China Resources Power (CRP), whose board had been accused of overpaying for coal assets in Shanxi, posted a 16 per cent drop in net profit for last year as it booked huge impairments on its coal assets. The company, a unit of state-owned conglomerate China Resources Holdings, booked a net profit of HK$9.22 billion, down from HK$11 billion in 2013 and lower than the HK$12 billion average estimate of 19 analysts surveyed by Thomson Reuters. “The company booked HK$2 billion of similar coal mine impairment in last year’s first half, so the extra provision in the second half was a negative surprise,” Credit Suisse’s regional head of utilities research, Dave Dai, said in a note. “And the total dividend per share of HK$0.78 increased by only 4 per cent, the lowest in recent years.” Shares of CRP dropped as much as 1.7 per cent after it unveiled the results just after noon. It later rebounded to close 2.4 per cent higher at HK$19.70 at 2.22pm. The Hang Seng Index rose 1.45 per cent. Operating profit from coal-fired power generation rose 28.7 per cent to HK$18.7 billion, while that of renewable energy grew 21.3 per cent to HK$2.47 billion. Coal mining booked a loss of HK$6.4 billion, compared to a profit of HK$334 million in 2013. CRP booked impairment losses of HK$6.09 billion, up from HK$2 billion in 2013. Some HK$5.81 billion was for coal mines held by its subsidiaries, and HK$287 million was for obsolete power assets. It attributed the mines’ impairment losses to higher safety and environmental standards requirements, falling coal prices and suspension of mines amid the market downturn. The write-downs do not appear to include any possible impairment of the coal assets in Shanxi, which was booked as an associate company, not a subsidiary. In mid-2013, CRP’s board was accused by minority shareholders of having breached its fiduciary duties by causing the company to enter into a 7.9 billion yuan mining and related assets acquisition in 2010 that went sour. Management has yet to disclose what CRP intends to do with the uncompleted deal, which involved incomplete mining rights.