China Coal Energy Company Limited

Hello everybody. So all the participants are all silent. And now I'm going to read their announcements. So this is faced with all the different investors. We remind all the investors to be careful when you do the investment and you have to take care of the time. So all the distinguished investors and shareholders, good afternoon. I'm Jiang Qin, the board secretary of China Coal. Welcome you to this company's performance press release in Q1 in 2023. I sincerely thank you for the long-term concern and care. So today we have with us is the CFO, Mr. Chai-Qiao Lin, and responsible persons of the company, the security affairs department, and all the different colleagues from the coal sales center, chemical products, etc. So now I'm going to share with you the company's performance in Q1. Unless otherwise specified, the following data are calculated according to China accounting standards. So since this year, the company has conscientiously implemented the decisions and arrangements made by the CPC Central Committee and the State Council and the State-Honed Asset Supervision and Administration Commission that adhered to the general tone of striving for progress while maintaining stability, scientifically organized production and sales, paid close attention to improving the quality and efficiency strengths and the implementation of plans, and then to achieve this stable opening and a good start of Q1. So now I'm going to talk about this main operation data. Coal production and sales volume, the output of commercial coal was 33.3 million tons, an increase of 2.81 million tons or 9.2%. YOY, so the sales volume of commercial coal was 74.77 million, an increase of 5.2 million or 7.5% among them. The sales volume of self-produced coal was 32.57 million tons, YOY increased of 5.7%. Buyout trade coal sales reached 39.31 million, up by 5.7. The sales volume of Asian coal was 2.89 million, up by 85.3% about selling price. The average selling price of self-produced commercial coal is 671 yuan, while a decrease of 56 yuan per ton by 7.7%. The average selling price of buyout trade coal is 735 yuan per ton, down by 12.4%. So the cost of coal products, the unit sales cost of the companies that self produce the commercial coal is down by 12.9%. where a decrease of 40.5 yuan per ton reaching 272.55 yuan. So for the production and sales of major coal chemical products, so polyolefin production was 378,000 tons up 2.4% YOY, sales volume was 365,000 tons up 10.9% YOY, and urea Output was 479,000 tons up by 0.4% YOY. Sales volume was 645,000 tons up 7.9%. Methanol output was 499 tons down 1.2%. So five is the major selling points of main coal chemical products. The sales price of polyolefin is 7,056 yuan per ton. down by 8.4%. Sales price of urea was 2,718 yuan per ton, increase of 4.7%. The sales price of methanol was 1,832 yuan per ton. So the sales price of ammonium nitrate was 2,459 yuan per ton, down by 10%. So the cost of main coal chemical products The unit sales cost of polyolefin products is 6,556 yuan, while a decrease of 1.2% unit sales price of urea is 1,837 yuan per ton, up by 7.2%. The unit sales cost of methanol was 2,130 yuan, up by 21.6%. The unit sales cost of ammonium nitrate was up by 5.2% the equipment business we have achieved the output value of my equipment was a 3.05 billion yuan up 17.3% financial business after deducting the distributed transactions the operation income was 427 million yuan increase by 2.2% so the other business conditions mainly including electric power aluminum processing equipment and accessories import. After deducting all the distributed transactions, the operating income was 2.076 billion yuan. So the second part is about the main financial indicators. In Q1, China Co. achieved operating income of 59.2 billion yuan. Total profit was 12 billion yuan, and the net profit attributed to the shareholders of the listed company was 7.2 billion yuan, the YOY increase of 5.3%, the basic earning per share was 0.54 yuan, the YOY increase of 5.9%, the weighted average return on equity was 5.32%, so YOY decrease of 0.44 percentage points. So the asset liability ratio was 49.9% down by 1.6%. So the main profit increasing factors are the unit sales cost of a self-produced commercial coal is reduced and the profit is increased by 1.282 billion yuan. The sales volume of self-produced commercial coal increased by 729 million yuan. The power generating and heat business increased the profit by 312 million yuan, so the financial expense decreases by 1.845 billion yuan. Investment income decreased by 281 million yuan. The taxes and surcharges increased by 271 million yuan. The major coal chemical enterprises reduced their profits by 101 million yuan. The third is about cash flow. In Q1, the company's net cash inflow was 11.098 billion yuan. Up by 1.128 billion. So these are all the situation about the operation in Q1. Now I'm talking about the Q2 key work arrangements. In Q2, the company will fully implement the goal of a one profit and five areas of SASEK and strive to achieve effective improvement in quality and reasonable growth. So first, the scientific and reasonable organization of production to ensure the completion of production targets. The second is intensifying the marketing efforts and strive to stabilize the sales and anchoring the goal of zero loss. And fourth is to further promote quality improvement. and efficiency improvement and further strengthen refined management. The fifth is about continuity-dependent enterprise reform and constantly stimulate the vitality. Six is comprehensively strengthen the implementation of the plan and accelerate the key work. Seven is adhere to this innovation-driven development. Eight is continuously improve the compliance system and stick to the bottom line of legal operation. So in H2, We actually have this vigorous task of steady growth and the management and all the colleagues of the company will overcome all the difficulties and make persistent efforts to build a world-class energy enterprise and give back to all the shareholders. So that's all for me. Now let's enter the Q&A session. Welcome you for all the questions. Thank you. Thank you so much for the sharing. So we will first have this telephone. question raisers and for this internet ones and you have to wait so hello everybody if you want to raise a question please first press the star and then press one so for this internet participants you can just tapping by words or you can just use the button of a hand raising to raise the question So we will first have the questions being read. Okay, so now let's just read all these online questions. So there's one investor asking about like a Q1 for this, for this coking coal. What is the reason why the production quantity is being lowered? so I cannot hear them very well I'm sorry and then let's see the second question so why methanol is actually the sales quantity is actually up however the income is not very increased and then you also can see it has little to do with that so you can see that a well Some telephone questions here. So we will have 6461 to raise a question. Hello, everybody. So I am from Huayou. I would like to ask the question because for this previous speech made by the leaders, it's not very good. And I don't know. It's actually for this Coal King Coal. so for the kinetic coal and I want to know that for this coking coal what is the reason why it is actually being lowered and what is the main reason why the production is lowered the second one is currently for this entire coke price and then for this market price and it has been lowered a lot so I would also like to know that currently for the future 2023 trend of this Coke's price and for the inference of the overall profit this year. Can you give us a simple prospect of that? So for Mr. Zheng, we will invite him to talk about that. And then for the price, we will also have some other colleagues to answer that. So for the production of cokes, it has this YOY decrease. There are actually two coal mines and because of their two coal mines influences, so the production quantity has been lowered and about price. Now let's welcome another one. So good afternoon. Coke price you can see that in Q1 so for Coke is actually fluctuating and then going on downward the pace is also quite fast and then it's actually under confident for this market with this for Coke currently it's actually hard for us to see this like a very obvious support for the price to go up and then because of Q2 for this overall economic policy stimulation and for this significant projects will also be increased so maybe for some like a low stock and for the demand from this Coke Steel Company they may have this peak of demand and then they may also have this bottom out because of this increase of the demand so we are also waiting for the afterwards macroeconomic policy and the economic stimulation to see the afterwards results okay got it and then the next C is for You can also see that Australian coal has been permitted to be exported to China and therefore this influence for us, have you got this evaluation for this import, how much they would influence us? so for this overall cokes market is still actually a very rare product in the market although you can see for this steel companies they are still maintaining this like a very limited profit and then also even sometimes losing money so they have the pressure of increasing the efficiency however cokes is still a very rare product in China domestically especially they have this very big space of growth in the market and for the current sales is still quite good so our profitability I still think it's still quite promising so for import what is the situation from Australia so the impact proposed by the Australian one so for Q1 it's still like having a big fluctuation and we also can see it doesn't have a very big impact and for the current demand is still quite big okay got it and there's another question because Previously, we have just got a report. We have about 20 billion of the investment. I would like to know that actually for such a large amount of investment, what is the concern? Because the last meeting we say that about this dividend issuance is actually about 30%. We may have a very big capex in the future. So for our asset liability, Can you share with us what do you want to keep your asset liability ratio? Because for central enterprises, they also have some requirements and the KPI regarding that. So for this lower our asset liability ratio and to increase our ROE, what is the overall thing that we want to do to improve these? Can you share with us? So you mean that actually for the current investment disclosure is in Shaanxi Yulin for this phase two, of this coal chemical industry. Now we have about 0.6 million tons of this coal chemical plant in Shanxi Yulin and we have already got a very good ROE and for this investment in this phase two of Yulin project has already been this further extension of our long-term strategy of extending this supply chain to have this clean and highly efficient operation method. of the company and then this project has already been done for many years it's just for the overall national documents this is also proposed by the central government general secretary Mr. Xi's visit of Shanxi and this project has been proposed so it has utilized this mature project construction and experiences of that and it has further expanded this scale of that. We hope to have about 0.9 million tons of the equipment and then we also hope to have a very good realization of that. So this is the overall investment method and then We also can see we will have Mr. Cheng to answer that. So for our liability rate, it has already been lowered while it's maintaining a stable level. And you also can see we have this very big capex. With this capex, we definitely would have about like 56%, 57% of this reliability rate. We wouldn't say that because of the investment. We will have just a very big boost of our liability rate. Okay, the last question is whether we have this kind of... like stock ownership incentive. Do you have any considerations of that? We hope that maybe you could refer to that because you can also see that for Tongye and they all have different ones. They have already started doing that. And for some local SOEs have already started doing that. Thank you so much for your questions. That's all. And maybe later for... this general meeting of stockholders to the EGM. Maybe I will come and have another chat. So now let's have the next investor. Hello, dear managers. I am from Guozhen Securities because since Q2 for this spot price of cokes is actually lowered significantly for Q1 the price was about 1700 and for Q2 compared with Q1 what are the changes we still have Mr. Dong to answer you the question Mr. Dong to answer you the question so for this stock of this cokes it is still being accumulated for this import coal and then it's also like having this very big complement and then we also can see as I said before with the overall macro policy and then to have this stimulation and for this steel industry for infrastructure and then to have this new starting of construction projects we are still quite positive about the market we think this is definitely going to bottom out We are still quite positive about the market in the future. Okay, got it. I just want to know that because for this small price since April, it has a significant decrease. So for Q1, the overall average price is still maintained at a high level. I don't know for Q2 compared with Q1's average price. So what is the change? What's the price difference? So just now Madam Dong has already answered to you the question. We think for this price on average would go down. However, generally speaking, you may have this trend of the bottoming out. And for our price of this coal, it depends on this market demand. I have something to add. So what do you have paid attention to this time? production of this cokes production being lowered and then in Q2 because of this two construction sites being finished so for this overall cokes will come to the normal level so it's just like the quarterly temporary change and for this annual target will not change thank you so I have another question and then for this kinetic coal for the price because I think that for this year's Q1 is about 576 Q1 price so for Q2 last year is about 659 and 660 for that for the kinetic cost is actually mainly depending on this long-term contracts why the price fluctuations still very big although it's based on this long-term contracts mainly So we will have Mr. Zheng from Financial Department. So for kinetic coal, on the one hand, it's actually vulnerable to the market change. And second one, the price is actually including the freight price. So for this two-year, the freight price would also influence this average price. So thank you. That's all. Okay, thank you. Now let's have 4772. We will first have him to share with us his name and where he's from. It's a she, sorry. So, I am Zhang Qi. I have several questions. The first one is, I would like to ask that for the afterwards coal mines, do we have some added ones? And for the existing ones, do we have some new things? So for this afterwards once and we will have our strategic plan department to do the answering. So now we are still preparing for that. It's about to be completed within this year. So for Anjali, it's about 5 million tons. We hope to complete that in 2025. We have already done this site survey and inspection. So for this future progress, we will keep you updated. So stay tuned. and the second question is you can also see in Q1 so for this coal cost is lower significantly and for Q1 the situation will it has some increase or something so for Q1 the cost of this coal products I think these are some different changes and then we will have this financial colleague to share with you in Q1 compared with Now before the price decreases about 12.9%, there are some objective reasons. The first one is a change of that to lead to this freight cost to be changed. And then second one is about this new safety production methods. And they have got this worldwide increase of this cost for this safety manufacturing. Except for these, none. They also have this Q1 of the lower demand. So this is also led to this overall cost reduction in Q1. So annually, I think in Q1, the cost of control cannot be simply copied. In Q2 or even this entire year's one, it will have this moderate increase. So compared with last year, we still hope the cost will be lower. We will keep this general stability. So the next one is we would like to ask about coal chemical industry. You can see for this coal chemical, the price is going up. However, for some cost for actually methanol, the cost is also rising significantly. In my imagination, for methanol, it should actually go together with this coal price, I didn't see this downward trend the same as the coal price. Why is that? Would you have Mr. Zheng to answer that? For the cost, you can see that for this polyolefin and they have this synergy with another site being opened and for urea because for urea's price range is actually fluctuating so the overall cost price is going down and originally maybe it is not in line with this overall average price And the second thing is for this urea, for this coal's requirement is actually very demanding. It will also lead to this urea's cost to have this slight increase. Okay, got it? And then looking into the future, so do you think it will be similar with Q1 for this coal chemical cost? I think for Q1, except for this polyolefin for my, Methanol and the urea, the price and the cost are still quite stable. So it still depends on this original situation and the overall market demand. So the last question is about our trade coal because last year for this trade coal, so overall quantity is actually downward significantly because we now have some import. So do we have this significant increase of the trade coal? So we can see from Q1, our current trade coal is still very stable. I should say that Q1 has already set the historical quarterly high. We have seized the business opportunity in the market. For this year, for trade coal, The scale is still kept about the level of 100 million tons. So in the future, this year, we also still will see this opportunity of this southeastern coastal area of this coal import and then to establish this market and then to continue to guarantee the supply of our coast from the coastal area. Thank you. Thank you, that's all for my question. Thank you so much for the management team. Now let's have this telephone number ends with 8310 to raise the question. Please tell us who you are and where you're from. Hello, I'm CN Securities Li Yu. I have several questions. Hello, we cannot hear you. Her voice is a little bit on and off. Can you hear me? Yes, I can. Now is it okay? Now it's okay. Okay, so I would like to ask that for this KPI focus of our listed company, what are the KPI focuses? What are the indicators? so according to this CESEC the new requirement so for all those companies owned by us it's the same except for this for coal production and sales and safety production we have some KPI related evaluation related to To our own major business area. Okay, got it. And I have several two other questions. The second question is this year for this production plan of coal mainly coming from which mines? They may come from Dahai Zhe for this Dahai Zhe's overall coal contribution. For Dahai Zhe, for this year's plan is roughly at what level? We hope to have about 14 million to 15 million around this range. Okay, got it? And then the third question is, I have already seen that Q1's self-produced coal is actually down by 7.7% YOY and for trade coal is down by 12%. I want to know that for trade coal is actually the price downward trend is even bigger than the self-produced ones. Why is that? So the thing is, you can also see for this year, for our self-produced coal is mainly supplying this long-term contract, this long-term contract price. So for the mid and the long-term contract price, it has given full play to this anchoring of this market price. Comparatively speaking, it has always been maintained at a very stable level. and from January to March for this average price is 726 compared with last year is up by 3 RMB per ton and until May, now we actually are according to this mid and the long term price is actually 719 compared with the same period of time last year, it's actually remained the same. So this is the reason why we see that the long term contract markets are quite stable. So for market based coal, you can also see for this market coal, it not only has reflected and it also has got this overall changes of that so since last year you can also see from this COVID control and for this coal mine accidents for this spot price of coal has already got some fluctuations so from January to April I think for this spot price of kinetic coal is about 1,121 compared to last year, the average price, it has a down by 60 RMB. So this is about 5.1% of the reduction. And for April, the spot price is 1,031 RMB. So YOY, it has a down by 107 RMB. This is 9.4%. and it has already down by 200 yuan compared with the end of last year. So this could also explain for our market call for the sales is actually following the trend in the market. So thank you so much. I have no more questions. thank you now we will have actually any more questions and to communicate with you and then for this telephone participants you can directly press star and one or this online participants you could raise your hands or type the questions in the chat box so we will have the question to be read online I'm going to read this online question so the voice is a little bit low so you could actually get closer and then everybody could hear better can you hear me? yes I can so the question is for Q1 so what is the overall performance of that and then we will have the finance so for Q1 but because of the price is actually slightly lowered and we also have this overall influence I think it has maintained this a quite stable situation although we have experienced a certain influences okay so any more questions if no question from the telephone and I will keep reading So we don't have any more questions from the telephone. And now we were just invited to have this question read. And we still got the feedback that the volume is a little bit low. So for this question, please introduce the production. So this will have Mr. Liu Xiangping from the coal department to do the introduction. All the investors, hello. So for Xiao Huigou's current situation, and it's about accumulated production is about 3 million. Because of this geological influences, it's about 0.9 million tons a year for consecutive several years. so for this geological conditions cannot be overcome so for this production plant has always been very low for that the first one is that and then we also can see this is actually all the plant production 2023 to 2025 and we expect about every year 0.9 million tons because of this geological difficulties okay so do you have any more telephone questions we don't have any telephone questions so we will just have another round of announcement of this telephone question proposing so for telephone participants if you want to Participate and raise the question. You can just press the star and the one or the online participants feel free to raise your hand or type some more questions. So please just read the questions online. And now I'm going to read this online question. This investor says for this year's major products price of coal chemical products have already been seen significantly. We also have got this Yulin project of the coal chemical products. So I want to know that how do you think about this coal chemical market and the price of the products. So now let's have with us Mr. Wang from here. in 2023 it has been this significant year of this coal chemical market this whole market is upon the influence of the demand so the price has declining significantly we expect that for this situation in May last for a quite long time and for this year actually the fluctuation is huge for later half of this year maybe for urea is about 13 to 14 million tons up by 8% so we also have about 10% for polyolefin and we expect and then it would also go downward for the future. You could see this usual price is actually fluctuating but going downward so for Polyolefin in a short period of time for the profitability we still have a limited space however with this Polyolefin market going to a higher quality and a higher portfolio we expect for the mid and the long run we still have a very good market prospect. Okay, I will read another question from the internet. This question is actually with this central enterprises got listed and then to have this deepening of the reform to solve this same industry competition has already been a key. We also can see like a company A and company B have already cleaned and assessed their assets. You can see for your company currently the cash flow on your book is very abundant so do you also hope to buy over some high quality coal mines and then to solve this competition within the same industry thank you so much for the question first of all for the company we highly pay attention to this competition and our shareholder is also considering this horizontal competition significantly. We may consider some other different methods including procuring all the different ones and then currently we haven't got a very accurate disclosed timeline. However, we will conscientiously implement the related work to reduce this horizontal competition. I have another question from the internet. The internet saying that for Dahai Ze coal mine phase two, do you have this specific starting point of the construction and the production? For Dahai Ze phase two, We are doing this early stage of preparation and we are still getting the approval and all the series of the procedures and all the preparation work. We haven't got the confirmed date of the starting of the project, but we really are working hard to try to start it as soon as possible. That's it. Thank you. So we want to see that any questions from the telephone line. So we will have 1683 to share with us your name and where you're from. Hello, I'm from Shandong Railway Development, Jiayin Kun. I want to know that for this partner of a corporation, you have used which technology from which company? Is this you or this Danyang's one? So I will have our Mr. Wang to answer this. Yes, the answer is yes. Yes, we still use this original technology you have asked. My understanding is actually for Dalian Coal Chemical Institute has already been like a globally leading Do you have some afterwards with Dalian chemical industry? Do you have some deeper cooperation including like Hengsheng Coal Chemical Technology has also been very well and then do you also have some different cooperation plans with this Dalian Chemical Institute because first of all we have maintained a quite close cooperation with Dalian Chemical Institute and in the future about this new energy development for our Chloramine is also being implemented and based on our next step of business development we will consider future cooperation with Dalian Chemical Research Institute thank you so now let's read Another round of the way to propose questions. So hello, everybody. If you want to raise questions, please first press the star and number one on the telephone line. And for online participants, you could also type in the questions in this live streaming chat box, or you could press the button of raise your hand. So please read another question. We don't have any online questions. So now I'm going to read another question from the online participants. This participant says that for Shanxi Yulin, deep cooperation project is actually going together with the phase two. And then for self-produced coal production, it takes what percentage? And we expect how long we will realize the target. So we will have Mr. Wang to answer the question. So for Yulin phase two, for this deep processing is actually implementing the strategy of our group. We hope to have this differentiating and premium level of coal chemical products. We hope to have this integrated, synergized development as one important project. So previously for this raw material coal, we definitely have used this Dahai Zhe Coal, this self-produced one. I have something to add here. So the previous investors have talked about the phase two. And I have to tell you that now it's about 15 million tons. And phase two, we will expand the production to about 20 million tons. And we think it still requires a certain time to realize that. And then when it reaches 20 million tons, but that has a phase one. It's already like almost 20 million tons and for September, We will just realize this approval and assessment. So for Phase 1 and Phase 2, that's to clarify the concept for September. This year, Dahai Ze will have about 20 million tons, and for Dahai Ze, Ding Tian. So for this future capacity increase, we haven't mentioned the specific discussion and specific timeline have not been stipulated yet. So we have no more telephone questions. So for Madam Yanqi, you could just keep reading the questions. There's an investor asking that for Q1, for the cost is significantly reduced for China coal. Can you break it down? Why is that? First of all, the product structure has been changed. So the freight fee has been reduced. And second one, about this new management method about the safety production, it has also led to this additional cost of the management. And you also can see that for this material and the labor costs have also been lowered because of this non-stop production and for the maintenance fee has also been reduced. Okay, got it? Mr. Cheng, thank you. Now there's another question from the online participants. This investor says, Q1 2023 for new energy, how do you think about the market and for this new energy market prospect in the future? And we will have this new energy department, Mr. Cheng, for 2023 Q1 So sorry. So actually the volume is actually quite low. So maybe it's hard for the interpreter to interpret. So wait a second. Now let's adjust the microphone. So with the WuFeng and WeiFeng, it has already been seen significantly. So we also can have this overall like 61 hours. So for solar energy, because this solar energy is about 303 hours, it's up by three hours. compared with last year. So this is the Q1 because of this no wind or like a little wind situation. The solar energy is not very good. So from the overall market situation, we will just stick to this green energy transformation. So for PV and solar energy, we'll have this significant development. We expect that for this new installation, for this non-fossil fuel electricity generation, we'll have a fast speed, very fast speed. This is how I want to answer that. So now let's have the host to propose the question of telephone line and for online stuff now I would like to say that if you want to propose questions for telephone line participants first press star and then press 1 for online participants you could directly type the questions in written format or you could press the hand icon to propose a question no question from the telephone line and we will just end today's meeting thank you thank you all the participants thank you all for the participants and investors. I hope you could keep a close eye on ChinaCo. If there are some future questions that you haven't got the chance to answer, you could still contact us and to have our department of investor's relationship to contact with you because we actually have another viewing and it's actually the repeated questions so we would not just take your time to just read all the questions if you feel interested you could just listen to our replay in the future so this is what I want to add so thank you so much thank you so much for the management team thank you so much for the participation so Wish you a happy life. Thank you. Bye. Bye