According to Caixin, coal prices have dropped year-on-year, which has led to a significant decrease in net income for Zhengzhou Coal Industry & Electric Power in the first half of the year. At the earnings conference held today, Chief Accountant Fang Jing stated that the peak coal storage period for winter is approaching and in the context of a loose supply and demand pattern, the overall price of thermal coal will decrease in the second half of the year, but the fluctuation range will be limited.

Regarding the asset injection by controlling shareholder Zhengzhou Coal Group, Chairman Yu Lefeng of the company stated that Yanghe Coal Industry is not yet qualified for injection, and Inner Mongolia Coal Field, the current controlling shareholder of the company, is conducting exploration and conversion work. After meeting the listing requirements, it will be injected at the appropriate time.

According to the financial report, in the first half of the year, Zhengzhou Coal Industry & Electric Power achieved revenue of 2.162 billion yuan, a year-on-year decrease of 1.35%; net profit attributable to shareholders of the listed company was 10.3842 million yuan, a year-on-year decrease of 79.75%.

Regarding the reason for the significant decline in net profit while the revenue remained relatively stable in the first half of the year, Chief Accountant Fang Jing stated that the main reason for the decrease in net profit in the first half of the year was a year-on-year decline in coal prices of about 9%; the relatively stable revenue was due to the increase in production and sales volume through optimization of mine production organization, which offset some of the impact of coal price declines on income.

Looking ahead to the price trend of thermal coal in the second half of the year, Fang Jing stated that the peak coal storage period for winter is approaching, and in the context of a loose supply and demand pattern, the overall price of thermal coal will decrease but the fluctuation range will be limited. With improved demand and increased supply, the thermal coal market is expected to maintain a balanced situation.

In the semi-annual report, Zhengzhou Coal Industry & Electric Power stated that two pairs of mines under the company's control had experienced a long period of production shutdown, which affected the company's profit and loss. Among them, Xinzheng Coal Industry was shut down for 19 days due to significant safety hazards, resulting in a decrease in total profit of approximately 35 million yuan compared to normal production.

Regarding the current production situation of Xinzheng Coal Industry, company secretary Chen Xiaoyan stated at the earnings conference that Xinzheng Coal Industry is currently operating normally with stable production. The announcement shows that among the company's six major coal mines, Xinzheng Coal Industry has a recoverable coal reserve of 0.157 billion tons, accounting for more than 60% and is the main coal mine of Zhengzhou Coal Industry & Electric Power.

Regarding the issue of asset injection by Zhengzhou Coal Industry & Electric Power Group, Chairman Yu Lefeng stated that the controlling shareholder had already retrieved 60% of the shares held by another shareholder of Yanghe Coal Industry last year. Due to the current weak profitability of the mine, it is not yet suitable for injection, and it will be injected in a timely manner after maturation and meeting the conditions. The controlling shareholder of Inner Mongolia coal field is currently promoting related exploration and mining work, and injection will be made at an appropriate time after meeting the listing conditions.

It is reported that as of the end of 2023, Yanghe Coal Industry has a confirmed reserve of 0.337 billion tons, with a recoverable reserve of 66.37 million tons; Haoqin Coalfield has a confirmed reserve of 3.106 billion tons, with a recoverable reserve of 1.553 billion tons. The two major coal mine resources have a total recoverable reserve of 1.62 billion tons. As of the end of 2023, Zhengzhou Coal Industry & Electric Power's coal resources reached a reserve of 0.567 billion tons, with a recoverable reserve of 0.255 billion tons.

In addition, when asked by investors about why the company's 'investment and financing cash flow has always been negative,' Fang Jing explained that the negative investment cash flow is mainly due to increased investment in mine technological transformation and new projects to ensure the sustainable development of the company's main business; the negative financing cash flow is mainly due to the repayment of some financing and payment of financing interest based on the financial situation.