Huaneng Power International (600011, 0902.HK) posted a 41.82 percent year-on-year decline in first half 2011 net profit attributable to shareholders to 1.18 billion yuan despite a 31.11 percent increase in revenue to 64.05 billion yuan, reports China Business News, citing a company filing.

Operating cost increased 34.16 percent year-on-year in the first half.

According to Huaneng Power, the higher cost of coal, higher interest rates, and increased power generation volume were the major causes of its net profit decline. It will seek new sources of coal supply in the second half and make further efforts to control the cost of coal.

The operating margin of its power generation and heat supply business dropped 1.81 percentage points year-on-year to 9.34 percent in the first half.