CKPower announces strong and sustainable Q2/2021 Net Profit growth of 845%

Wednesday 11 August 2021 16:59
Growth is expected to continue into Q3 driven by increase in water flow during the rainy season and share of profit from additional shareholding in Xayaburi Power
CKPower announces strong and sustainable Q2/2021 Net Profit growth of 845%

Mr. Thanawat Trivisvavet, Managing Director of CK Power Public Company Limited (CKPower), stock symbol "CKP", announced the performance of CKPower group for Q2/2021 and 1H/2021, stating that CKPower continued to generate healthy profits with the Company reporting Net Profit attributable to Equity Holders of the Company Baht 707.0 million, an increase of Baht 801.9 million or 845.0% from the same period last year when it reported a loss of Baht 94.9 million and also reporting total revenue of Baht 2,295.2 million, an increase of Baht 464.0 million or 25.3% from the same period last year when it reported total revenue of Baht 1,831.2 million. As for the first half of 2021, the Net Profit was Baht 821.6 million, an increase of 289.1% from the same period last year when it reported a loss of Baht 434.4 million, while total revenue was Baht 4,396.2 million, an increase of Baht 803.1 million or 22.4% from the same period last year when it reported total revenue of Baht 3,593.1 million.

The growth in operating results was partly attributable to higher revenue from the sales of electricity from the Nam Ngum 2 Hydroelectric Power Plant ("NN2"), which reported Q2 electricity sales of Baht 956.1 million , an increase of Baht 563.5 million or 143.5% compared to the same period last year, and reported 1H electricity sales of Baht 1,715 million, an increase of Baht 946.4 million or 123.1%. The increased revenue was driven by higher electricity sales due to greater reservoir inflows during the first half as well as higher water storage levels at the start of 2021 compared to the same period last year.

Furthermore, CKPower earned a year-on-year increases in the share of profit from its investment in the Xayaburi Hydroelectric Power Plant ("XPCL") of Baht 616.9 million or 626.3% in Q2/2021 and Baht 915.6 million or 208.5% in the first half of 2021, which were primarily attributed to greater average water flow rates through the Xayaburi Hydroelectric Power Plant compared to the same period of the previous year, boosting sales of electricity, and to a decrease in XPCL's financial expenses due to a decline in interest rates from the previous year and loan principal repayment.

Mr. Thanawat said that in addition to strong Q2 performance, CKPower issued Baht 4,000 million debentures on May 28, 2021 with the proceeds intended for the rollover of its debentures that were due in Q2/2021, for asset acquisition and investment in ventures related to the Company's businesses, as well as for use as working capital in CKPower's operations. The debentures were given a credit rating of "A-/Stable" by TRIS Rating Company Limited. Furthermore, on June 29, 2021, CKPower purchased an additional 5% share of XPCL as approved by the 2021 Annual General Meeting of Shareholders with a Baht 1,800 million short-term loan facility as source of fund, increasing its shareholding in XPCL from 37.5% to 42.5%.

The strong performance is expected to continue into Q3/2021 as a result of an anticipated year-on-year increase in NN2 and XPCL's electricity output as NN2's reservoir inflows and the Mekong water flow rates through XPCL are forecast to continue to be higher than the previous year. In addition, XPCL has been able to produce electricity at maximum capacity since mid-June. The performance will also be driven by the fact that CKPower is set to begin recognizing the increased share of profit from XPCL following the additional 5% shareholding from Q3 onwards.

"CKPower is making preparations to issue debentures to rollover the short-term loan facility used to pay for the additional shares in XPCL and expects to issue the debentures in Q4, subject to market condition. The Company is also set to start a credit rating process for XPCL in the second half of this year to accommodate XPCL's plan to issue debentures in 2022," said Thanawat.

With regard to COVID-19, the production of all CKPower's power plants have not been affected as Business Continuity Plans (BCPs) have been prudently prepared to handle such events and manage risks that may impact the Company's operations. CKPower has also donated Baht 2 million to Kasetsart University Foundation to support its COVID-19 vaccination efforts, contributed necessary equipment to Public Health Service Center 4 Din Daeng under BMA Health Department to support its public vaccination service, and handed out alcohol gel hand sanitizers to communities surrounding Bangpa-in Cogeneration Power Plant, a power plant under CKPower Group, Thanawat added.

About CKPower:
The Company engages in production and sales of electricity generated from three sources of energy under its 13 power plants with the total installed capacity of 2,167 MW, consisting of two hydroelectric power plants, the Nam Ngum 2 Hydroelectric Power Plant with 615 MW installed capacity, operated by Nam Ngum 2 Power Company Limited (46% owned by CKPower through its shareholding in SouthEast Asia Energy Limited) and the Xayaburi Hydroelectric Power Plant with 1,285 MW installed capacity, operated by Xayaburi Power Company Limited (42.5% owned); two cogeneration power plants with 238 MW installed capacity, operated by Bangpa-in Cogeneration Limited (65% owned); and nine solar power plants, comprising seven under Bangkhenchai Company Limited (100% owned) with total installed capacity of 15 MW, one under Nakhon Ratchasima Solar Company Limited (30% owned) with 6 MW installed capacity and one under Chiangrai Solar Company Limited (30% owned) with 8 MW installed capacity.

Source: CK Power