Ying Xuejun: Hello, analysts and investment friends from home and abroad, good afternoon!

The company issued the first-quarter report of 2017 just now. At present, we begin to hold the teleconference so as to carry out in-depth communications with all of you. Thanks for your active participation. First of all, I will give a brief introduction to the overall performance in the first quarter of 2017 to you on behalf of the company.

In the first quarter of 2017, the company acquired the accumulated operating incomes of 15.312 billion yuan with the year-on-year growth of 16.44%; acquired the net profit attributable to shareholders of the listed company of 0.631 billion yuan with the year-on-year decrease of 7.67% and acquired earning per share of 0.0474 yuan with the year-on-year decrease of 7.61%.

Up to the end of the first quarter, 2017, the company’s asset-liability ratio has reached 74.46% with the year-on-year decrease of 4.33%; the company’s total asset has reached 232.039 billion yuan with the year-on-year decrease of 22.96%; and the net asset attributable to shareholders of the listed company has reached 40.351 billion yuan with the year-on-year decrease of 11.68%.

Up to the end of the first quarter, the company has achieved the installed capacity of 45.648 million kilowatts with the year-on-year growth of 7.58%, the generating capacity of 44.2071 billion kilowatts with the year-on-year growth of 22.96%, the full bore utilization hours of 998 hours with the year-on-year growth of 17.27%, the unit power supply coal consumption of 289.57 grams per kilowatt-hour with the year-on-year growth of 1.51%, the unit equivalent availability coefficient of 96.49% with the year-on-year growth of 2.09% and the comprehensive station service power consumption rate of 5.5% with the year-on-year growth of 0.05%. My introduction to the performance indexes of the company in the first quarter is over. Next, it is the time for you to carry out communications with the management team of the company.

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Q: can you tell me the respective profit of coal power, gas turbine, wind power, hydro power and PV in terms of the structure of the power source in the company in the first quarter? Can you tell me whether the profit of coal power includes that of gas turbine? If included, how much is the net profit of the gas turbine in the first quarter of this year?

A: the profit (total profit) structure of the company in the first quarter of this year is as follows: the profit of coal machine segment, hydro power segment, wind power segment, PV segment and non-electricity segment respectively is 0.874 billion yuan (excluding incomes from investment of Ningde Nuclear Power Co., Ltd.), -0.325 billion yuan, 0.219 billion yuan, 27 million yuan and -0.254 billion yuan, of which, the main loss of non-electricity segment is from renewable resources. The profit of coal machine segment does not include that of gas turbine segment. In addition, in the first quarter, the profit of gas turbine segment is 0.318 billion yuan, and that in the same period of last year was 0.219 billion yuan.

Q: how much is the income from investment of Ningde Nuclear Power Co., Ltd. in the first quarter?

A: it is 0.373 billion yuan.

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Q: how much is the unit fuel cost of the first quarter and fuel costs respectively in each quarter of the last year? Does the unit fuel cost of the first quarter include that of gas turbine? How much is the unit fuel cost if that of gas turbine is included?

A: the unit fuel cost of the coal machine segment in the first quarter, 2017 is about 0.18 yuan/megawatt hour. In 2016, the fuel cost in the first quarter and the fourth quarter respectively was 0.126 yuan/megawatt hour and 0.193 yuan/megawatt hour. These are the unit fuel costs of the coal machine. The gap structure between the unit fuel cost of the coal machine and gas turbine is very large. So, the unit fuel costs of these two segments cannot be merged in a unified way.

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Q: in the quantity of electricity sold in the first quarter, what is the proportion of the market electricity quantity in the total electricity quantity and what is the discount of the market electricity quantity?

A: in terms of the market electricity quantity in the first quarter, the proportion of the market electricity quantity in the settlement electricity quantity of the company is about 11% according to market progress situation of each place. In terms of the price of the market electricity quantity, the average degree of price reduction of electricity quantity directly traded by the large users is about 6 cents, and the average degree of price reduction of trans-provincial or trans-regional electricity quantity is about 0.12 yuan.

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Q: can you tell me the main reasons why the utilization hours of the company rise largely in the first quarter?

A: the year-on-year growth of the generating capacity in the first quarter, 2017 is 22.96%, the main reasons of which are as follows: firstly, the big environment that the year-on-year growth of the total electricity consumption in the first quarter brings about the positive pull. Secondly, the company endeavors to generate electricity to the maximum degree by means of the company’s own benchmarking efforts, thus resulting in large year-on-year growth in the first quarter. In addition, the contribution of the new machine going into operation to the increase of the generating capacity is not obvious.

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Q: how much is the unit price of the standard coal of the company in the first quarter? How much was the unit price of the standard coal of the company in the first quarter of last year? Only the coal-burning unit is taken into account for the unit price of the standard coal, isn’t it?

A: the unit price of the standard coal entering the factory is 595.92 yuan per ton (excluding the tax) in the first quarter, 2017. In the first quarter of last year, unit price of the standard coal was about 340 yuan per ton; the coal price respectively was 424 yuan per ton and 578 yuan per ton in the whole year and the fourth quarter of last year. The unit price of the standard coal put in the furnace in the first quarter of this year is 612 yuan. This is only the unit price of the coal-burning unit. The calculation of coal price of gas turbine and coal-burning unit cannot be combined, because of the large difference.

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Q: the unit price of the standard coal was about 340 yuan per ton in the first quarter of last year. The unit price of the standard coal in the first quarter of this year is 612 yuan, which is nearly twice as much as the unit price of the standard coal in the first quarter of last year. Is the large increase degree true?

A: yes, it is true. The increasing degree of the coal prices is basically between 200 yuan and 300 yuan. The coal price was in a relatively low range from the first quarter to May in last year. It increased slowly with a small increasing degree from January to May and the basic price was about 340 yuan in the first quarter, thus, it was in the low position. From June, it rose continuously to the highest point in the end of last year. This is the conclusion if you compare the coal price in the first quarter of this year with that in the first quarter of last year.

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Q: in terms of unit fuel cost, that in the first quarter of this year is about 54% more than that in the first quarter of last year. But, why is there a large difference if the price of the standard coal increases by 80%?

A: this is related to the power generation structure. Some large units make the average coal consumption lowered in the first quarter of this year, thus the increasing degree of the unit fuel cost is lower than that of the coal price.

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Q: can you tell me whether the increasing trend of the second quarter will be same as that of the first quarter in terms of utilization hours?

A: in terms of the market situation of the second quarter, from the perspective of the completion situation of electricity quantity in April, it shows the trend of continuously steady increase compared with that in the same period. From the increase situation of the total electricity consumption, the total electricity consumption in each place of China in the third and fourth quarters shows a trend of rapid increase and the electricity consumption of each region basically shows a trend of “low first and high then”. From the perspective of the year-on-year growth of the electricity quantity, the company’s electricity quantity brings into correspondence with the market rhythm of the area where we are located. But, some uncertain factors will exist still in terms of increasing degree. In terms of the current situation, there is a steady and rising trend.

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Q: the average grid purchase price of the first quarter increases slightly compared with that of the whole year of last year. What is the reason, the change of installed structure of the company or the price difference in the market electricity quantity or decrease of discount?

A: compared with the fourth quarter of last year, the electricity price increases in the first quarter of this year, the main reason of which is the installed structure. Compared with the fourth quarter of last year, the proportion of the market electricity in the first quarter of this year increases and the electricity price difference is equivalent basically, thus the main reason of the difference in average electricity price is that the proportion of electricity quantity for the units with high electricity price results in the large structural difference. Thus, the main reason is the effect of the structure.

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Q: I want to ask the management layer to answer me the year-on-year growth or decrease situation of profit in each segment of the company.

A: in the same period of last year, the profit of the coal machine segment, hydro electricity segment, wind power segment and solar energy segment respectively was about 1.97 billion yuan, -5 million yuan, 0.1 billion yuan and 21 million yuan, of which the profit of the solar energy segment is basically equivalent to that of this year. The coal chemical industry segment is within the scope of the consolidated statements in the same period of last year, so, the loss of the non-electricity segment was 1.3 billion yuan in the same period of last year.

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Q: is the company able to provide the situation on the average utilization hours of the coal machine? Is the company able to provide the financial cost of the first quarter of the company? And the financial cost in the second quarter will increase compared with that of the first quarter, won’t it?

A: the total utilization hours of the coal machine in the first quarter were 1153 hours with the year-on-year growth of 239 hours and month-on-month growth of 110 hours.

The average financing cost is 4.41 in the first quarter. At present, under the background of monetary contraction and the gradually contracted credit scale at home, the expected financing price of our company shows a rising trend. But, our company has organized the affiliated units and financial institutions to strengthen the cooperation, increased the credit extension scale and made the financing arrangements with the purpose of enhancing the awareness of avoiding the funding risks so far.

Up to now, we also could acquire the preferential interest rate. If there is the good cooperation in the second quarter, it is predicated that we still can acquire the discount in the second quarter and the stock loan shall be implemented as per the original preferential interest rate.

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Q: can you tell me what the proportion of all market electricity quantities signed of the company is at present? What is the price difference? What is the proportion of the whole market electricity quantity in all generating capacity in this year according to predication?

A: the accumulated signed market electricity quantity is 16.167 billion kilowatt-hours in the first quarter, of which electricity quantity directly traded by the large users is about 14.295 kilowatt-hours, and the trans-provincial or trans-regional electricity quantity traded is 1.872 billion kilowatt-hours. The accumulated completed market electricity quantity is 3.869 billion kilowatt-hours in the first quarter. It is predicated that the traded electricity quantity will be 50.4 billion kilowatt-hours with the decreasing degree of 6 cents per kilowatt-hour in this year.

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Q: according to the first-quarter report, the incomes from investment of the company increase largely, the main reason of which is transferred available-for-sale financial assets. Can you tell me what kinds of assets are transferred and whether there will be another action of this part in the second to fourth quarters?

A: the main reason of relatively many incomes from foreign investment in the first quarter is completion of transferring of the Continent Insurance’s stock rights held by the company. The achieved profit increase is 0.238 billion yuan.

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Q: the profit before tax of the electricity segment shall be 1.1 billion yuan and the income from investment shall be 0.5 billion yuan, the total of which is 1.6 billion yuan. If deducting the profit of the non-electricity segment, it is about 1.3-1.4 billion yuan, and the actual profit before tax is about more than 0.8 billion yuan. So the difference is 0.5 billion yuan. Can you tell me whether 0.5 billion yuan could be understood as the total expense?

A: No, some are consolidated and offset. Some internal transactions, which could be found in the notice, are included in the statistics of non-electricity segment. The internal trades are not decreased in accounting in the non-electricity segment when we carry out statistics of profit of the non-electricity segment. But in the consolidation level, we will offset the internal trades.

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Q: is the company able to give us the data or concept that the cost of the standard coal will be lower than the level of the first quarter or will increase?

A: from the fuel situation of the first quarter, the total price is in the state of operating at a high level. But, from the perspective of the situation in April, the total fuel price at the end of April decreases in a certain degree in Qinhuangdao, whether in the market sale price or listed price or in the circum-Bohai Sea index. It is supposed to say that there will show a trend of decreasing in the stability in April and May.

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Q: can you tell me the proportion of the long-agreement coals and the spot coals in terms of fuel cost and then tell me what the difference between price of the long-agreement coals and that of the spot coals is?

A: the total quantity of the electricity-coal purchased by the company is 14.24 million tons in the first quarter, of which that of the long-agreement coals is 6.76 million tons accounting for 47.5% of the total purchase quantity. In addition, the quantity of self-supporting coals is 1.32 million tons, accounting for 9.3% of the total purchase quantity. The domestic spot goods are 4.4 million tons, accounting for 30.9% of total purchase quantity, and the imported spot goods are 1.76 million tons, accounting for 12.4% of the total purchase quantity. This is one structure of the total quantity of 14.24 million tons. In terms of price difference, the price of the long-agreement coal and the spot coal respectively is 703.1 and 680.9 in the first quarter.

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Q: can you share some discussion or measures on the coal price and electricity price linkage and rising of electricity price carried out by governments, which are known at present?

A: the friend from UBS mentioned whether there is the problem on launch of coal price and electricity price linkage by the government at present. Up to now, the company has not received information on this aspect. The increasing degree of coal price at the end of last year did not trigger the line of coal price and electricity price linkage. At present, the coal price begins to operate downwards at the high level and there is a trend of downward operation. Thus, from the current view, the coal price and electricity price linkage is impossible whether from the perspective of official information or the market situation.

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Q: can you tell me the situation on additional issuing of A-shares and H-shares of the company and when will the additional issuing of A-shares and H-shares be completed according to predication?

A: the applications for issuing A-shares and H-shares have been accepted successfully by China Securities Regulatory Commission respectively on April 13 and April 18 of this year. At present, we are waiting for the feedback of China Securities Regulatory Commission on the application materials. It is predicated that the relevant feedback on H-shares may be earlier. But, A-share issuing and H-share issuing are the premise of each other and we will carry out issuing only when the corresponding approval has been given to the A-shares and H-shares. Both acceptance and feedback were started just now, thus the specific approval time is uncertain.

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Q: does the company have a planned arrangement on asset injection after additional issuing?

A: there is not a specific scheme at present. Injection of the strong shareholders’ assets does not conflict?with private offering. We will carry out confirmation as per the forming time of the scheme and the situation of issuing of A-shares or H-shares.

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Q: how much is the scale of loss of the power plant in the first quarter? How many power plants are subject to loss and where do they distribute?

A: there are 24 coal machine enterprises in the first quarter, of which 6 coal machine enterprises are subject to loss. The enterprises with loss mainly distribute in Yunnan and Chongqing etc. and several small power plants in Hebei region. This is the situation of coal machine enterprises with loss.

In the first quarter, there are 2 gas turbine enterprises with loss, namely Jiangshan in Zhejiang and Baochang gas turbine unit in Shenzhen.

There are 11 hydro power enterprises, of which 8 hydro power enterprises are subject to loss and they mainly distribute in Sichuan and Yunnan.

In the first quarter, all wind power enterprises and PV enterprises acquire profits.

The non-electricity enterprises, which mainly are renewable resources enterprises, are subject to loss.

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Q: the increase speed of the generating capacity of the company is very fast in the first quarter. But, the actual proportion of the market electricity of the company is not large. According to explanation of generating more electricity quantity, how many generating capacity of the company will increase yearly? And how about is the situation of utilization hours??

A: from the perspective of the first quarter, the increase level of the generating capacity is relatively large with the increase of more than 22%, the main reasons of which are as follows: firstly, the company carries out the exceeding power generation, benchmarking exceeding power generation and competes some electricity quantities with the market. Secondly, it is related to the increase quota of the total electricity consumption. In the first quarter, the increase ratio of the total electricity consumption is 6.9%. Thus, compared with original yearly increase of 3% predicated by China Electricity Council, the increase in the first quarter far surpasses the expected increase. This increase is caused by the relatively low base number in the same period and the increase of the secondary industry leading to continuous and steady increase of electricity consumption. From the current view, in terms of the generating capacity of coal machine in the whole year, that in the second quarter is better than that in last year because of driving role of the secondary industry. It is originally predicted that the increase speed of the total electricity consumption in the whole year is 3% and the utilization hours of thermal power will decrease by about 150 hours. From the perspective of the situation in the first quarter and the second quarter, the data may be changed. But, the situation in the first quarter and the second quarter of this year cannot represent that in the whole year. We hope that the electricity consumption of the whole year should be kept at this level continuously, but we are observing the situation of the second quarter and we are also observing that of the third and fourth quarters at the same time. After the information on increase of total electricity consumption of 6.9% in the first quarter is issued, China Electricity Council has not changed the predicted value of 3% so far. We are also carrying out observation in terms of this matter.

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III. Meeting summary

Ying Xuejun: analysts and investment friends, the management layer carried out the in-depth communications with all of you on performance situation of the first quarter and other related matters. You will have an in-depth understanding of the company after communications on the situation of the first quarter.

From the perspective of the future development of the company, the coal price will operate at the high level and will show a decreasing trend. For electricity quantity, we could see a good beginning and we hope that the operation situation of the whole company will be better continuously and you can give us more attention. From the perspective of all indexes of electricity quantity in the first quarter, we enlarge the internal management and work performance. It is supposed to say that we also gain good achievements in electricity quantity. We also hope that we will make more progresses in one year with the help and support of you,

We also understand the key point and direction of the capital market, and also know your looking forward to future development of the company by the communications. Confronted with severe economic situation, the company will endeavor to improve the performance in the next work so as to repay shareholders' and investors' attention, care and love. Please forgive us if there is any insufficient and inadequate answer. I hope all of you can contact with the securities capital department and we will keep the smooth communications with all of you continuously.

The first-quarter performance issue teleconference of the company is over, thank you!