Core Viewpoint - Yancoal Australia reported a significant decline in coal prices and production due to strong supply and adverse weather conditions, impacting its financial performance for the third quarter of 2025 [1][2] Group 1: Financial Performance - Yancoal Australia's average coal price for Q3 2025 decreased by 17.6% year-on-year to AUD 140 per ton, with thermal coal and metallurgical coal prices falling by 17.2% and 24.7% to AUD 130 and AUD 195 per ton, respectively [1] - The company's estimated revenue for Q3 2025 is approximately AUD 1.48 billion, reflecting a year-on-year decline of 17% but a quarter-on-quarter increase of 30% [2] - The company’s production volume decreased by 9% year-on-year due to rainfall, while sales volume increased by 3% as earlier shipment delays were resolved [2] Group 2: Market Outlook - The average selling price decline aligns with market trends, leading to a downward revision of Yancoal Australia's earnings forecasts for FY 2025 to FY 2027 by 54%, 49%, and 40%, respectively [2] - Despite the weak coal prices, the company maintains a robust balance sheet and a consistent dividend policy, leading to a "buy" rating from analysts [2]

Core Viewpoint - CCB International's research report indicates that Yancoal Australia experienced a 9% year-on-year decline in production in Q3 due to rainfall, while sales increased by 3% year-on-year due to improved shipment conditions [1] Financial Performance - The average selling price for the period decreased by 18% year-on-year, aligning with market trends [1] - Estimated revenue for Q3 is approximately AUD 1.48 billion, representing a 17% year-on-year decline but a 30% quarter-on-quarter increase [1] Earnings Forecast - The earnings forecasts for Yancoal Australia for FY2025 to FY2027 have been revised downwards by 54%, 49%, and 40% respectively, primarily due to lowered average price predictions for thermal and metallurgical coal [1] - The slight increase of 2% in sales forecasts is attributed to increased equity from the Moolarben mine [1] Investment Rating - Despite weak coal prices leading to a lack of short-term catalysts for the stock, the firm maintains a "Buy" rating based on the company's robust balance sheet and ongoing dividend policy [1] - The target price has been adjusted from HKD 34 to HKD 31 [1]

Core Viewpoint - CICC has downgraded Yancoal Australia (03668) 2025E earnings by 11.5% to AUD 473 million due to increased cost assumptions, while maintaining 2026E earnings largely unchanged. The current stock price corresponds to 14.4x/8.9x 2025/26E P/E. The valuation has been switched to 2026, maintaining an outperform rating and target price of HKD 29, implying an 8% upside potential [1]. Group 1 - Q3 2025 production decline: The equity coal production was approximately 9.3 million tons, down 9% YoY and 2% QoQ, primarily affected by rainfall disruptions, but overall within the company's expectations [1]. - Q3 2025 sales increase: The self-produced coal equity sales were approximately 10.7 million tons, up 3% YoY and 31% QoQ, with thermal coal equity sales at 9 million tons, flat YoY and up 33% QoQ, and coking coal equity sales at 1.6 million tons, up 17% YoY and 22% QoQ. The significant QoQ increase in sales was mainly due to the delivery of sales delayed from Q2 2025 due to weather [1]. - Q3 2025 price decline: The average selling price of self-produced coal was AUD 140 per ton, down 18% YoY and 1.4% QoQ. Thermal coal price was AUD 130 per ton, down 17% YoY, while remaining flat QoQ. Coking coal price was AUD 195 per ton, down 25% YoY and 1% QoQ. The company's coal prices were weaker than market prices due to shipment delays, lagging sales prices, and the depreciation of the AUD against the USD [1]. Group 2 - Cash position: As of Q3 2025, the company maintained a relatively strong cash balance of AUD 1.8 billion [1]. - 2025 production guidance: The company maintains its 2025 guidance of 35-39 million tons of equity coal production, expecting to be close to the upper end of the range, with cash operating costs of AUD 89-97 per ton [2]. - Cost impact from weather: The company indicated that the rainfall in Q3 and shipment delays in Q2 led to additional demurrage fees, increasing costs. However, this impact is expected to dissipate as coal transportation normalizes. The overall coal prices in Q4 2025 are anticipated to improve due to better supply-demand dynamics [3].

Core Viewpoint - Yancoal Australia shares fell over 4%, closing at 27.48 HKD [2] Company Summary - Yancoal Australia experienced a significant decline in stock price, indicating potential market concerns or negative sentiment surrounding the company [2]

Core Viewpoint - Yancoal Australia (03668) experienced a nearly 4% decline in stock price, closing at 27.62 HKD with a trading volume of 18.61 million HKD following the release of its Q3 report for the period ending September 30, 2025 [1] Group 1: Production and Sales Performance - The total coal production for the quarter was 12.3 million tons, consistent with company forecasts despite disruptions from rainfall [1] - The equity sales volume exceeded equity production due to the recovery of sales gaps caused by shipping delays in the previous quarter [1] Group 2: Pricing and Financial Guidance - The overall coal sales price for Q3 2025 was 140 AUD per ton, with stable prices for thermal coal and a 1% decrease in metallurgical coal prices [1] - The company maintained its operational guidance for 2025, projecting equity commodity coal production between 35 million to 39 million tons, with current production above the midpoint of this range [1] - Cash operating costs are expected to be between 89 to 97 AUD per ton, with the first half of 2025 averaging 93 AUD per ton, anticipated to remain at the midpoint for the year [1] - Equity capital expenditure is projected between 750 million to 900 million AUD, progressing smoothly and expected to remain within guidance [1]

Core Viewpoint - Yancoal Australia (03668) experienced a nearly 4% decline in stock price, closing at HKD 27.62, with a trading volume of HKD 18.61 million [1] Production and Sales Performance - For the third quarter ending September 30, 2025, Yancoal Australia reported that total raw coal production was in line with company forecasts despite disruptions from rainfall [1] - The total commodity coal production was 12.3 million tons (100% basis), remaining stable compared to the previous quarter [1] - The company's equity sales volume exceeded equity production due to the recovery of sales gaps caused by shipping delays from weather factors in the previous quarter [1] Pricing and Cost Analysis - The overall coal sales price for the third quarter of 2025 was AUD 140 per ton, with stable prices for thermal coal and a 1% decrease in metallurgical coal prices [1] - The sales price reflects a lagging effect of coal price indices, exchange rates, and sales contract structures [1] Operational Guidance - The operational guidance for 2025 remains unchanged, with expected equity commodity coal production between 35 million to 39 million tons, currently above the midpoint of this range, with potential to reach the upper end for the year [1] - Cash operating costs are projected to be between AUD 89 to AUD 97 per ton, with the first half of 2025 averaging AUD 93 per ton, expected to remain around the midpoint for the year [1] - Equity capital expenditure is estimated between AUD 750 million to AUD 900 million, progressing smoothly and expected to remain within the guidance range [1]

Financial Data and Key Metrics Changes - The company reported a cash balance of $1.8 billion at the end of the quarter, following an interim dividend payment of approximately $82 million [16][63] - Cash operating costs were A$93 per ton, consistent with the previous year and within the guidance range of A$89–97 per ton [4][16] - The company is tracking to be in the upper half of the production guidance range of 35 to 39 million tons for the full year [4][63] Business Line Data and Key Metrics Changes - The company produced 15.8 million tonnes of ROM coal, translating to 12.3 million tonnes of salable coal, with an attributable share of 9.3 million tonnes [7][10] - Attributable sales volume increased by 31% compared to the June quarter, reaching 10.7 million tonnes [5][11] - The two Hunter Valley open cut mines performed well, with a 14% increase in attributable salable coal over the June quarter [9] Market Data and Key Metrics Changes - International coal prices remained under pressure, with average realized prices for thermal coal at A$130 per ton and metallurgical coal at A$195 per ton [15] - The average prices for the indices improved marginally, with the API 5 index averaging $69 per ton and the Global Coal Newcastle index averaging $109 per ton [14] - Total global seaborne trade is down 11% year-to-date, with Australian exports down 9% due to poor geological conditions [12][13] Company Strategy and Development Direction - The company aims to maximize operational performance and drive value generation for shareholders [3] - The focus remains on maintaining controllable cost discipline while navigating external cost pressures [4][16] - The company is evaluating opportunities for growth, particularly during cyclical downturns in the market [42][63] Management Comments on Operating Environment and Future Outlook - Management acknowledged the challenging coal market conditions but expressed optimism about the company's strong operational performance and financial position [63] - The company is well-positioned for an upswing in coal prices due to its tier-one assets operating in the bottom quartile of the cost curve [63] - Management expects to deliver production in the upper half of the guidance range, which would be the best performance in many years [63] Other Important Information - The company has encountered external and temporary cost pressures through the Port of Newcastle, impacting second-half cash operating costs [4][16] - The company is focused on achieving sales volumes that were delayed in the previous quarter due to disruptions [11][28] Q&A Session Summary Question: How is the breakdown of cash costs looking right now, particularly transportation costs? - The CFO noted that cash operating costs remain consistent, with some savings from diesel, but transportation costs have seen temporary increases due to wet weather and port issues [20][22] Question: How much inventory remains unsold at the end of the September quarter? - The company is in a comfortable position regarding unsold inventory and is focused on achieving sales while monitoring vessel arrivals closely [28] Question: What is the outlook on Queensland royalties? - The CFO stated that there are no anticipated changes to Queensland royalties at this time [58] Question: Has there been any change in the view on per tonne production costs? - Management confirmed that while external pressures are affecting costs, they still expect to be around the midpoint of the guidance range for the full year [45] Question: What is the expected profit for the upcoming quarter? - The company does not provide profit forecasts but offers guidance on production, cost, and capital expenditure ranges [51]

Financial Data and Key Metrics Changes - The company is tracking to be in the upper half of the production guidance range of 35-39 million tons for the full year, potentially reaching the upper quartile [4] - Cash operating costs were AUD 93 per ton at the half-year, consistent with the guidance range of AUD 89–AUD 97 per ton [4][16] - The company ended the quarter with a cash balance of $1.8 billion after paying an interim dividend of approximately $82 million [16] Business Line Data and Key Metrics Changes - The company produced 15.8 million tons of ROM coal, translating to 12.3 million tons of salable coal, with an attributable share of 9.3 million tons, all in line with forecasts [7][9] - Attributable sales volume was 10.7 million tons, which was 31% higher than the June quarter, recovering from previous delays [11] Market Data and Key Metrics Changes - International coal prices remained under pressure, with average realized prices for thermal coal at AUD 130 per ton and metallurgical coal at AUD 195 per ton [15] - The average prices for the indices improved marginally, with the API 5 index averaging $69 per ton and the Global Coal Newcastle index averaging $109 per ton [14] Company Strategy and Development Direction - The company aims to maximize operational performance and drive value generation for shareholders, focusing on maintaining controllable cost discipline [3][4] - The company is exploring opportunities for growth, particularly during cyclical downturns, while maintaining a strong financial position [42] Management Comments on Operating Environment and Future Outlook - Management acknowledged external and temporary cost pressures affecting cash operating costs but remains optimistic about maintaining costs within the guidance range [4][16] - The company is positioned well for an upswing in coal prices, with a strong operational performance and disciplined cost control [62] Other Important Information - The company has achieved a downward trend in total recordable injury frequency rate, which was 5.71% at the end of September, below the industry average [6] - The company is maintaining a strong financial position with no interest-bearing debt and good access to debt markets [62] Q&A Session Summary Question: Breakdown of cash costs and transportation costs - The CFO indicated that cash operating costs remain consistent, with some savings from diesel, but transportation costs are impacted by wet weather and port usage [20][22] Question: Inventory levels and sales recovery - The company reported that sales volumes were recovered in Q3 due to previous delays, and they are in a comfortable position regarding unsold inventory [28] Question: Capital expenditure for the third quarter - The CFO confirmed that capital expenditure is consistent with guidance and is primarily driven by fleet upgrades and heavy equipment [33] Question: Changes in production cost expectations - Management noted that while they previously hoped to move below the midpoint of the cost guidance, they now expect to remain around the midpoint due to external pressures [44] Question: Outlook on Queensland royalties - The CFO stated that there are no anticipated changes to Queensland royalties at this time [57] Question: Potential mergers and acquisitions - Management reiterated that they do not comment on specific scenarios but are exploring opportunities in the context of the current market conditions [55][56]

Financial Data and Key Metrics Changes - The company reported a cash balance of $1.8 billion at the end of the quarter, following an interim dividend payment of approximately $82 million, with no interest-bearing debt remaining [15][36] - Cash operating costs were A$93 per ton, consistent with the previous year, and the company aims to maintain costs around the midpoint of the A$89–97 per ton guidance range for the full year [4][15][40] Business Line Data and Key Metrics Changes - The company produced 15.8 million tonnes of ROM coal, translating to 12.3 million tonnes of salable coal, with an attributable share of 9.3 million tonnes, all in line with forecasts [6][9] - Attributable sales volume increased by 31% compared to the June quarter, reaching 10.7 million tonnes, recovering from previous delays due to disruptions at the Port of Newcastle [5][11] Market Data and Key Metrics Changes - International coal prices remained under pressure, with average realized prices for thermal coal at A$130 per ton and metallurgical coal at A$195 per ton, resulting in an overall average realized sales price of A$140 per ton, slightly down from A$142 per ton in the prior quarter [14][46] - The API 5 index averaged $69 per ton, and the Global Coal Newcastle index averaged $109 per ton during the quarter, with some improvement noted in the indices [13][14] Company Strategy and Development Direction - The company is focused on maximizing operational performance and driving value generation for shareholders, with expectations to deliver production in the upper half of the guidance range for the year [3][55] - The management emphasized maintaining cost discipline and operational efficiency as a competitive advantage, particularly in a challenging market environment [55] Management Comments on Operating Environment and Future Outlook - The management acknowledged external and temporary cost pressures affecting the sector, particularly through the Port of Newcastle, but remains optimistic about returning to normal operating conditions [4][40] - There is cautious optimism regarding the coal market, with indications that prices may have reached cyclical lows, and the company is well-positioned for potential upswing in coal prices [55] Other Important Information - The company has a strong financial position with $1.8 billion in cash and good access to debt markets, allowing for the evaluation of growth opportunities [55] - The company is actively assessing potential mergers and acquisitions, particularly during the cyclical downturn, while maintaining a disciplined approach to capital allocation [36][38] Q&A Session Summary Question: How is the breakdown of cash costs looking, particularly transportation costs? - The CFO indicated that cash operating costs remain consistent, with some savings from diesel, but transportation costs have seen temporary increases due to wet weather and port issues [18][20] Question: What is the current inventory situation and sales outlook? - The company reported a comfortable sales position, having recovered delayed sales volumes from Q2, and is maintaining a focus on logistics to ensure timely deliveries [24][25] Question: What is the outlook for capital expenditure? - The company confirmed that capital expenditure is on track within the guidance range of A$750 to A$900 million, primarily driven by fleet upgrades and heavy equipment investments [28][51] Question: What is the expected profit for the upcoming quarter? - The company does not provide profit forecasts but maintains guidance on production, cost, and capital expenditure ranges [43] Question: Any updates on Queensland royalties? - The company does not anticipate changes to Queensland royalties at this time [50]

Financial Data and Key Metrics Changes - The company reported a cash balance of AUD 1,800,000,000 at the end of the quarter, following the payment of an interim dividend of approximately AUD 82,000,000, and remains free of interest-bearing debts [20][21][75] - Cash operating costs were AUD 93 per tonne at the half-year mark, which is in the middle of the guidance range of AUD 89 to AUD 97 per tonne [5][20] - The company is tracking to be in the upper half of its production guidance range of 35,000,000 to 39,000,000 tonnes for the full year [4][75] Business Line Data and Key Metrics Changes - The company produced 15,800,000 tonnes of ROM coal, translating to 12,300,000 tonnes of saleable coal, with an attributable share of 9,300,000 tonnes, all in line with forecasts [7][8][12] - Saleable coal production increased by 14% compared to the previous quarter, despite wet weather disruptions [11][12] - Attributable sales volume was 10,700,000 tonnes, which is 1% higher than the previous quarter [14] Market Data and Key Metrics Changes - International coal prices remained under pressure, with average realized prices for thermal coal at AUD 130 per tonne and metallurgical coal at AUD 195 per tonne [18] - The average overall realized sales price was AUD 140 per tonne, slightly down from AUD 142 per tonne in the prior quarter [18] - Total global seaborne trade is down 11% year-to-date, with Australian exports down 9% due to poor geological conditions [16] Company Strategy and Development Direction - The company aims to maximize operational performance and drive value generation for shareholders, focusing on maintaining controllable cost discipline [4][75] - The management is optimistic about the potential for recovery in coal prices, emphasizing the company's strong financial position and ability to explore opportunities during cyclical downturns [49][75] - The company is committed to maintaining a strong operational performance and cost control, which is seen as a competitive advantage [74][75] Management's Comments on Operating Environment and Future Outlook - Management acknowledged external and temporary cost pressures affecting cash operating costs but expects to deliver unit costs around the midpoint of the guidance range for the full year [5][20] - There is cautious optimism regarding the coal market, with indications that prices may have reached cyclical lows [18][75] - The company is closely monitoring the impact of weather conditions and logistics on sales and production [14][41] Other Important Information - The company has a strong balance sheet and good access to debt markets, allowing for the evaluation of potential growth opportunities [75] - The management highlighted the importance of maintaining a low-risk sales position and the ability to take advantage of spot opportunities in the market [32] Q&A Session Summary Question: How is the breakdown of cash costs looking, particularly transportation costs? - The CFO noted that transportation costs are largely fixed and will be supported by increased production, but temporary increased costs from the Port of Newcastle are expected due to weather disruptions [23][26][27] Question: What is the current inventory situation and outlook for sales recovery? - The Executive General Manager of Marketing and Logistics stated that the company is in a comfortable low-risk scenario regarding sales and is focused on recovering delayed sales volumes from the previous quarter [32] Question: What is the capital expenditure incurred in the third quarter? - The CFO confirmed that capital expenditure is consistent with guidance and is primarily driven by fleet upgrades and heavy equipment investments [36][37] Question: Is there any change in the view on per tonne production costs? - Management acknowledged that while there were hopes to move below the midpoint of the cost guidance, current expectations are to remain around the midpoint due to external pressures [51][52] Question: What is the outlook on Queensland royalties? - Management indicated that there are no anticipated changes to Queensland royalties at this time [68] Question: What is the expected profit for the upcoming quarter? - The company does not provide profit forecasts but offers guidance on production, cost, and capital expenditure ranges [58] Question: What are the implications of potential mergers and acquisitions? - Management reiterated that they do not comment on specific scenarios but emphasized the company's strong financial position to explore opportunities [66][67]