Summary of Shanxi Coking Coal Conference Call Company Overview - **Company**: Shanxi Coking Coal - **Industry**: Coal and Steel Key Points Industry and Market Dynamics - The comprehensive selling price of commodity coal in the first three quarters of 2025 was 780 RMB/ton, a significant decrease from 1,070 RMB/ton in the same period of 2024, leading to a decline in performance [2][4] - The price of primary coking coal reached a low in July 2025 but gradually recovered to 1,550 RMB/ton by the end of October [2] - A price reduction of 30 RMB/ton for primary coking coal in February 2026 reflects market conditions and high relative prices [2][7] - The winter storage situation is similar to last year, with normal shipping volumes and auction enthusiasm [2][7] - The coking price increase indicates a reasonable acceptance in the steel industry, but a weak supply-demand balance is expected to continue into March due to the Spring Festival [2][8] Financial Performance - Sales volume decreased from October to November 2025, with specific data pending until December [10] - Revenue significantly declined in August and September 2025, with employee wages reduced by approximately 25% [10] - The company faced a projected loss of over 145 million RMB in its cement plant investments for 2025, indicating a challenging outlook [5][19] - The total interest for the New County Block coal mine is approximately 500 million RMB, evenly distributed quarterly [12] Cost Management and Production - The company aims to reduce the total cost of raw coal from 300 RMB/ton to 270-280 RMB/ton and the cost of washed mixed coal from 150 RMB to 120-130 RMB [5][17] - The production capacity of the Xie Gou mine is 15 million tons, fully utilized for supply assurance, with a price of 570 RMB/ton in 2025 [5][15] - The overall cost of washed and raw coal varies significantly across different mines, with the Shaqu mine's washed coking coal cost at approximately 900 RMB/ton [17][18] Future Outlook - The company does not expect significant improvements in coal supply in 2026 due to ongoing supply constraints and safety production pressures [10] - The production volume for 2026 is expected to be stable, with a slight increase compared to 2025, maintaining a total capacity of 48.9 million tons [23] - The company plans to explore associated mining technologies to develop aluminum resources alongside coal [20] Capital Expenditure and Dividends - Capital expenditures for 2026 and 2027 will focus on maintaining simple reproduction and necessary engineering and equipment procurement, with no major projects planned [21] - The company maintains an active dividend policy, with adjustments based on actual operating conditions [22] Regulatory Environment - Strict safety regulations are in place, with production loads adjusted according to actual conditions, maintaining a maximum of 110% capacity [16] Miscellaneous - The company plans to conduct maintenance during the Spring Festival, likely lasting about a week [24]

当前，我国煤炭供应正从"提量"转向"提质"，精准满足用煤需求。为推动煤炭分级分质利用，提升商品煤质量，推进煤炭洗选高质量 发展成为必然选择。通过因地制宜选择洗选技术路线，并应用智能化技术让选厂降本提效，到"十五五"末，我国煤炭洗选产能结构预 计将持续优化，智能化选煤厂建设也将取得重要进展。 与此同时，洗选产生的固体废物利用水平也在持续提升。例如，尾煤泥脱水掺配至洗混煤中销售，将煤炭资源"吃干榨净"；矸石直接 用于井下填充，节约能源和运输成本。这些曾经的纯成本支出，正逐渐转变为煤矿的"新增长点"，进一步促进煤炭资源的全面高效利 用。 目前，我国原煤入洗率已达68%。 近期，国家统计局公布2025年全国规模以上工业企业利润显示，石油、煤炭及其他燃料加工业比上年减亏，其中，煤炭开采和洗选业 亏损下降41.8%。 煤炭洗选有何作用 所谓煤炭洗选，既要"洗"也要"选"。洗去混在煤炭中的杂质，保障煤炭供应质量；选出不同类型的煤炭，保障煤炭分级分质利用。煤 炭洗选是煤炭资源开发利用的重要环节，对提高商品煤质量、减少无效运输、提升煤炭清洁利用水平具有重要意义。 "洗选通常包括破碎筛分、分选、脱水脱介、煤泥水处理、产品储存装车 ...

Core Viewpoint - The company focuses on enhancing coal supply stability through skill improvement, technological empowerment, and green safety measures, aiming for dual excellence in quality and efficiency [2]. Group 1: Skill Development and Training - The company conducts regular training competitions to enhance operational skills in coal loading, sampling, and equipment maintenance, ensuring high efficiency in coal supply [3]. - The management emphasizes the importance of both production reserves and skilled operations, highlighting a dual empowerment approach to achieve seamless coal supply [3]. Group 2: Technological Innovation - The company has invested in upgrading hardware and implementing smart monitoring systems, including drone technology for precise coal volume measurement, enhancing operational efficiency [4]. - A "three-priority" policy for coal transport has been established to ensure efficient loading and dispatch of coal vehicles, minimizing delays [4]. Group 3: Environmental and Safety Measures - The company integrates green development principles into its coal supply processes, employing dust control measures and ensuring safe transportation practices [5]. - A 24-hour monitoring system is in place to oversee coal storage conditions, effectively mitigating self-ignition risks and ensuring stable coal storage [5]. - The company actively collaborates with local power plants to adjust supply structures and has completed its monthly storage increase plan ahead of schedule, demonstrating commitment to national energy strategies [5].

Core Viewpoint - The company is expected to outperform the industry in terms of coal prices due to its high-quality coking coal resources, despite a significant decline in sales driven by lower downstream demand [1]. Financial Performance - The company maintains a "Buy" rating, with projected total revenue of 45.29 billion yuan in 2024, a year-on-year decrease of 18.43%, and a net profit attributable to shareholders of 3.11 billion yuan, down 54.1% [2]. - In Q1 2025, total revenue is expected to be 9.03 billion yuan, a year-on-year decrease of 14.46%, with a net profit of 681 million yuan, down 28.33% [2]. - Earnings per share (EPS) estimates for 2025-2027 are 0.54, 0.59, and 0.66 yuan respectively, with a target price of 7.5 yuan based on a 14x PE valuation for 2025 [2]. Production and Sales - In 2024, raw coal production is projected to increase slightly to 47.22 million tons, a year-on-year growth of 2.47%, while total coal sales are expected to drop significantly to 25.60 million tons, a decrease of 20% [3]. - Specific sales figures include: raw coal sales of 1.22 million tons (up 56.41%), coking coal sales of 5.89 million tons (down 20.30%), and mixed coal sales of 7 million tons (down 35.13%) [3]. Pricing and Cost Management - The average selling price of the company's coal is expected to decline by 5.43% to 1,037.23 yuan per ton, which is better than the industry average decline of 11.42% for main coking coal prices [4]. - The company demonstrated strong cost control with operating costs in Q1 2025 down 17.51% year-on-year and 27% quarter-on-quarter, alongside a period expense ratio of 12.15% [4]. Future Growth Potential - The company announced a successful bid for exploration rights in Shanxi, acquiring coal and associated bauxite resources with a total coal reserve of 952.78 million tons and planned production capacity of 8 million tons per year [4].