BUSINESS PERFORMANCE


GROUP PERFORMANCE

OPERATING EARNINGS
HK$ 11,121
million
down 20.5% from 2018

Operating Earnings1 By Region

Note 1: Before Group Expenses

TOTAL EARNINGS
HK$ 4,657
million
down 65.6% from 2018
DIVIDENDS
HK$ 3.08
per share
Up 2% from 2018


  • Operating earnings decreased largely due to the expected lower permitted rate of return in Hong Kong, a reduction in our share of earnings in India following the strategic partial divestment and the continued challenges in Australia
  • Higher earnings in Mainland China and Southeast Asia
  • Decarbonisation and digitalisation continued to be our strategic priorities
  • Launched revised Climate Vision 2050 with pledges not to invest in any additional coal-fired generation assets and to phase out existing ones by 2050 at the latest
  • Launched Asia’s first online energy app store Smart Energy Connect, offering innovative and practical applications for businesses to manage energy use in a greener and smarter way
  • Actively pursued further opportunities in non-coal electricity generation, transmission and distribution, as well as in new energy services such as those springing from the development of “smart cities”

performance by region

Hong Kong

Supports the city through an important journey of decarbonisation while maintaining a safe and highly-reliable electricity supply to 2.64 million customers.

Free Electrons connects utility companies with innovative start-up companies behind new, smarter and cleaner energy technologies.

  • Operating earnings: HK$7,448 million, down 13% from 2018
  • Earnings subject to full-year effect of lower permitted rate of return under the new Scheme of Control agreement
  • Good progress on 5-year Development Plan for 2018-2023
  • Sales of electricity up 1.8% from 2018
  • Customer accounts increased from 2.60 million to 2.64 million
  • High supply reliability of over 99.999%(1)
  • 6,900+ applications received for Feed-in Tariff scheme by end of 2019, 90MW approved or connected

(1) Supply reliability based on average unplanned customer minutes lost per year

Outlook

  • Continue decarbonisation journey to achieve around 50% gas-fired generation in fuel mix
  • Progress investments in major projects under Development Plan
  • Pursue renewable energy and energy efficiency & conservation initiatives
  • Implement stringent cost control measures across our operations
  • Work with the Government and the community to support Hong Kong through challenging times and steer it towards a greener, brighter future

Mainland China

One of the largest external independent power producers in Mainland China concentrating on low-carbon energy, including nuclear power and renewables.

2019 marks the 40th anniversary of CLP’s power supply to Guangdong.

  • Operating earnings: HK$2,277 million, up 5.3% from 2018
  • Nuclear: Highly reliable contribution of about 2/3 of earnings in Mainland China
  • Renewables: Solid underlying performance from diversified portfolio; added 36MW of solar and 50MW of wind
  • Thermal: Higher earnings reflecting lower coal cost and higher sent-out at Fangchenggang
  • Incremental distribution network at Fangchenggang Hi-Tech Zone, the Group’s first investment in distribution grids in Mainland China, has started providing electricity supply services to customers in the area

Outlook

  • Monitor the evolution of market regulations. Market competition anticipated to continue with higher pressure on margins
  • Continue to look for value-adding renewable energy opportunities to further increase contribution from non-carbon generation
  • Work with strategic partners to continue exploring opportunities, with focus in Greater Bay Area

India

Pursues growth in low-carbon areas, non-generation opportunities and other customer-focused businesses.

Renewable energy projects including solar farms account for about 85% of CLP India’s operating earnings in 2019.

  • Operating earnings: HK$263 million, down 54% from 2018; CLP’s share of earnings was diluted by the sale of a 40% stake in CLP India to Caisse de dépôt et placement du Québec (CDPQ)
  • Higher earnings from renewables including benefits from new solar projects, receipt of delayed payment charges and lower finance costs
  • End of Paguthan Power Station PPA; higher earnings from Jhajjar Power Station
  • Invested in three transmission assets to diversify into a new market segment with great potential; earnings from the first asset since November 2019
  • Successful auction bid for new 250MW wind project in Sidhpur

Outlook

  • Complete acquisitions of the two remaining transmission assets and progress construction of the Sidhpur wind project
  • Continue to pursue investments in non-carbon assets to diversify revenue stream
  • Pursue innovation and new business models as and when opportunities arise

Southeast Asia & Taiwan

Keen to invest in renewable energy generation in the region to support global efforts to reduce carbon emissions.

  • Operating earnings: HK$335 million, up 106.8% from 2018
  • Ho-Ping Power Station in Taiwan reported sound financial results due to lower coal costs and higher energy tariff
  • Lopburi solar plant in Thailand operated steadily with higher levels of solar irradiance

Outlook

  • Complete withdrawal from two legacy coal-fired power plant developments in Vietnam
  • Continue to explore renewable energy opportunities in the region

Australia

Operates a customer-focused energy business serving 2.47 million accounts across southeast Australia.

EnergyAustralia is a partner of the Startupbootcamp programme which supports start-up companies that innovate and disrupt the energy sector.

  • Operating earnings: HK$1,566 million, down 52.6% from 2018
  • Retail competition remained intense; number of customer accounts declined 3% and margins reduced significantly with higher discounts
  • Introduction of regulated retail prices led to impairment of goodwill
  • Increased utilisation of gas-fired assets, particularly Ecogen, increased overall generation costs
  • Lower generation due to coal supply issues at Mount Piper Power Station & safety works at Yallourn Power Station
  • Increased price volatility across wholesale market increased the cost to acquire energy, further impacting earnings
  • Continued investigation of flexible generation and storage options

Outlook

  • Focus on service excellence and customer support, especially in bushfire impact areas
  • Continue to focus on uplifting compliance and reducing costs
  • Intense competition and margin pressure remain: full year of price caps in 2020
  • Focus on asset availability, coal supply and evaluation of flexible generation options
  • Increasing renewables is likely to depress average wholesale electricity prices while price variability & volatility will stay high