Good afternoon. Welcome to CLP's 2025 annual results briefing.

My name is Marissa, Director of Investor Relations, and with me today is Chief Executive Officer Mr. T.K.

Chiang and Chief Financial Officer Mr. Alex Keisser.

We lodged our 2025 annual results with the exchange today. That announcement, as well as this presentation, is now available on the CLP IR website.

This recording is also being recorded, and you can access that a little bit later on this evening. Before we begin, please read the disclaimer on slide 2.

This year, we've got two languages available: one English and one Putonghua for you to choose from. For today's briefing, we'll start with T.K.

providing the overview, followed by Alex with the financial results, and then T.K. will return with the strategic outlook.

We will then conclude with a Q&A session. We encourage your participation and your questions.

With that, I will now hand over to T.K. to begin with the briefing.

Thanks, T.K.

Thank you, Marissa. Good afternoon, everyone.

Thanks for joining us. In 2025, our core Hong Kong business performed strongly, providing stability that offset market headwinds on the Chinese mainland and also Australia, and kept our overall results resilient.

The fundamentals of our business remain strong. Our operational excellence continues to drive value across the Group, advancing critical projects that secure energy reliability and our transition to zero carbon.

In Hong Kong, we completed our smart meter rollout and maintained world-class supply reliability, despite facing a record black rainstorms and 14 typhoons. On the Chinese mainland, we brought our largest wind farm to date into commercial operation, launched our first independent battery energy storage system, and commissioned our second centralized control center in Shandong.

In India, Apraava Energy achieved full commissioning of its 251 MW Sidhpur wind farm, its biggest wind project to date. In Australia, we completed outage programs at Yallourn and Mount Piper, enhancing its flexibility and reliability.

Our growth momentum is aligned with energy transition opportunities in our region. With a disciplined, value-driven approach, we are advancing a pipeline of low-carbon projects that will secure future earnings.

At the same time, we've taken steps to drive cost efficiency and strengthen our foundations. We completed Phase 1 of our ERP rollout in Hong Kong, advanced an enterprise-wide transformation at EnergyAustralia, and optimized head office operations.

We closed 2025 with healthy cash flow and a strong balance sheet. This financial resilience, combined with our growth momentum, gave the Board the confidence to increase the dividend, continuing our track record of delivering shareholders' returns.

Turning to the highlights. Financially, the Group's operating earnings before fair value movements were down marginally by 2% to over 10.6 billion Hong Kong dollars.

Total earnings were lower by 11% to 11.5 billion, driven by coal plant-related items affecting comparability. Alex will provide details shortly.

The Board has recommended a final dividend, bringing total dividends for 2025 to $3.20 per share, an increase of 1.6% from 2024. Operationally, we achieved strong performance in safety and reliability, with a lower injury rate and reduced unplanned customer minute lost in Hong Kong.

On the customer front, we added more accounts in Hong Kong, while competitive dynamics in Australia led to a decline in numbers. In terms of generation, electricity sendout declined by 3%, reflecting lower coal outputs.

At the same time, non-carbon capacity rose by 3%, driven by renewables and battery investments across the Group. I will now hand over to Alex for the financial results.

Thank you, T.K., and good afternoon. A summary of the key metrics.

Earnings before interest, taxes, depreciation, amortization, and fair value movement, or EBITDAF, was stable year-on-year at 25.7 billion Hong Kong dollars. Operating earnings before fair value movements decreased slightly by 2% to nearly 10.7 billion.

Adjusted for the fair value movements and items affecting comparability, total earnings was close to 10.5 billion, a decrease of 11%. Capital investment declined 13% to 16.4 billion, with higher growth capex offset by the absence of the headquarters acquisition booked in 2024.

Total dividends for financial year 2025 was $3.20 per share, representing an increase of 1.6%. Let's go now into the details.

The Group's performance was anchored by a strong Hong Kong business performance. Elsewhere, earnings were impacted by market pressures, transformation cost, and one-off items.

Fair value movements on EnergyAustralia's forward energy contracts were less favorable compared to a year ago. Several non-recurring items also affected comparability in 2025.

A 680 million impairment on two minority-owned coal plants on the Chinese mainland was taken due to lower demand and rising competition from renewables. A 345 million redundancy for Yallourn's planned closure was also provisioned, while a positive contribution of 390 million was booked from EnergyAustralia's Wooreen battery following the formation of our 50% joint venture with Banpu.

I'll now take you through the detailed performance and outlook for each business unit. All variances will exclude foreign exchange to reflect underlying performance of the business.

Let's begin with Hong Kong. It was another solid year.

Core earning rose 7% to just over 9.5 billion, driven by continued capital investment and high operational reliability. We also proactively refinanced debt in a favorable interest rate environment to lower interest cost.

Capital expenditure was 10.6 billion, focused on growth and decarbonization, supporting the Northern Metropolis development, data center expansion, grid upgrades, and completing the smart meter rollout. Electricity sales dipped slightly, reflecting milder weather and a high base in 2024.

However, demand from data centers continued to grow, reinforcing their role as a key structural growth driver. We continue leading Hong Kong's low-carbon transition, investing and partnering across sectors from transport and shipping to building.

Looking ahead, our focus remains on three priorities. First, continue delivering safe, reliable electricity at a reasonable tariff.

Second, deliver the 52.9 billion development plan, expanding infrastructure in growth areas and strengthening grid resilience to support Hong Kong's future. Third, support Hong Kong's zero-carbon goal by completing the clean energy transmission system and working closely with government to increase zero-carbon imports.

Now turning to Chinese mainland. It was a challenging year, shaped by transitional supply-demand imbalances, softer demand, and resource variability.

Earnings declined 12% to 1.6 billion, mainly from Yangjiang Nuclear and renewables. Yangjiang's contribution fell due to higher share of output sold at market tariffs, where prices were lower.

Renewables were impacted by historically low wind resources and higher curtailment of approximately 9% across the portfolio, particularly in Jilin and Gansu. Conditions improved as the year progressed in key provinces like Shandong and Jiangsu, with easing tariff pressure.

Our minority coal portfolio saw reduced dispatch from lower demand. Nevertheless, operational performance continues to be strong.

Energy sold increased across the portfolio, with Daya Bay Nuclear delivering another standout year. We also commissioned one new wind and three new solar projects, adding to earnings.

We received a record amount of renewable energy subsidies, boosting our cash flow. While our annual contracting GC and PPA volume with corporate customers increased, supporting short-term earnings visibility despite a softer pricing environment.

Finally, on the development side, our pipeline remains healthy at over 1 GW. Looking ahead, Daya Bay will remain a stable contributor, while Yangjiang will face increasing market tariff pressure.

For our minority coal assets, earnings should remain stable. Higher capacity charges under Policy 140 are expected to offset the removal of the floor price.

The outlook for renewables is sound. Market fundamentals are stabilizing, and tariff pressure looks manageable.

Importantly, with our success under Document 136, we secured full eligible mechanism tariff volume for four projects, locking in attractive rates for the next 10 to 12 years, providing solid long-term revenue visibility. Our capital strategy remains disciplined, and we are exploring efficient funding options, including onshore panda bond and strategic capital partnerships.

To EnergyAustralia. Overall performance was impacted by tough retail conditions and a combined 300 million impact from one-off tax expenses and upfront transformation costs.

In generation, the fleet performed well. Mount Piper ran reliably, and our fleet operated flexibly to capture optimal pricing outcomes in a period of less volatility, effectively offsetting Yallourn's lower output and Mount Piper's higher coal costs.

Retail remained challenging. Intense competition and cost-of-living pressures led to margin compression, loss of customer accounts, and a higher bad and doubtful debts.

That said, we saw improvement in the second half, with early benefits from cost initiatives and recontracting activities starting to materialize. We booked upfront cost under the Enterprise segment tied to the multi-year transformation program launched in 2025.

This strategic investment includes our partnership with Tata to streamline IT operation and corporate functions. Separately, we are evaluating billing and CRM platforms to simplify and digitize the business.

Earnings were also impacted by the one-off tax expense arising from changing law tax that limits the deductibility of interest expenses on shareholder loan. On the positive side, finance costs declined, driven by lower average debt levels and reduced interest rates.

We also settled the maturing shareholder loan and put in place a smaller, more flexible perpetual note, an equity-classified instrument with no fixed repayment obligation, to strengthens EA balance sheet. The net result was operating earning to 85 million, reflecting the combined weight of retail performance, transformation investment, and the tax one-off.

Looking ahead, EnergyAustralia is focused on four key actions. First, optimizing our generation portfolio, leveraging our flexible fleet to respond to demand and capture value in evolving NEM with high volatility.

Second, building on second-half momentum in retail to improve margins through targeted customer strategies, ongoing cost-out, and platform transformation. Third, executing our enterprise-wide transformation to deliver a leaner, more efficient operating model by 2028.

Lastly, delivering new flexible capacity. We are advancing over a gigawatt of new batteries and pumped hydro projects, with Wooreen on track for 2027, laying the foundation for stability and earning growth.

Moving to India. Our joint venture platform, Apraava Energy, delivered solid underlying performance.

However, reported earnings were impacted by one-offs. Headline results were down 29%, primarily due to a 82 million one-off impairment on KMTL transmission.

This compares to 2024 results that included one-off gains totaling 55 million. Excluding these one-offs, our underlying operating earnings improved.

Renewables delivered higher output, thanks to higher wind generation and the full commissioning of the 251 MW Sidhpur wind farm. Solar remained stable, and we saw additional interest income from delayed payment.

Transmission had solid availability and earning from our two operating lines. Our smart meters portfolio is scaling up, with more than 2.5 million meters installed and growing contributions as rollout accelerate, with another 7.2 million meters to be installed.

Jhajjar thermal output was lower, but the plant maintained high operational efficiency and reliability. We continued to drive an ambitious growth pipeline: 18 projects won within 3 years across a diversified portfolio, for an equivalent of close to 2 GW capacity.

Looking ahead, we remain focused on portfolio decarbonization and sustainable growth. A key milestone will be the sale of our Jhajjar coal plant, which is on track to complete in the first quarter.

The sale will unlock capital for reinvestment and is expected to generate gain. With a clear path to decarbonize and a robust pipeline, Apraava is well-positioned to capture India's significant energy transition opportunities and continue to deliver value to shareholders.

Finally, to Taiwan Region and Southeast Asia. Earnings declined to 179 million.

Ho-Ping's contribution in Taiwan was lower, due to lower recovery of coal cost, while Lopburi solar in Thailand remained stable. We also incurred higher development and corporate expenses as we explore new opportunities in the region.

Looking ahead, Ho-Ping will focus on managing fuel cost. More broadly, we are assessing opportunities with long-term contracts across Taiwan Region and Southeast Asia as part of our growth strategy.

These targets benefit from strong economic growth, supportive policy settings, and utility-scale projects offer attractive potential. We are currently evaluating opportunities, including renewable energy projects in Taiwan and cross-border development linking Laos and Vietnam, and will proceed with the right partners and funding structures in place.

Turning to cash flow. Free cash flow generation was strong, up 1.6 billion to 22.6 billion, driven by solid EBITDAF and fuel cost recovery from declining fuel prices from our Hong Kong SoC business, alongside receipt of renewable subsidies from the mainland.

With our new headquarters completed in 2024, overall capital spend came down. Total cash outflows were 22.6 billion, made up of 14.6 billion of capital investment and 8 billion of dividend payments.

Of the 14.6 billion of capital investment, 11.2 billion was invested in our Hong Kong SoC business, and 3.4 billion was spent on renewables projects on the Chinese mainland and Wooreen battery in Australia. Cash payment for dividends was higher, as a result of the higher final dividends for financial year 2024.

Finally, our financial structure remains strong, with a slight increase in net debt. Our liquidity remains sound, with around 29 billion in available facilities to meet business needs and contingency.

The team has successfully raised over 17 billion Hong Kong dollar debt for the Hong Kong SoC business, in addition to the refinancing of the 500 million US dollar perpetual capital securities, all with competitive credit spread. Our prudent financial management continues to be recognized by rating agencies.

S&P and Moody's reaffirmed our strong investment grade ratings for CLP Holdings, CLP Power, and CAPCO, all with stable outlooks. Finally, Moody's has upgraded EnergyAustralia outlook to positive on its investment grade Baa2 rating.

I'll pass it now over to T.K. for the strategy update.

Thanks, Alex. Energy security and decarbonization are the critical forces shaping our industry's future, and CLP is committed to leading this transition.

Our strategic priorities are clear and centered on: balanced growth, decarbonization, and financial discipline. Hong Kong remains our cornerstone.

Its stable, regulatory framework provides predictable returns and dependable earnings that are fundamental to our strength. We are executing the 52.9 billion 5-year development plan to deliver safe, reliable, and affordable power, while supporting government's economic and infrastructure agenda and accelerating the city's energy transition.

A major focus is modernizing and expanding our power system to meet future demand, from the Northern Metropolis, a 300 square kilometer development that will house 2.5 million people, to the rising needs of data centers and electrified transport. This disciplined investment delivers for Hong Kong and builds a solid platform for sustainable growth.

Now building on that foundation, we are targeting growth in fast-growing energy transition markets in our region, and doing it with discipline. Our strategy is firmly value over volume.

Each investments must meet our minimum return requirements. The goal is to build durable, recurring earnings, while ensuring diversification.

China led global renewable energy in 2025, adding nearly 450 GW of solar and wind, and now reinforced by the government's landmark pledge to reduce emission by 7% to 10% from peak levels. We are participating in that growth, but selectively.

In 2025, we added 0.5 GW of renewable, which is modest compared with the national scale. Reflecting our calibration to ongoing market reforms, we have adjusted our development targets from 6 to 5 GW of renewable energy by 2030.

We are prioritizing quality opportunities with long-term earning visibilities. This means focusing on high-demand regions with strong resources and grid access, expanding at existing sites where we already have scale, and securing long-term green power contracts or GECs with corporate customers.

Encouragingly, we've had success post-Document 136 implementation, with four projects across Hebei, Yunnan, and Shandong, each securing full eligible mechanism tariff volumes, totaling around 1 GW at attractive prices and long tenors, supporting long-term revenue stability. Importantly, our growth in China is being structured to be self-funded.

From 2026, we plan to tap into onshore financing like panda bonds and bring in strategic partners through a clean energy fund. It's a model we've already proven in Apraava, and we are applying that same capital discipline here.

India's commitment to clean energy is clear: targeting 500 GW of non-carbon capacity by 2030, alongside massive grid modernization for greater efficiency. This creates a powerful backdrop for Apraava's growth.

As our self-funding joint venture, Apraava is scaling up across the low-carbon value chain: wind, solar, transmission, and smart meters. In the last 3 years, Apraava secured 18 projects across a diversified portfolio, all backed by long-term contracts that lock in stable, attractive returns.

Today, it has around 2 GW of low-carbon projects underway, targeting 9 GW by 2030. As part of a diversified portfolio, the business will begin to explore opportunities across commercial and industrial customers and battery storage.

Apraava Energy is a capital-efficient growth platform, enhancing both our earnings and long-term growth profile. To Australia.

In 2025, solar and wind hit new milestones, supplying over 50% of the National Electricity Market in Quarter 4. This is a clear sign of where the market is heading.

Our focus is on firming this increasingly renewable-heavy grid. We are investing in flexible capacity that supports reliability and captures value as volatility grows through Australia's decarbonization.

EnergyAustralia has over 1 GW of new dispatchable and firming capacity slated to come online in the next 3 years. We've made strong progress on multiple fronts.

Over the last 2 years, we've secured government support for three key battery projects: Wooreen, Hallett, and Mount Piper, under the Federal Government's Capacity Investment Scheme. These projects benefit not just from policy tailwinds, but also from existing lands, grid connections, skilled local workforces, and EnergyAustralia's growing development capability.

Our partnership model is delivering results. We launched two major collaborations in 2025: the 350 MW Wooreen battery with Banpu, now under construction, and the 335 MW Lake Lyell pumped hydro project with EDF, in development.

EnergyAustralia will remain self-funded using partnerships and project financing for large projects, EA's balance sheet for smaller ones, and long-term contracts for projects outside our asset footprint. With a clear plan to reduce costs, a more flexible fleet, and a strong pipeline of new capacity, EnergyAustralia is well-positioned to deliver reliability, resilience, and value in Australia's evolving energy markets.

Let me touch on our capital allocation approach. It can be summarized as: invest for growth, but within our means, while protecting financial strength and delivering shareholder returns.

Our foundation is solid. A strong cash generation profile and solid investment-grade credit rating give us the flexibility to fund both operations and growth.

Hong Kong's sustained asset growth underpins stable and predictable cash flow, supporting our consistent dividend. Beyond Hong Kong, we apply a disciplined lens to every investment.

We prioritize capital for projects that are strategically aligned and meet our return thresholds. We also run our established businesses with the objective of financial independence, maintaining standalone credit profiles and tapping diverse funding sources.

We'll leverage capital recycling and business model options, including partnerships such as the clean energy funds on the Chinese mainland, for efficient use of capital. By adhering to these principles of discipline and diversification, we'll drive steady, long-term earnings growth.

Now finally, our core capabilities are what enable everything I've described. For CLP, it starts with operational excellence.

That means consistently delivering strong performance across the energy value chain through efficient operations, reliable networks, and great customer experience. We've strengthened grid resilience, modernized our infrastructure, and leveraged technology to improve efficiency, all of which underpin our reliability, cost discipline, and safety performance.

Two critical enablers support our strategy: our people and our digital transformation. We're investing in our teams, reskilling and upskilling our workforce, and fostering a culture that embraces change.

At the same time, we are embedding digital solutions across the business. A key milestone was deploying our ERP system in Hong Kong, alongside a digital literacy program that has reached thousands of employees, helping to improve efficiency and decision-making.

These capabilities are interconnected and reinforcing. Together, they give us the competitive edge to meet the demands of a rapidly evolving energy sector.

We face the opportunities of energy security and decarbonization with discipline and purpose, and with a clear focus on delivering sustainable long-term value for our shareholders. I'll now hand over to Marissa to facilitate our Q&A session.

Thank you, T.K., and thank you, Alex. We will now begin the Q&A session.

For those analysts on our Zoom channel, please use your raise hand icon to ask a live question, and for those on our webcast, please type your question in the bottom right-hand corner of your screen. We have a few questions online.

Pierre Lau from Citi, Pierre, if you can hear me, please go ahead and ask your question.

Hi, good afternoon. Can you hear me?

Hi, Pierre.

Yes, we can hear you well.

That's good. Thanks for the chance giving me raising questions.

I have two questions. The first one is for Alex.

If you look at page 12 regarding EnergyAustralia, I think 2025 EnergyAustralia earning below expectation, and I can see that there's sharp increase in the enterprise or the corporate expenses, and also increase in depreciation and amortization expense. I want to know these two numbers, -177 and also -190, how much of them are on recurring basis and how much of them on one-off basis?

Also what will be the outlook for 2026? The second question is on page 15 regarding your cash flow.

This is the question for T.K. I can see that 2025 your capex for growth capex mainly in Australia and China still up year-on-year.

Obviously 2025 earning from both Australia and China were not so good. Are we going to increase the capex further for these two country in 2026?

Also you mentioned that we target something like double-digit IRR for China and high single-digit for Australia. Are we too optimistic in terms of our return forecast?

Thank you.

Maybe Alex you answer the

I can start with the first one regarding EnergyAustralia. I will add one point if you allow me.

If we look at the breakdown of the three points that you have raised, the D&A increase, depreciation and amortization, is a recurrent increase up to 2028 that was linked to the increased capex that we did mainly in Yallourn in order to increase its reliability and able to hedge more of its energy. The one which is linked to enterprise EBITDAF, this is more one-off, linked to two activities.

The first activities is the outsourcing of our IT and corporate services to Tata. This has been done in order to prepare future reduction in our operating cost.

It's an opex which is done in order to improve our operation. The second type of expense that we had is for the contracting for a new platform for our customers that has been not yet set, but for which we already had some expense.

The third element that I want to raise, which you have not raised, is regarding taxation. This is also a reduction in our earnings linked to a one-off, as we took the decision not to deduct from the taxes the interest payment between EA and CLP for the shareholder loan that was in place.

Alex, just touching on the outlook on EA?

The outlook, I don't provide any outlook for that, [laughs] so sorry for that.

Okay.

Now, regarding question 2, the capex for growth, as you can see on slide 15, it is mainly for the Chinese RE projects and EnergyAustralia's Wooreen battery. Now for EnergyAustralia, Wooreen battery will only be commissioned next year, the benefit actually will be coming.

There's always a kind of a time difference between capex and asset commissioning to bring in the benefits. Maybe one data point is that for last year, we have four projects commissioned in Chinese mainland.

Total is about 400 MW. Right now, we have five projects under construction.

The total capacity is about 900 MW. We will see more asset coming online this year.

Now, regarding the expected return, that's our hurdle rate, and we have been very disciplined in ensuring that the investment that we're making can satisfy the hurdle rate. As I also mentioned previously, in Chinese mainland, we have had four projects with total capacity of about 1 GW that have been successful in the mechanism tariff bidding process last year.

For those mechanism tariffs, the tariff level actually are quite attractive, and all of those projects, after taking into account the future projections of the market tariff, we are quite confident that the IRR actually is higher than our hurdle rate. We will now continue to focus on winning these kind of mechanism tariff in our markets, because having the mechanism tariff with protection on the tariffs for a tenor ranging between 10 to 12 years will give us a proper stability.

Maybe just touching on the fact that the target has reduced a little bit from

Because of the fact that we want to be more selective in the Chinese mainland market, we have adjusted down the target from 6 GW to 5 GW by 2030. We want to be more selective in picking projects in markets or in regions that have relatively higher tariffs, greater demand, lower risk of grid curtailment, and also funding projects that are like extension projects that we have already had our existing asset, then we can leverage on existing infrastructure to reduce the cost of those additional investments.

Maybe, Alex, touching on the funding?

I'd like to provide two more information. The first one is regarding China.

We've financed our project with a 70% to 80% project finance, while when we do our evaluation on the return on equity, we don't assume full recontracting of this project finance, and we assume an average of 50% debt over the lifetime of the asset, taking a conservative approach. Second information that I want to provide is when we look at our minimum return, we don't take into account potential gain on sell-down in the future.

For example, when we took the Wooreen investment, we didn't take into account the gain that we did following this on the sale to Banpu, which was of 390 million Hong Kong D for the full 100% of equity.

Thank you, Alex. Thanks, Pierre, for your question.

Next on the line is Yonghua Park from HSBC. Yonghua, go ahead with your question, please.

Hi. Thank you, Marissa.

Can you hear me?

Yes, well. Go ahead.

I have three questions. In terms of long-term planning, India will add 9 GW of non-carbon energy.

This seems increase from last year's 8 GW goal. Will you increase planned capital allocation from $6 billion per annum to which number?

What's the reason behind this upgrade? Have you seen any improvement in terms of project return in India?

Secondly, in mainland China, renewable target is reduced to 5 GW. Can we assume capital allocation could be also trimmed from $4 billion per annum, last year number?

Lastly, Yallourn coal-fired plant will be shut down as planned, or any other plan after that? I saw some news previously indicated that EA will invest $5 billion Australian dollar for their restructuring.

Can you just clarify? Thank you so much.

Maybe I try to answer the first question and second question on capex, maybe I ask Alex to supplement. Now, for the first question about the long-term planning in India, actually, I think this 9 GW target is consistent with our long-term planning since last year.

Actually, our target is to have about 1 GW a year. If you look at our existing asset and those asset under construction, by 2030, adding 1 GW a year of commitments, then we can achieve this 9 GW of non-carbon projects.

The capital allocation basically is based on this 1 GW per year to deduce this 6 billion per annum.

Just on that point there, Yeonghwa, I think you were looking at the 8 GW. It was a 20 2028 target.

Now we've added 2030, an extra year, which is now 9 9

GW. It's consistent.

Yes. Yeah.

Then on Yallourn, basically we are maintaining this retiring Yallourn by middle of 2028. That's our current plan and actually the agreement with the government.

Regarding the capex investment, I think is it the longer term after Yallourn closure?

I think, Yeonghwa, that's what you're referring to, the Yallourn precinct investment? Yeah.

I assume that he is. Yeah.

I can try to cover

it. Maybe you can cover the capex,

yes. On China, yes, of course, the 4 billion per year will be slightly reduced, by a bit less than 20%, in light of the reduction of the target.

One incremental information that I want to provide on this, we have taken the decision that by end of 2026, renewable activity of BU China will be self-funded with the raise of up to 3 billion of panda bond, and also the creation of a clean energy fund where we will have some partners to that. That's regarding China.

Regarding Australia, maybe that was the question, is we have a target to have by 2030 up to 3 GW of flexible capacity, all contracted or developed, and we're not looking at developing any renewable projects, and we also plan to do this on the balance sheet of EA with similar structure for the large project that what we have done for Wooreen, which is a project finance, and also with seeking the right partners in order to reduce the funding needs and increase our return on this project.

Thank you, Alex. Next question from J.P.

Morgan, Steven Choi. Steven, please go ahead.

Hi, Alex.

Hi, Steven. Can we hear you?

Hello, Stephen.

Yes, thank you. I have two questions.

The first is, can you please [unclear] guidance on the capex outlook for this year in terms of growth capex, maintenance capex, and SoC? And [unclear] about the dividend outlook, because we [unclear] dividend by more than [unclear] this year, despite [unclear] decline in operating earnings.

How [unclear] dividend growth this year [unclear] the headwinds in mainland China and the Australia [unclear]?

Capex and

dividend. Two two questions.

Maybe I'll ask Alex to shed some light on the capex. Now regarding the dividend outlook, basically our dividend policy is to target to maintain a steady and growing dividend, supported by sustained growth in our business.

We'll based on the longer-term assessment on our sustainability of our business and then decide the appropriate dividend level. We will not give any outlook for the moment, and all the dividend will be approved by the board by year end.

Maybe Alex can touch on the capex?

On the capex, regarding the SoC capex, we have a total of 10 to 11 billion per year that will be spent. Regarding growth capex, the growth that we had in India has slowed down slightly this year versus 2023-2024.

It's not being consolidated in any case, and it's being self-funded. The growth in terms of capex in China will be linked to the project that we'll be able to close.

The growth of capex related to Australia will be depending when we'll be able to start our project of Mount Piper BESS and when we'll be able to close our partnership on this.

Thank you, Alex. On the line is Cissy Guan from Bank of America.

Cissy, please go ahead. Cissy, if you can hear us?

Hi, Marissa, can you hear me? Yes.

Hi, we can hear

you.

I have a few questions. All regarding to the future capital strategy.

You mentioned the Clean Energy Fund in China. When do [we?]

expect to see progress on this? What kind of partners are we looking for?

Are they going to be insurance money, or any specific type of investor do you think that may be interested in collaboration with us in renewable energy in China? Also secondly, in India, we saw that Apraava has sold the Jhajjar power plant, will there be any special dividend be upstreamed to CLP?

Thirdly, for EnergyAustralia, first of all, are we still looking for disposal of stakes? Also can you provide a outlook as regard to the wholesale power tariff in Australia going forward, and also how would the next DMO and VDO reset going to be, and how would the retail competition landscape going forward?

Thank you.

Okay. Maybe for the CEF strategy, Alex can help address it.

Maybe also including the what happened after Jhajjar sale.

Now,

regarding the EA the Australian market, now we do see continued intense competition in the retail sector. This will continue.

In order to address this, we have taken steps to improve the business performance. First is to optimize our cost of operation.

Secondly is that we are looking at upgrading and replacing our customer platform. We are in quite an advanced stage, and we hope that we can confirm the technology and start execution this year.

With a new platform, we target to further improve the efficiency, as well as enhancing the customer experience so as to improve our competitiveness in Australia. Regarding the power price, I think in short term, if you look at the forward price curves, it softens slightly.

We will see this will continue in the short term. I think maybe starting from 2028, we do see the potential of forward price increase later, because of some of the changes in supply situation.

Now, in Australia, because of the actually the whole energy transition and decarbonization for CLP Group, the capital requirements is very significant. We want to be focusing on our core markets, in particular Hong Kong and China.

For EnergyAustralia, firstly, it will be self-funded. Secondly, that we want to have different kinds of partnership in order to have more efficient use of our capital.

One example is the partnership in the Wooreen battery, where we have sold 50% to Banpu. This is a good example that, on one hand, we can have a more efficient use of capital, and secondly, that actually the overall return of the project can be enhanced.

We are open-minded about different forms of partnership, be it at project level or enterprise level. More importantly, I think in the short term, we want to make sure that the performance can be further improved, both in terms of the efficiency as well as how do we manage the all the risks in the market.

Maybe I ask Alex to address the first two questions? Yep,

I'll start with India. The plan is, once the transaction will be closed, to have Apraava Energy doing its full distribution of the proceeds to La Caisse and CLP in 50/50% over the year 2026 and 2027.

CLP, however, doesn't plan to have an extraordinary dividend distribution being done following this distribution. Regarding China, we have to recognize that CLP brand is very well recognized.

The first was when we had our 3 billion RMB bond being approved by the regulators, we started to do roadshow with our underwriter, and we plan to have this first 1 billion being drawn upon in H1, which have been quite well received. Regarding the Clean Energy Fund, the business model that we have is looking for the partners, bringing our full expertise in terms of development, in terms of operation, in terms of market sales, in terms of project finance, and keeping our brand attached to this Clean Energy Fund, meaning that we want to sell the project once they have been built, but we want also to stay into the fund being an LP with 50% in order to have aligned interest, because this is not a one-off.

This is a long-term strategy that we want to do not only for Chinese mainland, but also for other countries. Regarding who are the different investors, we are looking for a potential insurance company to be an anchor investor, and pending that, we will look for a few others, but a limited number, for a fund which will be around 4 billion fund size, with a total capex of 20 billion.

Thanks, Alex. I'll just note one more point on EA retail.

Yes, it has been challenging conditions, but if you look at first half versus second half retail results, second half was a turnaround, and that was based on the work around customer acquisition, recontracting, and the cost-out initiatives. We've got a question from Huatai, Weijia Wang.

Go ahead, Weijia.

Thank you [unclear] for questions. [unclear] two questions.

The first is [unclear] market to facilitate [unclear] clean energy [unclear]. We have all anticipated [unclear] nuclear project.

At [unclear] time [unclear] any kind of [unclear] project share? Also [unclear] shall we [unclear] the next capex [unclear] Hong

Kong [unclear]? Weijia, you were cutting in and out there, I'm just going to assume your question.

Number one is on nuclear investments, and then the second one, how that might impact capex in Hong Kong.

Yeah. Okay.

Now, I assume that you are talking about our so-called nuclear imports in the medium term, because for the Hong Kong market, the government has set a decarbonization target, and by 2035, we have to have 60% to 70% of our generation mix being zero-carbon energy. In order to fulfill that target, the plan actually is to import zero-carbon energy, mainly nuclear, from the region to Hong Kong by 2035.

Now, for that plan, we are now still in a very early stage, because importing nuclear from say Guangdong to Hong Kong, we need to have central government support, and actually right now, the Hong Kong government is discussing with the central government on identifying the right location for the nuclear power station and then how the power can be delivered to Hong Kong. Now, despite the fact that this is still in the early stage, if you look at the existing Daya Bay arrangement, actually this could be a precedent arrangement in which CLP invest in the Daya Bay.

Right now, the arrangement is we invest in 25%, and then we import 80% of the power from Daya Bay to Hong Kong through a dedicated transmission line, which can ensure that we are clear about the source of the power as well as ensuring reliability. This is a good reference for the future import arrangement.

As I said, I think right now is still very early stage. Once it's clearer about where the power will be coming, then we will enter into more detailed discussion with the relevant stakeholders in the Chinese mainland about the design of the network, how to bring the power in, and also the commercial arrangement of the investment.

Again, another reference point is that for Daya Bay, the equity investment in Daya Bay is not part of the SoC capex. Actually, it's invest at the CLP Holdings level, and through a PPA from Daya Bay to Hong Kong, for the Hong Kong SoC, all this will be treated as opex, and then the return on the investment in Daya Bay is based on a ROE approach.

Again, this is a reference model, and whether this will be applied, it depends on the future discussion with the relevant stakeholders.

Thank you, T.K. We are heading towards time, I'll take this as the last question from Rob Koh, Morgan Stanley.

Thanks, Rob, for joining us at that late hour in Australia. Go ahead with your question.

Thank you so much. My first question is in relation to the customer platform upgrade in Australia.

Other companies down here, when they do that, they obviously do that very carefully. They take 2 to 4 years.

Is that comparable time frame for EnergyAustralia? Then a second question is on the performance of the wholesale energy segment, which saw some lower prices, but I guess the volatility capture offset that?

Just want to make sure that's the right way to think about the generation performance.

Yep. Okay.

Thank you, Rob. Yeah.

Now, for the customer platform, our current plan is to take about 2 years or slightly more than 2 years, before end of 2028 would be our current target. Now, but we are still working on the detailed planning right now, and as I mentioned, we are at a very advanced stage of selecting the appropriate technology.

We are working very closely with the future potential vendor on this detailed plan. There will be more details later in the year, but our current thinking is that we will complete this before end of 2028.

Now, for the wholesale market, as you mentioned, in the forward price, you can see lower price level, but actually if you look at the intra-day volatility, over the past few years, this volatility actually is increasing. That's why, for EnergyAustralia, we have been focusing on investing in energy storage projects so that we can capture the benefit of this volatility in the Australian market.

Thank you, T.K. Thank you all for your very good questions, and thank you, T.K.

and Alex, for the briefing and answering the questions. Before we wrap up, I just wanted to announce the winners of our closest estimates competition.

There are two this year. The first goes to Chi Kang from Huatai Securities again, for the closest operating earnings, and the second, for the closest annual dividend, goes to Evan Li from HSBC.

Congratulations to you both. My team will reach out to you about your prizes.

That brings today's briefing to a close. My team and I will be available for any follow-ups, and thank you all for joining us today.

Take care, and goodbye.

Thank you.

Thank you.