[Non-English content] Ladies and gentlemen, good afternoon. Welcome to the interim result conference call of Huaneng Power International. [Non-English content] Yesterday, the company released the interim result. Please let me give a brief introduction. [Non-English content] In the first half of the year, under the leadership of the board of directors, the company centered on annual targets, seized the market opportunity, pushed forward operation, transition, innovation, and overseas management, achieving breakthroughs in green development and operating performance. [Non-English content] Under the Chinese accounting standard, the company achieved a consolidated operating revenue of CNY 112.032 billion, decreasing by 5.7%. Net profit attributable to the company's shareholder was CNY 9.262 billion, increasing by 34.26%. The earning per share was CNY 0.5. [Non-English content] In terms of the power generation, in the first half of the year, the company's massive concrete power cells was 205.68 billion kWh, decreasing by 2.67%, with a decline narrowing quarter-on-quarter. [Non-English content] In the increasingly competitive power market, the company analyzed the market trend, balanced volume and price with efficiency first to formulate trading strategies, and enhanced the flexible capability to secure capacity and auxiliary services payment. The average tariff was CNY 485.27 per MWh, firmly safeguarding the core of operations. [Non-English content] In terms of the coal supply, the company seized the opportunity, optimized procurement strategy, improved the quality of contracted coal, purchased low-cost spot market coal, and optimized inventory structure, achieving significant results in cost control. [Non-English content] Standard coal price in the first half of the year was CNY 917 per ton, a year-on-year decrease of 9.23%. [Non-English content] In terms of development, the company continued the green transition, seized the policy window for the renewable marketization, and pushed forward the construction on the premise of safety, compliance, quality, and cost effectiveness. [Non-English content] In the first half of the year, the company added 7.99 GW of unit, including 6.26 GW of renewable. The company installed capacity reached 163 GW. The renewable capacity reached 44.09 GW. The low carbon clean energy accounts for 39.12% of total capacity. [Non-English content] In terms of overseas operation, TUAS Power interpreted the policy and the research. The power and fuel market actively responded to the market changes. The profit remained at a relatively high level. [Non-English content] In the first half of the year, the profit before tax of TUAS was CNY 1.363 billion. The performance of Sahiwal Power Plant in Pakistan remained stable. The profit before tax was CNY 436 million. [Non-English content] In the second half of the year, the company will follow national strategic plans focused on quality and efficiency and optimize its development direction, layout, and structure. The company will adapt to the marketization of renewables, conduct policy and market research, dynamically optimize marketing strategy, and improve generation efficiency. [Non-English content] The company will track the changes in the coal market, optimize the procurement structure, and take multiple measures to control coal costs. The company will strengthen funds management, maintain a stable financing structure, funding for energy security, and green transition. [Non-English content] The company will prioritize high quality and steady growth, enhance risk control, new development, and value creation capability, and strive to achieve steady progress in operating performance and high-quality completion of annual goals. [Non-English content] Now, my colleague and I would like to answer your questions. Thank you. [Non-English content] Thank you, Mr. Wang. Here we come to the Q&A session. [Non-English content] To register your question, please press star followed by one on your telephone keypad. Thank you. [Non-English content] Please state your name and your organization before question raised. [Non-English content] The first question comes from [Non-English content] of Citibank. [Non-English content] I have three questions. First, in the second quarter, we can see the unit fuel cost decrease greater than the unit fuel cost decrease in the fourth quarter. Could you talk about the reason for that? Could you give us the unit fuel cost guidance in the following quarters? Second, about the company's renewable development. The company has added 4.3 GW of solar units and 1.9 GW of wind units. Could you talk about the company's outlook for the renewable addition in 2025? What percentage will be the wind power, and what is the proportion for the solar power? Could you give us the guidance for the CapEx in the year of 2025? Third question is about the company's cash flow. We can see from the report that free cash flow have increased by CNY 30.7 billion. Under this circumstance, what will be the dividend payout ratio of the company? Will the company raise the payout ratio? Thank you. [Non-English content] [Non-English content] The unit fuel cost in the second quarter was CNY 269.42 per MWh, comparing to the first quarter's CNY 272.68 per MWh, that's a quarter-on-quarter decrease of CNY 3.26 per MWh. [Non-English content] The reason of the company's cost decrease is, the company has seized opportunity in the market, coordinated the purchase of the contracted coal and spot market coal, and pushed forward the cost decrease of the fuel. Thank you. [Non-English content] To your question about our operating free cash flow, it has increased by CNY 32.7 billion. This was mainly due to the fuel cost decrease for our thermal sector; the profit of the thermal sector have increased significantly. [Non- English content] The company has insisted on sharing our performance results with our shareholders, considering the company's operational demands and the government policies. The company has raised our dividend payout ratio. In the year of 2024, the company has paid CNY 0.27 per share of dividend. The total dividend payment amounted to CNY 4.24 billion; it has increased by CNY 1.1 billion, and the payout ratio increased from 57.14%- 58.78%. [Non-English content] In the future, the company will insist on sustainable dividend payout policy, and considering our development guidance, our operating results, the CapEx, and the willingness of our shareholders to continue to research the dividend payout policy and implement the government policy, and to insist on a stable dividend payout. [Non-English content] About your question of renewable guidance, for now the company has 19.13 GW of units under construction, including 11.36 GW of renewable. The wind amounted to 5.72 GW; solar amounted to 5.64 GW. [Non-English content] The company will maintain our whole year guidance at the beginning of the year, which is 10 GW of renewable addition, including 4.2 GW of wind and 5.8 GW of solar. [Non-English content] Thank you. [Non-English content] [Non-English content] The next question comes from [Non-English content] of Fatai Energy. [Non-English content] We have three questions. First, in the second quarter, the company's unit profit for wind and solar sector was around CNY 160- CNY 170 per MWh, and that is exceeding our expectation, especially for our solar sector. So could you give us the utilization hour of wind and solar sector in the first quarter and second quarter, and the year-on-year changes? Could you give us the tariff of those two sectors in the first and second quarter? Second, could you give us the tariff of our coal sector in the second quarter, and the tax payment of the coal sector, and what was the year-on-year change? Could you talk about the standard coal price of the company as well as the coal consumption rate? Third, in Jiangsu Province, it has introduced a capacity payment policy to CNY 360 per kWh. However, we think the final compensation will be lower than that level. How does the company review this problem, and what was the company's perspective that if that policy will be taken in other provinces? [Non-English content] [Non-English content] The utilization hour of wind in the second quarter was 539 hours; in the first quarter, 594 hours. The utilization hour of solar in the second quarter, 338 hours; first quarter, 245 hours. [Non-English content] The average tariff of wind in the second quarter was CNY 470.09 per MWh; solar CNY 385.39 per MWh. [Non-English content] The average tariff for wind in the first quarter was CNY 487.97 per MWh, decreasing by CNY 17.88 quarter-on-quarter. The average tariff for solar was CNY 400.16 per MWh, decreasing by CNY 14.76 quarter-on-quarter. [Non-English content] Utilization hours of our coal sector in the first quarter: 964 hours; second quarter: 875 hours; first half of year: 1,869 hours, decreasing by 141 hours. The average tariff of our coal sector in the first quarter: CNY 467 per MWh; second quarter: CNY 476 per MWh; first half of year: CNY 471 per MWh. The standard coal price in the first quarter for the coal sector: CNY 664 per ton; second quarter: CNY 809 per ton; and in the first half of year: CNY 848.99 per ton. [Non-English content] Coal consumption rate in the first half of year was 295.9. [Non-English content] First, about the company's coal utilization hour, we can see it's a positive policy signal that coal-fired units will become adjustable, flexible power resources; utilization hours decreased have proved this point of view. [Non-English content] Second, as you just said, the recovery rate ratio of our capacity payment in Jiangsu Province won't reach the 100% level; however, the company is having research to have some operational renovations of our units. With this update, we will increase our compensation level. [Non-English content] About the future steps of this policy, we can see the 100% recovery ratio of capacity payments only happens in the areas that have small markets. For the areas that do not have small markets, the current case will be followed; that is, by the end of 2026, the coverage ratio will be 50% of the fixed cost. Thank you. [Non-English content] The next question comes from [Non-English content] of Canton Security. [Non-English content] I have three questions. First, about our coal procurement, what is the coal procurement structure in the first half of the year? What is the proportion for long-term contracted coal and spot market coal purchase? Second, about our tariff, could you give us the market-based tariff breakdown to different energy types? What is the company's capacity tariff for our coal units? What was the year-on-year change? My third question is, could you please give us the net profit breakdown to different energy types? [Non-English content] In the first half of the year, the company had purchased 42.9 million tons of coal, including 15.63 million tons of coal from the domestic market and 28.61 million tons of coal from the overseas market. [Non-English content] The long-term contracted coal accounted for 49.24% of total purchase; small market coal accounted for 17.94%; and imported coal accounted for 32.83%. [Non-English content] The company's market-based tariff in the first half of the year was CNY 435.09 per MWh; it accounts for 84.64% of our total power sales. [Non-English content] The market-based tariff for coal-fired units was CNY 430.29 per MWh; 100% of our total power sales are market-based; and gas units CNY 497.88 per MWh; 18.9% of our power sales are market-based. [Non-English content] The average market-based tariff for wind was CNY 495.36 per MWh; 45.5% from the market sales. And for solar, CNY 383.77 per MWh; the proportion was 35.2%. [Non-English content] The capacity payment in the first half of year was CNY 4.87 billion; and it was CNY 30.79 per MWh. [Non-English content] It has a CNY 2.17 per MWh increase comparing to the same period last year; that was mainly because the coal power generation had decreased this year and the proportion of capacity payment increased. [Non-English content] The net profit accounts for different energy types: the coal-fired power CNY 5.989 billion; gas power CNY 527 million; wind CNY 3.433 billion; solar CNY 1.858 billion; hydro CNY 13 million; biomass CNY 3 million. Thank you. [Non-English content] The next question comes from [Non-English content] of Guanghua Security. [Non-English content] [Non-English content] I have three questions. The first was about the company's tariff in the second quarter; the power generation for coal-fired have decreased; however, the tariff remains stable. Is that because our market-based tariffs have increased, where the company have less power generation when the tariff was low in small market and have more power generation when the tariffs are high? Could you talk about the differences between this trading strategy in different provinces? Second, we can see from our interim result report that we have REITs issuance spending in Shandong Province, and could you talk about the approval process of these REITs? Does that mean that the thermal power can be a stable asset in the future? Could you talk about our estimation of the cash flow as well as the profits? Third of three questions about our minority interest; the minority interest have decreased in the second quarter; would you give us the reason? [Non-English content] In the first half of the year, the company has made up our trading strategy that we coordinate between the volume and the price. There are two sectors of that. First, in the spot market area, because this year the renewable addition was significantly increased in the first half of the year, there's an oversupply of power in the market. So the spot market price we can see a longer time period that we have a negative tariff. So for our coal units, we have incentive to increase our generation when the price is high and decrease our generation when the price is low. Second, in the area that we only have long-term, mid to long-term contract power sales, the company's power generation remains stable, the contract we signed remains stable. So combining all the two factors, although our power generation has decreased, the tariff remains stable in the second quarter. [Non-English content] About the question about the issuance of our REITs, in the recent years the company has had several attempts to securitize our thermal assets and the burden of financial access. So in the last two years the company has issued several equity-based private REITs, and for now for the REIT you just mentioned, they are now in the approval process and we are waiting for the approval of the provincial NDRC. [Non-English content] The company has absolutely reported to the government authorities about the issuance of public REITs, and previously the thermal power hasn't been included in the issuance; however, with the company's effort, we are hoping we can be the first tier to issue a public issued REIT, and as for the cash flow, the cash flow will be based on the demand of heat supply. [Non-English content] I have your question about the minority interest decrease. We can, it can reflect the following issue that the proportion of the profits in our minority interest have decreased. The company's wholly owned assets have profits that increase, however, non-wholly owned assets have a profit decrease. Thank you, Thank you. [Non-English content] The next question comes from [Non-English content] of Guanghai Haifeng Security. [Non-English content] So first, my first question: after the anti-involution modified government, what will be the company's outlook for the coal price and tariffs in the following quarter and next year? Second, about the perpetual bond of the company, what is the interest payment as well as the interest rate of our perpetual bond? Third, about the company's minority interest, could you talk about why the company's non-controlling assets profits have increased? [Non-English content] Thank you for your question about the coal price outlook. In the second quarter of anti-involution and the summer peak season, the coal price has rebounded, and in the second quarter, if the macroeconomy continues to recover and the supply-demand balance continues to improve, the coal price may increase and fluctuate at a certain level. The coal price will be increased on the basis of the prices in the month of June. [Non-English content] About the tariff outlook in the following quarters, first on the supply and demand side, as more and more provinces have implemented spot market that will adversely affect the long-term contract power signing, and second, the government will continue the energy security policy and will push forward the research of the signing of next year. The company will keep track of the progress and actively report to the government authority. [Non-English content] About the company's perpetual bond, for the first half of last year, the perpetual bond interest rate was 3.71%. This year, first half of year 3.49%, and that was because the company has seized opportunity in the market and have decreased the cost in the perpetual bond refinancing, and the interest payment in the first half of this year was CNY 1.414 billion, from the last year first half of year was CNY 1.458 billion, that has a CNY 44 million decrease. [Non-English content] About the minority interest to the net profit decrease, that was partially because of thermal power. For example, our Beijing power generation power plant, the company have a 45.41% of shares, and in the heating season, when the heating season end in the second quarter, the profits have decreased by CNY 500 million. That dragged down the minority interest to net profit decrease. That was mainly decided by our power structure. [Non-English content] The next question comes from [Non-English content] of Huayan Securities. [Non-English content] I have two questions. First about the asset impairment, the company had made about CNY 200 million asset impairment in the first half of year, could you give us the reason and could you talk about the loss situation of our thermal sector as well as renewable sector in the first half of year? Second, the company has had 6 GW of renewable capacity in the first half of year, could you talk about the geographic layout of this unit and what will be the geographic layout of our capacity addition in the second half of year? Could you also talk about what is the capacity that is consumed locally, what is the capacity that consumed by the ultra high transmission grid? [Non-English content] About the asset impairment in the first half of year, that was taken in the power plants in Shang'an and Zhifu, the total asset impairment amounted to CNY 260 million, that was mainly because the policy reason. First the Shang'an power plants have the plan of shutting down one of its units and backing up one of its units, and for the power plants Zhifu, because two of their units have a long term of operation, it also have a plan in shutting down. [Non-English content] About the loss situation in the first half of year, that 12 projects have made loss in the first half of year for thermal sector, that was 2.5% of our total projects. One project of wind have made loss and nine projects of solar made loss. [Non-English content] About the renewable energy base project, we have 700 MW base project that's being constructed in the province of Hubei. Part of that will be put into operation this year and we have 860 MW units in Shandong province and it is aimed to be operated this year. [Non-English content] Thank you. [Non-English content] The next question comes from [Non-English content] of Tianjin Security. [Non-English content] I have three questions. First, could you talk about the procurement standard coal price changes in the second quarter? Second, could you give us the profit contributions to equity holders in the first quarter and second quarter breaking down to different energy types? Third, as document 136 has been implemented, could you talk about the changes about our project approval process and could you give us an analysis in different provinces and different regions? [Non-English content] The raw coal price of the second quarter was CNY 600.77 per ton and the standard coal price was CNY 877.76 per ton. [Non-English content] The raw coal price has a CNY 21 per ton decrease quarter-on-quarter. [Non-English content] About the profit attributed to equity holders in the second quarter, the coal was CNY 2.02 billion, gas negative CNY 7 million, wind CNY 1.2 billion, solar CNY 995 million, hydro CNY 30 million. [Non-English content] In the first quarter, for coal sector, the profit attributed to equity holder was CNY 2.44 billion, gas CNY 217 million, wind CNY 1.488 billion, solar CNY 417 million, hydro negative CNY 19 million. [Non-English content] After the implementation of document 136, the company hasn't changed our internal rate of return of our decision-making process; it remains 6%. [Non-English content] About the company's development process, first the company will require the profit from the market to maintain a high quality development; the company will have strict standards in the resources, in the facility, in the grid connection, in the energy storage, and in our maintenance and operation; the company will consider the guidance opinions of the government and the company's development plan. [Non-English content] And secondly, about the development of and operation, we will strengthen the evaluation of this project and quantify our indicators as in the tariff and in the power generation, and to optimize our investment, and the company will implement the policies and to ensure a high probability and to optimize dynamically our boundaries in cost, construction, fulfillment, and other factors, to increase the profit, the return of our renewable addition. Thank you. [Non-English content] The next question comes from [Non-English content] of Xinyue Securities. [Non-English content] I have two questions. First about the company's tariff, so could you talk about the changes of our ongoing tariff in the second quarter? As the coal-fired power decrease was smaller than our contracted power tariff decrease, was that because of the market-based trading? And what is the spot, what is the tariff of spot sales in the first half of year? And what's the income from the ancillary services? What was the income and expenses of peak and frequency regulation? Second, what's the financial cost in the first half of year and what will be the outlook of financial cost changes? Third, under the policy changes, what will be the CapEx of the 15-year period of the company? And what will be the company's focus on development? [Non-English content] First, the tariff and its year-over-year change for the coal sector: the average tariff was CNY 471.47 per megawatt hour, increasing by CNY 12.05 per MWh; gas CNY 742.7, increased by CNY 8.38 per MWh; wind CNY 479.37 per MWh, decreased by CNY 32.53 per MWh; solar CNY 391.27 per MWh, increased by CNY 35.71 per MWh; hydro CNY 358.68 per MWh increasing by CNY 3.65 per MWh. [Non-English content] About the question of ancillary services income, in the first half of the year, the ancillary services of peak regulation was CNY 854 million; from frequency regulation, the income was CNY 227 million. [Non-English content] In terms of peak regulation, the income of coal sector was CNY 1.042 billion; the expense of wind sector was CNY 168 million; the expense of solar sector was CNY 29 million. [Non-English content] About the peak frequency regulation, the income of co was CNY 264 million; the expense of wind was CNY 14 million; the expense of solar was CNY 12 million. [Non-English content] During the 14th Five-Year Plan, I'll talk about the capacity, capital expenditure plan of the company during the 14th Five-Year Plan. It is accelerate period for our building of new power system and is also a strategic opportunity period for the company of transition. The company will insist on high-quality development, continuing of green and low-carbon transition, and the renewable energy development will be a very important sector of the company's development. The company will continue to develop high-quality construction, and the company will try to increase our profitability and efficiency. [Non-English content] About the company's 15-year plan, now the company is in the research and the preliminary work of the 15-year plan. In the future, the company will combine the government policies as well as the company's layout and structure to have this planned and to expose to our investors. Thank you. [Non-English content] In the first half of year, the financial interest rate for our interest-bearing debt was 2.63%. Comparing last year's 2.89%, it has a 26 basis points decrease. The financial cost of the company was CNY 3.38 billion, and it has decreased by CNY 598 million, and that was mainly due to the government's managed monetary policy as well as the company's strategy to decrease our financial cost [Non-English content] About the future trend of our financial cost, as the government relaxed monetary policy continues and the financial market helps to support the real economy, the company will make full use of the government's green transition and facilitate renovation money to take the full advantage of this policy support and strive to decrease our financial cost. Thank you. [Non-English content] Due to time constraints, we invite the last question. The last question comes from Li Xiang of Zhongjin Securities. [Non-English content] I have two questions first about the renewable development. As we just discussed, after the implementation of the document 136, although the detailed policy hasn't been fully introduced by the provincial government, how does the company view this future development of renewable, and what percentage of the company's planning capacity was a large-scale base renewable project, which will have limited the impact from the policy changes? And my second question is about the company's debt. After the year of 2021, with alongside of the company's profit recovery, the debt asset ratio has decreased. Will the company consider to decrease the scale of our perpetual bond? And what will be the company's targeted debt to assets ratio? [Non-English content] After the release of the document 136, the company keeps close track on the plan of 14-year period, and the company followed the policy plan that we think the renewable development will still be a main focus of the government. During the 15-year plan, the government aimed to add 1 to 2 billion kW of renewable capacity. [Non-English content] The company will insist on the green and low-carbon transition and continue to develop renewable energy projects. The company will, based on the demand and to build some high-quality green projects of renewable and try to increase the quality and the efficiency of our new capacity. The detailed plan will be based on the government and the company's situation. [Non-English content] For the company's large-scale base project, there are three tiers of base projects. The first tier has been complete, and the second tier, the company hasn't had any projects. For the third tier, the company has 850 megawatts units in Jingzhou and two wind projects in Hebei. The company will continue to track the policy changes and analyze the policy impact. [Non-English content] About the company's perpetual bond, the company takes control of the debt to assets ratio as our target of operating, and the company aims to use the leverage to increase the returns to our shareholders. The debt to assets ratio has decreased because of our improved operating performance. At the end of last year, the debt to asset ratio was 65.4%, and in the first half of this year, the debt to asset ratio decreased to 64.5%. [Non-English content] The remaining perpetual bonds of the company amounted to CNY 79.1 billion. Among those, CNY 32.5 billion are the special bonds for energy security. The company hasn't had any new plans for incremental perpetual bonds. However, for the remaining parts, the company will strive to have a better refinance. In the next step, the company will keep close attention to the government and the market changes, will remain a stable amount of perpetual bonds and, at a proper time, decrease the total scale. Thank you. Thank you for that. [Non-English content] Thank you so much for all the questions and participation today. [Non-English content] Finally, Mr. Wang would like to give us the summary. Welcome. [Non-English content] Thanks for participating in the conference call. Thank you for your continued support. Here we come to the end of today's conference call. Please contact our IR if you have any further questions. Thank you. [Non-English content] Thank you again for your attendance of the conference call regarding the interim result announcement of 2025. We're looking forward to meeting with all of you in our next result announcement.