This article first appeared on GuruFocus .
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Operating Earnings (before fair value movements):Increased 10% year-on-year to over HKD5.7 billion.
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Total Earnings:Rose 7% to nearly HKD6 billion, including a HKD356 million gain from the Jhajjar divestment.
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EBITDAF:Increased 9% year-on-year to HKD13.6 billion.
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Total Dividends per Share (First Half 2026):HKD1.26 per share, unchanged from the prior year.
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Capital Investments:HKD7.3 billion, lower year-on-year despite higher Hong Kong SoC CapEx.
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Hong Kong Operating Earnings:Up 6% to HKD4.8 billion, driven by capital investment and lower interest costs.
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Hong Kong Electricity Sales:Rose 3.6%, with data center demand growing close to 12%.
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Chinese Mainland Operating Earnings:Held broadly stable at HKD899 million.
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Energy Australia Operating Earnings:Up 22% to HKD223 million.
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Apraava Operating Earnings:Up 41% to HKD105 million, lifted by one-off items.
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Cash Inflows:Healthy at HKD8.8 billion, up HKD1.7 billion.
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Total Cash Outflows:HKD11.8 billion, including HKD7 billion of capital investment and HKD4.9 billion of dividend payments.
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Net Debt:Higher than at the end of 2025, reflecting the dividend payment cycle.
Release Date: August 06, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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CLP Holdings Ltd ( CLPHF ) delivered a strong first half of 2026 with operating earnings up 10% to over HKD5.7 billion, driven by robust performance in its regulated Hong Kong business and improved contributions from all regions.
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The company achieved a strategic decarbonization milestone with the sale of the Jhajjar coal plant, shifting its India portfolio to a fully non-carbon, contracted, and regulated platform.
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CLP Holdings Ltd ( CLPHF ) successfully issued its inaugural Panda Bond, enabling a self-funded structure for its Chinese Mainland renewables platform and enhancing capital efficiency.
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Hong Kong electricity sales rose 3.6%, with data center demand growing nearly 12%, reinforcing the company's position to benefit from structural growth drivers.
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The company maintained exceptional network reliability at 99.999% in Hong Kong and improved its total recordable injury rate, underscoring operational excellence and safety commitment.
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CLP Holdings Ltd ( CLPHF ) is advancing a significant flexible capacity pipeline in Australia, including batteries and pump hydro, to capture value from the energy transition.
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The company is exploring a high-potential data center development at the Yallourn site, leveraging existing infrastructure to create long-term optionality.
Negative Points
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Energy Australia faces challenging market conditions with softened wholesale prices and volatility, which are expected to weigh on earnings in the near term.
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The Chinese Mainland business is experiencing tariff pressure, supply-demand imbalance, and increased renewable curtailment (15% in H1 2026 vs 9% last year), impacting profitability.
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Retail competition in Australia remains intense, and regulatory determinations (DMO/VDO) are expected to lower retail prices, potentially squeezing margins.
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The company's total dividends per share remained flat at HKD1.26, with no increase despite higher free cash flow, which may disappoint income-focused investors.
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Capital investment decreased by 11% year-on-year, reflecting disciplined allocation but potentially limiting growth opportunities outside Hong Kong.
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The company faces uncertainty regarding the next Hong Kong development plan (2029-2033) and the potential capital expenditure for the Tseung Kwan O zero-carbon receiving station, which could impact future earnings visibility.
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Geopolitical tensions, such as the Middle East war, have led to volatile international fuel prices, increasing costs in Hong Kong despite mitigation measures.
Q & A Highlights
Q: Why didn't CLP increase its interim dividend despite lower CapEx and higher free cash flow? Will the company follow its past pattern of increasing the total dividend in the fourth quarter? A: CEO TK Chiang stated that the dividend policy is to provide consistent and steadily growing dividends, provided the underlying business can sustain growth. The final decision rests with the Board, and he indicated that investors would see the outcome in the coming quarters. He did not confirm a specific increase for the fourth quarter.
Q: Given the regulatory-driven reduction in Australian retail electricity prices and declining wholesale prices, are the improvements in Energy Australia's retail and wholesale businesses short-term? A: CEO TK Chiang acknowledged near-term pressure on retail margins due to increased competition and lower VDO/DMO determinations. He also confirmed that softer wholesale prices and reduced volatility will likely continue into 2027. However, he highlighted that the multi-year transformation program, including the Tata Consulting Services partnership, is on track to deliver HKD250 million in cost savings by 2027, and the long-term outlook is constructive due to coal retirements and rising demand from electrification and data centers.
Q: Can you provide an update on the next Hong Kong development plan (2029-2033) and the potential for importing zero-carbon nuclear power from Mainland China? A: CEO TK Chiang said discussions for the next development plan will begin in late 2027 or early 2028. Regarding nuclear imports, he noted that the project is long-term, targeting the 2035 decarbonization goal. The focus is on importing nuclear power, with the receiving station at Tseung Kwan O earmarked for reclamation. He does not expect significant CapEx for this in the current plan, but it could be a major component of the next plan.
Q: What is the outlook for the Chinese Mainland renewables and nuclear businesses given curtailment and tariff pressures? A: CEO TK Chiang explained that while new wind projects added revenue, overall curtailment increased to 15% in H1 2026 from 9% last year due to grid constraints and supply-demand imbalance. The company is focusing on value over volume, targeting provinces with higher growth and lower curtailment risk, and is implementing a transformation program to save HKD100 million. For nuclear, Daya Bay is stable due to a cost-plus PPA, while Yangjiang saw a slight downward adjustment due to lower tariffs, but generation is expected to remain stable in H2.
Q: What is the business model for the Yallourn data center precinct, and will CLP invest in the data centers themselves? A: CEO TK Chiang stated the project is in its very early stages. The initial concept involves developing up to two 1-gigawatt data centers powered by renewable energy, battery storage, and gas generation. He confirmed that the business model is not yet decided and that they will conduct market sounding. He kept an open mind on whether CLP would invest in the data centers or focus solely on providing electricity services, but confirmed there are no plans to delay the Yallourn coal plant's closure in mid-2028.
Q: Can you provide an update on the Energy Australia transformation program and the new billing platform? A: CEO TK Chiang reported that the transformation is on track, with costs incurred in 2025 and 2026, and benefits starting this year, with the majority materializing in 2027 and 2028. The plan is to reduce back-office overhead by HKD250 million. The decision on the new billing platform solution is expected by Q4 2026, with a 2.5-year implementation period, meaning benefits will only materialize after completion.
Q: What is the breakdown of the SoC CapEx for the Northern Metropolis project, and what is the outlook for future CapEx? A: CEO TK Chiang confirmed that the current development plan includes HKD2.5 billion for the initial phase of the Northern Metropolis build-out, spread across the 2024-2028 period. He noted that discussions for the next development plan (2029-2033) have not yet started, so no information is available on future CapEx. Marissa Wong added that 72% of the SoC CapEx is directed to transmission and distribution.
Q: What is the scale and timeline for the Tseung Kwan O zero-carbon power receiving terminal, and will the imported power be 100% nuclear? A: CEO TK Chiang clarified that the terminal is needed to meet the 2035 target of 60-70% zero-carbon energy. He stated that the majority of imports will be nuclear, but the government's plan also includes 7.5-10% renewables, which could come from local sources or imports. He does not expect significant CapEx in the current development plan, but anticipates the next plan (2029-2033) will capture most of the project's capital expenditure, with commissioning expected around 2035.
Q: How is CLP mitigating the impact of the Middle East conflict on fuel prices and supply? A: CEO TK Chiang explained that in Hong Kong, gas prices are linked to oil prices, but the contract design uses a rolling average, which smooths out volatility. All fuel costs are passed through to customers via the monthly fuel cost adjustment mechanism, protecting the company. He confirmed that supply is secure with three sources of gas. In Australia, gas contracts are largely hedged, and there has been no significant impact on wholesale prices. China and India are not exposed to international fuel price issues.
Q: What is the update on new business ventures in Vietnam and the broader Southeast Asia region? A: CEO TK Chiang stated that near-term focus is on Taiwan region, where the regulatory regime is mature with PPAs from Tai Power and corporate clients like TSMC. Vietnam and Laos are considered medium-term opportunities, as the markets are still developing. He noted that new regulations in Vietnam favoring corporate PPAs are positive, and the company is closely monitoring regulatory developments.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
