China Resources Power Holdings said yesterday its net profit surged 22.7 per cent, helped by higher tariff, lower coal costs and new plants. The Hong-Kong-registered company, a unit of state-backed mainland conglomerate China Resources (Holdings), had a first-half net profit of HK$1 billion, or 26.29 HK cents a share, from HK$816.5 million, or 21.44 cents, it announced yesterday. Turnover rose 70 per cent to HK$3.76 billion. The profit was largely in line with the HK$986 million estimated by Merrill Lynch, HK$990 million by HSBC and HK$1.02 billion by Citigroup. The company plans to pay a half-year dividend of four Hong Kong cents, up from three cents a year earlier. Turnover was boosted by a 60 per cent rise in net generation by its majority-owned plants, whose results are consolidated into its books, said Citigroup. The main contributors to the output increase include the 85 per cent held, 600 megawatt (MW) plant in Shouyangshan, Henan province, which came on stream in early May, and the 100 per cent owned 600 MW generation unit of its Changshu plant in Jiangsu province that started operating in May last year. Output of all of its plants, including those where it has minority stakes and whose results are not consolidated, rose 15.27 per cent to 25.18 billion kilowatt hours (kWh). Turnover was also boosted by a 5 per cent rise in average tariff, according to Citigroup's estimate. The figure was not given in last night's results announcement statement. Operating profit margin rose to 27.85 per cent from 21.29 per cent. Coal cost per unit of power generated fell 9.7 per cent, while the cost of coal fell 4.8 per cent per tonne. No absolute figures were given. A Merrill Lynch report estimated that the firm's plant utilisation rate had fallen to 53.2 per cent in the second quarter from 68.4 per cent in the first quarter - the lowest since the first quarter of 2003. CR Power had 43.1 per cent of its capacity in the first half in eastern China, where utilisation has been falling rapidly on the back of rapid capacity expansion. At the end of June, it had 6,210 MW of installed capacity in operation and an additional 2,304 MW being built. It had 4,940 MW capacity at the end of last year. Last month, it said it planned to buy stakes in a power plant each in Yunnan and Anhui from its parent for a total of 555.7 million yuan. Its net debt-equity ratio rose to 64.4 per cent at the end of June from 50.4 per cent at the end of last year. CR Power's share price declined 5.67 per cent to close at HK$6.82 yesterday. The stock has risen 55.89 per cent so far this year.