Asia-Pacific beckons CLP's new investments

PUBLISHED : Friday, 25 February, 2011, 12:00am
UPDATED : Friday, 28 October, 2016, 9:17am

Power utility CLP Holdings will consolidate its assets with a focus on the Asia-Pacific region after reporting a 26 per cent jump in net profit last year to HK$10.33 billion.

Chief executive Andrew Brandler yesterday said the group would integrate the recently acquired electricity retailing business in New South Wales, Australia, with its flagship TRUenergy, expand its renewable energy portfolio in India and liquidate assets in Thailand.

TRUenergy and the India portfolio were prime candidates for separate listings down the road, said chief financial officer Mark Takahashi, without specifying a time frame.

'We have no interest in investing outside the Asia-Pacific market,' Brandler said. 'We will continue to expand in our existing markets.'

CLP's geographical strategy is contrary to Power Assets Holdings, formerly Hongkong Electric Holdings, which is aggressively expanding into Britain.

TRUenergy's profitability will be boosted next month upon completion of the A$2.05 billion (HK$16 billion) acquisition of AustraliaEnergy, the biggest electricity retailer in New South Wales and a supplier to the Sydney market. It will also obtain the rights to sell the output from the Delta West power station, also in New South Wales, as well as rights to develop three new power stations.

The deal will more than double the number of TRUenergy's customers to 2.75 million households from 1.26 million, surpassing the base of 2.3 million it has in its core service areas in Hong Kong - the New Territories, Kowloon and Lantau.

Last year TRUenergy was the largest overseas contributor to the group's revenues and generated a 77 per cent rise in operating earnings.

CLP's underlying earnings climbed 7 per cent to HK$9.14 billion last year excluding HK$1.18 billion non-recurring gains such as a tax benefit of HK$989 million, a HK$356 million gain from the Anshun power plant on the mainland and a write-off of goodwill on Australia-based wind power arm Roaring 40s.

TRUenergy's performance was partly helped by a 16 per cent appreciation in the Australian dollar last year, which translated into a HK$210 million operating earnings. Earnings of the mainstay electricity supply in Hong Kong rose 3 per cent to HK$6.12 billion on the back of a HK$7.75 billion investment in power assets.

To meet the government's target of slashing carbon emissions by about 60 per cent by 2020, Brandler said CLP needed 'strong support' from the government.

The fourth-quarter dividend remained the same at 92 HK cents per share, taking the full-year payout to HK$2.48 per share. Earnings per share jumped 26 per cent to HK$4.29.

CLP shares yesterday fell 45 HK cents, or 0.7 per cent, to HK$62.95 after the results.