[Important Notice](index=3&type=section&id=Part%20I.%20Important%20Notice) This section confirms the accuracy and completeness of the unaudited quarterly report, with guarantees from the board and financial officers [Report Statement](index=3&type=section&id=1.1%20Report%20Statement) The company's board, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of this unaudited quarterly report, assuming legal responsibility - The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the quarterly report, free from false records, misleading statements, or major omissions[4](index=4&type=chunk) - The company's chairman, CFO, and head of the financial management department guarantee the truthfulness, accuracy, and completeness of the financial statements[4](index=4&type=chunk) - This company's Q3 2019 report is unaudited[4](index=4&type=chunk) [Company Profile](index=4&type=section&id=Part%20II.%20Company%20Profile) This section provides key financial data, shareholder information, and details on preferred stock as of the report period end [Key Financial Data](index=4&type=section&id=2.1%20Key%20Financial%20Data) As of September 2019, total assets slightly decreased, but net assets attributable to shareholders grew by 9.05%, with year-to-date revenue and net profit increasing by 26.36% and 26.88% respectively Overview of Key Financial Data as of September 2019 | Indicator | As of Report Period End (Thousand Yuan) | As of Prior Year End (Thousand Yuan) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 197,572,917 | 203,679,900 | -3.00 | | Net Assets Attributable to Shareholders of Listed Company | 66,509,894 | 60,991,768 | 9.05 | | **Year-to-Date (Jan-Sept)** | | | | | Net Cash Flow from Operating Activities | 14,833,159 | 12,653,079 | 17.23 | | Operating Revenue | 150,611,076 | 119,190,485 | 26.36 | | Net Profit Attributable to Shareholders of Listed Company | 6,983,703 | 5,504,014 | 26.88 | | Weighted Average Return on Net Assets (%) | 10.71 | 9.51 | Increase 1.20 percentage points | | Basic Earnings Per Share (Yuan/share) | 1.4218 | 1.1205 | 26.89 | Non-Recurring Gains and Losses Items and Amounts (Thousand Yuan) | Item | Current Period Amount (July-Sept) | YTD Amount (Jan-Sept) | | :--- | :--- | :--- | | Gains/Losses on Disposal of Non-Current Assets | 10,283 | -13,221 | | Government Grants Recognized in Current Profit/Loss | 12,560 | 63,179 | | Funds Occupancy Fees Received from Non-Financial Enterprises Recognized in Current Profit/Loss | 18,430 | 71,718 | | Gains/Losses from Fair Value Changes and Investment Income from Disposal of Financial Assets | -9,969 | 42,391 | | Reversal of Impairment Provisions for Receivables and Contract Assets Subject to Separate Impairment Testing | 889 | 92,786 | | Other Non-Operating Income and Expenses | -49,623 | 195,081 | | Impact on Minority Interests (After Tax) | 8,039 | -14,581 | | Income Tax Impact | 6,036 | -102,359 | | Total | -3,355 | 334,994 | [Total Shareholders, Top Ten Shareholders, and Top Ten Circulating Shareholders (or Unrestricted Shareholders) as of Report Period End](index=5&type=section&id=2.2%20Total%20Shareholders%2C%20Top%20Ten%20Shareholders%2C%20and%20Top%20Ten%20Circulating%20Shareholders%20(or%20Unrestricted%20Shareholders)%20as%20of%20Report%20Period%20End) As of September 30, 2019, the company had 70,981 shareholders, with Yankuang Group Co., Ltd. and HKSCC Nominees Limited as the top two, holding 46.16% and 39.66% respectively, alongside disclosures of major shareholders' long and short positions in H-shares - As of September 30, 2019, the company had **70,981 shareholders**[8](index=8&type=chunk) Top Ten Shareholders' Holdings | Shareholder Name | Number of Shares Held at Period End | Proportion (%) | Shareholder Nature | | :--- | :--- | :--- | :--- | | Yankuang Group Co., Ltd. | 2,267,169,423 | 46.16 | State-owned Legal Person | | HKSCC Nominees Limited | 1,948,192,403 | 39.66 | Overseas Legal Person | | Hong Kong Securities Clearing Company Limited | 25,546,389 | 0.52 | Overseas Legal Person | | Agricultural Bank of China Co., Ltd. - Invesco Great Wall CSI 300 Enhanced Index Securities Investment Fund | 23,104,329 | 0.47 | Other | | New China Life Insurance Co., Ltd. - Dividend - Individual Dividend - 018L - FH002 Shanghai | 21,957,897 | 0.45 | Other | Major Shareholders' H-Share Interests/Short Positions | Major Shareholder Name | Share Class | Capacity | Number of Shares Held | Nature of Interest | Percentage of Company's H-Share Class | | :--- | :--- | :--- | :--- | :--- | :--- | | Yankuang Group | A-shares (State-owned Legal Person Shares) | Beneficial Owner | 2,267,169,423 | Long Position | - | | Yankuang Group | A-shares (State-owned Legal Person Shares) | Beneficial Owner | 391,507,272 | Short Position | - | | Yankuang Group | H-shares | Interest of Controlled Corporation | 374,989,000 | Long Position | 19.21% | | BNP Paribas Investment Partners SA | H-shares | Investment Manager | 117,641,207 | Long Position | 6.03% | | BlackRock, Inc. | H-shares | Interest of Controlled Corporation | 103,964,098 | Long Position | 5.33% | [Total Preferred Shareholders, Top Ten Preferred Shareholders, and Top Ten Unrestricted Preferred Shareholders as of Report Period End](index=7&type=section&id=2.3%20Total%20Preferred%20Shareholders%2C%20Top%20Ten%20Preferred%20Shareholders%2C%20and%20Top%20Ten%20Unrestricted%20Preferred%20Shareholders%20as%20of%20Report%20Period%20End) The company had no preferred shareholders as of the report period end - Not applicable[14](index=14&type=chunk) [Significant Events](index=8&type=section&id=Part%20III.%20Significant%20Events) This section details overall operating performance, significant changes in financial statement items, progress on major events, and disclosures regarding unfulfilled commitments or profit warnings [Overall Operating Performance](index=8&type=section&id=3.1%20Overall%20Operating%20Performance) In the first three quarters of 2019, raw coal output slightly decreased by 0.43%, and commercial coal output by 2.26%, but commercial coal sales increased by 1.58%; railway transport volume and revenue declined, while methanol production and sales grew, power generation and sales decreased, and non-coal trade revenue significantly increased [Overview of Key Products and Services Operating Data](index=8&type=section&id=3.1.1%20Overview%20of%20Key%20Products%20and%20Services%20Operating%20Data) In the first three quarters of 2019, raw coal output slightly decreased by 0.43%, commercial coal output by 2.26%, but commercial coal sales increased by 1.58%; railway cargo volume decreased by 3.79%, power generation and sales by 10.85% and 10.88% respectively, while methanol production and sales grew by 3.24% and 3.87% Key Products and Services Operating Data for Q1-Q3 2019 | Item | Q1-Q3 2019 | Q1-Q3 2018 | Change (%) | | :--- | :--- | :--- | :--- | | Raw Coal Output (Thousand Tons) | 77,908 | 78,243 | -0.43 | | Commercial Coal Output (Thousand Tons) | 69,375 | 70,978 | -2.26 | | Commercial Coal Sales (Thousand Tons) | 83,992 | 82,689 | 1.58 | | Cargo Volume (Thousand Tons) | 14,834 | 15,419 | -3.79 | | Methanol Output (Thousand Tons) | 1,274 | 1,234 | 3.24 | | Methanol Sales (Thousand Tons) | 1,288 | 1,240 | 3.87 | | Power Generation (10,000 kWh) | 190,674 | 213,870 | -10.85 | | Power Sales (10,000 kWh) | 116,852 | 131,119 | -10.88 | [Operating Performance of the Group's Main Business Segments](index=8&type=section&id=3.1.2%20Operating%20Performance%20of%20the%20Group%27s%20Main%20Business%20Segments) Coal business saw slight decreases in raw and commercial coal output, notably at Heze Energy due to capacity adjustments and complex geology; overall commercial coal prices rose, but thermal coal prices for Yancoal Australia and Yancoal International declined; railway transport revenue and volume both decreased; coal chemical methanol production, sales, and revenue increased, though Yulin Energy's revenue fell; power generation and sales generally decreased, with Yulin Energy experiencing significant drops in power sales and revenue; non-coal trade revenue grew substantially - In Q1-Q3 2019, the Group produced **77.91 million tons of raw coal**, a **0.4% year-on-year decrease**, and **69.38 million tons of commercial coal**, a **2.3% year-on-year decrease**[15](index=15&type=chunk) - Heze Energy's raw coal and commercial coal output decreased by **27.76% and 27.88% year-on-year**, primarily due to the implementation of new approved annual raw coal production capacity and complex geological conditions[16](index=16&type=chunk)[17](index=17&type=chunk) Commercial Coal Sales for Q1-Q3 2019 | Business Segment | Q1-Q3 2019 Sales Volume (Thousand Tons) | Q1-Q3 2019 Sales Price (Yuan/Ton) | Q1-Q3 2018 Sales Volume (Thousand Tons) | Q1-Q3 2018 Sales Price (Yuan/Ton) | | :--- | :--- | :--- | :--- | :--- | | Company Washed Coal Subtotal | 11,995 | 841.21 | 10,689 | 773.02 | | Company Screened Raw Coal | 11,039 | 448.43 | 13,908 | 446.96 | | Heze Energy No. 2 Washed Coal | 1,451 | 1,138.23 | 2,121 | 1,014.80 | | Yancoal Australia Thermal Coal | 20,842 | 498.02 | 21,251 | 576.91 | | Yancoal International Thermal Coal | 4,159 | 373.57 | 4,472 | 405.87 | | Trading Coal | 17,666 | 624.15 | 12,753 | 624.59 | - In Q1-Q3 2019, the Group's coal business sales cost was **RMB 28.111 billion**, a **12.1% year-on-year increase**; Heze Energy's per-ton coal sales cost increased by **31.16% year-on-year**, mainly due to decreased commercial coal sales volume[19](index=19&type=chunk)[20](index=20&type=chunk) - Railway transportation business cargo volume decreased by **3.8% year-on-year** in Q1-Q3, revenue decreased by **4.7% year-on-year**, and costs increased by **5.8% year-on-year**[21](index=21&type=chunk) - Coal chemical business saw growth in both methanol output and sales, but Yulin Energy's sales revenue decreased by **26.94% year-on-year**, and Ordos Energy's sales revenue decreased by **16.58% year-on-year**[22](index=22&type=chunk)[23](index=23&type=chunk) - Power business experienced declines in both power generation and sales, with Yulin Energy's power sales volume, sales revenue, and sales cost significantly decreasing, primarily due to a year-on-year reduction in external power sales[24](index=24&type=chunk) - Non-coal trade business achieved sales revenue of **RMB 98.497 billion** and sales cost of **RMB 98.146 billion**[25](index=25&type=chunk) - Equity investment business generated a profit of **RMB 1.35 billion**[26](index=26&type=chunk) [Operating Performance of Yankuang Group Finance Co., Ltd. ("Yankuang Finance Company") during the Reporting Period](index=12&type=section&id=3.1.3%20Operating%20Performance%20of%20Yankuang%20Group%20Finance%20Co.%2C%20Ltd.%20(%22Yankuang%20Finance%20Company%22)%20during%20the%20Reporting%20Period) Yankuang Finance Company experienced decreases in operating revenue and net profit in the first three quarters of 2019, but net assets grew while total assets decreased Yankuang Finance Company Operating Performance (Million Yuan) | Indicator | Q1-Q3 2019 | Q1-Q3 2018 | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 249 | 266 | -6.39 | | Net Profit | 142 | 146 | -2.74 | | **Period-End Data** | | | | | Net Assets | 1,630 | 1,488 | 9.54 | | Total Assets | 18,635 | 23,146 | -19.49 | [Significant Changes and Reasons for Major Financial Statement Items and Financial Indicators](index=12&type=section&id=3.2%20Significant%20Changes%20and%20Reasons%20for%20Major%20Financial%20Statement%20Items%20and%20Financial%20Indicators) The company experienced significant changes across multiple balance sheet, income statement, and cash flow statement items, including substantial increases in prepayments, inventory, and payables, alongside notable decreases in receivables, deferred tax assets/liabilities, and current non-current liabilities; income statement showed significant revenue and cost growth but reduced management, finance, and income tax expenses; cash flow from operations increased, while investment and financing cash flows significantly decreased [Significant Changes and Reasons for Balance Sheet Items](index=12&type=section&id=3.2.1%20Significant%20Changes%20and%20Reasons%20for%20Balance%20Sheet%20Items) As of September 2019, prepayments surged by 165.22% year-on-year due to increased advance payments for exploration, mining rights, and trade; inventory grew by 44.24% driven by Qingdao Zhongyan and Yancoal International; notes payable increased by 146.48% from company and subsidiary increases; deferred tax assets and liabilities significantly decreased due to Yancoal Australia's presentation adjustments Significant Balance Sheet Item Changes (Million Yuan) | Item | Sept 30, 2019 | Dec 31, 2018 | Change (%) | | :--- | :--- | :--- | :--- | | Notes Receivable | 3,118 | 4,429 | -29.60 | | Prepayments | 8,532 | 3,217 | 165.22 | | Inventories | 7,395 | 5,127 | 44.24 | | Deferred Income Tax Assets | 2,825 | 7,280 | -61.20 | | Other Non-Current Assets | 1,486 | 2,272 | -34.60 | | Notes Payable | 7,249 | 2,941 | 146.48 | | Contract Liabilities | 3,043 | 2,208 | 37.82 | | Non-Current Liabilities Due Within One Year | 4,104 | 7,195 | -42.96 | | Deferred Income Tax Liabilities | 3,286 | 8,122 | -59.54 | | Other Non-Current Liabilities | 1,952 | 427 | 357.14 | | Special Reserve | 3,952 | 3,046 | 29.74 | - Prepayments increased by **165.22%**, primarily due to Ordos Energy's advance payment of **RMB 1.156 billion** for Yingpanhao Coal Mine exploration rights, Haosheng Coal's advance payment of **RMB 1.200 billion** for Shilaowusu Coal Mine mining rights, and increased advance trade and equipment payments by Qingdao Zhongyin Ruifeng, Smart Logistics, and Zhongyin Financial Leasing[27](index=27&type=chunk) - Deferred income tax assets and liabilities significantly decreased, mainly due to Yancoal Australia's adjustment of presentation methods[27](index=27&type=chunk)[28](index=28&type=chunk) - Other non-current liabilities increased by **357.14%**, primarily due to a **RMB 1.461 billion** increase in Zhongyin Financial Leasing's asset-backed securities balance[28](index=28&type=chunk) [Significant Changes and Reasons for Income Statement Items](index=13&type=section&id=3.2.2%20Significant%20Changes%20and%20Reasons%20for%20Income%20Statement%20Items) In the first three quarters of 2019, operating revenue grew by 26.36% driven by significant increases in trading coal sales and other business revenue; operating costs rose by 36.05% consistent with increased trading coal and other business costs; management, finance, and income tax expenses all significantly decreased, with management expenses down 30.34% due to a prior-year one-time social insurance accrual, finance expenses down 40.25% from reduced interest and exchange losses, and income tax expenses down 38.86% due to changes in Yancoal Australia's deferred tax and taxable income Significant Income Statement Item Changes (Million Yuan) | Item | Q1-Q3 2019 | Q1-Q3 2018 | Change (%) | Primary Reasons for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 150,611 | 119,190 | 26.36 | Trading coal sales revenue increased by RMB 3.061 billion year-on-year; other business revenue increased by RMB 31.225 billion year-on-year | | Operating Cost | 129,952 | 95,521 | 36.05 | Trading coal sales cost increased by RMB 3.075 billion year-on-year; other business cost increased by RMB 31.444 billion year-on-year | | Administrative Expenses | 3,137 | 4,503 | -30.34 | A one-time accrual of social insurance expenses of RMB 1.006 billion in the first three quarters of 2018 | | Finance Expenses | 1,952 | 3,267 | -40.25 | Interest expenses decreased by RMB 337 million year-on-year; exchange losses decreased by RMB 762 million year-on-year | | Income Tax Expense | 2,154 | 3,523 | -38.86 | Yancoal Australia's income tax expense decreased by RMB 1.610 billion year-on-year due to changes in deferred tax and taxable income from the acquisition of Coal & Allied Industries Limited | [Changes and Reasons for Cash Flow Statement Items](index=13&type=section&id=3.2.3%20Changes%20and%20Reasons%20for%20Cash%20Flow%20Statement%20Items) In the first three quarters of 2019, net cash flow from operating activities increased by 17.23% year-on-year, primarily due to a significant rise in cash received from sales of goods and services; net cash flow from investing activities decreased year-on-year, influenced by reduced cash recovered from disposals of fixed assets, intangible assets, and other long-term assets, and increased cash paid for acquiring such assets; net cash flow from financing activities significantly decreased year-on-year, mainly due to reduced cash from investments and borrowings, lower cash paid for debt repayment, and increased cash paid for other financing activities Cash Flow Statement Item Changes (Million Yuan) | Item | Q1-Q3 2019 | Q1-Q3 2018 | Change (%) | Primary Reasons for Change | | :--- | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 14,833 | 12,653 | 17.23 | Cash received from sales of goods and provision of services increased by RMB 34.970 billion year-on-year | | Net Cash Flow from Investing Activities | -3,254 | -2,481 | - | Net cash recovered from disposal of fixed assets, intangible assets, and other long-term assets decreased by RMB 2.460 billion year-on-year; cash paid for acquisition of fixed assets, intangible assets, and other long-term assets increased by RMB 2.495 billion year-on-year | | Net Cash Flow from Financing Activities | -19,337 | -9,326 | - | Cash received from investments decreased by RMB 4.963 billion year-on-year; cash received from borrowings decreased by RMB 8.832 billion year-on-year; cash paid for debt repayment decreased by RMB 10.825 billion year-on-year; cash paid for other financing activities increased by RMB 6.373 billion year-on-year | | Net Increase in Cash and Cash Equivalents | -8,325 | 1,247 | -767.60 | - | [Analysis of Progress, Impact, and Solutions for Significant Events](index=14&type=section&id=3.3%20Analysis%20of%20Progress%2C%20Impact%2C%20and%20Solutions%20for%20Significant%20Events) During the reporting period, the company made progress on several significant matters, including favorable outcomes or plaintiff withdrawals in some lawsuits, though others were remanded for retrial or appealed; related-party transactions involved signing a financial services agreement and jointly increasing capital for Yankuang Finance Company with Yankuang Group, and a diesel fuel supply agreement with Glencore Group by a subsidiary; other key events included terminating A-share private placement, acquiring Yankuang Finance Company equity, organizational restructuring, establishing a shipping industry investment fund, capital increases for Ordos Energy and Yingpanhao Company, re-appointing a securities representative, proposing an interim cash dividend, and forming Yankuang Smart Ecological Investment Development Co., Ltd [Litigation and Arbitration](index=14&type=section&id=3.3.1%20Litigation%20and%20Arbitration) The company is involved in multiple lawsuits; in the CCB Guhuai Road Branch financial loan dispute, the company appealed after losing at first instance, and the Shandong High Court remanded for retrial; in the company's sales contract dispute against Changjin Hao, the company won at first instance but appealed for not achieving litigation objectives; in Zikuang Yunxiao Company's sales contract dispute against the company, the company won; in two contract disputes by Xiamen Xinda against Zhongyin Logistics and the company, the plaintiffs withdrew, and the company reported suspected seal forgery to the police - In the financial loan dispute case filed by China Construction Bank Guhuai Road Branch against Yanzhou Coal Mining, the Shandong High Court ruled to remand the case to Jining Intermediate People's Court for retrial, with no ruling yet issued[33](index=33&type=chunk)[34](index=34&type=chunk) - In the sales contract dispute case filed by Yanzhou Coal Mining against Shandong Changjin Hao Coal Industry Co., Ltd., Jining Intermediate People's Court ruled in favor of the company at first instance, and the company has appealed to the Shandong High Court[34](index=34&type=chunk) - In the sales contract dispute case filed by Shandong Zikuang Coal Sales Co., Ltd. against Yanzhou Coal Mining, Jining Intermediate People's Court ruled to dismiss the plaintiff's claims, with Yanzhou Coal Mining winning the case[35](index=35&type=chunk) - In two contract dispute cases filed by Xiamen Xinda Co., Ltd. against Shandong Zhongyin Logistics Co., Ltd. and Yanzhou Coal Mining, the plaintiffs have both withdrawn their lawsuits; the company has reported suspected contract fraud involving forged seals to the public security authorities, and the case has been accepted[35](index=35&type=chunk)[36](index=36&type=chunk)[37](index=37&type=chunk) [Significant Related Party Transactions](index=16&type=section&id=3.3.2%20Significant%20Related%20Party%20Transactions) The company engaged in multiple related-party transactions with Yankuang Group and its subsidiaries, including a financial services agreement and a joint capital increase of RMB 1.5 billion for Yankuang Finance Company (company contributed RMB 1.425 billion), and a diesel fuel supply agreement between subsidiary Hunter Valley Operations and a Glencore Group subsidiary - The company signed a 'Financial Services Agreement' with Yankuang Group, stipulating that Yankuang Finance Company will provide financial services to Yankuang Group, with a defined transaction cap[37](index=37&type=chunk) - The company and Yankuang Group jointly increased the registered capital of Yankuang Finance Company by **RMB 1.5 billion** in cash, proportionate to their shareholdings, with the company contributing **RMB 1.425 billion**[38](index=38&type=chunk) - The company's subsidiary, Hunter Valley Operations, signed a 'Diesel Fuel Supply Agreement' with a Glencore Group subsidiary, setting annual transaction caps for 2019-2021[39](index=39&type=chunk) [Other Significant Events](index=16&type=section&id=3.3.3%20Other%20Significant%20Events) The company terminated its A-share private placement plan and completed the acquisition of a 5% equity stake in Yankuang Finance Company; organizational adjustments included abolishing the Coal Mine Rock Burst Prevention Research Center and establishing a Rock Burst Prevention Office and an Ecological Restoration Comprehensive Management Office; additionally, the company established the Blue Gold Shipping Industry Investment Fund, increased capital by RMB 2.7 billion for Ordos Energy and Yingpanhao Company, re-appointed a securities representative, proposed an interim cash dividend of RMB 4.912 billion for 2019, and formed a wholly-owned subsidiary, Yankuang Smart Ecological Investment Development Co., Ltd., with a registered capital of RMB 80 million - The company terminated its non-public issuance of A-shares and withdrew application documents, primarily due to changes in capital market conditions and financing timing[40](index=40&type=chunk)[41](index=41&type=chunk) - The company acquired a **5% equity stake** in Yankuang Finance Company held by China Credit Trust Co., Ltd. for **RMB 78 million**, completing equity transfer and business registration changes on August 7, 2019[42](index=42&type=chunk) - The company abolished the Coal Mine Rock Burst Prevention Research Center and established a Rock Burst Prevention Office and an Ecological Restoration Comprehensive Management Office to strengthen rock burst management and promote ecological restoration[43](index=43&type=chunk) - The company, through Yancoal International, jointly established the Blue Gold Shipping Industry Investment Fund with Shandong Shipping Asset Management, with a total scale of **USD 60 million**, and Yancoal International contributing **USD 50 million**[44](index=44&type=chunk)[45](index=45&type=chunk) - The company increased the registered capital of Ordos Energy by **RMB 2.7 billion** in cash, and Ordos Energy in turn increased capital for Yingpanhao Company by **RMB 2.7 billion**[46](index=46&type=chunk) - The company's board of directors proposed an interim cash dividend (special dividend) of **RMB 4.912 billion** (tax inclusive) for 2019, equivalent to **RMB 10.00** (tax inclusive) per 10 shares[48](index=48&type=chunk) - The company established a wholly-owned subsidiary, Yankuang Smart Ecological Investment Development Co., Ltd., with a registered capital of **RMB 80 million**, primarily engaged in ecological restoration, industrial project investment, and management[49](index=49&type=chunk) [Overdue Unfulfilled Commitments during the Reporting Period](index=19&type=section&id=3.4%20Overdue%20Unfulfilled%20Commitments%20during%20the%20Reporting%20Period) The company had no overdue unfulfilled commitments during the reporting period - Not applicable[50](index=50&type=chunk) [Warning and Explanation of Potential Cumulative Net Profit Loss or Significant Change from Prior Year-End to Next Reporting Period End](index=19&type=section&id=3.5%20Warning%20and%20Explanation%20of%20Potential%20Cumulative%20Net%20Profit%20Loss%20or%20Significant%20Change%20from%20Prior%20Year-End%20to%20Next%20Reporting%20Period%20End) The company had no warnings regarding potential cumulative net profit loss or significant changes during the reporting period - Not applicable[50](index=50&type=chunk) [Appendix](index=20&type=section&id=Part%20IV.%20Appendix) This section includes the unaudited financial statements, adjustments for the first-time adoption of new accounting standards, and a note on the absence of an audit report [Financial Statements](index=20&type=section&id=4.1%20Financial%20Statements) The appendix includes the company's consolidated and parent company balance sheets as of September 30, 2019, consolidated and parent company income statements for January-September and Q3 2019, and consolidated and parent company cash flow statements for January-September 2019, all unaudited - Includes consolidated balance sheet, parent company balance sheet, consolidated income statement, parent company income statement, consolidated cash flow statement, and parent company cash flow statement[52](index=52&type=chunk)[55](index=55&type=chunk)[59](index=59&type=chunk)[62](index=62&type=chunk)[65](index=65&type=chunk)[68](index=68&type=chunk) - All financial statements are unaudited[52](index=52&type=chunk)[59](index=59&type=chunk)[62](index=62&type=chunk)[65](index=65&type=chunk)[68](index=68&type=chunk) [Adjustments to Financial Statement Items at the Beginning of the First Year of Adoption of New Financial Instruments, Revenue, and Lease Standards](index=33&type=section&id=4.2%20Adjustments%20to%20Financial%20Statement%20Items%20at%20the%20Beginning%20of%20the%20First%20Year%20of%20Adoption%20of%20New%20Financial%20Instruments%2C%20Revenue%2C%20and%20Lease%20Standards) Effective January 1, 2019, the company adopted "Accounting Standard for Business Enterprises No. 21 – Leases (Revised)," adjusting relevant financial statement items at the beginning of the year for the cumulative impact of first-time adoption, without restating comparative period information, primarily affecting fixed assets, right-of-use assets, current non-current liabilities, and lease liabilities - The Group adopted 'Accounting Standard for Business Enterprises No. 21 – Leases (Revised)' effective **January 1, 2019**[76](index=76&type=chunk)[80](index=80&type=chunk) - Under the new lease standard, lessees no longer classify leases as operating or finance leases, but instead apply a unified accounting model[76](index=76&type=chunk)[80](index=80&type=chunk) - The cumulative impact of first-time adoption of the new lease standard adjusted relevant financial statement items at the beginning of the year, with no adjustment to comparative period information[76](index=76&type=chunk)[80](index=80&type=chunk) Key Adjustment Items in Consolidated Balance Sheet (Thousand Yuan) | Item | Dec 31, 2018 | Jan 1, 2019 Adjustment | | :--- | :--- | :--- | | Fixed Assets | 44,293,193 | -345,175 | | Right-of-Use Assets | - | 711,173 | | Non-Current Liabilities Due Within One Year | 7,194,915 | 119,273 | | Lease Liabilities | - | 388,311 | | Long-Term Payables | 355,169 | -141,586 | [Explanation of Retrospective Adjustment of Prior Comparative Data for First-Time Adoption of New Financial Instruments and Lease Standards](index=38&type=section&id=4.3%20Explanation%20of%20Retrospective%20Adjustment%20of%20Prior%20Comparative%20Data%20for%20First-Time%20Adoption%20of%20New%20Financial%20Instruments%20and%20Lease%20Standards) The company only adjusted relevant financial statement items at the beginning of the year for the cumulative impact of first-time adoption of the new lease standard, without retrospectively adjusting prior comparative data - The Group adjusted relevant financial statement items at the beginning of the year for the cumulative impact of first-time adoption of the new lease standard, with no adjustment to comparative period information[80](index=80&type=chunk) [Audit Report](index=38&type=section&id=4.4%20Audit%20Report) This quarterly report does not include an audit report - Not applicable[80](index=80&type=chunk)

Financial Performance - The company's operating revenue for the first half of 2019 was CNY 105,975,591, representing a 38.88% increase compared to CNY 76,308,193 in the same period last year[16]. - The net profit attributable to shareholders for the same period was CNY 5,360,854, which is a 23.49% increase from CNY 4,341,279 year-on-year[16]. - The net cash flow from operating activities reached CNY 11,920,967, marking a 24.65% increase compared to CNY 9,563,372 in the previous year[16]. - The company's total assets at the end of the reporting period were CNY 202,392,645, a slight decrease of 0.63% from CNY 203,679,900 at the end of the previous year[16]. - The net assets attributable to shareholders increased to CNY 64,592,466, reflecting a 5.90% growth from CNY 60,991,768 at the end of the previous year[16]. - Basic earnings per share for the first half of 2019 were CNY 1.0914, up 23.49% from CNY 0.8838 in the same period last year[17]. - The weighted average return on net assets increased to 8.36%, up from 7.64% in the previous year, indicating improved profitability[17]. - The total operating revenue for the first half of 2019 was 105.976 billion yuan, an increase of 38.88% compared to 76.308 billion yuan in the same period last year[46]. - The operating cost increased by 51.20% to 91.271 billion yuan from 60.364 billion yuan year-on-year[46]. - The company's net profit for the first half of 2019 was impacted by a 2.97 billion CNY decrease in net profit for Yancoal International, primarily due to a one-time investment income recognition in the previous year[59]. Dividend and Shareholder Information - The board of directors proposed a cash dividend of RMB 10.00 per 10 shares based on a total share capital of 491,201.60 million shares as of June 30, 2019[3]. - The company plans to distribute a cash dividend of RMB 4.912 billion for the year 2019, which translates to RMB 10.00 per 10 shares[75]. - The total number of ordinary shareholders reached 69,681 by the end of the reporting period[160]. - Yanzhou Coal Mining Company Limited holds 2,267,169,423 shares, representing 46.16% of the total shares[161]. - The top ten shareholders collectively hold a significant portion of the company's shares, with the largest shareholder being a state-owned entity[161]. - The company has maintained a public float exceeding 25%, complying with Hong Kong listing rules[159]. Legal and Compliance Matters - The report indicates that the company has no non-operating fund occupation by controlling shareholders or related parties[4]. - The report has not been audited, which may affect the reliability of the financial data presented[2]. - The company has confirmed that there are no significant lawsuits or arbitration matters during the reporting period[81]. - The company is involved in multiple lawsuits, including a claim for RMB 15,997.70 million against Hengfeng Company, which is currently under appeal[86]. - The company is currently undergoing a retrial process regarding a financial loan dispute with Weihai Commercial Bank, which involves a claim of RMB 99.119 million[85]. - The company has not faced any significant legal or administrative penalties during the reporting period[96]. Operational Highlights - The company operates several subsidiaries, including Yulin Energy Chemical and Heze Energy Chemical, focusing on coal and power business development[7]. - The company produced 52,486 thousand tons of raw coal in the first half of 2019, a decrease of 880 thousand tons or 1.65% year-on-year[27]. - The company achieved a sales revenue of 31.22 billion RMB from coal business, an increase of 1.289 billion RMB or 4.3% year-on-year[31]. - The company’s total coal sales volume was 55,288 thousand tons, a slight decrease of 216 thousand tons or 0.39% year-on-year[27]. - The company’s electricity generation was 132,089 MWh, a decrease of 8,819 MWh or 6.26% year-on-year[27]. - The company is focusing on the development of intelligent mining, having established the first operational intelligent mining face in China[26]. Environmental and Social Responsibility - The company is committed to environmental protection and compliance with regulations, implementing a responsibility system for environmental goals[3]. - The group has not experienced any major environmental pollution incidents during the reporting period and has complied with relevant environmental laws and regulations[137]. - The group has established comprehensive pollution control facilities across its coal mines, power plants, and chemical enterprises, ensuring stable operation and compliance with emission standards[141]. - The company actively engaged in poverty alleviation, investing RMB 3.45 million to support five villages in Yijinhuoluo Banner and contributing RMB 1.95 million to local agricultural projects[131]. - The company provided 77,000 tons of coal for winter heating to impoverished areas in Ordos City and Huaiyang County[131]. Corporate Governance - The company has established a robust corporate governance structure, ensuring compliance with legal and regulatory requirements[155]. - The company has implemented a performance-based salary system for its directors and senior management, linking compensation to actual operational results[153]. - The company has adopted a comprehensive risk management approach to enhance its governance practices[156]. - The company has revised its articles of association to align with the latest regulatory requirements and operational needs[154]. Future Outlook and Strategic Plans - The company plans to continue expanding its market presence and investing in new technologies to enhance operational efficiency[16]. - The company aims to optimize its product structure by increasing the production of premium coal and expanding its market share in high-value coal segments[70]. - The company is focusing on cost control measures to maintain stable costs for its main products and improve operational efficiency[70]. - The company plans to enhance its coal production efficiency by implementing smart mining and transportation systems, aiming for balanced and stable production[70].

Financial Performance - Sales revenue for the first half of 2019 reached CNY 33,237,425 thousand, representing a 3.16% increase compared to CNY 32,220,096 thousand in the same period of 2018[15]. - The net profit attributable to shareholders for the first half of 2019 was CNY 5,809,977 thousand, a 25.68% increase from CNY 4,622,671 thousand in the previous year[15]. - Earnings per share for the first half of 2019 was CNY 1.18, up 25.53% from CNY 0.94 in the same period of 2018[15]. - The company's total assets as of June 30, 2019, were CNY 196,280,582 thousand, compared to CNY 206,003,615 thousand at the end of 2018[16]. - The net cash generated from operating activities for the first half of 2019 was CNY 8,378,922 thousand, a 5.50% increase from CNY 7,941,801 thousand in the same period of 2018[17]. - The company's net asset return rate was 9.50% for the first half of 2019, down from 16.48% for the full year of 2018[16]. - The company reported a decrease in cash and cash equivalents of CNY 4,600,233 thousand for the first half of 2019, compared to an increase of CNY 2,556,356 thousand in the same period of 2018[17]. Coal Production and Sales - In the first half of 2019, the company produced 52,486 thousand tons of raw coal, a decrease of 880 thousand tons or 1.65% year-on-year[24]. - The company achieved coal sales of 55,288 thousand tons in the first half of 2019, a slight decrease of 216 thousand tons or 0.39% compared to the same period in 2018[24]. - The company reported a coal business revenue of 31.22 billion RMB in the first half of 2019, an increase of 1.289 billion RMB or 4.3% year-on-year[28]. - The total coal sales volume for the first half of 2019 was 55,288 thousand tons, generating revenue of 31,220 million yuan, compared to 55,504 thousand tons and 29,931 million yuan in the same period of 2018[31]. - The average selling price of coal increased to 564.68 yuan per ton in the first half of 2019, up from 539.25 yuan per ton in the first half of 2018, reflecting a price increase of approximately 4.4%[31]. - The sales volume in the power sector reached 25,592 thousand tons, contributing 12,414 million yuan in revenue, compared to 23,235 thousand tons and 12,453 million yuan in the same period of 2018[32]. - The sales volume in the metallurgical sector was 3,978 thousand tons, generating revenue of 3,608 million yuan, compared to 3,802 thousand tons and 3,513 million yuan in the same period of 2018[32]. Investments and Subsidiaries - The company holds a 51.81% equity stake in its controlling shareholder, Yanzhou Coal Group Co., Ltd., as of the report date[5]. - The company has a 98.33% equity stake in its subsidiary, Heze Energy Chemical Co., Ltd., as of the report date[5]. - The company has a 62.26% equity stake in Yanzhou Coal Australia Limited, which is listed on both the Australian Securities Exchange and the Hong Kong Stock Exchange[6]. - The major subsidiary, Yancoal Australia, reported total assets of 51.722 billion yuan and a net profit of 274.6 million yuan for the first half of 2019[50]. - The company completed the acquisition of 100% equity in Shanghai Dongjiang Real Estate Development Co., Ltd. for RMB 185.37 million, as approved by the board meeting on March 29, 2019[139]. Legal and Compliance Issues - The company is involved in a legal dispute with Xiamen Xinda, claiming a principal amount of RMB 164 million and corresponding interest[83]. - The arbitration case with Inner Mongolia New Changjiang Mining Investment Co., Ltd. involves a claim for RMB 749 million for equity transfer price and RMB 656 million in penalties, totaling approximately RMB 1.435 billion[86]. - The company is currently undergoing arbitration proceedings, and the impact of these legal matters on current and future profits remains uncertain[86]. - The company is facing a financial loan dispute with China Construction Bank, with a claim of RMB 5,966.90 million for loan repayment and corresponding interest[93]. - The company has not yet received a ruling from the Qingting Intermediate Court regarding the loan dispute with Weifang Commercial Bank[90]. - The company is actively managing its legal disputes to mitigate potential impacts on its financial performance[93]. Environmental Compliance - The company reported no major environmental pollution incidents during the reporting period and complied with all relevant environmental laws and regulations[164]. - Key pollutant emissions from the company's coal mines, including COD and ammonia nitrogen, were within the permitted limits, with actual emissions of 292 tons COD and 3.7 tons ammonia nitrogen from the Nandian coal mine[165]. - The company's power plants achieved compliance in emissions of major pollutants such as smoke dust, sulfur dioxide, and nitrogen oxides, maintaining stable operation of pollution control facilities[164]. - The company has established a complete environmental management system to prevent pollution and ecological damage from the source, aiming to build a resource-saving and environmentally friendly enterprise[164]. - The company has completed the ultra-low emission transformation for all boilers in its power plants, ensuring compliance with environmental standards[167]. Corporate Governance - The company has maintained compliance with corporate governance documents and the Hong Kong Listing Rules throughout the reporting period[184]. - The company emphasizes transparency and accountability in its governance practices, ensuring compliance with both domestic and international regulations[183]. - The company has established a performance-based salary system for its directors and senior management, linking compensation to operational results[179]. - The company has revised its articles of association to align with the latest regulatory requirements, enhancing its corporate governance structure[182]. - The company has implemented a robust investor relations management system to facilitate effective communication with the capital market[185]. Shareholder Information - The total number of ordinary shareholders reached 69,681 by the end of the reporting period[188]. - The largest shareholder, 克骥集团有限公司, holds 2,267,169,423 shares, representing 46.16% of the total shares[189]. - The second largest shareholder, 香港中央结算(代理人)有限公司, decreased its holdings by 3,017,146 shares, now holding 1,945,591,353 shares, which is 39.61%[189]. - The company’s public float is confirmed to exceed 25% of total share capital, in line with Hong Kong Listing Rules[186]. - There were no changes in the controlling shareholder or actual controller during the reporting period[198].

[Important Notice](index=3&type=section&id=%E4%B8%80%E3%80%81%E9%87%8D%E8%A6%81%E6%8F%90%E7%A4%BA) This chapter emphasizes the guarantee of truthfulness, accuracy, and completeness of the quarterly report content by Yanzhou Coal Mining Company Limited's Board of Directors, Supervisory Board, and senior management, and clarifies the responsibility of key personnel for the financial statements' authenticity - The company's Board of Directors, Supervisory Board, and senior management guarantee the truthfulness, accuracy, and completeness of the quarterly report content, with no false records, misleading statements, or major omissions[3](index=3&type=chunk) - Mr. Li Xiyong, the company's responsible person, Mr. Zhao Qingchun, the CFO, and Mr. Xu Jian, the head of the financial management department, guarantee the truthfulness, accuracy, and completeness of the financial statements in the quarterly report[3](index=3&type=chunk) - This company's 2019 first-quarter report is unaudited[3](index=3&type=chunk) [Basic Company Information](index=4&type=section&id=%E4%BA%8C%E3%80%81%E5%85%AC%E5%8F%B8%E5%9F%BA%E6%9C%AC%E6%83%85%E5%86%B5) This chapter outlines Yanzhou Coal Mining's key financial data and shareholder holdings for the first quarter of 2019, showing a slight decrease in total assets but significant growth in net assets attributable to shareholders and net cash flow from operating activities, alongside increased revenue and net profit [Key Financial Data](index=4&type=section&id=2.1%20%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%95%B0%E6%8D%AE) In Q1 2019, the company's total assets decreased by 3.26% year-over-year, while net assets attributable to shareholders grew by 4.09%, and net cash flow from operating activities significantly increased by 35.30% 2019 First Quarter Key Financial Data (Consolidated Statements) | Indicator | Current Period End/Year-to-Date (Thousand Yuan) | Prior Year End/Prior Year-to-Date (Thousand Yuan) | Change (%) | | :--- | :--- | :--- | :--- | | **Balance Sheet:** | | | | | Total Assets | 197,037,106 | 203,679,900 | -3.26 | | Net Assets Attributable to Shareholders of Listed Company | 63,488,789 | 60,991,768 | 4.09 | | **Income Statement:** | | | | | Operating Revenue | 48,243,536 | 32,333,709 | 49.21 | | Net Profit Attributable to Shareholders of Listed Company | 2,308,395 | 2,227,536 | 3.63 | | Net Profit Attributable to Shareholders of Listed Company (Excluding Non-Recurring Items) | 2,229,570 | 2,166,053 | 2.93 | | Weighted Average Return on Net Assets (%) | 3.70 | 4.01 | Decreased by 0.31 percentage points | | Basic Earnings Per Share (Yuan/Share) | 0.4699 | 0.4535 | 3.62 | | Diluted Earnings Per Share (Yuan/Share) | 0.4699 | 0.4535 | 3.62 | | **Cash Flow Statement:** | | | | | Net Cash Flow from Operating Activities | 4,424,475 | 3,270,162 | 35.30 | 2019 First Quarter Non-Recurring Gains and Losses | Item | Current Period Amount (Thousand Yuan) | | :--- | :--- | | Gains/Losses from Disposal of Non-Current Assets | 388 | | Government Subsidies Included in Current Profit/Loss | 10,485 | | Funds Occupancy Fees Received from Non-Financial Enterprises Included in Current Profit/Loss | 93,296 | | Gains/Losses from Changes in Fair Value and Disposal of Financial Assets | 12,332 | | Other Non-Operating Income and Expenses | 47,608 | | Impact on Minority Interests (After Tax) | -24,503 | | Income Tax Impact | -60,781 | | Total | 78,825 | [Shareholder Holdings](index=5&type=section&id=2.2%20%E8%82%A1%E4%B8%9C%E6%8C%81%E8%82%A1%E6%83%85%E5%86%B5) As of the end of the reporting period, the company had 79,068 shareholders, with Yancoal Group and HKSCC Nominees as the top two, holding 46.16% and 39.67% respectively, with stable holdings and no pledges or freezes - As of the end of the reporting period, the total number of shareholders was **79,068**[6](index=6&type=chunk) Top Ten Shareholders as of March 31, 2019 | Shareholder Name | Shares Held at Period End (Shares) | Percentage (%) | Shareholder Nature | | :--- | :--- | :--- | :--- | | Yancoal Group Co., Ltd. | 2,267,169,423 | 46.16 | State-owned Legal Person | | HKSCC Nominees Limited | 1,948,612,033 | 39.67 | Overseas Legal Person | | China Life Insurance Co., Ltd. - Dividend - Individual Dividend - 005L - FH002 Shanghai | 22,065,202 | 0.45 | Other | | Central Huijin Asset Management Co., Ltd. | 19,355,100 | 0.39 | State-owned Legal Person | | National Social Security Fund 102 Portfolio | 19,103,061 | 0.39 | Other | | Abu Dhabi Investment Authority | 18,885,166 | 0.38 | Other | | National Social Security Fund 403 Portfolio | 12,884,351 | 0.26 | Other | | New China Life Insurance Co., Ltd. - Dividend - Group Dividend - 018L - FH001 Shanghai | 12,261,478 | 0.25 | Other | | Mo Jianrong | 7,594,500 | 0.15 | Domestic Natural Person | | Hong Kong Securities Clearing Company Limited | 6,791,793 | 0.14 | Overseas Legal Person | Major Shareholders' Interests and Short Positions in H-shares as of March 31, 2019 | Major Shareholder Name | Share Class | Capacity | Number of Shares Held (Shares) | Nature of Interest | Percentage of Company's H-share Class | Percentage of Company's Total Issued Share Capital | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Yancoal Group | A-shares (State-owned Legal Person Shares) | Beneficial Owner | 2,267,169,423 | Long Position | - | 46.16% | | Yancoal Group ① | H-shares | Interest of Controlled Corporation | 277,989,000 | Long Position | 14.24% | 5.66% | | BNP Paribas Investment Partners SA | H-shares | Investment Manager | 117,641,207 | Long Position | 6.03% | 2.39% | | BlackRock, Inc. | H-shares | Interest of Controlled Corporation | 115,722,028 | Long Position | 5.93% | 2.36% | | BlackRock, Inc. | H-shares | Interest of Controlled Corporation | 414,000 | Short Position | 0.02% | 0.01% | [Preferred Shareholder Information](index=7&type=section&id=2.3%20%E4%BC%98%E5%85%88%E8%82%A1%E8%82%A1%E4%B8%9C%E6%83%85%E5%86%B5) As of the end of the reporting period, the company had no preferred shareholders, making this disclosure item not applicable - The company has no information on the total number of preferred shareholders, top ten preferred shareholders, or preferred shareholders with unrestricted shares[10](index=10&type=chunk) [Significant Matters](index=8&type=section&id=%E4%B8%89%E3%80%81%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) This chapter details Yanzhou Coal Mining's overall operating performance, significant changes in key financial statement items, and progress on important matters including litigation, major related party transactions, and other events for Q1 2019 [Overall Operating Performance](index=8&type=section&id=3.1%20%E6%80%BB%E4%BD%93%E7%BB%8F%E8%90%A5%E4%B8%9A%E7%BB%A9) In Q1 2019, the company's coal business saw a slight decrease in raw coal output but an increase in sales prices, while railway transportation, coal chemical, and power businesses all achieved growth, with non-coal trade revenue significantly increasing [Key Product and Service Operating Data](index=8&type=section&id=3.1.1%20%E4%B8%BB%E8%A6%81%E4%BA%A7%E5%93%81%E5%8F%8A%E6%9C%8D%E5%8A%A1%E8%BF%90%E8%90%A5%E6%95%B0%E6%8D%AE) During the reporting period, the company's raw coal output slightly decreased by 0.27%, and commercial coal output decreased by 4.53%, while railway freight volume, methanol production, and power generation and sales all increased 2019 First Quarter Key Product and Service Operating Data | Item | 2019 First Quarter | 2018 First Quarter | Change (%) | | :--- | :--- | :--- | :--- | | **Coal Business (Thousand Tons):** | | | | | Raw Coal Output | 26,062 | 26,133 | -0.27 | | Commercial Coal Output | 23,192 | 24,293 | -4.53 | | Commercial Coal Sales Volume | 26,441 | 27,405 | -3.52 | | **Railway Transportation Business (Thousand Tons):** | | | | | Freight Volume | 5,600 | 5,149 | 8.76 | | **Coal Chemical Business (Thousand Tons):** | | | | | Methanol Production | 457 | 452 | 1.11 | | Methanol Sales Volume | 461 | 445 | 3.60 | | **Power Business (10,000 kWh):** | | | | | Power Generation | 68,355 | 64,833 | 5.43 | | Power Sales Volume | 43,250 | 37,092 | 16.60 | [Operating Performance by Main Business Segment](index=8&type=section&id=3.1.2%20%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E5%88%86%E9%83%A8%E7%BB%8F%E8%90%A5%E6%83%85%E5%86%B5) Coal business saw decreased output from some subsidiaries due to policy adjustments but increased output from Yancoal Australia and higher sales prices, while railway transportation, coal chemical, and power businesses showed varied performance, with non-coal trade revenue reaching 30.399 billion yuan - Coal business raw coal output was **26.06 million tons**, a year-over-year decrease of **0.3%**; commercial coal output was **23.19 million tons**, a year-over-year decrease of **4.5%**[11](index=11&type=chunk) - Heze Energy Chemical's raw coal and commercial coal output decreased year-over-year, primarily due to production organized according to new approved production capacity during the reporting period[13](index=13&type=chunk) - Haosheng Coal Industry's raw coal and commercial coal output decreased year-over-year, primarily due to production restrictions at Shilawusu Coal Mine affected by safety and environmental policies[13](index=13&type=chunk) - Yancoal Australia's raw coal output was **11.5 million tons**, a year-over-year increase of **13.11%**; commercial coal output was **8.818 million tons**, a year-over-year increase of **5.87%**[12](index=12&type=chunk)[13](index=13&type=chunk) - The Group's total commercial coal sales price was **595.67 yuan/ton**, an increase of **8.36%** compared to **549.73 yuan/ton** in the same period last year[15](index=15&type=chunk) - Coal business sales cost was **8.76 billion yuan**, a year-over-year increase of **714 million yuan** or **8.9%**[15](index=15&type=chunk) - Railway transportation business freight volume was **5.6 million tons**, a year-over-year increase of **8.8%**; revenue reached **109 million yuan**, a year-over-year increase of **5.7%**[17](index=17&type=chunk) - Yulin Energy Chemical and Ordos Energy Chemical's methanol sales revenue decreased by **14.84%** and **16.45%** year-over-year, respectively[19](index=19&type=chunk) - Huaju Energy's power business sales volume increased by **61.12%**, and sales revenue increased by **42.90%**[20](index=20&type=chunk) - Non-coal trade business achieved sales revenue of **30.399 billion yuan**, with sales cost of **30.327 billion yuan**[21](index=21&type=chunk) - Equity investment business achieved a profit of **296 million yuan**[21](index=21&type=chunk) [Operating Performance of Yancoal Group Finance Co., Ltd.](index=11&type=section&id=3.1.3%20%E6%8E%9B%E7%9F%BF%E9%9B%86%E5%9B%A2%E8%B4%A2%E5%8A%A1%E6%9C%89%E9%99%90%E5%85%AC%E5%8F%B8%E8%BF%90%E8%90%A5%E6%83%85%E5%86%B5) Yancoal Group Finance Co., Ltd. reported Q1 2019 operating revenue of 82 million yuan, up 12.33%, and net profit of 56 million yuan, up 14.29%, despite a 29.61% year-over-year decrease in total assets Yancoal Group Finance Co., Ltd. Q1 2019 Operating Performance | Indicator | 2019 First Quarter | 2018 First Quarter | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 82 Million Yuan | 73 Million Yuan | 12.33 | | Net Profit | 56 Million Yuan | 49 Million Yuan | 14.29 | | **Period-End Data:** | March 31, 2019 | December 31, 2018 | Change (%) | | Net Assets | 1,543 Million Yuan | 1,488 Million Yuan | 3.70 | | Total Assets | 16,293 Million Yuan | 23,146 Million Yuan | -29.61 | [Significant Changes and Reasons for Major Financial Statement Items and Indicators](index=12&type=section&id=3.2%20%E5%85%AC%E5%8F%B8%E4%B8%BB%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%8A%A5%E8%A1%A8%E9%A1%B9%E7%9B%AE%E3%80%81%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87%E9%87%8D%E5%A4%A7%E5%8F%98%E5%8A%A8%E7%9A%84%E6%83%85%E5%86%B5%E5%8F%8A%E5%8E%9F%E5%9B%A0) This section analyzes significant changes in the company's balance sheet, income statement, and cash flow statement items during the reporting period, attributing variations to factors like increased trade payables, debt repayments, and investment activity adjustments [Significant Changes and Reasons for Balance Sheet Items](index=12&type=section&id=3.2.1%20%E8%B5%84%E4%BA%A7%E8%B4%9F%E5%80%BA%E8%A1%A8%E9%A1%B9%E7%9B%AE%E9%87%8D%E5%A4%A7%E5%8F%98%E5%8A%A8%E6%83%85%E5%86%B5%E5%8F%8A%E5%8E%9F%E5%9B%A0) Prepayments significantly increased by 83.80% due to advance payments for mining rights and trade, while non-current liabilities due within one year and other current liabilities decreased due to debt repayments 2019 First Quarter Significant Balance Sheet Item Changes | Item | March 31, 2019 (Million Yuan) | December 31, 2018 (Million Yuan) | Change (%) | | :--- | :--- | :--- | :--- | | Prepayments | 5,913 | 3,217 | 83.80 | | Non-Current Liabilities Due Within One Year | 5,229 | 7,195 | -27.32 | | Other Current Liabilities | 2,164 | 7,282 | -70.28 | - Reasons for prepayment changes: Haosheng Coal Industry prepaid **2.054 billion yuan** for Shilawusu Coal Mine mining rights; Qingdao Zhongyin Ruifeng Guofeng International Trade Co., Ltd.'s prepaid trade款 increased by **770 million yuan** from the beginning of the year[23](index=23&type=chunk) - Reasons for changes in non-current liabilities due within one year: The company repaid **1.95 billion yuan** in corporate bonds during the reporting period[23](index=23&type=chunk) - Reasons for changes in other current liabilities: The company repaid **5 billion yuan** in short-term financing bills during the reporting period[23](index=23&type=chunk) [Significant Changes and Reasons for Income Statement Items](index=12&type=section&id=3.2.2%20%E5%88%A9%E6%B6%A6%E8%A1%A8%E9%A1%B9%E7%9B%AE%E9%87%8D%E5%A4%A7%E5%8F%98%E5%8A%A8%E6%83%85%E5%86%B5%E5%8F%8A%E5%8E%9F%E5%9B%A0) Operating revenue surged by 49.21% due to higher self-produced coal prices and increased trade and other business income, leading to a 63.98% rise in operating costs, while investment income grew by 37.67% from equity method investments 2019 First Quarter Significant Income Statement Item Changes | Item | 2019 First Quarter (Million Yuan) | 2018 First Quarter (Million Yuan) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 48,244 | 32,334 | 49.21 | | Operating Cost | 40,725 | 24,835 | 63.98 | | Investment Income | 296 | 215 | 37.67 | - Reasons for operating revenue changes: Increased sales price of self-produced coal led to a year-over-year increase of **925 million yuan** in operating revenue; trade coal sales revenue increased by **395 million yuan** year-over-year; other business revenue increased by **15.379 billion yuan** year-over-year[24](index=24&type=chunk) - Reasons for operating cost changes: Coal business sales cost increased by **714 million yuan** year-over-year; other business costs increased by **15.164 billion yuan** year-over-year[24](index=24&type=chunk) - Reasons for investment income changes: The Group's equity investment income accounted for by the equity method increased year-over-year[24](index=24&type=chunk) [Changes and Reasons for Cash Flow Statement Items](index=12&type=section&id=3.2.3%20%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8%E9%A1%B9%E7%9B%AE%E5%8F%98%E5%8A%A8%E6%83%85%E5%86%B5%E5%8F%8A%E5%8E%9F%E5%9B%A0) Net cash flow from operating activities increased by 35.29% due to higher cash receipts from sales, while net cash flow from investing activities turned positive, and net cash flow from financing activities significantly decreased by 215.18% due to reduced capital contributions and increased debt repayments 2019 First Quarter Significant Cash Flow Statement Item Changes | Item | 2019 First Quarter (Million Yuan) | 2018 First Quarter (Million Yuan) | Change (%) | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 4,424 | 3,270 | 35.29 | | Net Cash Flow from Investing Activities | -2,711 | -4,469 | - | | Net Cash Flow from Financing Activities | -8,157 | 7,082 | -215.18 | | Net Increase in Cash and Cash Equivalents | -6,660 | 5,684 | -217.17 | - Reasons for increase in net cash flow from operating activities: Cash received from sales of goods and provision of services increased by **15.055 billion yuan** year-over-year[25](index=25&type=chunk) - Reasons for changes in net cash flow from investing activities: Cash received from investment recovery increased by **952 million yuan** year-over-year; cash paid for the acquisition of fixed assets, intangible assets, and other long-term assets increased by **1.101 billion yuan** year-over-year[27](index=27&type=chunk) - Reasons for significant decrease in net cash flow from financing activities: Cash received from capital contributions decreased by **8.231 billion yuan** year-over-year; cash paid for debt repayment increased by **5.4 billion yuan** year-over-year[27](index=27&type=chunk) [Analysis of Progress, Impact, and Solutions for Significant Matters](index=13&type=section&id=3.3%20%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9%E8%BF%9B%E5%B1%95%E6%83%85%E5%86%B5%E5%8F%8A%E5%85%B6%E5%BD%B1%E5%93%8D%E5%92%8C%E8%A7%A3%E5%86%B3%E6%96%B9%E6%A1%88%E7%9A%84%E5%88%86%E6%9E%90%E8%AF%B4%E6%98%8E) This section details the progress of the company's litigation, major related party transactions, and other significant events during the reporting period, including ongoing lawsuits, successful defense in some cases, and strategic equity transactions [Litigation and Arbitration](index=13&type=section&id=3.3.1%20%E8%AF%89%E8%AE%BC%E3%80%81%E4%BB%B2%E8%A3%81%E6%83%85%E5%86%B5) The company is involved in four major lawsuits, with two contract disputes still in review or appeal, one factoring contract dispute where the company was exonerated, and one debt transfer contract dispute where the company won at first instance - Jinan Railway Coal Transportation and Trade Group Co., Ltd. v. Yanzhou Coal Mining Co., Ltd. sales contract dispute: The company lost at first instance, the second instance ruled the company liable for compensation, and the company has applied to the Shandong High Court for retrial; the impact is yet to be determined[28](index=28&type=chunk) - Yanzhou Coal Mining Co., Ltd. v. Jinan Railway Coal Transportation and Trade Group Co., Ltd. sales contract dispute: Jining Intermediate People's Court ruled to dismiss the company's litigation claims in a retrial, and the company has appealed to the Shandong High Court; the impact is yet to be determined[29](index=29&type=chunk) - Zhonghuixintong Commercial Factoring Co., Ltd. v. Yanzhou Coal Mining Co., Ltd. factoring contract dispute: Zhonghuixintong withdrew its lawsuit against Yanzhou Coal Mining, and the company was exonerated, which will not impact the company's current or future profits[30](index=30&type=chunk) - Luxing Real Estate Co., Ltd. v. Yanzhou Coal Mining Co., Ltd. debt transfer contract dispute: The company won at first instance in all 7 cases heard by Jining Intermediate People's Court and Rencheng District Court; the impact is yet to be determined[31](index=31&type=chunk) [Major Related Party Transactions](index=15&type=section&id=3.3.2%20%E9%87%8D%E5%A4%A7%E5%85%B3%E8%81%94%E4%BA%A4%E6%98%93%E4%BA%8B%E9%A1%B9) The company signed a management entrustment agreement with Yancoal Group for management services to seven subsidiaries, receiving 7.3 million yuan annually, and its subsidiary acquired 100% equity in Shanghai Dongjiang Real Estate Development Co., Ltd. for 185.3709 million yuan - The company signed a 'Special Management Entrustment Agreement' with Yancoal Group, providing specialized management services to 7 subsidiaries of Yancoal Group, receiving an annual management fee of **7.3 million yuan**[32](index=32&type=chunk) - The company's wholly-owned subsidiary, Zhongyin Financial Leasing Co., Ltd., acquired **100%** equity of Shanghai Dongjiang Real Estate Development Co., Ltd. from Shanghai Zhouhai Real Estate Development Co., Ltd., a wholly-owned subsidiary of Yancoal Group, for a transaction price of **185.3709 million yuan**[33](index=33&type=chunk) [Other Significant Matters](index=15&type=section&id=3.3.3%20%E5%85%B6%E4%BB%96%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) The company sold 20.89% equity in Dongguan Haichang Industrial Co., Ltd. to Guantai Industrial for 784 million yuan, with 550 million yuan received, and nominated Mr. Liu Jian as a non-independent director candidate for the seventh board - The company sold **20.89%** equity of Haichang Company to Guantai Industrial for a transaction price of **784 million yuan**, and as of the report disclosure date, **550 million yuan** of the transaction price has been received[34](index=34&type=chunk) - The company nominated Mr. Liu Jian as a candidate for non-independent director of the seventh Board of Directors, to be submitted for approval at the company's 2018 Annual General Meeting to be held on May 24, 2019[35](index=35&type=chunk) [Overdue Unfulfilled Commitments During the Reporting Period](index=16&type=section&id=3.4%20%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E8%B6%85%E6%9C%9F%E6%9C%AA%E5%B1%A5%E8%A1%8C%E5%AE%8C%E6%AF%95%E7%9A%84%E6%89%BF%E8%AF%BA%E4%BA%8B%E9%A1%B9) There were no overdue unfulfilled commitments during the reporting period - Not applicable[36](index=36&type=chunk) [Warning and Explanation of Potential Cumulative Net Profit Loss or Significant Change from Prior Year-End to Next Reporting Period-End](index=16&type=section&id=3.5%20%E9%A2%84%E6%B5%8B%E5%B9%B4%E5%88%9D%E8%87%B3%E4%B8%8B%E4%B8%80%E6%8A%A5%E5%91%8A%E6%9C%9F%E6%9C%AB%E7%9A%84%E7%B4%AF%E8%AE%A1%E5%87%80%E5%88%A9%E6%B6%A6%E5%8F%AF%E8%83%BD%E4%B8%BA%E4%BA%8F%E6%8D%9F%E6%88%96%E8%80%85%E4%B8%8E%E4%B8%8A%E5%B9%B4%E5%90%8C%E6%9C%9F%E7%9B%B8%E6%AF%94%E5%8F%91%E7%94%9F%E9%87%8D%E5%A4%A7%E5%8F%98%E5%8A%A8%E7%9A%84%E8%AD%A6%E7%A4%BA%E5%8F%8A%E5%8E%9F%E5%9B%A0%E8%AF%B4%E6%98%8E) The company has not issued any warning regarding potential cumulative net profit loss or significant changes from the beginning of the year to the end of the next reporting period - Not applicable[36](index=36&type=chunk) [Appendix](index=17&type=section&id=%E5%9B%9B%E3%80%81%E9%99%84%E5%BD%95) The appendix includes Yanzhou Coal Mining's consolidated and parent company balance sheets, income statements, and cash flow statements for Q1 2019, along with explanations of adjustments made for the first-time adoption of new leasing standards [Key Financial Statements](index=17&type=section&id=4.1%20%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8) This section presents the company's consolidated and parent company balance sheets, income statements, and cash flow statements for Q1 2019, offering comprehensive financial information on its financial position, operating results, and cash flows - The appendix includes consolidated balance sheet, parent company balance sheet, consolidated income statement, parent company income statement, consolidated cash flow statement, and parent company cash flow statement[38](index=38&type=chunk)[40](index=40&type=chunk)[43](index=43&type=chunk)[46](index=46&type=chunk)[48](index=48&type=chunk)[50](index=50&type=chunk) [Adjustments for First-Time Adoption of New Accounting Standards](index=28&type=section&id=4.2%20%E9%A6%96%E6%AC%A1%E6%89%A7%E8%A1%8C%E6%96%B0%E4%BC%9A%E8%AE%A1%E5%87%86%E5%88%99%E8%B0%83%E6%95%B4%E6%83%85%E5%86%B5) Effective January 1, 2019, the company adopted the new leasing standard, adjusting opening financial statement items for cumulative impacts without retrospective adjustment of comparative period information, primarily affecting fixed assets, right-of-use assets, and lease liabilities - The company adopted 'Accounting Standard for Business Enterprises No. 21 – Leases (Revised)' (new leasing standard) effective **January 1, 2019**[54](index=54&type=chunk)[57](index=57&type=chunk) - According to the new leasing standard, lessees no longer distinguish between operating leases and finance leases, but adopt a unified accounting treatment model[54](index=54&type=chunk)[57](index=57&type=chunk) - The Group adjusted relevant items in the opening financial statements for the cumulative impact of the first-time adoption of the new leasing standard, without retrospective adjustment of comparative period information[54](index=54&type=chunk)[57](index=57&type=chunk) - Consolidated balance sheet adjustments: Fixed assets decreased by **202,650 thousand yuan**, right-of-use assets increased by **455,497 thousand yuan**, non-current liabilities due within one year increased by **68,309 thousand yuan**, long-term payables decreased by **141,586 thousand yuan**, and lease liabilities increased by **326,124 thousand yuan**[53](index=53&type=chunk)[54](index=54&type=chunk) - Parent company balance sheet adjustments: Fixed assets decreased by **2,473,847 thousand yuan**, right-of-use assets increased by **2,473,847 thousand yuan**, long-term payables decreased by **2,687,713 thousand yuan**, and lease liabilities increased by **2,687,713 thousand yuan**[55](index=55&type=chunk)[56](index=56&type=chunk) [Explanation of Retrospective Adjustments for First-Time Adoption of New Accounting Standards](index=33&type=section&id=4.3%20%E9%A6%96%E6%AC%A1%E6%89%A7%E8%A1%8C%E6%96%B0%E4%BC%9A%E8%AE%A1%E5%87%86%E5%88%99%E8%BF%BD%E6%BA%AF%E8%B0%83%E6%95%B4%E8%AF%B4%E6%98%8E) The company adjusted opening financial statement items for the cumulative impact of the first-time adoption of the new leasing standard but did not retrospectively adjust prior period comparative data - The Group adjusted relevant items in the opening financial statements for the cumulative impact of the first-time adoption of the new leasing standard, without retrospective adjustment of comparative period information[58](index=58&type=chunk) [Audit Report](index=33&type=section&id=4.4%20%E5%AE%A1%E8%AE%A1%E6%8A%A5%E5%91%8A) This report does not include an audit report - Not applicable[58](index=58&type=chunk)

[Definitions](index=4&type=section&id=%E7%AC%AC%E4%B8%80%E8%8A%82%20%E9%87%8A%E4%B9%89) This section provides definitions for key terms and abbreviations used throughout the report [Company Profile and Key Financial Indicators](index=6&type=section&id=%E7%AC%AC%E4%BA%8C%E8%8A%82%20%E5%85%AC%E5%8F%B8%E7%AE%80%E4%BB%8B%E5%92%8C%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87) This section provides an overview of the company's basic information and presents key financial data and indicators for recent years [Company Basic Information](index=6&type=section&id=%E4%B8%80%E3%80%81%20%E5%85%AC%E5%8F%B8%E4%BF%A1%E6%81%AF) This chapter provides basic information about Yanzhou Coal Mining Company Limited, including its name, legal representative, contact details, registered address, website, information disclosure media, and stock overview - The company's A-shares are listed on the Shanghai Stock Exchange (stock code 600188), and H-shares are listed on the Hong Kong Stock Exchange (stock code 01171)[14](index=14&type=chunk) [Key Accounting Data and Financial Indicators for the Past Three Years](index=7&type=section&id=%E4%B8%83%E3%80%81%20%E8%BF%91%E4%B8%89%E5%B9%B4%E4%B8%BB%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%95%B0%E6%8D%AE%E5%92%8C%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87) The company achieved significant performance growth in 2018, with operating revenue increasing by 7.79% and net profit attributable to parent increasing by 16.81%, while net cash flow from operating activities surged by 39.65%, indicating strong operational and cash generation capabilities Key Accounting Data for the Past Three Years (Unit: RMB (Thousands)) | Indicator | 2018 | 2017 | YoY Change (%) | 2016 (Adjusted) | | :--- | :--- | :--- | :--- | :--- | | **Operating Revenue** | 163,008,472 | 151,227,775 | 7.79 | 102,282,148 | | **Net Profit Attributable to Shareholders of Listed Company** | 7,908,904 | 6,770,618 | 16.81 | 2,161,814 | | **Net Profit Attributable to Shareholders of Listed Company (Excluding Non-recurring Gains/Losses)** | 8,491,453 | 5,751,936 | 47.36 | 1,451,924 | | **Net Cash Flow from Operating Activities** | 22,432,396 | 16,063,074 | 39.65 | 6,235,489 | | **Total Assets (Period-end)** | 203,679,900 | 194,887,291 | 4.51 | 153,046,361 | | **Net Assets Attributable to Shareholders of Listed Company (Period-end)** | 60,991,768 | 54,939,172 | 11.02 | 43,060,359 | Key Financial Indicators for the Past Three Years | Indicator | 2018 | 2017 | Change | 2016 (Adjusted) | | :--- | :--- | :--- | :--- | :--- | | **Basic Earnings Per Share (RMB/share)** | 1.6101 | 1.3784 | Increase 16.81% | 0.4401 | | **Weighted Average Return on Net Assets (%)** | 13.48 | 14.00 | Decrease 0.52 percentage points | 5.17 | | **Weighted Average Return on Net Assets (Excluding Non-recurring Gains/Losses) (%)** | 14.47 | 11.90 | Increase 2.57 percentage points | 3.47 | [Differences in Accounting Standards Between Domestic and Overseas](index=8&type=section&id=%E5%85%AB%E3%80%81%20%E5%A2%83%E5%86%85%E5%A4%96%E4%BC%9A%E8%AE%A1%E5%87%86%E5%88%99%E4%B8%8B%E4%BC%9A%E8%AE%A1%E6%95%B0%E6%8D%AE%E5%B7%AE%E5%BC%82) Due to differences in business combinations under common control, special reserve provisions, classification of perpetual capital bonds, and reversal of long-term asset impairments, the company's net profit and net assets under IFRS differ from those under PRC GAAP 2018 Differences in Accounting Data Between Domestic and Overseas Standards (Unit: RMB (Thousands)) | Indicator | Under PRC GAAP | Under IFRS | Difference | | :--- | :--- | :--- | :--- | | **Net Profit for the Period** | 7,908,904 | 8,582,556 | 673,652 | | **Period-end Net Assets Attributable to Shareholders of Listed Company** | 60,991,768 | 52,077,360 | -8,914,408 | - Major reasons for differences include: 1) Different treatment of business combinations under common control; 2) Special reserves (e.g., maintenance and safety production fees) are recognized in equity under PRC GAAP but expensed under IFRS; 3) Perpetual capital bonds are recognized in equity under PRC GAAP but separately presented under IFRS; 4) Long-term asset impairment reversals are not allowed under PRC GAAP but permitted under IFRS[20](index=20&type=chunk)[21](index=21&type=chunk) [2018 Quarterly Financial Data](index=9&type=section&id=%E4%B9%9D%E3%80%81%202018%20%E5%B9%B4%E5%88%86%E5%AD%A3%E5%BA%A6%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%95%B0%E6%8D%AE) The company maintained stable operations across all quarters in 2018, with the fourth quarter achieving the highest net profit attributable to parent and net cash flow from operating activities, indicating significantly enhanced year-end operating efficiency and cash recovery capabilities 2018 Quarterly Key Financial Data (Unit: RMB (Thousands)) | Indicator | Q1 | Q2 | Q3 | Q4 | | :--- | :--- | :--- | :--- | :--- | | **Operating Revenue** | 32,333,709 | 43,974,484 | 42,882,292 | 43,817,987 | | **Net Profit Attributable to Shareholders of Listed Company** | 2,227,536 | 2,113,743 | 1,162,735 | 2,404,890 | | **Net Cash Flow from Operating Activities** | 3,270,162 | 6,293,210 | 3,089,707 | 9,779,317 | [Business Overview](index=11&type=section&id=%E7%AC%AC%E4%B8%89%E8%8A%82%20%E5%85%AC%E5%8F%B8%E4%B8%9A%E5%8A%A1%E6%A6%82%E8%A6%81) This section outlines the company's primary business segments, operating models, industry conditions, and core competitive advantages [Main Businesses, Operating Model, and Industry Conditions](index=11&type=section&id=%E4%B8%80%E3%80%81%20%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E5%85%AC%E5%8F%B8%E6%89%80%E4%BB%8E%E4%BA%8B%E7%9A%84%E4%B8%BB%E8%A6%81%E4%B8%9A%E5%8A%A1%E3%80%81%E7%BB%8F%E8%90%A5%E6%A8%A1%E5%BC%8F%E5%8F%8A%E8%A1%8C%E4%B8%9A%E6%83%85%E5%86%B5%E8%AF%B4%E6%98%8E) The company primarily operates in four segments: coal, coal chemical, electromechanical equipment manufacturing, and power and heat, with coal being the core business, and its products are sold in China, Japan, and South Korea - The company's core businesses include coal, coal chemicals (methanol), electromechanical equipment manufacturing, and power and heat, with coal products primarily being thermal coal and pulverized coal[27](index=27&type=chunk) - In 2018, China's supply-side structural reform continued to advance, leading to a balanced supply and demand in the coal market, stable medium-to-high prices, and enhanced industry profitability[27](index=27&type=chunk) [Analysis of Core Competencies](index=11&type=section&id=%E4%B8%89%E3%80%81%20%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E6%A0%B8%E5%BF%83%E7%AB%9E%E4%BA%89%E5%8A%9B%E5%88%86%E6%9E%90) The company's core competencies are multifaceted, including optimized coal production, advanced coal chemical projects, enhanced financial investment capabilities, and strengthened international competitiveness through capital operations - Coal business: Three 10-million-ton-level mines have been completed and put into operation, and the scale benefits of the Shaanxi-Mongolia base are becoming apparent[29](index=29&type=chunk) - Capital operations: Yancoal Australia successfully listed on the Hong Kong Stock Exchange, becoming the first state-controlled company listed on both Australian and Hong Kong main boards, enhancing capital efficiency and international market influence[29](index=29&type=chunk) - Financial investment: Through controlling Linshang Bank and increasing its stake in Zheshang Bank, the company steadily advanced its financial investments, consolidating and enhancing its value creation capabilities[29](index=29&type=chunk) [Chairman's Report](index=12&type=section&id=%E7%AC%AC%E5%9B%9B%E8%8A%82%20%E8%91%A3%E4%BA%8B%E9%95%BF%E6%8A%A5%E5%91%8A%E4%B9%A6) This section provides the Chairman's review of the company's performance in the past year and outlines the strategic outlook for the upcoming year [2018 Performance Review](index=12&type=section&id=2018%E5%B9%B4%E4%B8%9A%E7%BB%A9%E5%9B%9E%E9%A1%B9) The Chairman's report highlights that in 2018, the company capitalized on favorable coal market conditions, achieving comprehensive improvements in scale, revenue, and profitability, with four key economic indicators reaching historical highs 2018 Key Operating Results | Indicator | 2018 Data | | :--- | :--- | | **Raw Coal Production** | 105.9 million tons | | **Commercial Coal Sales** | 113.94 million tons | | **Operating Revenue** | 163.008 billion RMB | | **Total Profit** | 15.043 billion RMB | | **Net Profit Attributable to Parent** | 7.909 billion RMB | | **Total Assets** | 203.680 billion RMB | - The company's four key economic indicators—coal production and sales, operating revenue, total profit, and total assets—all reached their best levels since the company's establishment[30](index=30&type=chunk) - Yancoal Australia successfully listed on the Hong Kong Stock Exchange, becoming the first state-controlled company listed on both Australian and Hong Kong main boards[30](index=30&type=chunk) [2019 Development Outlook](index=13&type=section&id=2019%E5%B9%B4%E5%8F%91%E5%B1%95%E5%B1%95%E6%9C%9B) Looking ahead to 2019, the company anticipates a generally balanced and stable coal market, with plans to sell 100 million tons of self-produced coal and drive high-quality development through synergistic growth across its three major bases, enhanced operational performance, and strengthened support systems - 2019 Operating Plan: The company plans to sell **100 million tons** of self-produced coal[31](index=31&type=chunk) - Strategic Focus: Strengthen and optimize the three major bases—Headquarters, Shaanxi-Mongolia, and Australia—with the Shaanxi-Mongolia base accelerating the release of advantageous capacity from three 10-million-ton mines, and the Australian base enhancing market control and influence[31](index=31&type=chunk) - Operating Strategy: Focus on "volume, cost, and profit" by increasing output through releasing advantageous capacity, reducing costs through comprehensive lean cost control, and enhancing profitability by optimizing product structure and extending the industrial chain[31](index=31&type=chunk) [Management Discussion and Analysis](index=14&type=section&id=%E7%AC%AC%E4%BA%94%E8%8A%82%20%E7%BB%8F%E8%90%A5%E6%83%85%E5%86%B5%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) This section provides a detailed analysis of the company's operational performance, financial position, cash flows, and key business segments [Operating Performance of Business Segments](index=14&type=section&id=%E4%BA%8C%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E4%B8%BB%E8%A6%81%E7%BB%8F%E8%90%A5%E6%83%85%E5%86%B5) In 2018, the company's main business segments all achieved production growth, with raw coal production increasing by 23.68% to 106 million tons, primarily driven by a significant increase in Yancoal Australia's output 2018 Key Business Production and Sales Data | Business Segment | Unit | 2018 | 2017 | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Raw Coal Production** | Thousand tons | 105,895 | 85,620 | 23.68 | | **Commercial Coal Sales** | Thousand tons | 113,942 | 96,802 | 17.71 | | **Methanol Production** | Thousand tons | 1,656 | 1,614 | 2.60 | | **Methanol Sales** | Thousand tons | 1,645 | 1,611 | 2.11 | | **Railway Freight Volume** | Thousand tons | 19,879 | 14,385 | 38.19 | | **Power Generation** | 10,000 kWh | 277,533 | 267,434 | 3.78 | - Yancoal Australia's raw coal and commercial coal production significantly increased year-on-year, primarily due to the commissioning of the Moolarben underground mine and the consolidation of Coal & Allied production[35](index=35&type=chunk) - Haosheng Coal's production significantly decreased year-on-year due to the impact of safety and environmental protection policies[35](index=35&type=chunk) [Main Business Analysis](index=19&type=section&id=%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E5%88%86%E6%9E%90) The company's main business revenue and costs both increased, with the coal business gross margin at 44.67%, a year-on-year decrease of 2.16 percentage points, mainly due to faster rising costs of self-produced coal Main Business by Industry (Unit: RMB (Millions)) | By Industry | Operating Revenue | Operating Cost | Gross Margin (%) | Operating Revenue YoY (%) | Operating Cost YoY (%) | Gross Margin YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Coal Business** | 62,428 | 34,544 | 44.67 | 28.79 | 34.02 | Decrease 2.16 percentage points | | Of which: Self-produced Coal | 50,747 | 23,437 | 53.82 | 32.08 | 45.87 | Decrease 4.36 percentage points | | **Railway Transportation Business** | 420 | 178 | 57.62 | 38.61 | 2.89 | Increase 14.61 percentage points | | **Coal Chemical Business** | 3,495 | 2,254 | 35.51 | 12.42 | 2.08 | Increase 6.54 percentage points | Main Business by Region (Unit: RMB (Millions)) | By Region | Operating Revenue | Operating Cost | Gross Margin (%) | Operating Revenue YoY (%) | Operating Cost YoY (%) | Gross Margin YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Domestic** | 39,049 | 22,425 | 42.57 | 9.15 | 22.01 | Decrease 6.05 percentage points | | **International** | 28,398 | 15,433 | 45.65 | 68.06 | 47.32 | Increase 7.65 percentage points | - Among the cost components of self-produced coal, salaries and employee benefits, labor costs, and depreciation were the fastest-growing parts, increasing by **51.76%**, **184.33%**, and **53.09%** year-on-year, respectively[57](index=57&type=chunk) [Analysis of Expenses and Other Items](index=21&type=section&id=%E8%B4%B9%E7%94%A8%E5%92%8C%E5%85%B6%E4%BB%96%E7%A7%91%E7%9B%AE%E5%8F%98%E5%8A%A8%E8%AF%B4%E6%98%8E) During the reporting period, both selling expenses and administrative expenses increased significantly, while investment income more than doubled, primarily from investments in Zheshang Bank and Inner Mongolia Yitai Zhundong Railway - Selling expenses increased by **55.93%** year-on-year, mainly due to increased coal sales by Yancoal Australia, leading to a **2.116 billion RMB** increase in transportation, port fees, insurance, and resource royalty fees[50](index=50&type=chunk)[61](index=61&type=chunk) - Administrative expenses increased by **33.93%** year-on-year, primarily due to a one-time provision of **1.016 billion RMB** for social insurance during the reporting period[50](index=50&type=chunk)[61](index=61&type=chunk) - Investment income increased by **102.29%** year-on-year, mainly benefiting from investments in Zheshang Bank (income of **764 million RMB**) and Inner Mongolia Yitai Zhundong Railway (income of **196 million RMB**)[50](index=50&type=chunk)[61](index=61&type=chunk) [Cash Flow Analysis](index=22&type=section&id=%E7%8E%B0%E9%87%91%E6%B5%81) The company's cash flow significantly improved, with net cash flow from operating activities increasing by 39.65%, while net cash outflow from investing activities substantially decreased, and net cash flow from financing activities shifted from inflow to outflow Major Cash Flow Statement Item Changes (Unit: RMB (Millions)) | Item | Current Period | Prior Period | Change (%) | | :--- | :--- | :--- | :--- | | **Net Cash Flow from Operating Activities** | 22,432 | 16,063 | 39.65 | | **Net Cash Flow from Investing Activities** | -6,401 | -27,477 | Not applicable | | **Net Cash Flow from Financing Activities** | -9,851 | 15,365 | -164.11 | - The increase in net cash flow from operating activities was primarily due to a **5.186 billion RMB** increase in cash received from sales of goods and a **7.186 billion RMB** decrease in cash paid for purchases of goods[65](index=65&type=chunk) - The significant decrease in net cash flow from financing activities was mainly due to a **27.851 billion RMB** year-on-year decrease in cash received from investments[65](index=65&type=chunk) [Analysis of Assets and Liabilities](index=23&type=section&id=1.%E8%B5%84%E4%BA%A7%E5%8F%8A%E8%B4%9F%E5%80%BA%E7%8A%B6%E5%86%B5) The company's total assets grew steadily by 4.51%, with significant increases in long-term equity investments and construction in progress, while other current liabilities substantially decreased due to repayment of short-term financing bonds - Long-term equity investments increased by **85.34%**, mainly due to increased holdings in Zheshang Bank (an increase of **4.399 billion RMB**) and the acquisition of equity in Linshang Bank (an increase of **2.163 billion RMB**)[68](index=68&type=chunk) - Construction in progress increased by **97.20%**, primarily invested in the Ordos Energy & Chemical Phase II coal chemical project (an increase of **3.867 billion RMB**) and the Yulin Energy & Chemical Phase II coal chemical project (an increase of **1.256 billion RMB**)[68](index=68&type=chunk) - Other current liabilities decreased by **50.40%**, mainly because the company's balance of ultra-short-term financing bonds decreased by **7 billion RMB**[69](index=69&type=chunk) [Coal Reserves](index=25&type=section&id=2.%E7%85%A4%E7%82%AD%E5%82%A8%E9%87%8F%E6%83%85%E5%86%B5) As of the end of 2018, the company's total in-situ resource volume, assessed according to JORC standards, was 11.739 billion tons, with total recoverable reserves of 2.539 billion tons, primarily located in Australia and China Coal Resources and Reserves (Unit: Million tons) | Major Mining Area | Geographical Location | Coal Type | In-situ Resource Volume | Recoverable Reserves | | :--- | :--- | :--- | :--- | :--- | | **Company's Own Coal Mines** | Jining City, Shandong Province | Thermal Coal | 797 | 296 | | **Heze Energy & Chemical** | Heze City, Shandong Province | 1/3 Coking Coal | 88 | 24 | | **Ordos Energy & Chemical** | Ordos City, Inner Mongolia | Thermal Coal | 363 | 212 | | **Yancoal Australia** | Queensland and New South Wales | PCI Coal, Thermal Coal, etc | 8,878 | 1,763 | | **Yancoal International** | Queensland and Western Australia | PCI Coal, Thermal Coal | 1,585 | 231 | | **Total** | — | — | **11,739** | **2,539** | [Significant Equity Investments](index=26&type=section&id=1.%E9%87%8D%E5%A4%A7%E7%9A%84%E8%82%A1%E6%9D%83%E6%8A%95%E8%B5%84) In 2018, the company made two significant non-core equity investments totaling 3.921 billion RMB, both in commercial banking, aimed at steadily advancing financial investments and enhancing value creation capabilities 2018 Significant Equity Investment Projects (Unit: RMB (Billions)) | Equity Investment Project | Total Project Investment | Investment During Reporting Period | Investee Company | Primary Business | | :--- | :--- | :--- | :--- | :--- | | **Subscription of Zheshang Bank's New Shares** | 1.768 | 1.768 | Zheshang Bank | Commercial Banking | | **Acquisition of Linshang Bank Equity** | 2.153 | 2.153 | Linshang Bank | Commercial Banking | | **Total** | **3.921** | **3.921** | — | — | [Analysis of Major Holding and Associate Companies](index=27&type=section&id=%E4%B8%BB%E8%A6%81%E6%8E%A7%E8%82%A1%E5%8F%82%E8%82%A1%E5%85%AC%E5%8F%B8%E5%88%86%E6%9E%90) The company's main profit contributions come from its controlled subsidiaries, particularly Yancoal Australia, which achieved a net profit of 4.273 billion RMB in 2018, a significant year-on-year increase of 422.4% 2018 Financial Data of Major Holding Companies (Unit: RMB (Millions)) | Company Name | Total Assets | Net Assets | Net Profit | | :--- | :--- | :--- | :--- | | **Yancoal Australia** | 58,926 | 27,436 | 4,273 | | **Yancoal International** | 20,172 | 5,215 | 1,113 | | **Heze Energy & Chemical** | 8,150 | 5,946 | 1,009 | - Yancoal Australia's net profit in 2018 increased by **3.455 billion RMB** or **422.4%** year-on-year, primarily due to rising coal prices, the commissioning of the Moolarben underground project, and the acquisition of Coal & Allied[82](index=82&type=chunk) [Future Development and Capital Expenditure Plan](index=28&type=section&id=(%E5%9B%9B)%E8%B5%84%E6%9C%AC%E5%BC%80%E6%94%AF%E8%AE%A1%E5%88%92) The company projects capital expenditures of 9.024 billion RMB for 2019, a decrease from 10.809 billion RMB in 2018, with funds primarily allocated to maintaining existing production, technological upgrades, and key project construction 2019 Capital Expenditure Plan (Unit: RMB (10,000s)) | Major Project | 2019 Plan | 2018 Actual | | :--- | :--- | :--- | | **Ordos Energy & Chemical** | 263,272 | 400,077 | | **Yulin Energy & Chemical** | 97,563 | 128,349 | | **Heze Energy & Chemical** | 64,754 | 107,696 | | **Yancoal Australia** | 141,329 | 104,137 | | **Total** | **902,410** | **1,080,880** | - The company faces key risks including safety management, trade, exchange rate, and environmental protection, for which corresponding countermeasures have been developed[94](index=94&type=chunk) [Significant Events](index=31&type=section&id=%E7%AC%AC%E5%85%AD%E8%8A%82%20%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) This section details important corporate actions, including profit distribution plans, major litigation, equity incentive schemes, and significant related party transactions [Profit Distribution Plan](index=31&type=section&id=%E4%B8%80%E3%80%81%E6%99%AE%E9%80%9A%E8%82%A1%E5%88%A9%E6%B6%A6%E5%88%86%E9%85%8D%E6%88%96%E8%B5%84%E6%9C%AC%E5%85%AC%E7%A7%AF%E9%87%91%E8%BD%AC%E5%A2%9E%E9%A2%84%E6%A1%88) The company's board of directors proposed a 2018 cash dividend of RMB 5.40 (tax inclusive) per 10 shares, totaling 2.653 billion RMB, representing 33.54% of net profit attributable to parent, maintaining a consistent shareholder return policy Ordinary Share Dividend Distribution Plans for the Past Three Years (Unit: RMB (Billions)) | Dividend Year | Dividend per 10 Shares (RMB, tax incl.) | Cash Dividend Amount (RMB, tax incl.) | Ratio to Net Profit Attributable to Parent (%) | | :--- | :--- | :--- | :--- | | **2018** | 5.40 | 2.6525 | 33.54 | | **2017** | 4.80 | 2.3578 | 34.82 | | **2016** | 1.20 | 0.5894 | 35.73 | [Major Litigation and Arbitration Matters](index=38&type=section&id=%E5%8D%81%E3%80%81%E9%87%8D%E5%A4%A7%E8%AF%89%E8%AE%BC%E3%80%81%E4%BB%B2%E8%A3%81%E4%BA%8B%E9%A1%B9) During the reporting period, the company was involved in several significant litigation and arbitration cases, many of which involve third-party contract fraud using forged company seals, with ongoing legal proceedings and uncertain impacts on company profit - Xiamen Xinda contract dispute case: Involves principal amount of **164 million RMB**, the company believes the relevant seals were forged and has reported the case, which is still under trial[115](index=115&type=chunk) - Inner Mongolia Xinchangjiang arbitration case: The counterparty claims approximately **1.435 billion RMB** for breach of equity transfer agreement, but the company argues payment conditions were not met, and the case is still under trial[116](index=116&type=chunk) - Multiple lawsuits (e.g., with Weihai Commercial Bank, CCB Jining Dongcheng Branch) involve Shandong Hengfeng Power Fuel Co., Ltd. forging company seals for accounts receivable pledge financing, with cases still under trial or appeal[118](index=118&type=chunk)[123](index=123&type=chunk) [Equity Incentive Plan](index=48&type=section&id=%E5%8D%81%E4%B8%89%E3%80%81%E5%85%AC%E5%8F%B8%E8%82%A1%E6%9D%83%E6%BF%80%E5%8A%B1%E8%AE%A1%E5%88%92%E3%80%81%E5%91%98%E5%B7%A5%E6%8C%81%E8%82%A1%E8%AE%A1%E5%88%92%E6%88%96%E5%85%B6%E4%BB%96%E5%91%98%E5%B7%A5%E6%BF%80%E5%8A%B1%E6%8E%AA%E6%96%BD%E7%9A%84%E6%83%85%E5%86%B5%E5%8F%8A%E5%85%B6%E5%BD%B1%E5%93%8D) In early 2019, the company approved and implemented its 2018 A-share stock option incentive plan, granting 46.32 million stock options to 499 incentive recipients at an exercise price of RMB 9.64 per option, aiming to establish a long-term incentive mechanism - The company granted **46.32 million** A-share stock options to 499 directors, senior executives, middle management, and core employees, accounting for approximately **0.94%** of the total share capital[127](index=127&type=chunk)[128](index=128&type=chunk) - The exercise price is **RMB 9.64** per option, with vesting periods of 24, 36, and 48 months, and exercise ratios of **33%**, **33%**, and **34%** for the three tranches, respectively[129](index=129&type=chunk)[130](index=130&type=chunk)[131](index=131&type=chunk) [Significant Related Party Transactions](index=50&type=section&id=%E5%8D%81%E5%9B%9B%E3%80%81%E9%87%8D%E5%A4%A7%E5%85%B3%E8%81%94/%E5%85%B3%E8%BF%9E%E4%BA%A4%E6%98%93) The company's related party transactions primarily involve its controlling shareholder, Yankuang Group, and key partners like Glencore and Sojitz, covering daily operations such as material supply, labor services, and financial services 2018 Related Party Transactions for Goods Sales/Purchases and Services with Controlling Shareholder (Unit: RMB (Thousands)) | Transaction Direction | Amount | % of Operating Revenue | | :--- | :--- | :--- | | **Sales/Services from the Group to Controlling Shareholder** | 3,556,594 | 2.18 | | **Sales/Services from Controlling Shareholder to the Group** | 2,710,218 | 1.66 | - Related party transactions with the Glencore Group primarily involve mutual purchases and sales of coal and sales services, with annual transaction amounts within the approved limits[139](index=139&type=chunk) - Independent non-executive directors and auditors have confirmed that the company's continuing related party transactions for 2018 complied with regulations, were fair and reasonable, and were in the overall interest of shareholders[141](index=141&type=chunk)[142](index=142&type=chunk) [Other Significant Matters](index=59&type=section&id=%E5%8D%81%E5%85%AD%E3%80%81%E5%85%B6%E4%BB%96%E9%87%8D%E5%A4%A7%E4%BA%8B%E9%A1%B9%E7%9A%84%E8%AF%B4%E6%98%8E) During and after the reporting period, the company advanced several significant matters, including a non-public A-share offering, equity investments in commercial banks, the listing of Yancoal Australia, and state-owned enterprise reform initiatives - Non-public A-share offering: Proposed to raise no more than **6.35 billion RMB** for the acquisition of 100% equity in Coal & Allied, pending approval from the China Securities Regulatory Commission[161](index=161&type=chunk)[162](index=162&type=chunk) - Financial Investments: Completed investment in Linshang Bank, holding **19.75%** equity; increased stake in Zheshang Bank H-shares to **4.99%**[163](index=163&type=chunk)[167](index=167&type=chunk) - Capital Operations: Controlled subsidiary Yancoal Australia successfully listed on the Hong Kong Stock Exchange on December 6, 2018, stock code 03668[169](index=169&type=chunk) - State-owned Enterprise Reform: Progressed with the separation and transfer of "three supplies and one property" (water, electricity, heating, and property management) for employee residential areas, as well as enterprise-run municipal and community management functions[171](index=171&type=chunk)[172](index=172&type=chunk) [Changes in Share Capital and Shareholder Information](index=71&type=section&id=%E7%AC%AC%E4%B8%83%E8%8A%82%20%E6%99%AE%E9%80%9A%E8%82%A1%E8%82%A1%E4%BB%BD%E5%8F%98%E5%8A%A8%E5%8F%8A%E8%82%A1%E4%B8%9C%E6%83%85%E5%86%B5) This section provides details on the company's share capital movements and the composition of its shareholder base, including major shareholders and the ultimate controlling party [Shareholder and Actual Controller Information](index=72&type=section&id=%E4%B8%89%E3%80%81%E8%82%A1%E4%B8%9C%E5%92%8C%E5%AE%9E%E9%99%85%E6%8E%A7%E5%88%B6%E4%BA%BA%E6%83%85%E5%86%B5) As of the end of 2018, the company had 83,084 ordinary shareholders, with Yankuang Group Co., Ltd. as the controlling shareholder, holding 51.81% directly and indirectly, and the Shandong Provincial SASAC as the actual controller Top Ten Shareholders' Shareholdings (As of End of 2018) | Shareholder Name | Shares Held | Percentage (%) | Shareholder Type | | :--- | :--- | :--- | :--- | | **Yankuang Group Co., Ltd.** | 2,267,169,423 | 46.16 | State-owned Legal Person | | **Hong Kong Securities Clearing Company Nominees Limited** | 1,948,608,499 | 39.67 | Overseas Legal Person | | **National Council for Social Security Fund 102 Portfolio** | 24,499,961 | 0.50 | Other | | **Central Huijin Asset Management Co., Ltd.** | 19,355,100 | 0.39 | State-owned Legal Person | - The controlling shareholder is Yankuang Group Co., Ltd., which directly and indirectly held **51.81%** of the company's equity at the end of the reporting period[220](index=220&type=chunk) - The actual controller is the Shandong Provincial State-owned Assets Supervision and Administration Commission[221](index=221&type=chunk) [Directors, Supervisors, Senior Management, and Employees](index=76&type=section&id=%E7%AC%AC%E5%85%AB%E8%8A%82%20%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E3%80%81%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E4%BA%BA%E5%91%98%E5%92%8C%E5%91%98%E5%B7%A5%E6%83%85%E5%86%B5) This section provides information on the shareholdings and remuneration of directors, supervisors, and senior management, as well as the overall employee structure and compensation policies [Shareholdings and Remuneration of Directors, Supervisors, and Senior Management](index=76&type=section&id=(%E4%B8%80)%20%E7%8E%B0%E4%BB%BB%E5%8F%8A%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E7%A6%BB%E4%BB%BB%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E5%92%8C%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E4%BA%BA%E5%91%98%E6%8C%81%E8%82%A1%E5%8F%98%E5%8A%A8%E5%8F%8A%E6%8A%A5%E9%85%AC%E6%83%85%E5%86%B5) During the reporting period, the shareholdings of the company's directors, supervisors, and senior management remained stable, with no changes, and their total pre-tax remuneration received from the company amounted to 9.9886 million RMB - At the end of the reporting period, the total pre-tax remuneration actually received by all directors, supervisors, and senior management was **9.9886 million RMB**[227](index=227&type=chunk)[237](index=237&type=chunk) - Some directors and supervisors, including Chairman Li Xiyong and Vice Chairman Li Wei, received remuneration from related party Yankuang Group[226](index=226&type=chunk) [Employee Information](index=85&type=section&id=%E5%85%AD%E3%80%81%E6%AF%8D%E5%85%AC%E5%8F%B8%E5%92%8C%E4%B8%BB%E8%A6%81%E5%AD%90%E5%85%AC%E5%8F%B8%E7%9A%84%E5%91%98%E5%B7%A5%E6%83%85%E5%86%B5) As of the end of the reporting period, the company had 64,473 employees, with production personnel constituting the largest group at 36,192, and approximately 40% of employees holding a college degree or above Employee Structure | Category | Number of People | | :--- | :--- | | **Total Employees** | 64,473 | | **Professional Structure** | | | Production Personnel | 36,192 | | Technical Personnel | 4,492 | | Administrative Personnel | 3,350 | | **Education Level** | | | College Degree or Above | 25,478 | | Secondary Education | 26,494 | - In 2018, the total employee salaries and allowances for the group amounted to **6.813 billion RMB**[243](index=243&type=chunk) [Corporate Governance](index=86&type=section&id=%E7%AC%AC%E4%B9%9D%E8%8A%82%20%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86) This section outlines the company's corporate governance framework, including its internal control systems, board committees, and compliance with regulatory requirements [Overview of Corporate Governance](index=86&type=section&id=%E4%B8%80%E3%80%81%20%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86%E7%9B%B8%E5%85%B3%E6%83%85%E5%86%B5%E8%AF%B4%E6%98%8E) During the reporting period, the company continuously improved its corporate governance structure, revising core policies such as the Articles of Association and Shareholder Meeting Rules, and establishing new regulations to meet regulatory requirements and company development - During the reporting period, the company revised its Articles of Association and the rules of procedure for the three meetings, and formulated 16 internal governance systems, including the "Management System for Shareholdings and Changes of Directors, Supervisors, Senior Management, and Insiders," further standardizing company operations[249](index=249&type=chunk) - The company's Board of Directors has four special committees: Audit, Remuneration, Nomination, and Strategy & Development, all of which performed their duties as required during the reporting period[270](index=270&type=chunk) - The company has adopted and complied with the Hong Kong Listing Rules' Corporate Governance Code, and in some aspects, such as the establishment of Board committees and securities trading codes, it is even more stringent than the Code's requirements[261](index=261&type=chunk) [Corporate Bonds Information](index=100&type=section&id=%E7%AC%AC%E5%8D%81%E8%8A%82%20%E5%85%AC%E5%8F%B8%E5%80%BA%E5%88%B8%E7%9B%B8%E5%85%B3%E6%83%85%E5%86%B5) This section provides an overview of the company's outstanding corporate bonds, including their terms, credit ratings, and repayment capabilities [Overview of Corporate Bonds](index=100&type=section&id=%E4%B8%80%E3%80%81%E5%85%AC%E5%8F%B8%E5%80%BA%E5%88%B8%E5%9F%BA%E6%9C%AC%E6%83%85%E5%86%B5) As of the end of the reporting period, the company's outstanding corporate bonds totaled 17.05 billion RMB, comprising two ordinary corporate bonds and two perpetual corporate bonds, all serviced on time without default Outstanding Corporate Bonds (As of End of 2018) (Unit: RMB (Billions)) | Bond Abbreviation | Code | Maturity Date | Bond Balance (RMB Billions) | Interest Rate (%) | | :--- | :--- | :--- | :--- | :--- | | 12兖煤02 | 122168 | 2022/7/23 | 40 | 4.95 | | 12兖煤04 | 122272 | 2024/3/3 | 30.50 | 6.15 | | 17兖煤Y1 | 143916 | 2020/8/17 | 50 | 5.70 | | 18兖煤Y1 | 143959 | 2021/3/26 | 50 | 6.00 | - The company's long-term corporate credit rating remains **AAA**, with a stable outlook; all bond credit ratings also remain **AAA**[296](index=296&type=chunk) - As of the end of 2018, the company's total bank credit line was **113.377 billion RMB**, with **60.677 billion RMB** utilized and an unused balance of **52.700 billion RMB**[304](index=304&type=chunk) [Financial Report](index=105&type=section&id=%E7%AC%AC%E5%8D%81%E4%B8%80%E8%8A%82%20%E8%B4%A2%E5%8A%A1%E6%8A%A5%E5%91%8A) This section presents the audited financial statements, including the balance sheet, income statement, cash flow statement, and notes to the financial statements [Audit Report](index=105&type=section&id=%E4%B8%80%E3%80%81%20%E5%AE%A1%E8%AE%A1%E6%8A%A5%E5%91%8A) ShineWing Certified Public Accountants issued a standard unqualified audit opinion on the company's 2018 financial statements, affirming their fair presentation in all material respects in accordance with enterprise accounting standards - Audit Opinion: **Standard Unqualified Opinion**[308](index=308&type=chunk) - Key Audit Matter: Estimation of mining right impairment provisions, for which auditors performed procedures including evaluating valuation models and reviewing key assumptions (e.g., future cash flows, discount rates)[310](index=310&type=chunk)[311](index=311&type=chunk)[312](index=312&type=chunk) [Financial Statements](index=108&type=section&id=%E4%BA%8C%E3%80%81%20%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8) This chapter includes the company's 2018 consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in owners' equity, showing growth in total assets, revenue, and profit, along with strong operating cash flow [Significant Changes in Accounting Policies](index=160&type=section&id=50.%20%E9%87%8D%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%94%BF%E7%AD%96%E5%92%8C%E4%BC%9A%E8%AE%A1%E4%BC%B0%E8%AE%A1%E7%9A%84%E5%8F%98%E6%9B%B4) Effective January 1, 2018, the company adopted the newly revised revenue and financial instruments standards, which introduced the "expected credit loss" model and reclassified financial assets, leading to retrospective adjustments to opening financial statements - The company adopted the new revenue standard and new financial instruments standard effective **January 1, 2018**[434](index=434&type=chunk) - The new financial instruments standard replaced the "incurred loss" model with the "expected credit loss" model, which may lead to earlier recognition of impairment losses[436](index=436&type=chunk) - In accordance with the new standards, the company retrospectively adjusted its financial statements as of January 1, 2018, affecting various accounts including financial assets held for trading, available-for-sale financial assets, contract liabilities, other comprehensive income, and retained earnings[438](index=438&type=chunk)[439](index=439&type=chunk)[440](index=440&type=chunk) [Reference Documents](index=282&type=section&id=%E7%AC%AC%E5%8D%81%E4%BA%8C%E8%8A%82%20%E5%A4%87%E6%9F%A5%E6%96%87%E4%BB%B6%E7%9B%AE%E5%BD%95) This section lists all documents available for public inspection, including the audited financial statements and other regulatory filings

Financial Performance - Net profit attributable to shareholders of the listed company increased by 13.36% to CNY 5,504,014 compared to the same period last year[10]. - Net profit attributable to shareholders after deducting non-recurring gains and losses increased by 34.88% to CNY 5,885,151 compared to the same period last year[10]. - Basic earnings per share for the reporting period was CNY 1.1205, an increase of 13.37% year-on-year[10]. - Operating revenue for the first three quarters was CNY 119,190,485, a slight decrease of 0.21% compared to the same period last year[10]. - Net profit for Q1 2018 reached 146 million, up 31.53% from 111 million in Q1 2017[38]. - The company's operating revenue for Q3 2018 was CNY 5,953,536,000, an increase of 4.4% compared to CNY 5,701,415,000 in Q3 2017[81]. - The net profit attributable to the parent company for Q3 2018 was CNY 723,000,000, a decrease of 48.9% from CNY 1,414,234,000 in Q3 2017[82]. - The company's operating profit for the first nine months of 2018 was CNY 4,278,939,000, a decrease of 28.6% compared to CNY 6,002,174,000 in the same period of 2017[81]. Assets and Liabilities - Total assets at the end of the reporting period were CNY 194,243,624, a decrease of 0.33% compared to the end of the previous year[10]. - Current assets totaled 64,649,315 thousand RMB, down from 66,138,871 thousand RMB at the beginning of the year[66]. - Total liabilities were 112,364,047 thousand RMB, compared to 117,605,925 thousand RMB at the beginning of the year[68]. - The company's cash and cash equivalents were 27,720,563 thousand RMB, down from 28,568,253 thousand RMB[66]. - As of September 30, 2018, total assets amounted to 194,243,624 thousand RMB, a slight decrease from 194,887,291 thousand RMB at the beginning of the year[66][68]. Production and Sales - The company's raw coal production for Q3 2018 was 24,877 thousand tons, an increase of 18.11% compared to 21,062 thousand tons in Q3 2017[20]. - The total sales volume of commercial coal in Q3 2018 reached 27,185 thousand tons, reflecting a growth of 20.37% from 22,584 thousand tons in Q3 2017[20]. - The company reported a total of 82,689 thousand tons of commercial coal sales for the first three quarters of 2018, up 28.64% from 64,281 thousand tons in the same period of 2017[20]. - The total production of raw coal for the first three quarters of 2018 was 78,243 thousand tons, representing a year-on-year increase of 36.16%[21]. - In the first three quarters of 2018, the company sold 82.69 million tons of coal, an increase of 28.6% or 18.41 million tons year-on-year[24]. Cash Flow - Net cash flow from operating activities for the first three quarters was CNY 12,653,079, an increase of 123.03% year-on-year[10]. - Operating cash flow for the first nine months of 2018 was CNY 21,090,279, an increase of 17.5% compared to CNY 18,001,295 in the same period last year[88]. - Cash received from sales of goods and services was CNY 20,726,025, an increase of 17.9% from CNY 17,622,203 year-over-year[88]. - The total cash inflow from financing activities was CNY 27,941,487, a decrease of 22.2% from CNY 35,915,940 in the previous year[89]. Shareholder Information - The total number of shareholders as of the end of the reporting period was 76,629[12]. - The largest shareholder, Yanzhou Coal Mining Group Co., Ltd., held 46.16% of the shares[12]. - As of September 30, 2018, Yancoal Group held a total of 2,267,169,423 A shares, representing 46.16% of the company's total issued share capital[17]. Investments and Acquisitions - The company plans to acquire a 49% stake in Yancoal Blue Sky Clean Energy Co., Ltd. for 21.29 million, marking a strategic investment in clean energy[44]. - The company acquired land use rights for Yancoal Australia from Yancoal Coal Australia Limited for RMB 21.47 million, covering an area of 91,382.6 square meters, with a usage period until February 20, 2054[46]. - The company plans to raise up to RMB 6.35 billion through a non-public issuance of A shares to acquire 100% equity of United Coal[55]. Research and Development - Research and development expenses for the first nine months were CNY 58,465 thousand, slightly down from CNY 61,355 thousand, indicating a decrease of about 4.7%[75]. - Research and development expenses for Q3 2018 were CNY 14,500,000, slightly up from CNY 13,712,000 in Q3 2017[81]. Financial Ratios and Returns - The weighted average return on net assets decreased by 0.74 percentage points to 9.51%[10]. - The average coal sales cost per ton for the company was 247.01 yuan, up 5.22% year-on-year[26].

Financial Performance - The company's operating revenue for the first half of 2018 was CNY 76,308,193, a decrease of 5.52% compared to CNY 80,769,522 in the same period last year[22]. - Net profit attributable to shareholders increased by 34.09% to CNY 4,341,279 from CNY 3,237,574 in the previous year[22]. - The net cash flow from operating activities surged by 359.50% to CNY 9,563,372 compared to CNY 2,081,278 in the same period last year[22]. - The company's total assets at the end of the reporting period were CNY 193,906,055, a slight decrease of 0.50% from CNY 194,887,291 at the end of the previous year[22]. - Basic earnings per share rose by 34.09% to CNY 0.8838 from CNY 0.6591 in the same period last year[23]. - The weighted average return on equity increased to 7.64%, up by 0.25 percentage points from 7.39% in the previous year[23]. - The company reported a total non-recurring loss of CNY 192,796, primarily due to various non-operating income and expenses[30]. - The net assets attributable to shareholders increased by 4.44% to CNY 57,376,953 from CNY 54,939,172 at the end of the previous year[22]. Operational Highlights - The company produced 53,366 thousand tons of raw coal in the first half of 2018, an increase of 16,963 thousand tons or 46.6% year-on-year[38]. - The company achieved a total coal sales volume of 55,504 thousand tons, up by 13,807 thousand tons or 33.11% compared to the same period last year[38]. - The sales revenue from coal business reached 29,931 million RMB, an increase of 8,812 million RMB or 41.7% year-on-year[42]. - The methanol production was 795 thousand tons, reflecting an increase of 61 thousand tons or 8.31% year-on-year[38]. - The company generated 140,908 million kWh of electricity, which is an increase of 19,592 million kWh or 16.15% year-on-year[38]. - The company’s coal production in Australia increased significantly by 13,718 thousand tons or 173.65% year-on-year[39]. - The company’s electricity sales volume was 86,155 million kWh, an increase of 13,876 million kWh or 19.20% year-on-year[38]. Strategic Initiatives - The company plans to continue expanding its market presence and investing in new technologies to enhance operational efficiency and profitability[32]. - The company plans to continue expanding its coal and chemical business while optimizing its financing structure[36]. - The company plans to enhance its marketing strategy by integrating "big marketing, big trade, and big logistics" to improve market competitiveness and efficiency[85]. - The company is committed to enhancing its equipment manufacturing capabilities through a three-year upgrade program to improve profitability[84]. - The company is pursuing strategic measures to ensure the successful completion of its annual operational goals despite external economic challenges[84]. Legal and Compliance Issues - The company is currently involved in significant litigation, including a financial loan dispute with Weifang Commercial Bank, claiming RMB 99.119 million in principal and interest[100]. - The company is also facing a factoring contract dispute with Zhonghui Xintong, with a claim for RMB 159.977 million in financing and interest[100]. - The company is engaged in multiple legal proceedings, which may impact its current and future profits, but the outcomes remain uncertain[101]. - The company is actively seeking resolutions for ongoing legal matters and has reported to the public security authorities regarding potential fraud[102]. - The company has not disclosed any significant updates on litigation or arbitration matters in its interim announcements[103]. Shareholder Relations - The controlling shareholder, Yanzhou Coal Group, holds a 49.82% stake in the company as of the report date[10]. - The company has established various agreements with its controlling shareholder, including supply and service agreements, with transaction limits set for 2018 to 2020[116]. - The total number of ordinary shareholders as of the end of the reporting period is 72,951[188]. - The company has conducted over 650 meetings with analysts, fund managers, and investors during the reporting period to enhance investor relations[179]. - The report does not indicate any changes in the controlling shareholder or actual controller[197]. Environmental Compliance - The company has not experienced any major environmental pollution incidents and has complied with all relevant environmental regulations during the reporting period[153]. - The company has implemented effective pollution control measures, achieving compliance with emission standards for major pollutants such as COD, ammonia nitrogen, and PM10[153]. - The company has established emergency response plans for environmental incidents, which have been evaluated and approved by government environmental authorities[161]. - The company has reported that all pollution control facilities are operating normally across its various production units[158]. - The company is committed to adhering to the pollution discharge standards set by relevant authorities, including the GB20426-2006 and DB37/599-2006 standards[154]. Financial Management - The company has established a robust corporate governance structure, ensuring compliance with legal and regulatory requirements[175]. - The company has implemented a salary policy for directors and senior management, combining a fixed annual salary and performance-based incentives[171]. - The company has a performance-based salary system for other employees, linking compensation to overall economic performance and individual achievements[171]. - The company has not faced any investigations or penalties from regulatory authorities during the reporting period[112]. - The company has not reported any major related party transactions outside of those already disclosed[129].

Financial Performance - Net profit attributable to shareholders increased by 25.49% to CNY 2,227,536,000 year-on-year[7] - Basic earnings per share rose by 25.48% to CNY 0.4535[8] - The weighted average return on equity increased by 0.06 percentage points to 4.01%[7] - Total operating revenue decreased to ¥32,333,709 from ¥39,812,986, representing a decline of approximately 18.6% year-over-year[61] - Operating profit increased to ¥3,532,955 from ¥2,383,398, marking an increase of approximately 48.0% year-over-year[62] - Net profit rose to ¥2,747,026 compared to ¥2,030,798, reflecting an increase of around 35.3% year-over-year[62] - Total comprehensive income decreased to ¥635,282 from ¥4,143,545, a decline of approximately 84.7% year-over-year[63] Cash Flow - Net cash flow from operating activities was CNY 3,270,162,000, a significant recovery from a loss of CNY 373,786,000 in the previous year[7] - Cash inflow from operating activities decreased to CNY 39,614,296 from CNY 44,724,234, a decline of approximately 11.4% year-over-year[68] - Cash outflow from investing activities increased significantly to CNY 5,450,236 from CNY 2,921,145, resulting in a net cash flow from investing activities of -CNY 4,468,658[69] - Net cash flow from financing activities increased by 573.40%, amounting to 7,081,562 thousand yuan, driven by a 42.306 million yuan increase in cash received from borrowings[32] - The ending cash and cash equivalents balance increased to CNY 26,757,171 from CNY 15,530,077, reflecting a growth of approximately 72%[69] Assets and Liabilities - Total assets increased by 2.29% to CNY 199,353,174,000 compared to the end of the previous year[7] - Current assets rose to CNY 70,571,599, up from CNY 66,138,871, marking an increase of about 6.9%[54] - Total liabilities decreased to CNY 115,639,233 from CNY 117,605,925, a reduction of about 1.7%[56] - Current liabilities decreased to CNY 58,606,607 from CNY 63,167,502, a decline of approximately 7.9%[55] - Shareholders' equity rose to CNY 83,713,941 from CNY 77,281,366, reflecting an increase of approximately 8.4%[56] Production and Sales - In Q1 2018, the company produced 26,133 thousand tons of raw coal, a 39.67% increase from 18,710 thousand tons in Q1 2017[15] - The company sold 27,405 thousand tons of commercial coal in Q1 2018, up 33.56% from 20,519 thousand tons in Q1 2017[15] - The company’s commercial coal production in Q1 2018 was 24,293 thousand tons, a 34.74% increase from 18,030 thousand tons in Q1 2017[15] - The average selling price of commercial coal in Q1 2018 was 549.73 yuan/ton, compared to 510.46 yuan/ton in Q1 2017[20] - The company’s total coal production from its Australian operations reached 8,329 thousand tons in Q1 2018, a significant increase of 155.73% from 3,257 thousand tons in Q1 2017[18] Investments and Acquisitions - The company completed the acquisition of 65% of Yancoal Financial Company, impacting financial statements retrospectively[8] - The company exercised an option to acquire a 28.898% stake in the Walkworth joint venture for 230 million USD on March 7, 2018[44] - The company subscribed to 420 million H-shares of Zheshang Bank at a price of HKD 4.80 per share, increasing its stake from approximately 2.86% to about 4.99% post-transaction[49] Legal and Compliance - The company is currently involved in a litigation case against Jinan Railway Coal Transportation and Trade Group, claiming 80 million yuan for unpaid coal supplies[34] - A new arbitration case has been initiated by Inner Mongolia Xin Changjiang Mining Investment Co., claiming 748.5 million yuan for breach of a share transfer agreement[40] - The company has committed to avoid any major violations related to real estate operations during the self-inspection period from 2015 to 2017, ensuring compliance with regulatory requirements[46] Shareholder Information - The total number of shareholders reached 73,170 by the end of the reporting period[10] - The largest shareholder, Yancoal Group, holds 46.74% of the shares, totaling 2,295,662,151 shares[10]

Financial Performance - The company's operating revenue for 2017 was CNY 151.23 billion, an increase of 47.85% compared to CNY 102.28 billion in 2016[23]. - The net profit attributable to shareholders for 2017 reached CNY 6.77 billion, representing a significant increase of 213.19% from CNY 2.16 billion in 2016[23]. - The net cash flow from operating activities was CNY 16.06 billion, up 157.61% from CNY 6.24 billion in the previous year[23]. - The total assets at the end of 2017 amounted to CNY 194.89 billion, a growth of 27.34% compared to CNY 153.05 billion at the end of 2016[24]. - The company's total liabilities increased by 16.67% to CNY 117.61 billion in 2017 from CNY 100.81 billion in 2016[24]. - Basic earnings per share for 2017 were CNY 1.3784, a 213.20% increase from CNY 0.4401 in 2016[25]. - The net profit under international accounting standards for 2017 was CNY 7.36 billion, compared to CNY 1.65 billion in the previous year[28]. - The company's net assets attributable to shareholders at the end of 2017 were CNY 54.94 billion, an increase of 27.59% from CNY 43.06 billion in 2016[24]. - The total operating revenue for 2017 reached 151.2278 billion yuan, with a net profit attributable to shareholders of 6.7706 billion yuan, marking historical highs for coal production, revenue, and total assets[46]. Dividends and Shareholder Returns - The board of directors proposed a cash dividend of RMB 4.80 per 10 shares based on a total share capital of 491,201.6 million shares as of December 31, 2017[5]. - The company proposed a cash dividend of RMB 2.35778 billion for the year 2017, equivalent to RMB 0.48 per share (tax included)[153]. - The cash dividend distribution plan will be submitted for approval at the 2017 annual general meeting and, if approved, will be distributed within two months[153]. - The company's net profit attributable to ordinary shareholders for 2017 was RMB 6.770618 billion[153]. - The retained earnings at the beginning of the year were RMB 31.614494 billion, with an ending balance of RMB 37.748767 billion after accounting for the dividend[153]. - The cash dividends distributed in 2016 amounted to RMB 589.442 million, which represented 35.73% of the net profit attributable to ordinary shareholders for that year[149]. - The company has a policy to distribute approximately 35% of the net profit after deducting statutory reserves as cash dividends when conditions permit[147]. Acquisitions and Investments - The company completed the acquisition of 65% of Yancoal Financial Company during 2017, which is classified as a business combination under common control[26]. - The company completed the acquisition of 100% equity in United Coal on September 1, 2017, significantly increasing its overseas assets to 795.157 billion RMB, accounting for 40.8% of total assets[43]. - The company completed the acquisition of Coal & Allied Industries Limited for USD 2.69 billion, enhancing Yancoal's profitability and market position[6]. - The company invested a total of 20.3273 billion yuan in external equity investments, marking an increase of 138.0% compared to the previous year[112]. - The company has classified 3,123,513 as held-for-sale assets following an agreement with Glencore Mining for a 16.6% stake in the HVO joint venture[100]. Legal Matters and Disputes - The company has faced significant litigation and arbitration matters during the year[170]. - The company was ordered to pay a total of RMB 316.919 million related to a lawsuit involving China Minsheng Bank, which included principal, interest, and litigation costs[171]. - The company is actively pursuing recovery measures to minimize losses from the aforementioned lawsuits[172]. - The company is currently involved in a lawsuit with Jinan Railway Coal Transportation Group, claiming a repayment of RMB 19.9498 million, with the first instance ruling against the company[173]. - The company is facing a claim from Luxing Real Estate for RMB 99.96 million in receivables, with the company denying any liability and alleging forgery of its seal[174]. - The company is involved in a lawsuit against Rizhao Port Storage for RMB 27.83 million related to a coal sales contract, with the case under trial[179]. - The company is currently unable to predict the impact of these lawsuits on its profits for the current and future periods[177]. Operational Highlights - The company achieved a historical high in coal production and sales volume in 2017, driven by the gradual release of new mining capacity in the Shaanxi and Inner Mongolia bases[44]. - In 2017, the company produced 85.62 million tons of raw coal, an increase of 28.3% year-over-year, and sold 96.8 million tons of commercial coal, up 29.1% from the previous year[55]. - The company's coal business remains a major revenue driver, with products primarily sold in East, North, and South China, as well as Japan, South Korea, and Australia[41]. - The company achieved a 7.01% increase in railway freight volume, transporting 14.385 million tons in 2017[55]. - The total coal sales volume for the group in 2017 was 96,802 thousand tons, an increase of 21,833 thousand tons or 29.1% year-on-year[61]. Governance and Compliance - The company reported a standard unqualified audit opinion from the accounting firm Xin Yong Zhong He[8]. - The company emphasizes the importance of accurate financial reporting, with key executives affirming the completeness and accuracy of the annual report[8]. - The company has a strong governance structure with all board members present at the board meeting for the annual report approval[8]. - The company operates in compliance with Chinese accounting standards and international financial reporting standards[12]. - The independent non-executive directors confirmed that the related party transactions were fair and reasonable, aligning with the overall interests of the shareholders[194]. Risk Management - The company has disclosed major risks and countermeasures in the annual report, which investors should pay attention to[7]. - The company is focused on enhancing its financial services to support its core business, aiming for a multi-layered financial industry system[51]. - The company plans to implement a strategy of "three reductions and three improvements" to enhance operational efficiency and cost control across all business segments[52].