Investment Rating - The report indicates a positive sentiment towards the company, highlighting the successful oversubscription of the rights issue, which reflects shareholder confidence in the company's business development [1]. Core Viewpoints - The rights issue was well-received, with a subscription rate of approximately 4.44 times the available shares, indicating strong interest from existing shareholders [1]. - The total amount raised from the rights issue is expected to be around HKD 427 million, with a net amount of approximately HKD 425 million after expenses [1]. - Following the rights issue, the major shareholder's stake increased from 17.52% to 18.07%, while another shareholder's stake slightly decreased, indicating a shift in the ownership structure [1]. - The report suggests that the company has sufficient cash reserves to support its coking coal business and ensure stable high dividends for shareholders, presenting long-term investment value [1]. Summary by Sections Rights Issue Details - The rights issue was based on a ratio of one new share for every thirty existing shares held, priced at HKD 2.60 per share [1]. - A total of 164,227,928 new shares were offered, with 52 valid acceptances and applications received by the deadline [1]. Shareholder Confidence - The oversubscription of the rights issue demonstrates existing shareholders' confidence in the company's future performance and its coking coal business [1]. - The report notes that while there may be some dilution of earnings per share (EPS) due to the new shares, the rights issue was structured to consider existing shareholders' interests [1]. Future Outlook - The company is expected to see a recovery in coal production and sales in 2025, supported by ample cash reserves for future operations [1]. - The report emphasizes the potential for improved profitability and sustained returns for shareholders in the long run [1].

[FINANCIAL HIGHLIGHTS](index=5&type=section&id=FINANCIAL%20HIGHLIGHTS) [H1 2024 Performance Overview](index=5&type=section&id=H1%202024%20Performance%20Overview) H1 2024 saw significant year-on-year declines in key financial metrics, including a 27% revenue drop to HKD 2.5 billion and a 32% decrease in profit attributable to owners to HKD 840 million, with a reduced interim dividend Financial Highlights | Metric | H1 2024 | H1 2023 | Y-o-Y Change | | :--- | :--- | :--- | :--- | | **Revenue (HKD '000)** | 2,497,844 | 3,442,305 | -27% | | **Gross Profit (HKD '000)** | 1,406,230 | 2,232,651 | -37% | | **Gross Profit Margin** | 56% | 65% | -9pp | | **Profit for the Period (HKD '000)** | 982,542 | 1,519,093 | -35% | | **Profit Attributable to Owners (HKD '000)** | 837,351 | 1,232,644 | -32% | | **EBITDA (HKD '000)** | 1,666,070 | 2,372,560 | -30% | | **Basic Earnings Per Share (HK cents)** | 17.00 | 24.40 | -30% | | **Interim Dividend Per Share (HK cents)** | 9.00 | 10.00 | -10% | Financial Position Highlights | Metric | As of June 30, 2024 | As of Dec 31, 2023 | Change | | :--- | :--- | :--- | :--- | | **Total Assets (HKD '000)** | 23,140,351 | 22,491,544 | +3% | | **Cash and Deposits (HKD '000)** | 9,220,290 | 7,944,731 | +16% | | **Total Liabilities (HKD '000)** | 4,698,733 | 4,021,026 | +17% | | **Total Equity (HKD '000)** | 18,441,618 | 18,470,518 | - | | **Current Ratio (times)** | 3.44 | 3.97 | -13% | | **Gearing Ratio** | – | – | – | [Condensed Consolidated Financial Statements](index=8&type=section&id=Condensed%20Consolidated%20Financial%20Statements) [CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENT%20OF%20PROFIT%20OR%20LOSS%20AND%20OTHER%20COMPREHENSIVE%20INCOME) In H1 2024, revenue decreased 27% to HKD 2.5 billion, gross profit fell 37% to HKD 1.41 billion, and profit attributable to owners declined 32% to HKD 840 million Income Statement | Item (HKD '000) | H1 2024 (Unaudited) | H1 2023 (Unaudited) | | :--- | :--- | :--- | | **Revenue** | 2,497,844 | 3,442,305 | | **Cost of Sales** | (1,091,614) | (1,209,654) | | **Gross Profit** | 1,406,230 | 2,232,651 | | **Profit Before Income Tax** | 1,393,872 | 2,121,154 | | **Income Tax Expense** | (411,330) | (602,061) | | **Profit for the Period** | 982,542 | 1,519,093 | | **Profit Attributable to Owners of the Company** | 837,351 | 1,232,644 | | **Profit Attributable to Non-controlling Interests** | 145,191 | 286,449 | [CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION](index=10&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENT%20OF%20FINANCIAL%20POSITION) As of June 30, 2024, total assets increased 3% to HKD 23.14 billion, total liabilities rose 17% to HKD 4.7 billion, and cash and deposits reached HKD 9.22 billion, maintaining a robust financial position with a 3.44x current ratio and zero gearing Assets | Assets (HKD '000) | As of June 30, 2024 (Unaudited) | As of Dec 31, 2023 (Audited) | | :--- | :--- | :--- | | **Total Non-current Assets** | 12,161,507 | 12,467,529 | | **Total Current Assets** | 10,978,844 | 10,024,015 | | Of which: Cash and Cash Equivalents | 6,758,308 | 6,552,242 | | Of which: Time Deposits | 2,461,982 | 1,392,489 | | **Total Assets** | 23,140,351 | 22,491,544 | Liabilities and Equity | Liabilities and Equity (HKD '000) | As of June 30, 2024 (Unaudited) | As of Dec 31, 2023 (Audited) | | :--- | :--- | :--- | | **Total Current Liabilities** | 3,188,759 | 2,522,589 | | Of which: Dividends Payable | 886,831 | – | | **Total Non-current Liabilities** | 1,509,974 | 1,498,437 | | **Total Liabilities** | 4,698,733 | 4,021,026 | | **Total Equity** | 18,441,618 | 18,470,518 | | **Equity Attributable to Owners** | 16,109,542 | 16,281,846 | [CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS](index=14&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENT%20OF%20CASH%20FLOWS) In H1 2024, net cash inflow from operating activities significantly decreased to HKD 1.18 billion, primarily due to lower profit before tax, while net cash outflow from investing activities was HKD 900 million, and cash and cash equivalents increased to HKD 6.76 billion at period-end Cash Flow Statement | Item (HKD '000) | H1 2024 (Unaudited) | H1 2023 (Unaudited) | | :--- | :--- | :--- | | **Net Cash Inflow from Operating Activities** | 1,180,302 | 2,720,518 | | **Net Cash Outflow from Investing Activities** | (900,997) | (1,329,616) | | **Net Cash Outflow from Financing Activities** | (64,735) | (125,061) | | **Net Increase in Cash and Cash Equivalents** | 214,570 | 1,265,841 | | **Cash and Cash Equivalents at End of Period** | 6,758,308 | 5,027,222 | [MANAGEMENT DISCUSSION AND ANALYSIS](index=53&type=section&id=MANAGEMENT%20DISCUSSION%20AND%20ANALYSIS) [Business Review](index=53&type=section&id=Business%20Review) In H1 2024, raw coking coal and clean coking coal production decreased by 15% and 31% respectively due to temporary suspension at Xingwu Coal Mine, with clean coking coal sales down 25%, while average selling price only slightly decreased by 2% to RMB 1,938 per tonne Operational Data | Operational Data | Unit | H1 2024 | H1 2023 | Y-o-Y Change | | :--- | :--- | :--- | :--- | :--- | | **Raw Coking Coal Production** | Million tonnes | 2.25 | 2.66 | -15% | | **Clean Coking Coal Production** | Million tonnes | 1.29 | 1.86 | -31% | | **Clean Coking Coal Sales** | Million tonnes | 1.34 | 1.79 | -25% | | **Clean Coking Coal Average Selling Price (incl. tax)** | RMB per tonne | 1,938 | 1,973 | -2% | - The primary reason for the production decline was the **temporary suspension** at Xingwu Coal Mine in H1 2024 due to production layer replacement, with normal operations resuming in **mid-July**[164](index=164&type=chunk) [Financial Review](index=56&type=section&id=Financial%20Review) The financial review details the performance decline, with revenue down 27% due to lower sales and prices, gross profit margin compressing from 65% to 56% due to increased unit production costs, and net profit decreasing 35%, while maintaining a robust financial position with no borrowings and ample cash reserves [Revenue and Customers](index=56&type=section&id=Revenue%20and%20Customers) H1 2024 revenue decreased 27% to HKD 2.5 billion, primarily due to a 25% drop in clean coking coal sales and a 2% decline in average selling price, with the top five customers accounting for 73% of revenue, and Shougang Group's share increasing to 51% - Revenue decreased by **27%** year-on-year to **HKD 2.498 billion**, primarily due to a **25%** decline in clean coking coal sales volume and a **2%** decrease in average selling price[168](index=168&type=chunk) - The top five customers accounted for **73%** of total revenue, with the largest customer, Shougang Group and its subsidiaries, contributing **51%** of revenue and **48%** of sales volume[168](index=168&type=chunk) [Cost and Gross Profit](index=58&type=section&id=Cost%20and%20Gross%20Profit) Cost of sales decreased 10% to HKD 1.09 billion, but raw coking coal unit production cost rose 13% to RMB 453 per tonne due to lower output, leading to a 37% decline in gross profit to HKD 1.41 billion and a gross profit margin compression from 65% to 56% Unit Production Cost | Unit Production Cost (RMB per tonne) | H1 2024 | H1 2023 | Change | | :--- | :--- | :--- | :--- | | **Raw Coking Coal Production Cost** | 453 | 400 | +13% | | Less: Depreciation and Amortization | (96) | (74) | +30% | | **Cash Raw Coking Coal Production Cost** | 357 | 326 | +10% | | **Clean Coking Coal Processing Fee** | 50 | 40 | +25% | - Gross profit margin decreased from **65%** in the prior period to **56%**, primarily due to lower average realized selling prices and reduced recovery rates[172](index=172&type=chunk)[186](index=186&type=chunk) - Raw coking coal unit production cost increased by **13%** year-on-year, mainly due to a **15%** decrease in raw coking coal production volume[183](index=183&type=chunk) [Expenses and Profitability](index=61&type=section&id=Expenses%20and%20Profitability) Sales and distribution expenses significantly decreased by 56% year-on-year due to lower sales volume and cost control, while profit attributable to owners was HKD 837 million, down 32%, with basic earnings per share at HKD 0.17 - Sales and distribution expenses significantly decreased by **56%** year-on-year to **HKD 58 million**, primarily due to a **25%** decline in clean coking coal sales volume and a lower proportion of rail transportation sales[192](index=192&type=chunk) - Profit attributable to owners of the company was approximately **HKD 837 million**, a **32%** year-on-year decrease; basic earnings per share were **HKD 0.17**, compared to HKD 0.244 in the prior period[201](index=201&type=chunk)[174](index=174&type=chunk) [Capital Structure and Liquidity](index=66&type=section&id=Capital%20Structure%20and%20Liquidity) As of June 30, 2024, the company had no borrowings, a 0% gearing ratio, a current ratio of 3.44 times, and approximately HKD 9.22 billion in free cash and bank deposits, indicating a highly robust financial position - The company has **no borrowings**, resulting in a **0%** gearing ratio[210](index=210&type=chunk) - The current ratio is **3.44 times**, with approximately **HKD 9.221 billion** in available free funds, indicating ample liquidity[214](index=214&type=chunk) [Future Prospects](index=68&type=section&id=Future%20Prospects) Looking ahead, management anticipates weak domestic real estate demand offset by infrastructure and manufacturing, with coking coal supply constrained by enhanced safety regulations supporting prices; Xingwu Coal Mine resumed production in July, expecting output recovery in H2, while the company focuses on intelligent construction and cost control for efficiency - Regarding downstream demand, steel demand from real estate remains sluggish, but infrastructure investment and steel exports continue to provide support[221](index=221&type=chunk) - On the supply side, strengthened coal mine safety regulations limit coking coal production, providing some price support, though rapid growth in overseas coking coal imports, especially from Mongolia, partially offsets domestic output declines[224](index=224&type=chunk)[225](index=225&type=chunk) - The company's Xingwu Coal Mine completed its production layer replacement and resumed operations in **July**, with output expected to gradually recover and return to normal in the second half of the year[231](index=231&type=chunk) [Dividends and Shareholder Information](index=52&type=section&id=Dividends%20and%20Shareholder%20Information) [INTERIM DIVIDEND](index=52&type=section&id=INTERIM%20DIVIDEND) The Board declared an interim dividend of **HKD 0.09** per ordinary share for the six months ended June 30, 2024, a decrease from HKD 0.10 per share in the prior period - The Board has declared an interim dividend of **HKD 0.09** per ordinary share for the six months ended June 30, 2024 (H1 2023: HKD 0.10 per share)[157](index=157&type=chunk) [DISCLOSURE OF INTERESTS](index=72&type=section&id=DISCLOSURE%20OF%20INTERESTS) As of June 30, 2024, major shareholders included Fude Life Insurance (28.38% stake), Shougang Group (17.52% stake), and Shoucheng Holdings (15.72% stake) Major Shareholders | Shareholder Name | Number of Shares Held | Percentage of Shareholding | | :--- | :--- | :--- | | **Fude Life Insurance** | 1,398,284,000 | 28.38% | | **Shougang Group** | 863,358,000 | 17.52% | | **Shoucheng Holdings** | 774,743,327 | 15.72% | [CORPORATE GOVERNANCE AND OTHER INFORMATION](index=76&type=section&id=CORPORATE%20GOVERNANCE%20AND%20OTHER%20INFORMATION) [Corporate Governance and Compliance](index=76&type=section&id=Corporate%20Governance%20and%20Compliance) During the reporting period, the company complied with the Listing Rules' Corporate Governance Code and the Model Code for Securities Transactions by Directors, with the Audit Committee reviewing the interim report and unaudited interim financial information - The company complied with the code provisions of the Corporate Governance Code as set out in Appendix C1 to the Listing Rules for the six months ended June 30, 2024[244](index=244&type=chunk) - The Audit Committee has reviewed the unaudited interim results for the six months ended June 30, 2024, and this interim report[256](index=256&type=chunk)

Investment Rating - The report maintains a "Buy" rating for Shougang Resources [3][10]. Core Views - The company's total revenue for the first half of 2024 was HKD 2.53 billion, a decrease of 27.6% year-on-year, while the profit attributable to shareholders was HKD 840 million, down 32%, aligning with market expectations [3]. - The production volume is expected to recover in the second half of the year, with an annual forecast of 4.8 to 5 million tons, following a decline due to temporary shutdowns [3]. - The average selling price of premium coking coal in the first half was HKD 1,938 per ton, a slight decrease of 2% year-on-year, while the average market benchmark price increased by 3% [3]. Summary by Sections Financial Performance - Total revenue for 2024 is projected at HKD 5.33 billion, with a year-on-year decrease of 9.58% [5]. - Net profit estimates for 2024 and 2025 have been revised down to HKD 1.695 billion and HKD 1.844 billion, respectively, reflecting a decrease of 6.55% and 5.36% [3][5]. - The company’s average cost per ton in the first half was HKD 450, up from HKD 401 in the previous year, primarily due to reduced production and increased resource taxes [3]. Production Insights - The company’s coal production in the first half was 2.25 million tons, a 15% decline year-on-year, with premium coking coal production down 31% to approximately 1.29 million tons [3]. - The company has a total approved production capacity of 5.25 million tons, with the Xingu mine accounting for 1.75 million tons, and is expected to achieve an annual production of 4.8 to 5 million tons [3]. Market Dynamics - The report notes a significant change in the sales structure, with low-sulfur premium coking coal sales dropping by 91%, now accounting for only 3% of total sales [3]. - The company’s coal washing rate fell below 60%, compared to over 70% in the first half of 2023, attributed to the temporary shutdown of the Xingu mine [3].

Investment Rating - The report assigns a rating of "Hold" for the company based on its current financial performance and future outlook [1]. Core Viewpoints - The company's revenue for the six months ending June 30, 2024, was HKD 2.498 billion, a decrease of 27% year-on-year, with gross profit falling to HKD 1.406 billion, down 37% [1]. - The attributable profit to shareholders was HKD 837 million, a decline of 32%, with basic earnings per share at HKD 0.17, and an interim dividend of HKD 0.09 per share proposed [1]. - The decrease in revenue and profit was primarily due to a drop in both the volume and price of premium coking coal, alongside rising production costs [1]. - The company expects to recover its production levels to between 5-5.25 million tons in the next year, following the successful commissioning of new mining operations [1]. - The company maintains a strong cash position of approximately HKD 9.22 billion, which supports its ability to sustain high dividend payouts despite reduced capital expenditures [1]. Summary by Sections Financial Performance - Revenue decreased to HKD 2.498 billion, a 27% decline year-on-year - Gross profit fell to HKD 1.406 billion, down 37% - Attributable profit to shareholders was HKD 837 million, a 32% decrease - Basic earnings per share were HKD 0.17, with an interim dividend of HKD 0.09 proposed [1]. Production and Costs - Premium coking coal sales volume dropped by 25%, with an average selling price down by 2% - Raw coking coal production decreased by 15%, with production costs rising by 13% to HKD 453 per ton [1]. - The company has adjusted its full-year production guidance for raw coking coal to 4.8-5.25 million tons for 2024 [1]. Future Outlook - Production is expected to recover to 5-5.25 million tons next year due to new mining operations coming online [1]. - The company anticipates a reduction in capital expenditures to approximately RMB 400-500 million, which will help maintain high dividend payouts [1].

Financial Performance - Revenue for the six months ended June 30, 2024, was HKD 2,498 million, a decrease of 27% compared to HKD 3,442 million in the same period of 2023[2] - Gross profit decreased by 37% to HKD 1,406 million, with a gross margin of 56%, down from 65%[2] - Net profit attributable to owners was HKD 837 million, a decline of 32% from HKD 1,233 million in the previous year[2] - EBITDA for the period was HKD 1,666 million, representing a 30% decrease from HKD 2,373 million[2] - Basic earnings per share decreased to HKD 17.00, down 30% from HKD 24.40[2] - The company reported a total comprehensive income of HKD 857 million for the period, down from HKD 1,324 million in the previous year[7] - For the six months ended June 30, 2024, the group recorded operating revenue of approximately HKD 2.498 billion, a decrease of about HKD 944 million or 27% compared to the same period last year[42] - Net profit for the six months was approximately HKD 983 million, a decline of 35% year-on-year, with profit attributable to owners decreasing by 32% to approximately HKD 837 million[42][54] - The EBITDA for the period was approximately HKD 1.666 billion, down from approximately HKD 2.373 billion in the same period last year[42] Assets and Liabilities - Total assets as of June 30, 2024, amounted to HKD 23,140 million, an increase from HKD 22,491 million as of December 31, 2023[9] - Current ratio decreased to 3.44 from 3.97, indicating a 13% decline in liquidity[2] - Trade receivables as of June 30, 2024, amounted to HKD 606,007,000, an increase of 14.2% from HKD 530,468,000 as of December 31, 2023[29] - Trade payables as of June 30, 2024, totaled HKD 572,908,000, a decrease of 7.8% from HKD 621,467,000 as of December 31, 2023[34] - As of June 30, 2024, total accounts payable amounted to HKD 286,257,000, a decrease from HKD 303,096,000 as of December 31, 2023, representing a reduction of approximately 5.8%[35] - The company’s financial assets at fair value through other comprehensive income decreased to HKD 574,891,000 as of June 30, 2024, from HKD 688,264,000 as of December 31, 2023[28] - The group maintained a strong financial position with available bank balances and cash reserves of approximately HKD 9.22 billion, an increase from HKD 7.945 billion at the end of 2023[43] - The group has no borrowings as of June 30, 2024, resulting in a capital debt ratio of 0%[58] Dividends and Shareholder Returns - The company declared an interim dividend of HKD 0.09 per share for the six months ended June 30, 2024[2] - The interim dividend declared for the six months ended June 30, 2024, is HKD 443,415,000, down from HKD 492,684,000 in the same period of 2023, reflecting a decrease of 10%[25] - The company declared an interim dividend of HKD 0.09 per share for the six months ended June 30, 2024, compared to HKD 0.10 per share in the previous year[39] Operational Highlights - The company operates primarily in the coking coal mining sector, focusing on exploration and production in China[18] - The production of raw coking coal for the six months ended June 30, 2024, was 2.25 million tons, a decrease of 15% compared to 2.66 million tons in the same period of 2023[40] - The production of premium coking coal was 1.29 million tons, down 31% from 1.86 million tons in the previous year[41] - The sales volume of premium coking coal decreased by 25% year-on-year, with total sales accounting for 100% of the company's revenue during the review period[41] - The company experienced a significant drop in low-sulfur premium coking coal sales, which fell by 91% year-on-year, while the average market price increased by approximately 3%[41] - The group’s subsidiary, Xingwu Coal Mine, has completed the production replacement and resumed normal operations in July 2024, contributing to the gradual increase in coking coal output in the second half of 2024[64] Cost and Expenses - The cost of sales for the six months ended June 30, 2024, was HKD 1,091,614, down from HKD 1,209,654 in the same period of 2023[22] - Employee costs, including directors' remuneration, were HKD 390,945 for the six months ended June 30, 2024, compared to HKD 437,739 in the previous year, reflecting a decrease of 10.7%[22] - Sales costs for the period were approximately HKD 1.092 billion, a decrease of about HKD 118 million or 10% year-on-year[44] - The average production cost per ton of raw coking coal increased by 13% year-on-year, primarily due to a 15% decrease in production volume[46] Other Income and Gains - Other income for the six months ended June 30, 2024, totaled HKD 53,445, an increase of 68.6% from HKD 31,703 in the previous year[19] - Interest income increased by approximately HKD 11 million or 13% year-on-year to about HKD 95 million, driven by rising deposit rates[48] - Other income and gains for the period were approximately HKD 53 million, a significant increase of about HKD 21 million or 66% year-on-year[49] Compliance and Governance - The company has complied with the corporate governance code as per the Listing Rules during the six months ended June 30, 2024[67] - All directors have adhered to the standards set forth in the company's code of conduct for securities transactions during the six months ended June 30, 2024[67] - The interim report will be published on the Hong Kong Stock Exchange and the company's website, with printed copies sent to shareholders who opted for them[68] Market Conditions - In the first half of 2024, the national crude steel production slightly increased by 0.2% year-on-year, while pig iron production decreased by 3.3%[63] - Shanxi Province's raw coal production reached approximately 590 million tons in the first half of 2024, achieving 45% of the annual target, despite a nearly 2% decline in national raw coal production[64] Employee and Community Engagement - The group employed 4,155 staff as of June 30, 2024, with annual reviews of employee compensation[62] - Charitable donations for the six months ended June 30, 2024, were HKD 1,106, significantly higher than HKD 33 in the previous year[20]

Financial Performance - Revenue for the year ended December 31, 2023, was HK$5,891,068,000, representing a decrease of 28% compared to HK$8,214,719,000 in 2022[11] - Gross profit for 2023 was HK$3,466,028,000, down 34% from HK$5,289,594,000 in the previous year, with a gross profit margin of 59%[11] - Profit for the year decreased by 30% to HK$2,300,938,000 from HK$3,308,155,000 in 2022[11] - EBITDA for 2023 was HK$3,924,133,000, reflecting a decline of 28% from HK$5,414,715,000 in 2022[11] - Basic earnings per share for 2023 was HK$37.66, a decrease of 30% from HK$53.75 in 2022[11] - The proposed final dividend per share for 2023 is HK$18.0, compared to HK$32.0 in 2022[11] - The Group's sales revenue for the year amounted to HK$5.89 billion, a decrease of 28% year-over-year due to falling coal prices and RMB foreign exchange rate drop[36] - The net profit for 2023 reached HK$2.3 billion, with net profit attributable to shareholders amounting to HK$1.89 billion, a decrease of 30% year-over-year[36] - The Group recorded a net profit of approximately HK$2,301 million, representing a decrease of approximately 30% YoY, primarily due to the decrease in gross profit[56] - Total revenue from the top five customers accounted for approximately 67% of the Group's revenue, with the largest customer contributing 43%[54] Assets and Liabilities - Total assets as of December 31, 2023, were HK$22,491,544,000, a decrease of 4% from HK$23,463,484,000 in 2022[12] - Total liabilities decreased by 16% to HK$4,021,026,000 from HK$4,786,265,000 in 2022[12] - Equity attributable to owners was HK$16,281,846,000, down 3% from HK$16,768,677,000 in 2022[12] - The Group maintained a healthy financial position with free bank balances and cash of approximately HK$7.945 billion as of December 31, 2023, an increase from approximately HK$6.014 billion the previous year[59] - The Group had no borrowings as at 31 December 2023, resulting in a gearing ratio of 0%[93] Production and Operations - The company operates three coal mines with an annual approved raw coking coal production capacity of 1.75 million tonnes each[20][22] - In 2023, the Group achieved a raw coking coal output of 5.25 million tonnes, maintaining the approved production capacity and consistent with the previous year[36] - The sales volume of clean coking coal decreased by 7% to 3.10 million tonnes due to coal in transit[36] - The average realized selling price of clean coking coal was RMB 1,932 per tonne, representing a 20% year-over-year decrease[36] - The average market prices of coking coal in FY 2023 dropped by approximately 20% year-on-year, with benchmark clean coking coal prices decreasing by about 30% year-on-year in the first half of 2023[103] Market and Economic Conditions - The GDP growth rate for 2023 was 5.2%, reflecting a gradual economic recovery[34] - The central government set a GDP growth target of around 5% for 2024, indicating confidence in economic development[39] - The domestic coking coal supply, especially high-quality coking coal, is expected to remain relatively tight in 2024[39] - Domestic steel demand decreased, but exports increased by 36.2%, indicating a generally balanced steel supply and demand[117][119] - The International Monetary Fund (IMF) projects China's GDP growth rate to decelerate to 4.6% in 2024 due to real estate market challenges and external uncertainties[121][122] Environmental, Social, and Governance (ESG) Initiatives - The company has made significant efforts in promoting safety management and environmental protection, aiming to build itself into a safety-oriented and environmentally-friendly enterprise[98] - The ESG management system is led by the board of directors, with the Audit Committee responsible for formulating ESG management policies and assessing material ESG issues[139] - The Group emphasizes the integration of ESG concepts into its overall development plan and production operations, ensuring alignment with social well-being and environmental protection[145] - The Group actively identifies ESG risks and opportunities through regular assessments and stakeholder communication[145] - The most important ESG issues identified include workplace safety, emissions management, and occupational health[167] Risk Management - The Group has established a comprehensive risk management system based on a "three lines of defense" structure to enhance risk prevention capabilities[175] - Major risks identified include safety risks, environmental risks, financial risks, time risks, and technology risks, with targeted countermeasures developed for each[193][196] - The objective for safety risk is to eliminate serious injuries and effectively prevent minor injuries, with measures including improved systems and enhanced safety supervision[193] - The environmental risk objective is to achieve zero violations of environmental protection regulations, with regular inspections and management of waste disposal[193] - Financial risk management focuses on timely project investments, addressing uncertainties in project application and implementation processes[196]

即时点评 稳定高派息，降本增效保毛利 首钢资源（0639.HK） 2024-03-28 星期四 事件： 公司公告2023年业绩： 2023年公司取得收益58.91亿港元，同比减少28%;公司拥有人应占溢 利18.89 亿港元，同比减少30%;每股基本盈利 37.66 港仙;拟派发末期 股息每股18港仙。 相关报告 截至 2023 年 12 月 31 日止年度，公司的原焦煤产量约 525 万吨(2022 年度：约525万吨)，保持去年水平;而精焦煤产量约325万吨(2022年 度：约323万吨)，按年微增1%。 点评观点： ➢ 业绩下降主要因为精焦煤量价齐跌所致： 公司收入下跌主要因为回顾年度精焦煤的平均实现售价按年下调 20% 及精焦煤销量按年下跌 7%，连同平均人民币兑港元汇率按年下调约 4.6%的负面影响所致。精焦煤销量下降主要因为截至2023年12月31 日，有14万吨运送至客户在途煤炭库存增加，因会计结算未确认为收 入；而精焦煤价格下降主要是市场价格波动所致。 ➢ 24年原焦煤产量指引小幅下降，矿井智能化进一步降本增效： 因为公司兴无矿进入下组煤联合试运转，上组煤关闭将影响上半年产 量，公司调低全年原 ...

Financial Performance - Total revenue for the year ended December 31, 2023, was HKD 5,891 million, a decrease of 28% from HKD 8,215 million in 2022[2] - Gross profit for the same period was HKD 3,466 million, down 34% from HKD 5,290 million, resulting in a gross margin of 59% compared to 64% in the previous year[2] - Net profit attributable to owners for 2023 was HKD 1,889 million, a decline of 30% from HKD 2,715 million in 2022[2] - EBITDA per share decreased to HKD 37.66 from HKD 53.75, reflecting a drop of 30%[2] - Total comprehensive income for the year was HKD 1,883 million, down from HKD 2,300 million in 2022[5] - Profit before tax for 2023 was HKD 1,889,247,000, a decrease of 30.5% from HKD 2,715,374,000 in 2022[24] - The basic earnings per share for 2023 was HKD 0.3766, down from HKD 0.5375 in 2022, representing a decrease of 30%[24] - Net profit for the fiscal year was approximately HKD 2.301 billion, a decline of about 30% year-on-year, with earnings per share dropping to HKD 0.3766 from HKD 0.5375[39] Revenue Sources - The company's revenue from coking coal sales for the year 2023 was HKD 5,891,068,000, a decrease of 28.4% compared to HKD 8,214,719,000 in 2022[15] - The total external customer revenue from the China market was HKD 5,891,068,000 in 2023, down from HKD 8,214,719,000 in 2022, representing a decline of 28.4%[16] - Revenue from the sale of by-products decreased to HKD 95,462,000 in 2023 from HKD 123,039,000 in 2022, a decline of 22.4%[18] - The contribution of the top five customers to total revenue was approximately 67%, down from 74% in the previous year, with the largest customer accounting for 43% of total revenue[38] Assets and Liabilities - The company's net asset value as of December 31, 2023, was HKD 18,471 million, a slight decrease of 1% from HKD 18,677 million in 2022[2] - The total assets as of December 31, 2023, were HKD 22,491 million, compared to HKD 23,463 million in 2022[6] - Current liabilities decreased to HKD 2,522 million from HKD 3,234 million, indicating improved liquidity[7] - The company reported a decrease in trade receivables to HKD 714,894,000 in 2023 from HKD 1,504,189,000 in 2022, a decline of 52.5%[25] - As of December 31, 2023, accounts payable amounted to HKD 303,096,000, an increase from HKD 236,931,000 in 2022[29] - The total accounts payable and notes payable reached HKD 621,467,000, slightly up from HKD 614,737,000 in the previous year[29] Dividends - The board proposed a final dividend of HKD 0.18 per share for the year 2023[2] - The total dividend declared for 2023 was HKD 1,907,199,000, compared to HKD 2,374,364,000 in 2022, a decrease of 19.7%[22] - The proposed final dividend for the year ending December 31, 2023, is HKD 0.18 per share, compared to HKD 0.28 per share for the previous year[33] Expenses and Costs - The total sales cost for the fiscal year was approximately HKD 2.425 billion, a decrease of about 17% from HKD 2.925 billion in the previous year[40] - The company’s employee costs, including directors' remuneration, decreased to HKD 808,778,000 in 2023 from HKD 834,779,000 in 2022, a decline of 3.1%[20] - Sales and distribution expenses for the review year were approximately HKD 215 million, a decrease of about HKD 134 million or 38% compared to the previous year[47] - General and administrative expenses were approximately HKD 201 million, down by about HKD 7 million or 3% year-on-year[48] - Other operating expenses were approximately HKD 10 million, a significant decrease of about HKD 108 million or 92% compared to the previous year[49] Financial Position - The current ratio improved by 23%, increasing to 3.97 from 3.23 in the previous year[2] - The company maintained a strong financial position with cash and bank balances of approximately HKD 7.945 billion, up from HKD 6.014 billion in the previous year[39] - The company had no borrowings, resulting in a capital debt ratio of 0%[54] - The current ratio was approximately 3.97 times, with total cash and bank deposits of about HKD 8.887 billion[56] Market and Economic Context - In 2023, China's GDP growth was recorded at 5.2%, achieving the set target despite a complex domestic and international environment[61] - Fixed asset investment, excluding price factors, grew by 6.4% in 2023, while infrastructure investment increased by 5.9%[61] - Real estate development investment decreased by 9.6% in 2023, with a gradual narrowing of the decline in new construction area in the second half of the year[61] Strategic Initiatives - The group plans to invest RMB 70 billion in major projects in 2024, focusing on manufacturing and infrastructure[62] - The group will continue to invest in technological innovation and improve production efficiency to align with national carbon neutrality goals by 2060[62] - The group has sufficient cash flow and will adjust operational strategies in response to environmental changes and economic developments[62] Shareholder Actions - The company repurchased and canceled 125 million shares, representing approximately 2.47% of the total shares issued prior to the offer[59] - The company repurchased and canceled a total of 125 million shares at HKD 2.40 per share, totaling HKD 300 million[64] Compliance and Governance - The company has complied with the corporate governance code as per the listing rules for the fiscal year ending December 31, 2023[65]

Financial Performance - Revenue for the six months ended June 30, 2023, was HK$3,442,305,000, a decrease of 26% compared to HK$4,662,983,000 in 2022[10]. - Gross profit for the same period was HK$2,232,651,000, also down by 26% from HK$3,006,836,000 in 2022, with a gross profit margin of 65%[10]. - Profit for the period was HK$1,519,093,000, reflecting a 22% decline from HK$1,936,269,000 in the previous year[10]. - Profit attributable to owners of the Company decreased by 23% to HK$1,232,644,000 from HK$1,606,697,000[10]. - EBITDA for the period was HK$2,372,560,000, down 27% from HK$3,267,024,000 in 2022[10]. - Basic earnings per share decreased to 24.40 HK cents, a 23% drop from 31.80 HK cents in 2022[10]. - Total comprehensive income for the period was HK$1,323,564,000, down from HK$1,646,154,000, representing a decline of 19.6%[23]. - Profit before income tax was HK$2,121,154,000, compared to HK$2,749,626,000 in the previous year, indicating a decline of 22.8%[21]. Assets and Liabilities - Total assets as of June 30, 2023, increased by 3% to HK$24,178,695,000 from HK$23,463,484,000 at the end of 2022[12]. - Total liabilities rose by 17% to HK$5,592,427,000 from HK$4,786,265,000[12]. - Total current assets rose to HK$11,424,003, compared to HK$10,442,805, reflecting an increase of about 9.4%[25]. - Net current assets improved to HK$7,386,949, up from HK$7,208,171, indicating a growth of around 2.5%[28]. - Net assets decreased slightly to HK$18,586,268 from HK$18,677,219, a decline of about 0.5%[30]. - Total equity attributable to owners of the Company decreased to HK$16,411,027 from HK$16,768,677, a decline of about 2.1%[32]. Cash Flow - Net cash inflow from operating activities for the first half of 2023 was HK$2,720,518, compared to HK$1,879,534 in the same period of 2022, representing a 44.9% increase[41]. - Cash generated from operations was HK$3,416,045, with income tax paid amounting to HK$695,527[41]. - The company reported a net cash outflow from investing activities of HK$1,329,616 for the six months ended June 30, 2023, compared to HK$142,546 in the same period of 2022[43]. - The net increase in cash and cash equivalents for the same period was HK$1,265,841,000, down from HK$1,630,619,000 in 2022, indicating a decrease of about 22.4%[45]. - Cash and cash equivalents at June 30, 2023, totaled HK$5,027,222,000, a decrease from HK$5,865,117,000 at the end of June 2022, reflecting a decline of approximately 14.3%[45]. Dividends - Interim dividend per share was reduced to 10.00 HK cents, a decrease of 33% from 15.00 HK cents in 2022[10]. - The total interim dividend declared for the six months ended June 30, 2023, is HK$505,184,000, based on 5,051,837,842 ordinary shares[81]. - The interim dividend per ordinary share for 2023 is HK$0.10, down from HK$0.15 in 2022[79]. Production and Sales - The Group produced approximately 2.66 million tonnes of raw coking coal, a slight decrease of 1% YoY, while clean coking coal production increased by 7% YoY to approximately 1.86 million tonnes[161]. - The sales volume of clean coking coal increased by 3% YoY, with both sales accounting for 100% of the Group's revenue during the period[164]. - The average realised selling price of clean coking coal decreased by 22% YoY to RMB 1,973/tonne, down from RMB 2,521/tonne in the previous year[165]. - The Group sold clean coking coal amounting to HK$1,437,157,000 for the six months ended 30 June 2023, a decrease of 28.2% compared to HK$2,001,941,000 for the same period in 2022[145]. Cost Management - Cost of sales for the Period Under Review was approximately HK$1,210 million, representing a decrease of approximately HK$446 million or 27% YoY[176]. - The unit production cost of raw coking coal decreased by 4% YoY to RMB400 per tonne, while cash production cost decreased by 5% YoY to RMB326 per tonne[180]. - The Group faced rising cost pressures but implemented stringent cost controls, resulting in a reduction of RMB4 per tonne YoY in material and electricity costs[183]. Other Income and Expenses - Other income and gains, net, rose to approximately HK$32 million, an increase of approximately HK$29 million YoY, despite a net foreign exchange loss of approximately HK$42 million[186]. - Selling and distribution expenses decreased by approximately HK$36 million or 21% YoY to approximately HK$132 million, primarily due to a drop in sales by train[190]. - General and administrative expenses slightly increased by approximately HK$2 million YoY to approximately HK$91 million[191]. Environmental and Safety Measures - The Group emphasizes production safety and environmental protection while maintaining stable coal production[200]. - The Group is committed to safety management and enhancing environmental protection measures[200]. - All coal mines of the Group have obtained necessary permissions from relevant Chinese regulators[200]. - The Group actively manages production procedures to eliminate wastewater and waste gas discharge[200]. - The Group focuses on energy saving, emission reduction, and environmental protection[200].

Financial Performance - Revenue for the six months ended June 30, 2023, was HKD 3,442 million, a decrease of 26% compared to HKD 4,663 million in 2022[2] - Gross profit for the same period was HKD 2,233 million, down 26% from HKD 3,007 million in the previous year[2] - Net profit attributable to owners for the six months was HKD 1,519 million, a decline of 22% from HKD 1,936 million in 2022[2] - EBITDA for the period was HKD 1,233 million, representing a 23% decrease from HKD 1,607 million in the prior year[2] - Basic earnings per share for the six months was HKD 24.40, down 23% from HKD 31.80 in 2022[2] - Total comprehensive income for the period was HKD 1,323 million, down from HKD 1,646 million in 2022[6] - The group's operating revenue for the six months ended June 30, 2023, was approximately HKD 3.442 billion, a decrease of about 26% from HKD 4.663 billion in the same period of 2022[45] - Net profit for the six months ended June 30, 2023, was approximately HKD 1.519 billion, a decrease of 22% year-on-year[45] - The EBITDA for the six months ended June 30, 2023, was approximately HKD 2.373 billion, down from HKD 3.267 billion in the same period of 2022[46] - The group recorded a profit attributable to owners of approximately HKD 1.233 billion, a decrease of about HKD 374 million or 23% compared to approximately HKD 1.607 billion in the same period last year[57] Assets and Liabilities - The company's net asset value as of June 30, 2023, was HKD 18,586 million, a slight decrease of 1% from HKD 18,677 million at the end of 2022[2] - The total assets as of June 30, 2023, amounted to HKD 24,178 million, an increase from HKD 23,463 million at the end of 2022[7] - Trade receivables as of June 30, 2023, amounted to HKD 893,962,000, a significant decrease of 40% from HKD 1,504,189,000 as of December 31, 2022[29] - The net trade receivables after impairment losses were HKD 706,005,000 as of June 30, 2023, compared to HKD 1,314,509,000 as of December 31, 2022, indicating a decline of approximately 46%[29] - The company’s total receivables, including notes receivable, were HKD 1,443,854,000 as of June 30, 2023, compared to HKD 2,889,765,000 as of December 31, 2022, reflecting a decrease of about 50%[29] - The company’s total liabilities related to pledged notes receivable were HKD 84,378,000 as of June 30, 2023, down from HKD 182,668,000 as of December 31, 2022[32] - As of June 30, 2023, the company reported accounts payable of HKD 234,396,000, a slight decrease from HKD 236,931,000 as of December 31, 2022, representing a reduction of approximately 1%[34] - The company’s accounts payable notes decreased to HKD 211,218,000 as of June 30, 2023, down from HKD 377,806,000 as of December 31, 2022, indicating a significant reduction of approximately 44%[34] Dividends and Share Repurchase - The interim dividend declared was HKD 0.15 per share, compared to HKD 0.10 per share in the previous year[2] - The total interim dividend declared for the six months ended June 30, 2023, was HKD 505,184,000, compared to HKD 757,776,000 for the same period in 2022, representing a reduction of about 33%[25] - The company declared an interim dividend of HKD 0.10 per share for the six months ended June 30, 2023, down from HKD 0.15 per share in the previous year[40] - The company plans to repurchase up to 125,000,000 shares at a price of HKD 2.40 per share, which would result in a total cash payment of approximately HKD 300,000,000[38] - The company announced a conditional cash offer to repurchase up to 125 million shares at HKD 2.40 per share, representing approximately 2.47% of the total issued shares[68] Production and Sales - The company’s production of premium coking coal for the six months ended June 30, 2023, was 2.66 million tons, a decrease of 1% compared to 2.70 million tons in the same period last year[41] - The sales volume of premium coking coal increased to 1.79 million tons for the six months ended June 30, 2023, up by 3% from 1.74 million tons in the previous year[41] - The average realized selling price of premium coking coal was RMB 1,973 per ton, a decrease of 22% from RMB 2,521 per ton in the same period last year[41] - The group's raw coking coal production for the six months ended June 30, 2023, was approximately 2.66 million tons, a slight decrease of 1% compared to 2.70 million tons in the same period of 2022[43] - The production of premium coking coal increased by 7% to approximately 1.86 million tons, up from 1.74 million tons in the same period of 2022, due to improved recovery rates[43] Expenses and Costs - The cost of sales for the six months ended June 30, 2023, was HKD 1,209,654, down from HKD 1,656,147 in the same period of 2022, reflecting a decrease of 27%[21] - The total sales cost for the six months ended June 30, 2023, was approximately HKD 1.210 billion, a decrease of 27% from HKD 1.656 billion in the same period of 2022[47] - The cash production cost per ton of raw coking coal was RMB 326, down 5% from RMB 344 in the same period of 2022[48] - Sales and distribution expenses were approximately HKD 132 million, a decrease of about HKD 36 million or 21% compared to approximately HKD 168 million in the same period last year, mainly due to a decline in the proportion of sales from fire transportation[54] - General and administrative expenses were approximately HKD 91 million, a slight increase of about HKD 2 million compared to approximately HKD 89 million in the same period last year[55] Financial Position and Ratios - The current ratio decreased to 2.83 from 3.23, reflecting a 12% decline[2] - The current ratio was approximately 2.83 times, with total cash and bank deposits of approximately HKD 9.278 billion as of June 30, 2023[63] - The total equity value was approximately HKD 15.157 billion, with no borrowings as of June 30, 2023[64] - The group maintained a strong financial position with available bank balances and cash of approximately HKD 8.494 billion as of June 30, 2023, up from HKD 6.014 billion as of December 31, 2022[46] Economic and Market Conditions - In the first half of 2023, China's GDP growth increased to 5.5%, up from 3% in 2022, with Q1 growth at 4.5% and Q2 at 6.3%[66] - National fixed asset investment grew by 3.8% year-on-year in the first half of 2023, with infrastructure investment increasing by 7.2%[66] - In the first half of 2023, the national crude steel production reached 540 million tons, a year-on-year increase of 1.3%[66] - The price of domestic coking coal showed a pattern of rising and then falling, with imported coal volume increasing by 75% to 45.61 million tons in the first half of 2023[66] - The real estate market showed slight improvement in the first half of 2023 but weakened again, impacting steel demand[66] Safety and Governance - The company achieved a zero fatal accident management goal in the first half of 2023, emphasizing safety in production[67] - The company remains committed to adhering to corporate governance codes and has complied with the relevant regulations during the reporting period[69] - The company continues to assess the impact of new accounting standards and interpretations on its financial performance and position[16] - The group did not report any significant changes in operations for the six months ended June 30, 2023, compared to the previous period[12] - The board approved the publication of the interim financial data on August 30, 2023[13]