Earnings Call: H2 2025

Apr 1, 2026

Summary

2025 revenue and profit declined as coal and chemical prices weakened, while lower costs and strong operating cash flow supported resilience. 2026 plans target stable results, higher investment and continued integration across coal, power, chemicals and renewables.

Vice Director for Marketing Department, Mr. Lin Jing. China Energy's Chairman, Mr. Zhang Futao. Independent Executive Director, Mr. Zhou Fangshan. General Accountant, Mr. Zhang Chongbin. Xinji Energy General Manager, Mr. Sun Kai. Independent Executive Director, Mr. Yao Zhishu. Vice President, Zhang Shizhong. General Accountant, Mr. Cheng Maozhu. Board Secretary, Mr. Dai Fei. All the business heads for the three subsidiaries. We will have five items on the agenda. First is the basics about China Coal Group, our performance in the 14th Five-Year Plan, our outlook for the next Five-Year Plan outlook. Then the three listed subsidiaries will brief you on our performance, our tasks completed, and our work tasks for 2026. Then we will have the Q&A session. Let's give the floor to Mr. Gao Shigang to give your briefing about the China Coal Group, our achievements in the 14th Five-Year Plan, and the outlook for 2026 and the next five-year period. Distinguished investors, ladies and gentlemen, good afternoon. Welcome to the 2025 Collective Performance Briefing for China National Coal Group's Listed Subsidiaries. I would like to express my sincere gratitude for your continued attention and support for China Coal. I will provide a brief overview from four aspects, the basic profile for China Coal and its listed subsidiaries, key achievements during the 14th Five-Year Plan, and development plans for the 15th Five-Year Plan, and analysis of industry trends outlook for 2026. First, overview of China Coal. China Coal is a key state-owned backbone enterprise under the supervision of SASAC. As a central enterprise covering the entire coal industry chain, it shoulders the important mission of ensuring national energy security. Our core businesses include coal development, utilization, and trading, electricity and heat production and supply, coal-based new materials and related chemical product development, equipment manufacturing, and engineering and technical services. We have controlled proven coal resources reserves exceeding 70 billion tons with a total capacity of 310 million tons and annual trading volume of 400 million tons. We operate and construct 11 million-ton chemical projects with a total capacity exceeding 20 million tons. We have an installed capacity of over 47 gigawatts for thermal power in operation and under construction, and a renewable installed capacity of 7 gigawatts. We hold control in six and three listed subsidiaries, China Coal Energy, Shanghai Energy, and Xinji Energy. By the end of 2025, the group's managed total assets exceeded CNY 660 billion with 120,000 employees. We have received an A rating from SASAC for operational performance for six consecutive years and have been listed in the Fortune Global 500 for six consecutive years. China Coal Energy is the core listed subsidiary of China Coal Group. It is a large-scale energy enterprise integrating coal production and trading, coal chemicals, power generation, and coal mining equipment manufacturing. It was listed in Hong Kong in December 2006, and we returned to A-share market in February 2008. Shanghai Energy was listed on the A-share market in August 2001, primarily engaged in coal, electricity, railway operations, and integrated energy services. Xinji Energy was listed on the A-share market in December 2007 and became a holding subsidiary of China Coal in 2015, mainly involved in coal, electricity, and renewables. Second, the key achievements during the 14th Five-Year Plan period and development plans for the 15th Five-Year Plan. During the 14th Five-Year Plan period, China Coal and its listed subsidiaries diligently implemented the requirements from SASAC. We adhere to the general principle of pursuing progress while ensuring stability, enhancing efficiency from assessing assets, and driving growth through new businesses. We pursued two integrated business models, established and refined governance systems, innovated information disclosure, strengthened IR investment, took measures to enhance market Cap, and promptly conveyed confidence while stabilizing expectations. We delivered remarkable achievements characterized by steady growth, structural optimization. The key features are, first, focusing on core businesses which enhance core competitiveness with the mission of ensuring national energy security during the 14th Five-Year Plan period. We fulfilled medium and long-term coal contracts of 730 million tons, reserved 160,000 tons of fertilizers, and supplied nearly 10 million tons of urea, and provided over CNY 110 billion in benefits to society. We completed investments exceeding CNY 200 billion and paid total taxes of over CNY 180 billion, contributing to local economies. We optimized our industrial structure. Total coal production capacity reached 310 million tons per year, up by 22% versus 2020. Installed capacity of thermal power in operation and under construction exceeded 47 gigawatts, quadrupling versus 2020. Installed capacity of renewable in operation and under construction surpassed 7 gigawatts, achieving leapfrog development. Significant progress was made in the two integrated business models. Through coordinated efforts in resource and marketing, we leveraged the synergies of the full coal-based industrial chain. Distinctive integrated coal, electricity, chemicals, renewable industrial chain with China Coal characteristics has gradually taken shape. Second, we focus on strengthening our business, achieving improvements in scale and efficiency. The enterprise has grown rapidly, with total assets increasing from CNY 400 billion in 2020 to over CNY 600 billion. Production volumes of major products achieved substantial growth. Since 2023, coal production has remained above 240 million tons. Power generation went up by over 80%, and the output of coal chemical was above 10 million tons. Maintaining a safe, stable, long-term, full capacity, and optimal operating status. The average annual operating revenue during the 14th Five-Year Plan period was up by 80% compared with the previous period. Profitability was enhanced with average annual total profit exceeding CNY 30 billion. Thirdly, we focused on value creation, achieving quality improvements for over 6 subsidiaries. During the 14th Five-Year period, chemical achieved an average annual total profit of CNY 30 billion, up by 253% versus 13th Five-Year period, with market Cap growing by approximately 200%. We consistently rank among the top of the China top 100 list of companies and received the Shanghai Stock Exchange's A-rating for information disclosure for 16 consecutive years. Shanghai Energy focused on strengthening the fundamentals, making up for scenarios such as system optimization, lean management, policy utilization, and bidding procurement, achieving cost reduction and efficiency improvement. Its average annual profit grew substantially, while its assets, market Cap, and stock price all maintained a stable upward trend. Xinjiang Energy promoted transformation and upgrading, advancing the integrated development of coal and power during the 14th Five-Year Plan, as installed thermal power capacity went up by 298% from 2 gigawatts at the end of the 13th Five-Year period to 7.96 gigawatts at the end of the 14th Five-Year Plan period, proving the effectiveness of the two integrated business models. Its average annual operating revenue increased, with both average annual profit and asset growing. During the 14th Five-Year period, the three listed subsidiaries cumulatively paid out dividends of CNY 30.9 billion, up by 360% versus the previous five-year period. At the end of the 14th Five-Year Plan period the combined market cap of the three listed subsidiaries reached CNY 176 billion. Fourth, we focused on problem-oriented approaches, achieving significant improvements in risk prevention and control capabilities. Safety supervision responsibilities were strengthened. Safety awareness among all employees was enhanced. System support capabilities were reinforced. Overall, safety production remained stable. We continued to strengthen pollution prevention and control, promoted application of clean production and energy-saving emission reduction technologies, carried out mine ecological restoration, land reclamation, biodiversity protection, and improved ecological environment in mining areas. Each listed subsidiary improved its ESG governance system. It advances specialized work such as climate change and double materiality analysis. Fifth, we focused on innovation-driven development, gaining momentum for transformation and development. The group refined its innovation system, featuring a small internal brain plus large external brain. We established the National Natural Science Foundation of China Enterprise Innovation and Development Joint Fund in the field of coal energy, the National Key Research and Development Program, disruptive technology innovation, key project, energy, low carbon joint initiatives. We organized the National Key Lab of Digital and Intelligent Technology for Unmanned Coal Mining, established the Energy Low Carbon Innovation Center of the Beijing-Tianjin-Hebei National Technology Innovation Center, got approval for the construction unit of the Central Enterprise Industrial Green Low Carbon Original Tech Source, and a leading technology-based enterprise. We focused on national strategic needs. The development of original technology, the strategic emerging industries. The group increased our R&D spend by 2.2 times compared with 13th Five-Year period. Breakthroughs in key technologies were advanced, including special catalysts for polypropylene units filling the technology gaps. During the 15th Five-Year Plan period, China Coal and China Coal Energy will be guided by the Xi Jinping Thought on Socialism with Chinese characteristics for a new era. Fully implement the spirit of the 20th National Congress of the CPC and its subsequent plenary sessions. Fully implement the new development philosophy. Deeply implement the energy security strategy of four revolutions and one cooperation. Respond to the major strategic decision of carbon peaking and carbon neutrality. Fulfill our mission of ensuring national energy security. Strengthening SOEs and state-owned capital are leading the high-quality development of coal industry. Adhere to the dual wheel-drive of efficiency gain of existing assets and transforming incremental assets. Practice the two integration plus model. Build a two hedging mechanism against the downward risk of the external market for own coal and against future carbon emission constraints. Create an industry chain of coal, electricity, chemicals, renewable with China Coal characteristics. Expand in emerging industry. Shanghai Energy will leverage its three major bases in Jiangsu, Gansu, Shaanxi, and Xinjiang as strategic pillars to strengthen its coal power generation and renewable and integrated energy services. It will accelerate innovation, industrial transformation, achieving complementary advantages and tiered succession among its bases to become a benchmark for China Coal Energy's transformation in the Yangtze Delta region. Xinji Energy will focus on the Anhui-Jiangxi region, aiming to create a CNY 100 billion level energy supply industrial cluster in East China. It will promote co-development of coal, thermal, and renewable power, with seven major industrial bases in Huainan, Fuyang, Bozhou, Chuzhou, Lu'an, Xuancheng, and Jiangxi, laying a solid foundation for high-quality development. China Coal will leverage the synergy of its listed companies to enhance high-end energy supply and service guarantee capabilities, striving to become a highly competitive, integrated energy player by 2030, and by 2035, a world-class energy company with multi-energy complementarity, green and low-carbon exemplary leadership, and modern governance. Third section, industry analysis. 2026 marks the start of China's 15th Five-Year Plan. China's development is characterized by strategic opportunities and risks with increasing uncertainties. The company's production operation reform and development will face a complex external environment. In macroeconomy, the world is undergoing accelerated changes, with increasingly complex and intense great power competition affecting domestic development. At the same time, China has mismatched supply and demand and many risks and hidden dangers in key areas. However, the fundamentals supporting China's long-term positive economic outlook, including a stable economic foundation, numerous advantages, strong resilience, and great potential, remain unchanged. Supported by a series of macro policies, especially the 15th Five-Year Plan, the development has great prospects. In terms of industry operation, with profound adjustments in the global energy landscape and the parallel construction of a new energy system, the green and low-carbon transition is a long-term process. Ensuring energy security is essential for stable economic and social development, and coal's role as a primary energy source and a safety net is more prominent. Considering international geopolitical tension, the supply and demand of China's coal market in 2026 is expected to be tight. The LTA mechanism for ensuring the supply of thermal coal will still be an anchor, and the spot price of coal is likely to rise with more fluctuations. Looking into the 15th Five-Year period, we're still in a strategic window of opportunity. The foundational role of coal and thermal power will be strengthened. A new power system with renewables as a mainstay is being accelerated. Technological and industrial innovation is integrating, and a unified national market is advancing. This period presents both opportunities and challenges as well as pressures and drivers. Facing this new landscape, China Coal possesses the following advantages. First, resource and scale. Abundant coal resources and full production capacity, strong internal synergies, a solid development foundation, and considerable industry influence. Second, value creation advantage. Lean management has been implemented with notable cost reduction efficiency gains and economic benefits, and our operational performance consistently ranks among the top of the central enterprises. Third, industrial chain synergy. We continue to optimize our industrial structure, integrating coal chemicals, renewables with more resilience. Fourth, innovation and mechanism. Investment in technology continues to grow. The science and innovation system is refined, giving us more momentum. Fourth section, outlook for 2026. In 2026, China Coal will adhere to the general principle of pursuing progress while ensuring stability, efficiency gains from existing assets, and growth from new businesses focused on our core business, deepen reform and innovation, accelerate the green transformation, coordinate development and safety, strengthen core functions and competitiveness, promote high-quality development, and contribute to ensuring national energy security and achieving a good start for the 15th Five-Year Plan. First, we will scientifically optimize production organization, develop potential, and enhance efficiency. We will carry out special actions to improve quality and efficiency, strengthen refined management and cost control. Second, we will focus on project development and advance strategy implementation. We prepare the 15th Five-Year Plan, develop the coal, electricity, chemicals, renewables business, strengthen the modern industrial system, create new growth engines, and enhance the two hedging capacity. Third, we will consolidate and deepen reform achievements and drive reform to greater depths. We promote reform to the grassroots level, remove institutional and mechanism obstacles. Fourth, we will strengthen the management of listed subsidiaries and solidify investment value. We will improve the market Cap management, enhance the quality of information disclosures, strengthen investor communication, and maintain overall stability in operational performance, barring significant market changes. The development of China Coal is inseparable from your trust and support. We will always uphold the principle of openness, transparency, mutual benefit, to continue to improve our management, accelerate green transformation and innovation, and strive to become a trustworthy, outstanding listed company with long-term investment value. We firmly believe that with the joint efforts of all shareholders, investors, and all sectors of society, China Coal will take on greater responsibility and make even greater contributions to the advancement of Chinese-style modernization. Thank you. Thank you, Ms. Gao. Now, let me give you a presentation of the operating performance of China Coal Energy during the 14th Five-Year Plan and the work arrangement for 2026. Dear investors and analysts, I will begin with the performance presentation of China Coal Energy. Unless otherwise specified, this is subject to the Chinese Accounting Standards. China Coal Energy has resolutely implemented decisions and plans of the Central Committee, and firmly grasped the theme of high-quality development and earnestly practiced development strategy of improving efficiency in existing operations and transforming new ones. It has accelerated the advancement of two joint operations and actively building the two hedging mechanisms, continuously enhancing development resilience. First, high coal output and stable sales with enhanced efficiency during the 14th Five-Year Plan. The company resolutely showed that the mission of ensuring energy supply and carrying out in-depth benchmarking of refined management, we have achieved a total of 639 million tons of commercial coal output, an increase of 43% compared with the 13th Five-Year Plan, and a total of 1.4 billion tons of commercial coal sales, an increase of 52.7% compared with the 13th Five-Year Plan period. In 2025, the company made every effort to ensure safe and stable supply of coal and fully release the production capacity of high-quality mines. To maximize output and benefits, the company strengthened the management of coal quality at the source. We have increased the mining area by 18%, optimizing the output. However, due to stricter safety supervision and changes in the geological conditions, the company's coal output decreased. The total commercial coal output was approximately 135 million tons, a decrease of 1.8%, but still at a relatively high level in our history. The company adhered to the general tone of stable and refined sales, strengthened the coordination between production and sales, and deeply implemented the marketing strategy of segmented product and segmented markets. It innovatively launched a new trading model such as the virtual coal mines and maintained the sales pace under the background of deep pressure in the industry. The fulfillment rate of the medium and long-term contracts for thermal coal exceeded 90%, fully playing the role of the stabilizer in energy supply. In 2025, the total commercial coal sales were 256 million tons, a decrease of 10.2%, and the self-produced commercial coal sales were 136 million tons, a decrease of 0.9%, and the purchased coal sales were 109 million tons, a decrease of 23%. The average sales price of the self-produced commercial coal was CNY 485 per ton, a decrease of 13.7%. Among them, the sales price of the thermal coal was CNY 448, a decrease of 10.2%. The sales price of the coking coal was CNY 949, a decrease of 24.3%. The sales price of the purchased coal was CNY 492 per ton, a decrease of 15.6%. Second, stable and refined sales in coal chemical industry and rapid growth in new energy business. During the 14th Five-Year Plan, the company's coal chemical business maintained a very robust curve. The total output of major coal chemical product was 28.9 million tons, an increase of 49.2% compared with the 13th Five-Year Plan, and the total sales volume was 29.545 million tons, an increase of 49.9% compared to the 13th Five-Year Plan. The total installed capacity of the wholly owned and controlled coal-fired power plants under construction and in operation was 53.99 million kilowatts, an increase of 58%. The total installed capacity of new energy has also reached 12 million kilowatts, growing from scratch. In 2025, the company's coal chemical business adhered to the standard operations, strengthening basic management, and successfully completed the national commercial reserve tasks. The total output of major product was 6.06 million tons, an increase of 6.5%. Among them, the output of the polyolefins was 1.38 million, decreased by 8.5%. The output of urea was 2.134 million tons, an increase of 14.1%. The output of the methanol was 1.955 million tons, an increase of 13%, and the output of ammonium nitrate was 0.58 million tons, an increase of 1.9%. The company continuously improves its marketing network, flexibly adjusts its sales strategies, optimizing the layout and flow direction. In 2025, the total sales volume reached 6.356 million, an increase of 8.8%. Specifically, the sales volume of the polyolefins was 1.381 million tons, a decrease of 9%. The sales of urea was 2.423 million tons, an increase of 18.9%. The sale volume of methanol was 1.963 million tons, an increase of 14.4%, and the sale volume of the ammonium nitrate was 0.58 million tons, an increase of 3%. The sales price of the polyolefin was CNY 6,337 per ton, a decrease of 9.4%. The sales price of the urea was CNY 1,752, a decrease of 14.4%. The price of methanol was CNY 1,737 per ton, a decrease of 1.1%, and the price of ammonium nitrate was CNY 1,776 per ton, a decrease of 13.5%. Thirdly, upgrading of coal mine equipment services and the prominent value of the financial business. During the 14th Five-Year Plan, the coal mine equipment business promoted the improvement and expansion of joint storage and supply and intensive transformation, achieving a total output value of CNY 50.41 billion, an increase of 56.6%. The financial business has centered on the construction of the treasury system and continuously improving the level of centralized and lean management, maintaining an asset scale of over CNY 100 billion and net profit continue to grow steadily. In 2025, the coal mining equipment business will accelerate its transformation towards intelligent manufacturing platforms and services, achieving a total output value of CNY 9.1 billion. We have also obtained international orders worth CNY 1 billion, an increase of 72.9%. We have also been highly rated by CEREC. Fourthly, in-depth promotion of lean management. During the 14th Five-Year Plan, the company deeply implemented standard cost management and all production centers established cost control mechanisms. In 2025, in the face of a CNY 77 per ton decrease in average selling price of self-produced commercial coal, the company deeply carried out the lean management approach. The unit sales cost of major products decreased significantly. In 2025, the unit sales cost of self-produced commercial coal was at CNY 251.51 per ton, a decrease of CNY 30.2 per ton or 10.7%. Specifically, material costs decreased by 5.45 or 9.4%. Labor cost decreased by 0.82 per ton, or 1.4%. Depreciation and amortization increased by 1.76, or 3.9%. Maintenance expenses decreased by CNY 1.26, or 11.6%. Transportation and port charges decreased by 1.82 or 3.2%. Other costs decreased by 22.63 or 43%. This was mainly due to the company's implementation of cost management and also the optimization of production organization, which led to a decrease in the material cost per ton of coal. Additionally, due to need for safety production and future production continuation, there is an increase of unit depreciation and amortization costs. In 2025, due to the decline of the purchasing price of raw coal and the fuel coal, the unit sales cost of some products decreased year on year. Specifically, the unit sales cost of the polyethylene was at 6,136, a decrease of 61.6%. The unit sales cost of urea was CNY 1,297 per ton, a decrease of 21.7%. The unit sales cost of the methanol was CNY 1,321 per ton, a decrease of 45.7%. The unit sales cost of ammonium nitrate was CNY 1,412 per ton, an increase of 7.4%. Number five, the company maintained a stable business performance and continuously optimizing the financial structure. During the 14th Five-Year Plan, the company strengthened the operational management focusing on improving quality and efficiency. We have reached an annual revenue of CNY 198.2 billion, an increase of 91.8%. The average annual profit was at CNY 30 billion, an increase over 253%. The weighted average return on net assets increased by nearly six percentage points compared to the end of 13th Five-Year Plan. The average annual net cash flow from operating activities was at CNY 39.7 billion, an increase of 109%. The company's market cap increased by 209%, and the total net profit attributable to parent company over the past five years was CNY 88.7 billion, laying a solid foundation for the long term development. In 2025, because of the decline in the market price of coal and chemical products, the company achieved a revenue of CNY 148.1 billion, a year on year decrease of 21.8%. The total profit was CNY 26.6 billion, a year on year decrease of 15.7%. The net profit attributable to parent company was CNY 17.9 billion, a year-on-year decrease of 7.3%. The comprehensive profit margin was at 27.5%, an increase of 2.6%. The basic earnings per share was CNY 1.35. Despite the overall pressure in the industry, the company still maintained a strong profit resilience. The company continuously strengthens cash flow management with a net cash inflow from operating activities of nearly CNY 30 billion, providing a solid support for business development and shareholder returns. The asset liability ratio further decreased to 45.8%. The capital structure became more stable and risk resilience is increased. The changes in the total profit in 2025 were as follows. Firstly, the unit sales cost of self-produced commodity coal decreased, increasing profits by CNY 4.16 billion. Second, the reduction in taxes and surcharges increased the profits by CNY 0.8 billion. Thirdly, the power business increased the profit by CNY 0.7 billion. Fourthly, reduction in period expenses increased the profit by CNY 0.53 billion. Fifth, the reduction in impairment provisions increased the profit by CNY 0.406 billion. The main profit decreasing factors were, first, the decline in self-produced commodity coal pricing by 10.5%. Second, the main coal chemical enterprises reduced the profits by CNY 0.36 billion. Thirdly, the decrease in the sales volume of self-produced commodity coal reduced profits by CNY 0.35 billion. Fourthly, the reduction in investment income reduced the profit by CNY 0.34 billion. Fifth, the decrease in non-operating income and expenses reduced the profits by CNY 0.087 billion. Number six, the company steadily advances the two joint operations and enhanced the momentum for development. During the 14th Five-Year Plan, the company accelerated the two joint operation program and also built the two hedging mechanism of the coal, electricity, chemical and new energy, accelerating the installation of key projects. In 2025, the company's CapEx plan was closely centered around coal, about CNY 21.678 billion. During the reporting period, a total of CNY 19.92 billion was completed, achieving 91.9%. Relevant key projects were steadily advancing. For example, the Libi coal mine is expected to achieve the trial operation by end of 2027, and the Xuankou coal mine is expected to achieve a trial operation by end of 2026. The Wuxun Power Plant is expected to be in operation in the second half 2027, and the Yulin Coal Deep Processing Project has entered equipment installation stage. The company's CapEx plan for 2026 was CNY 21.32 billion, an increase of 7.05% compared with 2025. By business segment, the coal segment plans to allocate CNY 7.24 billion. The coal chemical segment, about CNY 8.48 billion. The coal power segment, about CNY 2.18 billion. The new energy segment, about CNY 2.6 billion. The coal mining equipment and other segments, about CNY 739 million. Seven, the foundation of safety and environmental protection remains solid. In 2025, the company has strengthened the foundation in consolidating the basics, increased the safety protocols, and carried out in-depth safety production efforts with no major safety incidents. The company strengthened the pollution prevention and ecological governance, and also its long-term mechanism. The regionalization and specialization reform was deepened, and the company maintained a leading position in the top 100 Chinese listed companies, and has received an A-level information disclosure evaluation from the Shanghai Stock Exchange for 16 years in a row. Number eight, the dividend payout policy continuously being optimized. The shareholder return remains stable during the 14th Five-Year Plan. The company's cumulative dividends were CNY 28.2 billion, an increase of 393%. Since its listing, the company's cumulative dividend has reached CNY 46.1 billion. In 2025, to enhance the investment value of listed company, the company's board of directors proposed to distribute CNY 5.07 billion in a cash dividend to shareholders in 2025, which is 45% of the company's shareholders' share of profit. After deducting the interim dividend of CNY 2.2 billion already distributed, the cash dividend to the shareholder is CNY 2.87 billion. Number 2, main work arrangement for 2026. In 2026, the company will continue to adhere to the general principles of seeking progress while maintaining stability, improving efficiency, and striving to have a good start of the 15th Five-Year Plan. The company plan to produce and sell over 130 million tons of produced commercial coal with 1.45 million tons of polyolefin product and over 2.03 million tons of urea. Under the condition that the market does not undergo significant changes, the company will strive to maintain overall stability of revenue and profit. The company will fully ensure a stable supply of energy to fulfill its responsibility of energy supply security, accelerating the transformation and upgrading of energy service business to ensure the efficient and smooth operation of the entire value chain from production, transportation, sales, distribution, and usage. Second, we will deepen the lean management and the cost control for the phase two of the Yulin Chemical Project. Number 4, we will steadily promote the two joint operation programs, as well as the coal, electricity, chemical, new energy industrial chain to promote the green development. Number 5, continuously deepen enterprise reform and mechanism innovation to consolidate the achievements of reform and improvement, and to stimulate organizational vitality and talent potential. Number 6, we will also strengthen the level of digitalization, increasing R&D investment, as well as to cultivate new high-quality productivity with Chinese coal industry characteristics. Number 7, we will also enhance the ability to prevent and resolve major risks. We will strive to further consolidate the foundation of market value management. Number 8, the company will continuously consolidate the foundation of market value management as well as the level of the corporate governance and the quality of information disclosure. The investors and analysts looking back to the 15th Five-Year Plan in 2025, China Coal Energy, against a complex and dire market environment, we have demonstrated resilience, and in 2026 will continue to maintain this attitude to forge ahead, and also to reward our shareholders with even greater returns. Thank you. Thank you. Now, please join me to welcome Mr. Zhang Futao from China Energy to present the performance in 2025, as well as the work arrangement for 2026. Dear Mr. Gao, Mr. Chen, distinguished guests, ladies and gentlemen. I will present to you the performance in 2025, as well as the plans for 2026 and the 15th Five-Year Plan. Firstly, we have intensified efforts to improve quality and efficiency, enhancing the level of operation. The company closely focused on the one profit and five risk targets. For example, we have embraced some cost down initiatives, such as blending inferior coal and reusing old materials. We managed to reduce cost by CNY 500 million, and the production cost of raw coal and the cost of electricity sales decreased by CNY 40 per ton and CNY 0.012 per kilowatt hour respectively. We strengthened the management of off-peak electricity usage, saving nearly 13 million CNY in electricity fees. We have also coordinated the use of safety and maintenance funds, reducing costs by 30 million CNY. We have also expanded new customers. We are also proactively adapting to the market. We have also improved the value added to our products, and this has led to an efficiency boost of 16.28 million CNY. The raw coal calorific value has also increased by 164 kilocal. Additionally, the company has also achieved operating income of RMB 7.67 billion and net profit attributable to shareholders of listed company of RMB 220 million, total profit of RMB 150 million, total assets of RMB 1,900 billion and net asset of RMB 12.63 billion. Earnings per share 0.31. The asset liability ratio 45.28%. We have also strengthened the coordination of the production, transportation, and marketing. Faced with this continued downturn in the coal market and unprecedented production pressures, the company coordinates production, transportation, and marketing, optimizing the production organization and also the OE to stabilize the production capacity. In 2025, the company's annual commercial coal volume is 6.13 million tons, and refined coal output has also improved to over 4.47 million tons. The power generation capacity is 4.24 billion kilowatt hours. Among them, the new energy-based power generation is at 536 million kilowatt hours. Thirdly, we have also solidified the reform and continuously improving the development momentum. Additionally, we have also vigorously promoted unified allocation of human resources, deployed 216 personnel between mines, including 87 technical personnel that are operating under the mine. The ratio of the three mines has reached 1 by 1.7 by 3. Number four, we have also steadily advanced the key projects. The company took key project as the basis to accelerate the construction of the two joint operation programs, and all demonstration bases in Xinjiang. The first mining project of the Xinjiang Weizigou Coal Mine smoothly entered the construction phase. Additionally, the construction of a key new energy project has also been accelerated. The 165,000 kilowatt PV project in the substantive area of the Liangdon Coal Mine has been fully connected to the grid for power generation. The import capacity of new energy under construction has reached 672,000 kilowatts. The Datun Power Grid renovation was also put into operation. Fifth, the company has continuously strengthened innovation and R&D. The company has continuously increased our commitment to this direction with R&D expense increase of 4.12%, and also has won 24 provincial and ministerial level and industrial level awards, with eight achievements reaching domestic leading or above levels. The company has also obtained 45 national authorized patents, including 10 invention patents. Key science projects such as carbon storage space and virtual power plant, have been implemented in an orderly manner. The source grade load storage coordinate regulation microgrid project has also been included. Number six, the company has to pay close attention to shareholder dividends. Since its listing, the company has achieved a cash dividend for 21 years in a row with a total dividend amount of RMB 3.91 billion, which is 4.46 times the raised funds of RMB 874 million. In September 2025, the company implemented the 25th semi-annual cash profit distribution, distributing a total of 65 million CNY. This is the company's second interim dividend. From 2017 to 2024, the company's cash dividend ratio to the net profit attributable to shareholders of the listed company has exceeded 30%. In 2025, on the basis of implementing interim dividends, the company distributed a total of CNY 217 million in cash dividends to all shareholders at a rate of RMB 2.1 per 10 shares, accounting for nearly 100% of the net profit attributable to shareholders. At the same time, the company distributed three bonus shares per 10 shares to all shareholders and increased their share capital by one share per 10 shares through capital reserve. Number 7, the company has continuously strengthened market value management and fully met market expectations. The company accelerated the pace of external development, and we have also kickstarted the phase one of the 400-megawatt PV power generation project in Luzhai City, Zichang City, and it has been approved by the board of directors. The company actively completed the share purchase by some Directors or former Supervisors, as well as senior management and middle-level management, purchasing 623,200 shares with a total value of CNY 7.10 million. China Coal Energy has increased the holdings of the Shanghai Energy shares by 2.43 million shares with a holding ratio of 62.78%. It has continued to introduce active shareholders. For the next step, the company will continue to take value creation as the core, continuously boost the investor confidence and promote reasonable reflection of the company's quality and its investment value through standardized governance, stable operation and transparency. Second, Shanghai Energy's 15th Five-Year Plan. At present, the company has formulated a preliminary 15th Five-Year Plan. The overall thinking is to resolutely implement the strategic orientation for green and low-carbon transformation, and also leading a coordination of high-quality development in the coal industry, as well as to fully incorporate the ESG concept into the company's strategy and operation. Again, the company is building the two hedging mechanism and remains firm in the 12457 development strategy without wavering. That is aiming at creating a new data mine, and we will build a two hedging mechanism based on these two joint operation platforms, creating three major bases in Jiangsu, Gansu, and Shanxi, and Xinjiang adhere to the regionalization and integration principles, and also strengthen the five coordinations of safety, stability, improve efficiency of existing assets, and transforming new assets. We will also accelerate the expansion of external coal products from a single field to raw materials. We will also focus on researching and developing the technology of the coal grading and quality differentiation. The three mines and the headquarters will remain stable on production, increasing the planning of resources in the 50 area and also promote the sustainable exploitation of resources in the headquarters. The two mines in the Xinjiang will shift their focus to improving economic benefits and taking the path of differentiation and focusing on improving coal quality, and also to achieve a key transformation from production growth to value creation. Power and new energy sector, we will adhere to our load-oriented approach, focusing on the load-intensive areas, and also to build an integrated energy park service providers to meet the needs. The headquarters will fully leverage the integrated advantages and actively expand electricity customers, who will use different ways to obtain resources through investment acquisition as well as building new projects in rural areas to obtain new resources. Comprehensively boosting the business for the energy service. We will firmly establish the concept of going out for development and also encouraging the high value-added and high-tech content business. Next, work plan for 2026. 2026 is the starting year of the 15th Five-Year Plan. We will be guided by the central government to implement the spirit of the 20th National Congress of CPC and also requirements of the Central Economic Work Conference. We will comprehensively strengthen the party's leadership and vividly implement the new development concepts. We will also strive to improve the quality and efficiency of operation and with a focus on the 12457 tasks, as well as accelerating the start of the 330,000 kilowatt PV project in the remaining area of the 1 million kilowatt ecological governance clean energy base in Beijian. Additionally, we'd also try to strengthen the three production keys of route control, system optimization, and response prevention. Dear guests, ladies and gentlemen, the achievements of the Shanghai Energy today could not have been possible without your long-term care, support and help. I would like to express my sincere gratitude. We will take this performance briefing as a new starting point and carefully listen to the valuable input and opinions of all investors and draw on the experiences of China Coal Group. In the next step, we will continue to optimize the effort of operation, continuously improving our corporate governance and strive to create greater returns for investors. Thank you. Thank you, Mr. Zhang. Let's give the floor to Mr. Sun Kai about the performance of Xinji Energy in 2025 and the working plans for 2026. Distinguished investors, good afternoon. I am very pleased to meet with all our friends at the Xinji Energy performance briefing. I would like to extend my sincere gratitude and heartfelt greetings to all the friends from various sectors who have consistently cared for and supported the development of Xinji Energy. We forged ahead with innovation, achieving breakthroughs against challenges, marking a successful conclusion to the 14th Five-Year Plan. In 2025, it was a critical period for Xinji Energy as we navigated challenges and tackled difficulties head on. Our cadres and staff, united as one, fully embodying the Xinji spirit of perseverance, resilience, and dedication. We actively responded to multiple challenges, including the downturn in the coal market and spot market, trading for electricity sales, achieving record results in key operating indicators. For the year, we produced 19.76 million tons of commercial coal and sold 19.69 million tons. We generated 14.2 billion kilowatt-hour of electricity and sold 13.4 billion kilowatt-hours. We achieved operating revenue of CNY 12.3 billion, total profit of CNY 3.1 billion, net profit attributable to shareholders of the parent company of CNY 2.1 billion, and EPS of CNY 0.8 for the year. By the end of 2025, total assets reached CNY 53 billion, liabilities were CNY 33.7 billion with a gearing ratio of 60%. Owners' equity attributable to the parent company was CNY 17 billion, up by 9% year-over-year. In 2025, it also marked the conclusion of Xinji Energy's 14th Five-Year Plan. During this period, our cadres and staff implemented the strategy of enhancing efficiency for existing assets and driving growth through new businesses. We had seven major achievements. The first is we made historical breakthroughs in transformation. We established a new industrial structure with coal as the foundation, thermal power as the support, and renewable as the direction. The coal foundation was strengthened with commercial coal production up by 1.7 million tons and growth of 10%. The thermal power business achieved a leap from single-point projects to clusters with controlled installed capacity increasing by 5.96 gigawatts, nearly fourfold. The renewable business grew from the scratch, establishing a demonstration base for the group's two integrated business models, and therefore, a crucial milestone. Secondly, we made significant improvements in production efficiency. We improved our production layouts and with commercial coal production achieving an average annual growth rate of over 2%. The calorific value of commercial coal was up by 392 kilocal per kilogram, generating over CNY 1.5 billion in revenue from quality improvement. Equipment upgrades improved with all five operational coal mines passing intelligent acceptance inspection. Third, construction of an intelligent safety protection and control system. We advanced systems governors and intelligent construction, upgrading intelligent safety systems and disaster early warning platforms. Advanced tools like AI, intelligent identification of video surveillance, intelligent safety perception networks covering underground and surface operations was established, enabling real-time monitoring and intelligent early warning of gas, water hazards, and ground pressure, taking our risk control capability to the next level. Fourth, we achieved leapfrog growth in operating performance. Total assets exceeded CNY 50 billion, nearly doubling total assets and profit versus the end of 13th Five-Year Plan. We entered a fast track for both scale and quality, achieving a dual breakthrough in assets and profitability. The gearing ratio was 63%, down by 9.55 percentage points. Labor productivity per headcount reached CNY 724,800, up by 59%. Fifth, we reaped the fruits from our reform efforts. A corporate governance system known as 113511 was established, comprising one charter, one measure, three rules, five lists, one manual, and one compilation. We were selected as a demonstration enterprise for grassroots corporate governance by SASAC, completed our three-year action plan for SOE reforms of high quality. Sixth, we achieved leading progress in tech innovation. We invested CNY 303 million in intelligent construction. We undertook three national key R&D projects during the 14th Five-Year Plan period, with 10 world-leading technological achievements. We were selected as one of the first batch of pilot enterprises for digital transformation by SASAC and established the industry's first 5G plus smart power plant. Seventh, we owned our social responsibility. Over the five-year period, 74.76 million tons of LTA coal were delivered, exceeding national energy supply assurance targets and fulfilling our role as a pillar in ensuring energy security. We spent CNY 450 million to improve our employees' sense of gain and well-being. We paid CNY 13.67 billion in taxes. We consistently built on the ESG governance system. In 2025, we received the highest A rating for information disclosure and got recognized as an excellent enterprise for national coal industry social responsibility report release for eight consecutive years. 2026, we are setting clear goals, systematically planning, outlining a grand blueprint for the 15th Five-Year Plan. 2026 is a pivotal year for Xinji Energy's energy transformation and development with firm and clear objectives. Comprehensively improve production quality and efficiency, with commercial coal production no less than 18.5 million tons and aiming for 19 million tons. Power generation, no less than 30 billion kilowatt hours. We will make every effort to improve operational quality, optimizing the annual budget targets for the five rates indicator. We will develop at full speed, ensuring timely commissioning of three power plants. 2026 also marks the start of Xinji Energy's 15th Five-Year Plan, closely aligning with national requirements for building a renewable and modern industrial system and Anhui 14th Five-Year Plan, and leveraging the advantages of the coal base of industrial chain. We've established a 12457 development strategy. The focus will be on the following tasks. First, focusing on stable production and increased sales to build up on our strength in coal. Adhering to the development principles of safety, efficiency, green, and intelligence, while improving the quality and efficiency of the existing five operational mines, we will enhance the level Deepening of Liuzhuang Mine, Xinji Number 2 Mine, and Xinji Number 1 Mine. We will raise about 20 million ton coal resources and complete the integration of Zhuzhou and Zhushi resources. We focus on changes in coal products and categories to enhance our competitiveness. Second, we will focus on the two integrated business models to fully enhance new project construction. We will strictly control the safety and quality of power projects under construction to ensure the timely grid connection and power generation of Shangrao, Chuzhou, Lu'an Power Plant. Accelerate the renewable projects construct and strengthen the renewable industrial landscape, achieving leapfrog development. Thirdly, we will focus on industrial upgrades to explore emerging industries. Leveraging the resources in coal mining areas and our renewables development, we conduct feasibility studies combined with water electrolysis, hydrogen production, and CCUS for thermal power. Centered on the strategy of building a new energy system and based on the regional industrial parks and facilities, we will promote projects for substituting clean energy in regional heating and achieve industrial upgrades. Fourth, we focus on innovation-driven development to empower high-quality development. We will expand intelligent control applications, data lake integration, and standardized governance. We will plan for the construction of high-value AI plus scenarios, creating a smart support system covering production, safety, and management. We will accelerate the construction of national key labs, establish experimental environments for technologies such as unmanned intelligent mining, intelligent rapid tunneling, and the depth of control of deep mine equipment. Fifth, we will focus on the three defense lines and solidify the foundation for stable development. Safety is the lifeline, and environmental protection is the bottom line, and compliance is the red line. We will strengthen these three defense lines. Sixth, we focus on strengthening the enterprise through talent. We will improve recruitment models, systematically maintain normalized recruitment, and try to meet the labor needs of grassroots units. We improve the compensation system, like the equal pay for all approach, and effectively safeguard the income of frontline workers. We conduct scientific analysis, promote competitive selection for positions, and build a talent pipeline for cadres. Seventh, we focus on party-building leadership to forge strong entrepreneurship. We will always adhere to CPC's leadership over SOEs, ensuring high-quality development with party-building. We deepen the comprehensive governance of the party, consolidate the political responsibility, improve party-building quality, advance the scientific standardized systematic construction of party-building, promote the deep integration of party-building with production and operations. Looking back, we have overcome obstacles and achieved remarkable results. Looking ahead, we are full of confidence. 2026 is a crucial transitional year for Xinji Energy's transformation. We will maintain an unrelenting spirit, strengthen our confidence for the ahead, and work diligently. We will make every effort to accomplish all annual targets and write new chapters for the company's high-quality development during the 15th Five-Year Plan. We will keep improving quality and efficiency, supporting market Cap growth, and through solid operations and rewarding all shareholders and investors with strong performance. I wish all investors a smooth work, good health, and abundant rewards. Thank you. Thank you, Mr. Sun. Now we will open the floor for Q&A with both online and on-site participants. We give priority to the on-site questions while also addressing some online questions. Please. Thank you, Mr. Zhang and management from China Coal. I am an analyst from CITIC Securities. I have two questions about coal chemical. Since the conflict in the Middle East, people are concerned about the pricing trend of coal chemicals. So what will be the trend now compared with last year for coal chemical pricing? The second question is about the polyolefin business. Last year, the production and sales volume of polyolefin has dropped. Do you think that this year the production and sales would rebound? If that is true, will that lead to better economies of scale and thus lowering the unit cost of sales for polyolefin? Okay. I would like to ask Ms. Lee from the marketing to address this question. Thank you for that question. The international conflict has indeed an impact on the chemical products as well as on energy. For China Coal Group, the pricing of our urea and polyolefin has also been affected, even though recently it started to rebound to a more reasonable level. We have made some price comparison on March 31st. Urea's pricing is basically flat with same period last year. In 2025, the urea pricing was relatively stable, so it went down, but it has rebounded. This has something to do with the supply control as well as additional export. For polyolefin, the pricing is more volatile. The price is 10% higher than last year. That is for the polyethylene. While for the propylene, the price is actually still higher. It is CNY 1,000 higher than same period last year. Even though recently, both futures and spot prices are falling. I think that in the Chinese market, the capacity and the supply abilities are relatively sufficient. In 2026, there are a lot of new capacities. In 2026, the price would be more reasonable, but it will not drop a lot because indeed this conflict has a huge impact on the energy sector. Regarding the production and sales volume of polyolefin, I would also like to ask Mr. Xue from the Coal Chemical BU to address this question. In 2025, we have two sets of our devices are under major maintenance or overhaul. Judging by the current circumstances, reaching a full load or full operation is very profitable. This year we have a planned production volume of 1.45 million tons, and I think we are able to go beyond that by around 60,000 tons. Secondly, after the device overhaul, the overall operation is becoming better. That means the cost will be lower and that also extends to next year. That means we will have better outcomes. Thank you. The gentleman in the first row. Thank you, Mr. Gao, and also thank all management from China Coal. I am Shaoyong from the Orange River Metal. I have some questions. Firstly, a question to Mr. Gao regarding the 15th Five-Year Plan of the group. I understand that in the 14th Five-Year Plan, the group has a lot of investment in coal chemicals, and people are also interested to find more about the directions of our investment and the volume guidance for the 15th Five-Year Plan for coal chemical, as well as whether the dividend payout if the China Coal Group would also change with the changes of the CapEx. That is my first question. The second question is about, we know that in Anhui province, the electricity prices are turning down this year. Actually judging by the performance last year, the integration advantage is quite significant. Revenue stream was quite stable. After the placement of the several power plants, what will be the prospect for the power generation segment in 2026 and 2027? That is my second question. Last question is about market cap. As mentioned earlier, the company will continue to do more in the capital market. The current P/B ratio is still lower than one. What will be the plan to improve the price to book ratio or any other additional plans in the capital market? Thank you. Thank you for the question. This is about the coal chemicals. It is true that we have been paying close attention to that segment. The chemical business is one of our main businesses. Apparently we need to be aligned with the national strategy to remain committed and unwavering in this direction. We are paying close attention to a few initiatives. We have some production bases in Inner Mongolia and the Shanxi Province. We also interested to find more about the opportunities in Shanxi Province and the Xinjiang for some early technical investment or some demo project. Second thing would be the coal-based LNG. We are also engaging in some research in North China because for a coal chemical business, it has a high requirement for the quality of the coal as well as the maturity of the chemical technology, as well as the equipment readiness. So we are also considering these aspects. Thirdly would be coal to oil. As we know, because of these international uncertainties, China, we have 77% of oil dependency on the foreign countries and also over 40% of gas dependency on foreign countries. From a strategic point of view, the nation is trying to improve the supply security, in particular in light of the current international conflict. We have also made some attempts in the coal-based oil, but the profit margin is not as high as a coal-based methanol or coal-based olefins. If the technology readiness is not good enough, then it might lead to loss-making. So we are engaged in the R&D in this area. This is also actually our forte. For China Coal Group, we have been cultivating in these areas for many years. These will be the main directions. The other thing, as mentioned earlier in a prior presentation, the coal-based hydrogen and then using these hydrogen to generate green alcohol. We are making some experiments in Ordos. If the technology becomes more mature, then we might to invest more in this direction. As to how to land this project, that will be dependent on the state's industry policies as well as our technology maturity and also the coal quality and whether it matches with our know-how in the chemical segment. We would try to seize the right timing, and we are currently engaged in some preliminary research. But please rest assured that coal and the power and chemical and new energy, these are the main businesses for China Coal Group, and we would steadily step forward in these areas. Thank you. Next, please. Thank you for the question. I would like to address the question about the commissioning of the power plant. Last year, the Linxing power plant, the power capacity is 14.2 billion. This year, for the Chuzhou and Shangrao, with these new power plants, the generated electricity would increase by 13 billion. So I think that means the profit margin for the power business will be even better. Also, the power business is also correlated with the coal cost. 75% of the cost is actually the coal. Because of our two joint operation programs, we are able to leverage this advantage. Our power plants are very resilient against the risk. Certainly, for our power plants, I think we have 4 over 1 billion capacity and 6 over 660,000 capacity. These are very ideal for the spot market transactions. I think the profit prospect of the power segment is something that we could look forward to. Thank you. Now, move to Shanghai Energy. Let me briefly address the questions. For Shanghai Energy, we have been driving these initiatives. There are still some gaps from our targets. In 2026, we aim to address the following initiatives. Firstly, to improve our operational ability, which is like the value of a listed company. That means we would stabilize our production capacity to improve the quality, to optimize the product mix, and also the production efficiency, and in a way to boost our operation. Secondly, from a perspective of development, we would also accelerate the cadence mostly in three directions. Firstly, for the coal industry. In principle, we would want to stabilize the coal output, so capacity would be controlled within the number 709. Regarding the quality, we would also try to speed up the contribution ratio from external projects, including the Xinjiang project. We need to speed up the construction of the Xinjiang project and also improving the quality of coal output. Also, we also want to speed up the construction of our facility in Gansu province and Shaanxi province. At appropriate timing, we would announce more details to the capital market. In the meantime, for our power business at headquarter level, we would also engage in some major expansions. As you probably have noticed, we had this M&A project, and we would have even more M&A projects for new energy as well as some of our self-developed projects. All of these will be carried out. At the same time, our ESS project is also in the validation stage, and maybe very soon we are able to disclose more details. Also regarding the construction of the new power system, like the distribution power network as well as the micro-grid, we are working on these agenda. At the same time, we have also a new direction that is low carbon and green initiatives, including making use of the geothermal energy, as well as the recycling of the coal ashes or coal powder. All of these are on the right track. We aim to leverage these developments to drive the market value. Certainly, we would also strengthen the communication with the capital market so that our investors would understand and appreciate the value of the Shanghai Energy. At the same time, we are also actively introducing more shareholders and to improve the branding as well as driving the market cap. Thank you. Thank you, Mr. Zhang. Next, please. The lady in the middle. Greetings. I am from Dongfang Securities. I have two questions. First, about dividend payout, because we have noticed that in the recent years, China Coal Energy has been improving your dividend payouts. You had some special dividend payouts after the annual results for 2023 and 2024. Also last year when the coal price was low, you still improved your dividend payout ratio from 30% to 35%, and these measures were well received by the market. Many of the long funds, they have been paying attention to the changes we have been making. But in this year's annual payout, you have used a payout ratio of 35%. You are not improving it further. We used the Hong Kong performance, a relatively lower pace, to do the payout ratio. That means for the A-share market, the payout ratio is about 28%. This, for the long insurance-based funds, this is a bit stressful for us because we expect higher returns. My question for the management team is, what is your plan for the future dividend payout? We also noticed how the finance ministry has adjusted up the payment ratio for SOEs, and for those in coal sector, it is at 35%. Does that affect your payout ratio? That is my first question. For question number 2, we have noticed you have many of the good quality assets. In May 2028, your commitment about the non-compete with Huayu will expire, and the P/B ratio in A-share market is at 1.5x, and in a Hong Kong Stock Exchange, it is 1x. That means you are no longer under the pressure to do further asset injection, and the external environment is good for you. Do you have any plans to inject the good quality assets into the listed companies? The dividend payout question will be taken by Mr. Lee. We were listed in the H-share market in 2006, and we made the commitment to have a cash dividend, a payout ratio of 20% to 30%. It is part of our company charter. From that IPO year, although we made the range of 20% to 30%, it has never gone below 30%. When we make the dividend payout policy, we want to strike the balance between our development, operation stability. We want to maintain our high-quality development. We have been asking for the inputs from investors and from our shareholders, from the management teams, and from the board. That is how we made the dividend payout policy. For your question, I have several points to make. People might say that we have a lot of the cash reserves, and with so much cash on hand, why do not we pay out more? CNY 90 billion of those money market funds. We put such of the finance management under the holdings company. Out of the CNY 90 billion, about CNY 40 billion belongs to the group level. Not all of those cash reserves can be tapped into. Also we have got the special reserve funds for safety and environmental compliance. It is not the idle funds resting on our balance sheet. If you deduct all that amount, we have only about CNY 40 billion at our disposal. Considering our revenue size of at least CNY 150 billion, this is a good enough ratio here. We want to further improve our operational efficiency to give better returns to our shareholders. I want to explain more about how we're using those cash reserves. It's not being idly held. Of course, about investor returns, at the end of the day, it all comes back to the high-quality growth. It's not just about the cash payout. You can calculate our payout ratio in the 14th Five-Year Plan versus the market average. We are always on top. in 2021, we paid out CNY 1.7 billion, and in 2024, it was CNY 6.3 billion, and we also offered some special dividends. Last year was also about CNY 5 billion. Through further improving efficiency and improving our growth, we are expanding the base for dividend payout. No matter how violent the market could be, we still have a stabilized growth, and that's a better guarantee for your returns. About whether we can further expand the payout ratio. In the 15th Five-Year Plan, you have been asking about the M&A possibilities and asset injection possibilities. These are part of our plan, and they all need funds. They need liquidity. For a good enough asset, we need to at least have CNY 10 billion or even CNY 20 billion to be part of the bidding process if we want to acquire it. For all the transformations and the development we need for the 15th Five-Year Plan, we also need the ammunition. So we have to factor in all those different variables and also getting input from investors and shareholders. We will definitely listen to the input from you, and we welcome all advices from you to formulate the payout ratio policy. About your second question, we have got a lot of attention from our existing assets and the injection of other assets. Yes, the group has some other oil and electricity-based assets, and you're wondering what would happen to them. This is something we have been studying at the group level. We do not rule out the possibility to securitize those assets or injecting them into the listed subsidiaries. As to how does that happen, through what channel and when, we are conducting the researches here. We do not have a finite solution here. If we have come to a conclusion, we would definitely disclose it to the capital market. About the non-compete commitment being expired, thank you for noticing that. We have been discussing this issue, and we are studying all these issues. Again, if there are some concrete conclusions, we would disclose them in a timely manner. Let's continue. Afternoon. I'm from Minsheng Securities. I'm Wang Shanshan. I have three questions. The first question for China Coal Energy. Last year, the coal price was trending down, and you have made different efforts to cut costs, and that is why you had good enough performance. Based on your 2025 financial report, you have lower levels of the specialized reserve. In 2026, we have a lot of uncertainties in the external market and the geopolitical landscape. So can you give us some outlook about the unit coal cost? How would that trend? The second question is for Xinji. in Q1, the power plant in Shangrao and Hulujo has been put into operation. Another one will be put into operation in the second half. In 2027, 2028, what are the new growth drivers, or would you prioritize paying the liabilities, paying for liabilities, or increasing the payout ratio? The third question, Xinjiang Tianshan subsidiary was loss-making. It's tied to the Xinjiang Weizigou Coal Mine, and in 2026, with the goal, coal mine will go live. It's also based in Xinjiang, and once it goes online, what's your expectation for the profit level? Sure. About unit production cost of coal. We have used more of the specialized funds last year. In the 15th Five-Year Plan, we had good cost control. It was very effective. It's not about how much we tapped into the specialized fund, but our mines are modernized and highly efficient, and production technologies and designs are very advanced. That matters. No matter how strict or severe the circumstances are, we could have stable operation, and that's the most important foundation for the good operation. For the specialized funds, and mostly went to the inspection and safety, and we do not get to decide how to spend it. There are some strict state-level rules about how to spend it. We have a very detailed rule about spending it. It's all going according to a rule. We do not get to decide to use it more or less based on the market trends. There is rules about its usage. Last year was the last year for 14th Five-Year Plan, so we decided to invest more into safety and inspection so that we would have smooth operation for the 15th Five-Year Plan. Every year, there are different focuses for such investments. That is why it seems that we use more of the specialized funds. As for the smaller balance, starting from last year, we took some big measures. One part of the cost would be about the finances. We have unified. We have got the transparent procurement for all the raw materials and eliminating 90% of the middlemen. We're connecting directly to the vendors, and we can have better management of the vendors. Last year, procurement cost was reduced by more than 7%, and we will continue that trend this year. We have done the online procurement for such procurement so that we can keep tabs on procurement. That's what we have done from the source. We have standardized cost control, and over the years, we have established a good SOP there. Mr. Gao is being hands-on in monitoring this system, making sure that each step of the process, we can scientifically squeeze the costs. This is still an ongoing process. We believe we can effectively control the costs here. But I want to emphasize, it's not about how much more you can squeeze the costs here because margin is also tied to the selling prices. The unit coal shipping fees could be tied with the sales, and there could be different pricing for different varieties of the coals, and we could shift the manufacturing capacity for different varieties. Last year, we increased about CNY 800 million in profits through shifting capacity for different varieties of coal. It's not just about cutting costs in just one dimension. We have multiple levers to pull. Question about Xinji. Thank you for the question. In Q1, our Shangrao and Chuzhou power plant went live. This year, we increased the power generation by 30 billion kilowatt hour in Q1, up by 2 billion units. That ensures our future profitability. Your question about our investments during the 15th Five-Year Plan, Mr. Gao, in his report, has mentioned our Xinji 12457 strategy and the two hedging system we have. We are aiming to build the industry cluster in East China, and we will have two transformational sites. We also have the coal power chemical renewable. We have got installed capacities for thermal plants, and we want to make a thermal power plant base. For the coal-based chemical, it is also an important component. For our coal production capacity, we are tying it with the chemical production and renewable production so that we can be better hedged against the future risks. In the 15th Five-Year Plan, we are adding some incremental capacity. In the seven bases we have, we are conducting new businesses there. Question about Shanghai Energy. The Qingsheng company sustained loss last year. It had 1.8 million tons of capacity, and in 2025, because of the complex geological structure, it affected our production capacity. Also, the 1.6 mine, there was an incident with a higher carbon monoxide level. To prioritize safety, we had this thorough inspection and governance, and these two factors led to only 960,000 tons, a 47% reduction versus our goal. Also, coal price was reduced a lot. In 2025, it was CNY 195 per ton, 30% down year-over-year. That is why mine 106 sustained losses in 2025. As for the Weizigou mine, it is in the same region with mine 106, but it has some features. It has bigger capacity, 3 million tons of capacity. Also, during the construction of Weizhou, we added the coal washing plant. For Mine 106, there is no washing and selection. In Weizhou, we have added the washing step, so it is more differentiated. It is possible that we could use it for chemical coal. We could change our sales strategy. We are also planning for a cost control here to better ensure cost reduction after it went online to achieve good efficiency. In the interest of time, let us have one last question. I am Huang Guangfan, Securities and Shuntau. Two questions for the management team. In the past decade, we saw how the three listed companies have got very advanced footprint. Your presence in Shaanxi, Xinjiang, and in other regions in China, you are more advanced than your peers. In the presentation you said, in the 15th Five-Year Plan, you have presence for a coal power chemical renewable, but after 2030, when peak carbon emission has been reached, do you have any changes to coal power chemical renewable business? Are you adding new things or are you putting a stop to any of these sectors, any of these businesses? Question number two, Xinji is aiming to build CNY 100 billion energy clusters. How do you make that happen? Answer. You are already asking questions about the 16th Five-Year Plan. It is beyond 2030. You are asking very sharp questions, tricky for us to answer. Based on what I have learned, this is from Mr. Gao, and based on my knowledge about the group strategy, let me give you a response. About coal power chemical renewable strategy, we have the two integration and two hedging system. During my prepared remarks, I have mentioned the two integration, coal plus thermal power, so that we can be better protected against the changing prices of coal. If the coal price goes up, electricity could be sustaining losses. If the coal price goes down, it could be loss-making for coal. But if we tie the two together, we produce the coal and we use it ourselves so that there's less price fluctuations affecting our performance and making sure that our margin would be steadily trending up. Less fluctuations here. Second integration is thermal power being tied to renewable. Why do we do this? It's about the carbon emission restrictions here. We are onboarding many of the renewable projects. They are part of the green energy. It can offset some of the CO2 emissions from our thermal power generation. So this can address the carbon emission restrictions for us. That is why we set the two integration strategies. Two integrations leading to the two hedges. As for in 2030, how will we develop the coal power chemical renewable strategy? We have another strategy about our efficiency gains from existing assets for our existing businesses. You already know them, but for our future growth, you have the thermal power and renewable. These are the focuses. Where's our leverage here? For the coal business, we want to use less human labor. We want it to be even unmanned. We want a higher unmanned intelligent solution so that we can have more efficiency gains. As for thermal power generation, many other power companies that have high coal consumption for the new power generation units, they could be reducing coal consumption by 10%. By consuming less coal, it means less carbon emission. We also have other steps like desulfurization, and that can also further be even more environmentally compliant. As for the chemical, we are combining biomass with chemicals. We make hydrogen with green energy, and then we add hydrogen into our chemical devices. You're all experts here. In the chemical process, hydrogen is used a lot, but the hydrogen we have now is gray hydrogen made out of coal. But in the future, if we have the green energy-based hydrogen and we add it into the chemical process, it can help reduce our carbon emissions too. So this is our rationale and our strategy for carbon peak emission and carbon neutrality. This is the trajectory that we're on. We're not just grounded, we also have high ambitions. In the renewable sector, we are also making some explorations. For example, the gas, natural gas, and also biomass-based protein and the green ammonium and green hydrogen. We're following those technologies, but they're not part of our main business just yet, but we're considering those new advancements. To Mr. Gao, the question about Xinjiang. Thank you for your question about our 100 billion cluster in the 15th Five-Year Plan. We're headquartered in Huainan, and the Huainan mine, we're trying to make it a mine. For the Fuyang green mine, we are trying to combine coal with renewables, and there was a new policy targeting it last year. About the Bozhou industry, cycling industry for the Lixin power plant, where it is based, we are combining it with another coal energy. We're providing the local government with cheap energy and also heat generation. Fourth, around the Chuzhou factory, there's a zero carbon industrial park, and we can combine it with heat generation and renewable. For our Lu'an power plant, after putting it into operation in H1 this year, we could expand its possibilities based on what's available to us locally. For the Shencheng base, it is around an economic development zone. We could provide that region with thermal power. It is the same story for Shangrao. Because renewable energy is taking some share from thermal power, in the future, we want to work better with the government so that we can gain more inroads through such introductions. Let's wrap up the Q&A session. Dear friends and investors, the management team from our group has answered your questions. In the interest of time, I know if you have some unresolved questions, you can keep in touch with us. You can reach out to us. We are happy to address your questions. Again, thank you for your questions, and thank you for following our development and participating in our earnings briefing. Thank you.