stimulus signals coming in the second half. The renewable energy market is growing rapidly accompanied by the continuous support of national policies. As a solar farm operator, Xinyi Energy will actively seize opportunities to expand and strengthen its business scale and asset portfolio by acquiring high-quality renewable energy projects from its parent company and independent third parties, thereby consistently generating substantial returns for shareholders.”