TNAG-1058-FCO40-1308-Guangdong-nuclear-power-station-project-1981 — Page 89

18

(ii)

(iii)

Loan Repayment

After the commissioning of the nuclear power station, the estimated total loan will be US$3661m. This loan will be repaid mainly by

mainly by funds generated from depreciation and partly by retained profits. In the economic evaluation, depreciation is calculated at US$223m per annum and the total depreciation charge for the 15 year loan repayment period would be US$3345m. It means that only a total of US$316m

would be required for loan are repaid, the profits will be gradually

retained

repayment.

After

profits all

above-mentioned retained

loans

refunded to the shareholders using the depreciation fund.

Decapitalisation

After all loans are repaid, the depreciation fund will be used

models indicate Financial for decapitalisation. that by the end of the joint venture period in 2008, the shareholders of GNPC will get back their total share equity of US$796m

is the sum of shareholders

investment and accrued interest

shareholders' on during construction of the nuclear power station.

which

fund

(iv)

Profit Sharing

The profit is assumed to be 30% of the GNPC operating cost which comprises fuel cost, depreciation, O & M cost, taxation,

and decommissioning

allowance.

operating interest

The average rate of return on the shareholders' equity would be about 25.0%. In the case of HKNIC, after deducting the dividend withholding tax of 10%, the net rate of return would be 22.5%.

the

taking Company.

to

into

The

GNPC will distribute all

part or

of its profits shareholders in accordance with their shareholdings after making allowance for reserves and consideration the cash position of undistributed profits will be accumulated in the retained profit account. According to the financial analyses, the total amount of profits distributed by GNPC during the joint venture

would period

be

at US$7548m (US$993m present value). This will be shared by GPC and HKNIC in a 6 to 4 ratio.

3.3.5

Conclusions

After the extensive studies and analyses, it is considered that the joint development of a nuclear power station in Guangdong by GPC and The main findings are HKNIC is financially and economically viable. summarised as follows:-