When facing thousands of listed company announcements every day, which ones should you read? What are the key points to take away from the dozens or hundreds of pages of material announcements? Are the many professional terms in the announcements bullish or bearish? Check out Caixin's "Quick Read Announcement" column, where our reporters across the country will provide you with accurate, fast and professional interpretations on the night of the announcement.

According to Caixin, on August 23, due to factors such as the year-on-year decline in coal sales prices, China Coal Energy (601898.SH), a coal industry leader with a total market cap of over 170 billion yuan, saw a nearly 20% year-on-year decline in net income in the first half of the year, but a slight increase in net income in the second quarter.

China Coal Energy announced tonight that in the first half of 2024, the company achieved revenue of 92.984 billion yuan, a 15% year-on-year decrease; and a net profit attributable to the company's shareholders of 9.788 billion yuan, a 17.3% year-on-year decrease.

In terms of quarterly profitability, the company's Q2 net income was 4.818 billion yuan, slightly lower than Q1's 4.97 billion yuan, but an increase of about 3% compared to the same period last year.

The announcement shows that in the first half of the year, the company's coal business revenue was 77.767 billion yuan, a 16.8% year-on-year decrease. China Coal Energy stated that due to the year-on-year decline in coal sales prices, the company's coal business achieved a gross margin of 19.848 billion yuan, a 11.9% year-on-year decrease; with a gross margin of 25.5%, an increase of 1.4 percentage points, mainly due to the lower proportion of buyout trade coal with low gross margin. In other business areas, influenced by the year-on-year decline in urea and ammonium nitrate sales prices, the company's coal chemical business revenue decreased by 3.5% year-on-year.

In terms of production and sales volume, China Coal Energy saw a year-on-year decline in both commodity coal and coal chemical product production and sales volumes in the first half of the year. Specifically, the production and sales volumes of commodity coal were 66.5 million tons and 133.55 million tons, respectively, representing a year-on-year decrease of 0.9% and 8.9%; while the production and sales volumes of coal chemical products were 2.927 million tons and 3.083 million tons, respectively, representing a year-on-year decrease of 2.5% and 4%.

Public information shows that China Coal Energy's main business includes coal, coal chemical, coal mining equipment, and financial services, with coal and coal chemical business revenues accounting for approximately 80% and 10% respectively.

From the perspective of the industry as a whole, the decline in coal prices has had a negative impact on the performance of coal companies, with a general year-on-year decline. China Coal Energy stated that due to insufficient domestic demand, excess capacity in some industries, and weak social expectations and other macro factors, coal demand in the first half of the year decreased slightly year-on-year, inventories at all levels increased, and coal prices overall remained weak and volatile.

Regarding the dividend situation that investors are concerned about, the 2024 mid-term profit distribution plan of China Coal Energy shows that a cash dividend of 2.936 billion yuan, equivalent to 30% of the net profit attributable to the parent company of 9.788 billion yuan, will be distributed to shareholders, with a dividend of 0.221 yuan per share.

Compared with other coal listed companies with a market capitalization of over 100 billion, the dividend proportion of China Coal Energy is relatively low. For example: Yankuang Energy (600188.SH), Shaanxi Coal Industry (601225.SH), China Shenhua Energy (601088.SH), although the three companies have not yet announced their profit distribution plan for the mid-term of 2024, announcements show that the dividend proportions for 2023 were 55.04%, 60.03%, and 75.2% respectively, while China Coal Energy was 30% in the same period. Comparing the industry situation, according to the data cited by Minsheng Securities from company announcements, the average dividend proportion of the coal sector in 2023 was 46.57%, an increase of 1.52% year-on-year.

However, based on the profit distribution plan for the full year of 2023 already formulated by China Coal Energy, the company has added a special dividend of 1.5 billion yuan. According to the company's announcement, the controlling shareholder, China National Coal Group, proposed to distribute a special dividend of 1.5 billion yuan to all shareholders, with a dividend of 0.113 yuan per share (tax included).