China Coal Energy Company Limited

So these are all in silent mode. Now let me do this reading of this broadcast. So we would like to invite all the investors to rationally understand the market. So after this, we will also have the QA session. Now let's have with us the host to make the speech. Now let's welcome. So hello all the investors and shareholders. Good afternoon. I am Jiang Xun from China Coal. Welcome you to participate in this 2023 Q3 press release. Here I would like to thank you for this long-term care and support for China Coal. So we also have with us This CFO, Mr. Cai Chaolin, and we also have this company's security department and petrol, chemical, business department, coal, business department, electricity, and new energy. And now I'm going to report to you Q3's performance and Q4's key management. and now I'm going to say the data. These are all according to this Chinese accounting rules. First of all I would like to say this first three quarters operation and for this year China has stick to this seeking for development with stability to be maintained to have this improvement of the efficiency of the existing market and then try to improve the quantity and transformation. We have already scientifically organized this guarantee of the production and sales to improve the stability of the price and to also deepen this lean management to have already got Coal Energy Company Limited is already like not as good as before. First of all, I would like to say this major production and operation data for Q3. So the first one is we have already actively got this commercial coal, the production, and then for the commercial coal is up by 10%. And for this coal production, That is actually halving by 4.1%. And then we also have seen this up by 8.5%. For this in-house coal production is 99.67 million. And then for this buyout commercial coal sales is 109 million, up by 5.7%. So for this commercial coal, its average sales price is about 603 yuan per ton. It's reduced by 127 yuan per ton. It's down by 17.4%. For the buyout, coal is in average price at 660 yuan per ton. So it is down. by 152 yuan per ton, highly efficient. So for these major products, it's actually like polyolefin, it's about 1.12 million tons, up by 1.6%. The sales is 1.105 million tons, it's up by 3.0%. Urea is 1.532 million tons, up by 18.6%. So for the sales is 1.704 million tons, up by 20.8%. For muscle alcohol is 1.457 million tons, up by 9.5%. For the sales amount is 1.465 million tons, up by 12.7%. Monia Nitrate is 0.1 million tons by 17.0% and we also have seen this sales price per ton on average for this Apollo 11 is 6,914%. and it's down by 600 yuan per ton, down by 8%. For urea, it's down by 237 yuan per ton, down by 9% from the previous one to 2,408 yuan per ton. So for this methyl alcohol, it's 1,752 yuan per ton. It's down by 182 yuan per ton, down by 9.4%. For ammonia nitrate, it's is up by 2.2%. So now I'm going to introduce these major financial indicators. For January to September, we have already realized this revenue of 46.852 billion yuan, down by 10.9%. So we have already got this... I have to say that for this attributed to this shareholders of this company is down by 13.7% with a total of 4.853 billion yuan and then for this per share profit is 0.37 yuan is down by 13.7% so for this weighted average net asset Profit rate is 3.45%. It's down by 3.54%. So now I would like to say the reason why we have this reduced profit. You also can see that for this 12.655 billion yuan is about this commercial coal that is produced by ourselves. So we can also see compared with last year and it is down by like 496 million. So we also can see for this petrochemical, it is up by 690 million for this commercial one. We also have already got this major profit increase. At the same time, we also can see that with this influence of this price, so we also can see that it has already led to this 12.16 billion yuan. So it's also because of the market influence that for all those investment revenue is also having a significant decline. and it is also about 376 million yuan for the management fee increases so these are all the major reasons why we have this reduced profit so the second thing is I would like to introduce to you about this Q4 key work arrangements so for Q4 we will strengthen our judgment about this market situation and try to have all the different works being done and because of things next year we hope to have a very good Preparation for that, the first one is we have to really manage this safety management and to stick to the threshold of that and to guarantee that at the end of this year we will have no accidents of safety. And the second thing is we also would have this scientific arrangement of this organization of production to guarantee that all the different schedule and timeline would all be guaranteed. The third one is to have this guaranteed safety. supply of coal and electricity to answer to this national demand to try to stick to this key timing and a key area and extreme conditions guarantee of this coal supply security to give full play to this central government as this cornerstone functionality of this stability of the energy. The fourth one is to improve this quality of the operation. And then we also hope to have to deepen this about this and highly efficient utilization of coal to try to organically to at this restructuring and for the industrial chain of coal, electricity, chemical and new energy. And then the sixth one, we have to understand and remember our starting point and the mission and then to keep looking forward to the future to have this good performance to repay our shareholders and investors and also make due contributions of this healthy development of the capital market. That's all for me. Now let's come to the QA session. So I would like to welcome all the investors to propose questions. Thank you. So if you would like to propose questions for those participants, you would press star and one. So for these online participants, you could also have the written interaction or you could use this raise your hand button to have a discussion. If you want to propose a question, please first press star and one. So for these online participants, you could also have this written question to be raised, or you could press this raise your hand button to have this voice question. So now let's have... 6704 investor to share with us his question. Thank you. Please tell us where are you from and what's your name? Hello. I am from CITIC. Thank you so much for your introduction. I also would like to congratulate on this Q3 performance. It's actually quite good. And with this slight increase, I also would like to say about this production and about the data. I have several questions. The first one is about this in-house production of the coal. I have to say that for Q3, for this overall production, compared with the last year and compared with Q2, we have about 0.2 million tons of increase for the sales. It is actually quite a big increase. It's about 2 million tons. So for this production and the sales, you can see the sales increase faster. Why is that? And then in Q4, will it still be like keeping, compared to speaking, quite fast growth? So this is also having something to do with about this Q4's arrangement of production and sales. And the next thing is in the past few years for this security supervision, it is also like quite strict. Will it have any influence on us? Thank you. Thank you. So for this question, I would like to Mr. Zheng from this financial department to answer that. I am Mr. Zheng Lin from this financial department for the question said about this compared with Q2 and then this part of the growth is bigger than the sales. It's just about the Q3 for the sales and then for this stock coal is actually quite a lot. So for this basic comparison, it is actually the sales is bigger than the production. Thank you. So thank you, Mr. Zheng. And the next thing is for this production in Q4. Does it have something to do with this influence of this security management or are there any plans for this Q4? I would also have Mr. Tian from this coal business department to answer that because for this production and we also have already considered about this stock and about this overall procurement So we also can see from this January to September, we also will consider all these and then to say that according to early days of the year, we have about 125 million tons and above for Q4. Thank you. According to this annual plan. Thank you, Mr. Tian, for the answering. So no more. Thank you. Thank you, all the leaders, and thank you, Mr. Jiang. Okay, so thank you. We will have a 6322 investor to propose a question. Please tell us where you're from. Hello? Hello, Mr. Chang, Mr. Jiang, and all the leaders. Can you hear me? Yes, I can hear you. And thank you for the time. because you can also see that in the past nine months I can say that these are actually quite good performance of that and therefore this overall... So I also would like to invite Mr. Chen from Finance. By 4% of the cost, we have our own features. So for Q4, we will also arrange some maintenance and repairment. So for next year, for this preparation of next year, we will lay a very good foundation for that. So for Q4, for this production, it is... So we also can see that this is actually quite like a high cost. So we are also hoping that because for 2022, it's about 320. So for this year, because for next year, because for all those wells, they're all like with high production and high efficiency. So cost-wise, it's actually quite stable. So for next year's cost, we expect that it will not have this big fluctuation. That's all. We think it will maintain stable. Okay, thank you. And the second question is about finance. And we also can see that So we also have already seen this several decrease of data. What is the reason? And then for Q4 and for next year, what is your looking forward to that? So for this question, it's just because for Q3, and for this profitability of the company because for our small companies under us and for the non-holy owned companies they have some fluctuations. So we may see some changes for this profitability. It still depends on this overall market for the profitability. I have to say that Now, wholly owned company, can I ask that which companies could actually have a better performance to make it like a profitability to have this lower portion, lower percentage? It's just about environment and about mining resources. Okay, got it. Thank you. And... I have another question. The last question is I also would like to ask you about this idea about a market. You also can see for this kinetic coal and for Q4 and next year... from the sales company to answer that I'm dumping from the sales company. So for Q4, and you can also see for Q4, it is actually having... like the peak season, the overall consumption. So for the last three years of the data, we also can see the quarters, it is about like 11.9% higher and 14.4% higher and 17.1% higher for the first three quarters, comparatively speaking. So we expect for the sales, it is still having this recovery in Q4. So we also can see from this supply of the coals We also can see that, generally speaking, for this year's supply, it is still quite loose, quite sufficient, especially for our imported coals. This year we have this quite big growth. So from January to September, cumulatively, we have already got 347 million tons to be imported. It is up by 13%. So for the first nine months for the production of coals, according to statistics, it is about... Coal Energy Company Limited and about this governmental departments about the guidance of the coal policies in the past few years for Q4 surprise it's still like quite restrained so I think this high peak of the quarterly ones have been lowered year by year so for this year's Q4 it's still we have this top ceiling and we have this overall bottom as this fluctuation so for this overall fluctuation is weaker than before so this is about Q4 and maybe for next year. So for 2024, the whole situation, we also are like thinking January speaking for 2024 when we guarantee the supply for this overall policy as a background for this guarantee of the supply. So the price of the coal is actually quite rational. And then to be based on this 2023 long-term and mid-term agreement signing, so for 2024 the overall demand and supply situation is actually from the balance to be this quite loose balance. and then for the close demand increase and about the release of that and about the fluctuation they will all have this fluctuation but balanced. So the price of the coal will also be quite stable despite some fluctuations. For the long-term agreement for 2024, they could still play this anchoring functionality. Compared with 2023, the fluctuation is quite limited. So it is still maintained at about 700 yuan around this level. And then we can also see for this kinetic energy, Coal, so for 2024's trend, so for Middle East and conflict between Russia and Ukraine and the change of this interest increase of U.S. and then for this global indicators will still play a role. So for this bulk commodities, high level fluctuation, and about this periodical and long term, about port price and food price being uncertainty, we think the stock price in 2024 will also have certain fluctuation. So we also consider that in the past few years, we will still have like this management of this coal price and about policy supervision. So for this stock price of kinetic coal, we'll all be with lower flexibility. And compared with 2023, it will have a certain decline. And for the fluctuation range of the price, we think it will still come to a lower range of the fluctuation. Thank you. That's all for me. Thank you. Thank you so much for the detailed answer. And I also would like to say this is very clear, very helpful. That's all for me. Thank you. And please wait a sec, I have something to add here. So for market judgment, I just represent the current prediction from the company perspective. This is not just our own perspective. Please keep rational, okay? So we are just like a company's prediction. It doesn't represent our absolute judgment. So then thank you so much from the management team. So this is a written question from this online channel. So the question is for this in-house coal, what is the proportion? Is this about like 80% to 85% of this long-term coal supply? Thank you. Indeed, hello. So I'm Dong Bin from the sales company. So previously for China coal, we are definitely implemented this mid- and long-term agreement signed and stipulated by this NDRC. So we were definitely sticking to this mid- and long-term agreement. And for this long-term agreement, for the proportion of this in-house production coal, it is still like according to this Chinese government's Okay, thank you so much for the answer. The next question is, is it possible that I could also ask you to introduce about a petrochemical and about a coal distribution to this net profit? Please give me some answers. So for all the different proportions contributed to this different net profit, we haven't disclosed this information. However, for our operation, it's actually quite stable. So this keeps the same level of this interim report. So it has already been having a detailed explanation and disclosure in this interim report. So that's all for me. Thank you so much. And he has to probe here for 2023, the target of the net profit. How much is that? Thank you. So this still depends on next year about this market fluctuation because currently we are also adjusting this year for 2023. We are still adjusting. I have to say that for 2023, we just keep stable for 2023. Broadcasters say that do you need to have some other voice questions? Yes.

Now let's welcome the next one to answer with a 1605. Hello, I'm Wang Xinyu from Riggs Capital. I have several questions for company leaders. It is assured that the profit has been greatly impacted. I would like to ask for the capital arrangement according to many forecasts in Q2 and Q3 the performance of the company is lower than our expectations so in Q1 So the average price for coal is a 57.6 rand in Q1 and in Q2 it's a 51.9 rand. The decline has been higher than the market average. So the question was also asked in the first half of this year's press conference. So for such a declining trend, you provided more explanations. I will ask my colleagues from financial departments to take your question. I feel the price fluctuations, apart from the declining of price in the market, for example, my forecast for Q3, the price should be around $509, which seems to be more reasonable. I would like to also have a check on the price on a revised the condition. Let me take your first question. About the price drop higher than the market average. In Q3, As we know, there is a structural decline of the coal. And on one hand, the market price is declining. And also the power coal structures is under adjustment. So that's why the price has dropped. Okay, thank you. And then, what about the price and differences? Port price. Price at the port is $5,500. When there will be such a price and revised price structure? The port's price. Normally, These prices, when there are major fluctuations that take place in the market, as we know, apart from shipment to the port, there are still additional fees charged. Therefore, while prices and fluctuations are tight, then the price would be different from the port price. Only when major fluctuations take place in the market will this price be revised. Shanxi Kunkou's price is Coal Energy Company Limited Coal Energy Company Limited Coal Energy Company Limited Coal Energy Company Limited The sales expenditures was 946, but now we are seeing a huge rise in the sales cost or administrative cost. What's the reason? Well, on one hand, there are some byproducts and price and fluctuation this year, and on the Also, as for the amino nitrates, currently there are some maintenance work ongoing at the moment. Okay, thank you. Thank you for your question. Now let's invite the next event. Hello everyone, I'm Chen Jianying from Huashan Securities. I would like to ask the price and the cost of profit for polyethylene. Did you hear me? Yes. Well, let me take this question. Well, with some technical support, we have reduced the cost comprehensively. First, the coal structures have been adjusted. Many of the companies have chosen to use their own coal. And secondly, Capacity has been increased with fixed costs that have been diluted. Energy consumption has been reduced. technical improvement and more waste were recycled and reused. Supposedly, accessories and spare parts have been well prepared. Therefore, profit of polyethylene has maintained flat physically. Well, what's the exact number for the data for Profit Marginal for Polyethylene. While doing our presentation that we have shared with you about the sales price, you can check those data. Now let's talk on the next speaker and the next one to ask a question. Can you hear me? I have a question. In 2023, you plan to produce 125 trillion coals and now it's approaching 1 trillion tons now, 100 trillion now, so what's the plan for Q4? Hello, I'm Tiandong from the coal department. You have mentioned that the whole forecast or the plan for the production is 1.25 trillion pounds and we will maintain this production goals above 1.25 trillion without a major from the market? Well, because if I see normally Q4 production is lower than that of Q3, is that so in this year? Well, because maintenance will take place at the end of the year, so the production in Q4 would be lower than previous quarters. However, maintaining and achieving the 1.25 trillion pounds of coal should be no problem. Thank you for your answer. Now let's invite the next one to ask a question. Please let us know your name and your institute. Well, Ms. Wang Weibing, can you hear me? Yes. Coal Energy Company Limited Coal Energy Company Limited Coal Energy Company Limited Coal Energy Company Limited Coal Energy Company Limited Shanshi Province, Inner Mongolia Reserves So, for the cost of coal, will you be able to maintain or decline or reduce it in the next 3-5 years? Well, the first question, do you want to ask about the reserves? Coal reserves. We have just closed our reserves and well because there are different mine areas and so I would like to get some more detailed data well what and those coals are fully owned by our subsidiaries and it's We barely, we rarely use the way to calculate, use the wrong way to calculate. This is not the normal financial ways that we calculate the reserves. We need to consider about the sustainable development of the company. Capacity is not calculated in such a way. So there's no equity yield used for calculation. Well, we have seen the cost of coal is declining in the past five years. The cost for next year has not been mentioned enough. Therefore, I would like to get some ideas about your plans for the cost in the next three to five years. Well, thank you for your attention to our company. In the long term, our cost management is a part that we are quite confident about. Well, If we look into the long term, the coal price is impacted by different factors. There's a rising labor cost and also national policy changes, whether there will be favorable policies or not. We can only say that the company is dedicated to the long-term cost management and also maintain the cost at a reasonable range. Thank you. Thank you. Now we have questions from online. Recently, in Xinjiang area, the Production closes about two digits, while in other areas it closes only single digits. What's your plan in developing your business in Xinjiang province? Our company currently, the contribution from the production in Xinjiang does not account for a major part. We plan to explore resources in Xinjiang. Currently, we have a small proportion of the production completed in Xinjiang province. It still takes time to increase in capacity. Thank you for your question and for your answer. And now we have another question about the dividend. The question is that recently a company has released about an increasing the sharing. Well, what are the policies for dividends? Well, actually our company is a holding group and is increasing the stock shares. In the long run, we will maintain the 30% of the dividend by cash. There's no change. And while for the specific plans of dividend would be In the Q3 report, do you see a possibility of a large increase of provision in Q4? Well, so far we do not see major changes in the provision for next quarter. If there will be, I will be honest. Disclose. Thank you. The next question is, what's the cost of coal in the next three to five years? This question has been answered, and please refer to my privacy and answer. In the long run, we dedicated on the continuous cost management and maintain it at a reasonable range. Thank you. The next question is, What would be the investment direction for the core capital of our company? The signal is very poor at the moment. Thank you. The cash of the company is $90 billion. How would you spend that? Can you reduce the debt rate? There's about 60% on proprietary cash. We have some dedicated funds. So 60% can be managed by ourselves. So currently we do not have a plan to repay the debt in advance.

And also, carbon monoxide has been reduced by 12.1 billion compared with the beginning of the year.