Shanghai Datun Energy Resources Co., Ltd. (1898) Earnings Call Transcript & Summary

We look forward to share the results of last year, and we sincerely thank your support this whole time. The attendees are Mr. Zhao Rongzhe, the Executive Director and President of China Energy; Mr. Jing Fengru, Independent Non-Executive Director of China Energy; CFO, Mr. Chai Qiaolin; Vice President, Mr. Zhang Guo Xiu; Mr. [indiscernible], Chief Expert and General Manager of Coal Chemical Business Unit; Mr. Li Ying Ping, Vice Director of Sales and Management; Mr. Zhang Futao, Director -- Chairman of the Board at Shanghai Energy; and Mr. Zhang Chengbin, Chief Accountant of Shanghai Energy; Mr. Jun Duan Jian, Board Secretary of China Energy; Mr. Sun Kai, General Manager of Xinji; Mr. Yao Zhishu, Director -- Independent Director of Xinji; [indiscernible], Chief Accountant of Xinji; and also Board Secretary, Dai Fei. We'll be talking to you about the China Coal results overview and the plan for 2025. And also we'll be talking to you about the overview for the 3 listcos, and their plan in 2025. Then the last section is Q&A. Now I will have Mr. Zhao Rongzhe , the President and the Executive Director of China Coal Energy to talk to you about the overview of China Coal in 2024 and its plan in 2025.

Thank you very much for your support, everybody, for your support for China Coal and its listcos. I'll be talking to you about the overview of China Coal and its listcos, its strategy, industry trends and our work plans. Firstly, China Coal is a mega SOE, supervised by SASAC. We're the only whole value chain central SOE in the coal sector, and we have this important mission of securing energy supply. Our main business includes production and trade of coal, power and thermal production supply, coal-based new materials and chemicals development. And we control China Coal Energy, Shanghai Energy and Xinji Energy, these 3 listcos. As of the end of 2024, our total assets were RMB 600 billion and 120,000 staff. We have been ranked as a Level A SASAC company, and we have been ranked among Fortune 500 companies for 5 years. China Coal Energy is a listco for our main business. It's a large energy enterprise integrating 4 major lines of business; coal production and trade, coal chemicals, power generation and coal mining equipment manufacturing. China Coal Energy was founded in August 2006 and got listed in Hong Kong in December 2006 and got listed in A shares in February 2008. China Coal now has a 58.4% of China Coal Energy's shares. And for many years, this coal has been ranked among the top 100 companies in China and has been ranked as -- rated as excellent by Shanghai Stock Exchange. Shanghai Energy went public in A shares in August 2001, and the China Coal has 62.43% of its shares and is a comprehensive energy supplier with the coal, power, railroads and energy comprehensive services. Xinji Energy got listed in December 2007. And in 2016, 30.31% of shares got transferred from SDIC to China Coal, and China Coal now has a 30.37% of its shares. Its main business are coal, power and new energy. Now I'm going to talk to you about our development strategy and our work during the 14th 5-year plan. We uphold the 4 reforms and 1 collaboration, and we uphold the dual coal goals, and we showed the responsibility as a central SOE and serve as a pillar and a cornerstone for energy security, and we are accelerating the innovation build-out and are trying to achieve efficiency improvement and transformation for our old and existing -- and new business. And we're trying to build ourselves into a world-class energy company with modern governance, low-carbon development, innovation and multi-energy forms, securing energy supply for China. Firstly is to secure energy supply. We have unlocked over 100 million tonnes of quality coal, and we are focusing on periods with high energy demand. So we are using our concrete actions to secure energy supply to serve socioeconomic development. We're also pushing for the 2 joint operations and the 2 hedges. We have breaking records of -- and exceeded the 50 million kilowatts for installed capacity for coal power. And we are pushing for the forming of industrial clusters in areas with rich energy resources, leading to a high density in value chain. The Phase 2 Yulin project is going steadily, and the Liquid Sunshine Project is accelerating in Tuke and the Wusheng County Integration Project is going to start construction soon. And we have set up China Coal Institution. And we have also set up a fund with National Natural Science Foundation. And we have set up a low-carbon innovation center with Jingjinji National Center of Technology, and we're working with colleges and universities as well. And we are proactively taking on science and technology projects since the start of 14th 5-year plan. And we're also trying to cultivate new productive -- new quality productive forces. And we're focusing on smart technologies and focusing on low-carbon transition and Liquid Sunshine and also carbon capture sequestration technologies. We're building out a value chain with low coal or no coal to further utilize CO2 as a resource. And we are also investing in coal-based new energy, hydrogen and energy storage. According to the SASAC's requirements, we are using new ways of information disclosure and do a better job of managing market cap to convey more confidence. And we are also trying to improve efficiency and transformation. And we have achieved to optimize the structure and steady growth as a result. The first 4 years of 14th 5-year plan has seen very good revenue and rank making us among the Fortune 500 companies. Our financials are better than central SOE averages and our installed coal capacity -- installed coal power generation increased fourfold, and we achieved zero to one for alternative energies or renewable energies. And so 2025 marks the end of the 14th 5-year plan, and it's also the beginning of the 15th 5-year plan. Even though we have achieved a lot of results, this year is going to be more complex because we're faced with more risks and challenges. Firstly, the -- there's more negative impact coming from the external environment, and the recovery is still on shaky ground. But the underlying conditions and trends for sustainable growth for China haven't changed. And the supply and demand in the coal market is still in equilibrium with more positive policies continuing to be implemented. There is still ample supply overall, even though there's tight supply periodically. Even though in the short run there's a lot of downward pressure, overall, the equilibrium is still there. At the same time, we need to see that China Coal has a wide diversity of coal types, and it's got a lot of long-term contract coal, and it's faced with a vast domestic market, and its operations are sound, innovation is strong, and we have great potential for joint operations. And despite downward pressure, declining prices and uncertainty in policies, the long-term contracts are being strictly fulfilled. And so our profitability is better than averages. And there's also a strong impetus to reform and innovate. We have been rated as an outstanding company by SASAC, and we're also accelerating our transformation and reform efforts. Overall, we have opportunities and challenges at the same time. So we will be upholding the socialism with the Chinese characteristics under the leadership of President Xi. And we will be implementing the spirits from the 20th National Congress of the CPC and its second and third plenary sessions, and we will be implementing this philosophy of improving efficiency and pushing for transformation. And we will be pushing for the 2 joint operations, the 2 hedges to enhance our core competency. In terms of our main goals, we will be implementing the 5 values and the requirements raised by SASAC to achieve steady progress to ensure that our operational performance is sound. We will be upholding safety to enhance our foundation. We will put people's lives at the center and try to achieve zero casualties and accidents by way of detailed safety management measures. We will also set reasonable production and sales targets to try to achieve them. We will be trying to go with the policies and increase sales while being safe and compliant. We will also be improving management capabilities. We will be using different kinds of management and modalities to improve efficiency, effectiveness and cost effectiveness so as to tap into the potential of growth and value creation. Four, we will continue to reform and finish off the reform efforts. Five, we will continue on this path of the 2 joint operations and 2 hedges. We will continue to accelerate the transformation of the company to tackle market volatility. Six, enhancing innovation and scientific R&D to cultivate new qualitative productive force. We will be implementing the strategy of development driven by innovation to cultivate productive force of our own characteristics. We will also be matching our market cap to increase our investment value. We will continue to strive forward and upward in 2025 to use our concrete actions to tackle challenges. We will make our 3 listco's stronger and make them great examples of the capital market with great performance and integrity so that investors can understand what's going on and have confidence in our performance. And we will also be promoting and contributing to the modernization and economic development of China. We hope that you can pay -- continue to pay attention and support our effort. Thank you so much.

Thank you, Mr. Zhao. I will be talking to you about the overview of 2024 for China Coal Energy and also 2025 plans. So all of the data are according to Chinese accounting standards. Firstly, we have steady growth in coal production. We are trying to improve efficiency, and we are -- we have managed to secure coal supply. In 2024, we realized the production of 137.57 million tonnes, an increase of 3.35 million tonnes or 2.5%. So Shaanxi region increased by 0.69 million tonnes and Mongolia and Shaanxi region increased 1.72 and Jiangsu increased by 0.49 million. And for the type of coal, 2.87 million tonne of coal, an increase of 2.3 coking coal, 0.48 and the company took initiative to overcome the difficulties and challenges and try to improve and try to complete the supply guarantee and try to improve the fulfillment of the contract. And we conducted different methods to improve the revenue and stabilize the market share. So in 2024, the sales was 28,000 -- was 284 million tonnes. So it was basically breaking even. So for the buy off of trade coal and the import-export and the internal represented or agency coals reduced by 3.83 million tonne, down by 2.5%. And we actively dealt with the price downfall, and we effectively coordinated the safe production and the turnaround to realize the safe, stable and long and full rate and optimized operations. In 2024, Coal Chemical product reached 5.69 million tonnes, down by 346,000 tonnes, down by 5.7%. PO increased by 27,000 tonnes, up by 1.8%. Urethane down by 195,000 tonnes. Methanol down by 171,000 tonnes, down by 9%. And the sales network was continuously improved, and we continued the improvement of the coordination of production and sales and transportation and cross-regional coordination. So in 2024, the Coal Chemical product increased -- sales was 5.84 million tonnes, down by 284,000 tonnes, and the urethane down by 104,000 tones, down by 4.9%, and methanol, down by 203,000 tones, down by 10.6%. And then for the lean management, we continued the organization of the product. We also improved the efficiency, and the sales cost was down by a lot. The unit cost of coal product was CNY 281.73 per tonne, down by CNY 25.28 or 8.2%. And the amortization and depreciation was down by CNY 6.98 per tonne. And we also added the base number of the production and reservoir amortized base, so the cost was down. The maintenance was down by CNY 2.23 per tonne. And then for the freight cost, transportation or the warehousing report was down by CNY 4.33 or 7%. And the proportion of the self-produced coal in the overall coal sold was down. And the other cost was down by CNY 14.71 per tonne, down by 48.3%. So there is some still balance of the special fund of the safety fees and the maintenance. And affected by the coal, the raw coal and the fuel coal purchase price, the sales unit cost was down. So the PO cost was CNY 6,200 per tonne, down by CNY 137. And for methanol, CNY 1,779, down by CNY 110. And for the turnaround, it affected urethane by CNY 1,656. So then for ammonium nitrate, it was CNY 1,315 per tonne, a year-on decrease of 11%. Then the product price followed the market fluctuation. In '24, the average price of long-term agreement coal in the port was CNY 701 per tonne, down by 1.82% year-on-year, with the highest price CNY 710 in January and the lowest CNY 696 in December. Average spot price of CNY 5,500 kcal power coal in the port was CNY 863. And the highest price of CNY 931 in February, lowest CNY 794 in December. The average selling price of the company's self-produced commodity coal was CNY 562 per tonne, the only decrease of CNY 40 per tonne, 6.6%. And the price of power coal was CNY 499 per tonne, a year-on-year decrease of CNY 33 per tonne or 6.2%. And the coking coal was CNY 1,254 per tonne, year-on decrease of 9.5%. And the sales of buyout trade coal was CNY 583, the decrease year-on-year was 9.5%. Poly -- PO was CNY 6,991, a decrease of 1.2%. Urea sales was CNY 2,047, down by 15.5%. And the sales price of methanol was CNY 1,757, up by 0.5%. And ammonium nitrate was CNY 2,054, a decrease of 12.3%. In the case of the downward trend of market price coal, coal chemical and other major products, the company has strengthened its operation and management and also continued to maintain a high level of profitability. And in '24, we realized a total profit of CNY 31.58 billion, down 44% year-on-year. Realized net profit attributable to shareholders of the parent company of CNY 19.3 billion, down 1.1% year-on-year. Consolidated gross profit margin, 24.9%, year-on-year decline of 0.2%. Net cash flow from operating activities amounted to CNY 34.14 billion, year-on-year decline of 28.5%. Basic earnings per share of CNY 1.46, down 0.7% and a weighted average return of net asset 13.01%, down by 1.2%. And the changes in total profit in '24 are the follows, the main profit gaining factors, first, the decrease in unit cost of sales self-produced. Commodity coal increased by CNY 3,486 million. And the finance costs decreased by CNY 600 million, and the financial business increased profit by CNY 89 million. And the main profit reducing factors, the self-produced commodity coal price fell down by CNY 5 billion. And the investment income decreased by CNY 441 million. Taxes and surcharges increased by CNY 299 million. Provision of impairment increased by CNY 285 million. And power generation, heat supply decreased profit by CNY 130 million. Coal mining experiment decreased profit by CNY 71 million. And at the end of '24, the total assets amounted to CNY 357 billion, up 2.5%. Shareholders' equity attributable to parent company, CNY 151 billion, up 0.4%. Year-end gearing ratio of 46.3%, down 1.4%. And the earnings per share is CNY 11.46 per share. In '24, the company will focus on giving full play to the advantage of coal, power and chemical industry chain, promote the regional integrated management, optimize the original structure. And we also organized the market and tried to start and accelerate the transition. The full life cycle of coal facilities was implemented, and we realized the growth of 6.6%. And for the contracts signed, the cumulative value of 2.0% year-on-year. And we also had the innovation of financial business and made comprehensive efforts in nurturing product design, and we also got the title of Advanced Collectives of Central Enterprises by Ministry of Human Resources and Social Security and SASAC. Our asset size exceeded CNY 100 billion for 2 consecutive years. Gross profit of 62.4%, up 5.2%. And in '24, company's capital expenditure plan closely centered on coal, coal chemical, power, new energy and coal mining, including capital projects, equity investment, technological transformation and renewal of investment in 3 categories. In '24, the expenditure plan totaled CNY 16 billion. During the report period, a total of CNY 15.2 billion was completed, 95%. And the coal mine and coal preparation plant project will complete an investment of CNY 1.2 billion, and the project under construction and expected to come into operation at '26. And [indiscernible] coal mine and coal processing plant will complete investment of CNY 380 million in '24 with a cumulative investment of CNY 2.79 billion, and the project is under construction. And for Pingshuo Antaibao 350-megawatt low calorific value coal power generation project completed, CNY 268 million in '24, and Wushenqi Tuke by 660-megawatt power plant project will complete investment of CNY 437 million in '24 and is expected to be put into operation in '27. Shaanxi Yulin's coal chemical industry Phase 2 is expected to be completed in '26, and we will have a one-time one-go start-up. And for Liquid Sunshine, it will have a total investment of CNY 749 million, and it's in construction, and it's expected to put into use in '26. In '25, the CapEx will be mainly in coal, coal chemical, coal power, new energy, coal mining, coal equipment. And the annual CapEx is planned to be CNY 21.6 billion, an increase of 41.7% compared to the previous year. And the main projects, for example, for equity is CNY 415 million. And then for tech revamp, CNY 600 million, and tech information technology, CNY 1.728 billion. And then for the coal, it's in coal chemical, it's -- coal segment was CNY 8 billion, and the coal chemical, CNY 8.6 billion. Coal power, CNY 1.3 billion; and new energy CNY 2.691 billion. And then we will make effort to build the technology creator and energy low carbon innovation center and try to focus on the low-carbon transformation. In '24, we got 20 -- 47 progress awards above the industry and 276 authorized patents in '24. So we will deeply integrate the digital transformation with the production and operation of the enterprise and put smart control platform online for trial operation. And we are trying to make breakthroughs in stimulus policies, and we will try to have a perfect closure of this period and try to maintain the position in the top of the list of the top 100 listed companies in China. And we have been awarded the Grade A rating for information disclosure by Shanghai Stock Exchange for 15 consecutive years. And 10 stabilization of safety and environmental protection for the better, deeply implemented the idea of ecological stabilization and effectively fulfilled the ecological environment protection responsibilities. So in '23, the company invested CNY 3.21 billion in environmental protection without any environmental emergencies occurring. We have always adhered to the safety concept of people first and life first, and we always controlled and remitted the major safety risks and tried to improve the inherent safety. And in '24, production safety cost was CNY 3.2 billion to CNY 7 billion, and the overall safety situation was stable. And we persistently gave back to shareholders. In 2024, company paid a special dividend of CNY 1.5 billion and an interim dividend of CNY 2.936 billion, totaling CNY 4.436 billion. And in order to share the benefit with the shareholder, in the year of '24, we plan to pay 35% of the net profit attributable to shareholders of the listed company of RMB 18.156 billion. So per share, we will pay CNY 0.258. And we have cumulatively paid out RMB 44 billion, maximizing the interest of our shareholders and sustainable development of the company. Looking forward, in 2005, we will continue to focus on the efficiency and transformation to drive our creation -- drive our value through innovation. And our plan is to achieve 133 million tonnes of commercial coal of sales, 1.34 million tonnes of polyolefin and 2.05 million tonnes of urea. We will continue to exert more control and fine management to ensure stable revenue for both stable topline and bottom line. Specifically, we will be focusing on safety and enhance the foundation of controlling the risks. Second, we will continue to focus on excellent operations. Third, we will accelerate innovation. Fourth, we will accelerate the progress of the key projects. Fifth, we will control risks -- major risks to ensure sustainable development. Sixth, we will manage our cap -- market cap to improve our governance capabilities. We will continue to work hard to build ourselves into a top-tier energy company to maximize returns to the shareholders and our investors. Thank you so much for your attention.

Thank you. Mr. Zhang Futao, the Chairman of the Board for Shanghai Energy will be talking to you about their overview in 2004 (sic) [ 2024 ] and plan in 2005 (sic) [ 2025 ].

Distinguished Mr. Zhao, guests, ladies and gentlemen. 2024 was an important year for achieving the tasks for 14th 5-year plan. And we have been upholding socialism with Chinese characteristics with the leadership of President Xi, and we are trying to improve efficiency and transformation, and we're implementing 1,2,3,4,5 strategy, and we also led our staff to work really hard to improve our core competencies to improve our quality and efficiency. Now I'm going to talk to you about our performance in '24, the accomplishments and our future plans. Firstly, we enhanced the coordination between production, transportation and sales. Despite the weak market conditions and the challenges, we completed our budget goals. In 2024, we produced 6.27 million tonnes of commercial coal and 4.53 million tonnes of clean coal. Power generated was 3.82 billion kilowatt-hour, out of which 370 million was from renewable energy. And net profits were RMB 716 million. Total profits were RMB 880 million. Total assets were RMB 19.69 billion. Net equity was RMB 12.81 billion. Debt-to-asset ratio was 35.17%. Coal generated RMB 6.29 billion of total revenue, accounting for 67%. Power was RMB 1.96 billion, accounting for 20.9%. Aluminum processing revenue was RMB 960 million, 10.2% of total revenue. And comprehensive services, RMB 180 million, 1.9% of revenue. And we are improving our management capabilities, and we are taking -- we have taken measures to optimize our costs. The -- compared to the budget, the cost of raw coal production and coal cleaning, power sales were down by RMB 21 per tonne, RMB 1.7 per tonne and RMB 0.008 per kilowatt-hour, respectively. And we also reduced admin expenditure, achieved a tax relief, which accounted for RMB 15 million of savings. And we also achieved a replacement value of RMB 110 million through enhanced coal quality management. We achieved RMB 230 million of additional revenue. And by expanding our presence in North ports markets, we acquired 4 new quality customers, and sales increased by 290,000 tonnes. And we also achieved a capacity charge of RMB 60 million and sold 4 billion kilowatt-hour of power. Second, we continued to reform, and we replaced and reduced 107 people. We hired 104 on the ground technicians and operators. And we also hired 98 undergrad students fresh out of college. And we moved people to underground posts. Revenue ratio among the 3 business lines of coal mines were 1 to 1.9 to 2.91. 102 ground staff proactively took underground posts. The tenure and the contract-based system covered all managers, and we were ranked as excellent by SASAC, and we got grade A ratings from Shanghai Stock Exchange. We are also accelerating the progress of projects, and we are firmer in terms of transformation. The great integration of renewable energy project has pretty much completed. So 3 projects have been integrated into the grid. They included the 263,000 kilowatt PV project, 40,000 kW PV project and 5,900 kW distributed PV project. The Longdong area is also ready to be integrated into the grid. The renewable energy there reached 473,900 kilowatt. And we signed the land lease for Phase 2 PV project with 204,000 kilowatt and 3,580 more. We signed a -- that finished project initiation filing, and we signed a carbon zinc project with Hebei, Weixian -- Wei County government. And we also completed the permanent drainage system for Weizigou Mine. And we also are -- we also doubled down on technological innovation, which has been put as the top priority of ours. We invested RMB 380 million with an intensity of 3.7%, and we achieved 26 science advancement awards, 40 patents, 12 of them were invention patents, 8 reached international advancement level. And we also invested RMB 160 million to build 2 plus 12 intelligent mining phases, and we also smartly swapped out 140 people from underground. And we also got approved for our disruptive serving technology, and we also reduced coal gain for -- by 30%. And we also improved -- increased our returns to the shareholders. Since our listing, we have been paying out cash dividends for 20 years, accounting to -- amounting to RMB 3.621 billion, 4.13x of our raised capital. We paid cash dividend of RMB 145 million in 2025. And this was our first interim dividend payout. And on the basis of this interim dividend payout, we paid another RMB 145 million. Specifically, it was RMB 2 tax included per 10 shares. So together, we paid out RMB 290 million in cash dividend in 2024, accounting for 40.4% of our profits. And we have also formulated our market cap management and valuation improvement plan to keep improving the investors' confidence in us. Fifth, our future plan. The total -- the overall philosophy is to improve efficiency and drive transformation. We will continue to insist the 1, 2, 3, 4, 5 strategy, and we will be rooted in the 2 joint operations and the 2 hedges, and we'll be building out our 3 bases and upholding our 4 principles and enhance the safety, stability, efficiency, transformation, innovation and leadership. And by doing all these, we will try to transform ourselves to achieve new heights. For Jiangsu headquarters, we will try to stabilize output at 7.29 million per tonne, and this is a supporting zone and pilot zone for us. We will build a national base for clean energy and ecosystem governance for a subsidence area with over 1 million kilowatt-hour -- kilowatt rather worth of coal reserves, and we will try to build another couple of grid integration, demonstration basis, and the use of CO2 as a resource and also develop underground space and other future industries. For Jiangsu and Shaanxi, these are our strategic reserve zones and development acceleration zones. We will try to have another coal output of 12 million tonnes per year, two 1 million-kilowatt coal power projects and over 1.5 million kilowatts of renewable energy installation. And for Xinjiang base, we will try to get our hands on quality coal projects with our 2 mines, and we will try to have 2 million kilowatt-plus of renewable energy, and we'll try to build Xinjiang into a comprehensive energy demonstration base. For 2025, it's going to be the last year of the 14th 5-year plan and also an important transitional year for us. We will be upholding the XI Jinping thoughts and implementing the spirits of the NPC -- 20th NPC and the third and the second plenary session. We will be upholding all these philosophies and uphold the red lines of safety, environmental friendliness and inequity and also stabilize our workforce, output and operations. We will also be continuing to optimize our costs, focusing on 9 areas, including HR optimization, wage reform, marketization, tenure and contract-based management, disciplinary integration and major risk control. We will also try to achieve 8 goals, including improving our operations and achieving excellent status for our management and also achieving all of the safety production standards so as to finishing off the 14th 5-year plan and having a great start for the 15th 5-year plan. Ladies and gentlemen, we are having so much results and great achievements. We cannot do these without your support and help. And we do pay a lot of cash dividends, and we hope that the patient capital can grow with us. And we would like to use this earnings report to get your opinions and recommendations, and we will continue to grow and learn and strive forward and upward to achieve intrinsic growth and innovative development as to improve our market recognition and value creation. Our ultimate goal is to create more value and returns for our investors. Thank you, all.

Thank you, Mr. Zhang. Mr. Sun Kai will be talking to us about the performance in 2024 for Xinji and their plan for '25.

Distinguished investors, good afternoon. First of all, very happy to be here to hold the performance release for the new energy. So I would like to extend to all of the friends that cared about and supported us. I would like to extend the heartfelt gratitude and greetings. '24 marks the 75th anniversary of PRC and also the 35th anniversary of the new mining zone. So with the leadership of the party organization of China coal, we always deeply learned and studied the 20th CPC and the 20th second and third plenary session. And we adhere to the spirit of hard work and dealt with multiple challenges of the downward trend of the coal market, and we finished the production indexes and targets, and we formed the stable and good situation and momentum. And we use our undertaking and wrote the new chapter of the new energy company. So for 2024, the performance release. In 2024, the commercial coal production was 19 million tonnes. Sales was 18.8 million tonnes. Power generated 13 billion kWh. The sales was 12.3 billion kWh. The revenue was CNY 12.7 billion. The profit was CNY 3.7 billion, up by CNY 290 million, 8%. Net profit attributable to parent company, CNY 2.4 billion, up by CNY 280 million, 13%. The total asset of the company at the end of '24 is CNY 34.7 billion. The debt was CNY 27.3 billion. Debt-asset ratio -- asset-debt ratio of 61%. The right attributable to parent company, CNY 15.6 billion, up by 15%. Earnings per share, CNY 0.92, up by CNY 0.11, 13%. The completion situation of the key work in '24. First, we consolidated the foundation of the enterprise. The commercial coal production was stable. Power generated hit historic high. The quality of the coal was 4,468 calories per gram. Compared to the budget and compared to last year, we both improved and offset the market price downward trend and its impact on the business. So the profit ratio was up by 2.9% higher than the peers. The productivity was up by 7.6%. So we improved the profit and the 5 rates. Second, we also deepened our reform and innovation. Around the decisions that we made, we perfected the [ 113:511 ] governance system. And the advantage of the system translated into the governance efficiency. The contract-based and term-based management covered all of the functional department and the management personnel. We also improved the marketized talent system and mitigated the issues of the hardship of introducing talents and also hardship of introducing the coal business. And we also provided sound support and guarantee for the transformation. Third, we also stabilized our transformation and transition. We grasped the opportunity of regional advantage and also ceased the opportunity to promote the 2 joint businesses, and we had the 3 synergies of coal, power and new energy. We took leapfrog development into as a comprehensive enterprise of energy. So for the 5 coal wells and for the coal industrial safety group and the safe, high-efficiency wells, we maintained 4 power plants in parallel. And we also realized the completion rate of the investment of more than 100% of the 3 power plants in [indiscernible] and Yulin. And we also displayed our sense of undertaking and responsibility. We fully implemented the supply guarantee of the energy, and we also responded to the call of the rural revitalization policy. We improved the 5 helps and assistance. We cumulatively invested CNY 4.99 million, helping the locals to improve their living standard. And fifth, the livelihood projects were more improved. We went deeper and wider and tried to benefit our employees and improved and enlarged the scope of our welfare for the employees. And we increased the investment in the health check program for the employees. We also initiated the mutual health insurance. And we also sent gifts for the summer and winter time for the employees. And we solved a lot of issues for the people in our enterprises. And for the major work in '25. 2025 is the closing year of the 14th 5-year plan and also the planning year of the 15th 5-year plan. And we took the responsibility of the energy guarantee -- supply guarantee, deepened reform and low carbon transformation. We also are faced with market change and the new situation of improving quality. We have to avoid being complacent. We need to take a new posture to receive the challenges, and we need to be stable with improvement and improve our industry layout and improve the development quality. We want to promote the 2 joint businesses and try to have the 2 hedges and try to have the synergetic development of coal, power and new energy to finish the 14th 5-year plan target and also build a sound foundation for the 15th 5-year plan. First, we need to continuously strengthen the safety management and try to safeguard the stable production. We will take the 3-year breakthrough project of work safety as the main goal and try to target the 6-3 work requirements and try to focus on the disaster treatment and the process control and shift construction and also the cultural building to try to go stricter, deeper and more refined safety management. And second, we have to be scientific in terms of optimizing the production management to try to improve the quality and the efficiency, and we need to center around the -- stabilizing the coal and improving the power and try to improve both the quality and quantity and the efficiency to realize the higher level of production management. And third, we need to actively promote the enabling by innovation to try to improve growing development. We need to use scientific innovation and smart construction and grain capacity as the breaking point -- breakthrough point and try to nurture new quality productive force. We need to adhere to the direction of safe and smart grain and highly effective to improve the capability to enable the development. Four, we need to improve the control and improve the efficiency and quality. We need to do refine management, try to improve the efficiency and try to benchmark against the first-class enterprises and try to improve the efficiency and try to take the potential and always be efficiency centered and try to be refine in 3 and strong in 2 and improving in 5. Fifth, we need to be very careful about the schedule and speed up the transition. We have to take advantage of our coal resources and implement the 2 joint businesses, and we will try to stabilize the coal and expand the power and try to expand the new energy so that we can stabilize the process of transition. Six, we need to deepen the reform and try to guarantee the perfect closure of the task. We need to finish the requirement raised by SASAC and China Coal and try to realize the tasks in the 200 list and try to be very consolidated in the reform and try to realize high-quality closure. This year is an important year bridging the last and the new 5-year plan. We will try to speed up the thermal power plant schedules and try to explore in coal power and new energy and try to build the multi-energy mutually complementary green, low-carbon, smart, highly effective with -- system with modern governance. So for the new energy company, all of our employees will remember our task and try to move forward, improve the development quality and actively contribute to the healthy development of the capital market and try to return to the shareholder and investors with our outstanding performance. We look forward to cooperate with investors and friends that cares about our company and share our results of the high-quality development. We wish you good work, good health and all the best. Thank you.

Thank you, Mr. Sun. Next, we will come to the Q&A. So we will have the online and off-line Q&A, and we will try to answer the questions here first and then look at the online questions. So that lady at the back, please.

I'm from Huatai Securities. My name is [ Mumin Chen ]. Very glad to participate in this release by China Coal. I have 2 small questions. I want to ask the leaders. First, for the production of the company. So in '24, with the release of the capacity, actually the production had some increase, and also, in Mongolia and Shaanxi, there is, respectively, 1 million tonne increase. So where is the expected growth of production coming from in this new year? And the second question is for the dividend. I believe that this is an interesting topic to a lot of investors. So in '23, we increased the special dividend. So if we calculate the rate, it's now up to 37.7%. So in '24, if you add the year-end dividend, so now it's 33%. So actually, it's kind of like a decrease, but we also saw that in '24, the debt with interest was down by 91%. So I just want to ask about the future allocation of funds, and for the dividend payout ratio, is there any possibility or room for further increase? And for the central enterprise or SOE, the market value management and review mechanism, is there any new plans for that?

Okay. Thank you. So let me answer the question about the production in '25. We disclosed the '25 production plan. And, of course, that is our goal. And according to the business results, normally, the production at the end of the year would be higher than the plan. That is the big direction that we're headed. And secondly, if we look at the current situation, Tuke has already reached the nameplate scale, and there is only limited room for improvement. In '25, we have Libi and Weizigou, that is still in construction, they will not be finished. So we will still rely on the stable operation of the existing mines to stabilize the production in '25. So that is the overall plan. And then, I would like to invite our CFO to talk about the dividend.

So let me introduce to you about the dividend. If you are paying attention to the company, in the last few years, I think there is one characteristic about the dividend. We always maintain stable, continuous and foreseeable as the 3 principles. So for the stable, so when we went IPO, we made a commitment that it will not be lower than 20% to 30% of the income that we can dispose, so we always tried to reach the highest ceiling, which is 30%. And last year, considering the market and also the expectation, and also, we took a look at our cash, so we improved -- we increased the payout ratio. So that's stable than continuous or sustainable. That means we want to maintain this momentum of sustainable and high-quality development. If you look at 2017, the attributable -- the profit attributable to parent company was just 24%. So we just paid out 7.2%. So last year, as you said, it's 33%. So actually, the attributable part was CNY 19.2 billion. And actually, the payout was CNY 6.2 billion. So percent is very important, but whether a company can sustainably develop to continuously give back to the shareholders, so that's even more important. So I'm just emphasizing our stable as -- our stability and how we are always on the path of sustainable development. And that's the basis for dividend payout. Third is anticipation or foreseeability. You have been tracking our prices, production capacity and output, so, of course, you would have certain anticipations of our performance. And so our payout will not be 30% less than your anticipation, right? Whatever happens, we would definitely try to shoot over your anticipation, not under it. So the payout is going to be sustainable. So I will stop here. So what was the last question?

Last question was regarding the arrangements for market cap management.

Mr. Zhang speaking. So we focus on improving our operational and managerial capabilities. And in terms of our stock prices, we are trying to enhance our operational foundations to enhance the returns for the shareholders, and that's the basis for the market cap management. Of course, I -- we noticed that you -- if you track the -- track China Coal for the longest term, be it CSRC or SASAC, they have issued guidelines on how to go about managing market caps. So we will definitely be implementing these guidelines. So right now, we'll be focusing on improving our operations, ensuring the stability of our performance and also to meet the anticipation of our shareholders. And, of course, in some sense, for payout this year, it's 35% on the basis of '24, and that was actually a direct response to the market concerns or investor concerns.

Company management, I'm from Tianfeng Securities. My name is [ Xiao Dong ]. I have 2 questions. First, in your CapEx plan in '25, the figures are pretty high. So could you talk to us about the use of the proceeds, the CapEx and the timelines? Second, will this high CapEx put pressure on dividend payout? For example, will dividend ratio come down vis-a-vis '24?

Regarding CapEx, so your question was regarding what was the new addition for, right?

Yes.

And also the time line or an expected timeline of how -- when the CapEx will happen? Sure. I will answer the first question regarding the CapEx growth. Yes, indeed, CNY 21.6 billion is an increase from '24. So firstly, we are accelerating the 2 joint operations project. And also, there's a lot of renewal projects. They are entering a critical period. So RMB 4.8 billion increased for the renewal project. The Libi project increased by 27% with RMB 1.7 billion. Yulin Phase 2, it was -- it's going to be RMB 6.5 billion, and that's 83% increase. And for Liquid Sunshine, it's going to be RMB 1.8 billion additional CapEx and year-over-year growth of 80%. So for these ongoing projects, there have been a lot of increases compared to last year. And also, we're using a different basis of statistics. When we were formulating the '25 CapEx plan, the CNY 1.728 billion of IT spend was also included. And as to the growth, Libi mine is a 4 million tonne mine, expected to be constructed in 2026. Weizigou is in Xinjiang and will also come alive -- become operational in 2026. For Antaibao power plant, it's already in production. And the Wushenqi project will become operational in 2027. And Shaanxi Yulin should become operational by the end of 2026. And for Liquid Sunshine, it's hydrogen plus a CO2 converted methanol. So this is expected to become operational in 2026. So that's basically it for all of the major projects.

I'm from Changjiang Securities. My name is [ Xiao Yong ]. I have 1 question regarding the industry and 3 questions regarding the company. So coal prices have come down by a lot recently. So the CNY 675 prices have fallen below the benchmark price of CNY 675. Will that benchmark price change? What's your take? And regarding China Coal, so this question is for China Coal management. You did a good job in Q4 in terms of cost controls. Will there be further room for cost reduction in '25? And another question is for Xinji management. Right now, the power unit installation and construction is going very fast. So after that is finished, will be using the cash reserves for dividends or for new coal projects? And for Shanghai Energy, my question is for [indiscernible]. Mr. [indiscernible], you said we're going to build another project. So aside from the planned coal production, do you have other measures that you're going to take to build another project that is of an equal size of Shanghai Energy?

That's a lot of questions. So the first question will be addressed by Mr. Guo Xiu and Mr. Ying Ping.

Thank you for your question. So regarding the CNY 675 price structure, you are a little concerned. So the coal industry has been around for many years. We are very familiar with CNY 675. And it's a result of the negotiations between the coal and the power industries. And so this is the benchmark prices. So from the perspective of the coal and power industries, the CNY 675 -- so for long-term prices, it's CNY 686, and the spot price is CNY 682. So I think the chances of adjusting the CNY 675 structure are pretty low. But that's, of course, based on our judgment of the overall industry trends. I don't think there will be a large adjustment there. So this benchmark price system will not be adjusted. It doesn't look like it will -- there will be. Regarding costs, Mr. Chai will take the question.

Mr. Chai speaking. So costs are always top of mind for investors. And it's -- the same can be said for ourselves, and we're constantly controlling costs and using up-to-date measures to control the costs. So when people ask questions, they always ask about costs, and we need to keep our costs as controllable and stable as possible. So right now, our revenue is for RMB 140 billion. Of course, there is further room for cost reduction. So this year, we made a lot of efforts. For example, for the self-controlled projects, we used a centralized data platform mid-office to oversee all lines of business. So this mid-office or this platform controls all units to generate more value and optimize costs. And we designed 100-plus models in order to drive cost down. And specifically, when it comes to costs, so we will be building out a modern supply chain to reform our purchasing efforts. You all know that for every 1% reduction in purchasing costs, the contribution to the bottom line is multiples, so we will be using AI and digitization to drive cost down. And with this mid-office, our -- we can't -- it's easier for us to standardize a lot of the procedures. So we are basically digitizing and smartizing our processes. Of course, our revenue will become larger, maybe much higher than RMB 140 billion. On the other hand, why do I stress the full lifetime value? We have to worry about ESG, environment and social responsibilities. We have to follow the national policies closely. So on this front, we will be enhancing investments on all fronts to ensure sustainable growth. So for the costs, you need to look at it from multiple aspects. We need to continue continually to drive value. As long as we can do that, the cost structure should be reasonable. The third question will be addressed by Mr. [ Jian ].

Thank you very much for the questions from that researcher from Changjiang Securities. So your question is regarding anticipation for dividend payout going forward. So for the power -- coal-powered units that are under construction, there's [indiscernible], Yulin and [indiscernible]. So these 3 projects will be integrated into the grid gradually. So as of mid 2026, we will be formulating on the 15th 5-year plan and exploring potential new projects. So after these units are built, in terms of dividend payout policy, we have been upholding long-term, stable, sustainable returns of project -- profits to the shareholders since our listing. We grew from RMB 0.10 per share -- per 10 shares in 2018 to RMB 1.6 per 10 shares in 2024 -- or 2022, rather. And from '22 to '24, cash dividend accounted for 13%, 18% and 17%, about -- over 30% of profits available for dividends. Of course, this is lower than China Coal's figures, and we acknowledge that. As for the future plans, we will be basing our efforts off the 15th 5-year plan and be rooted in our sustainable development, and we'll continue to enhance our core competencies and make our main business stronger. With the careful analysis of our operations and the cash reserves and on the basis of the 15th 5-year plan, we will uphold the principle of protecting shareholders' rights, and we'll also be considering sustainable development of the company, and we will definitely factor into reasonable returns to the shareholders. We will sustain a stable dividend policy to the shareholders. Mr. Zhang will be addressing the question addressed to Shanghai Energy.

I should say that for Shanghai Energy, it is an old enterprise of 40, 50 years. And with our exploration, our production base is also migrating outwards. Now, in Xinjiang, we have a mine being constructed. And for the mine being constructed, that's expected to be commissioned in '26. So then it's -- this target of rebuilding [indiscernible], I think we need to do several things. The first is our headquarter space. For the headquarter space, the current method is to stabilize our productivity and headquarters. Now it's 7.29 million tonne. And it is providing some guarantee for us to migrate and to expand and also provide the talent for the new base. Therefore, the headquarter space, the advantage is that we have our own network for the incremental volume for substation. We want to build the comprehensive energy service company. We have the integrated project of storage and generation. So now 49 megawatt was already built and in 20,400 kilowatt. So for the substation network, we also built the virtual power plant, which is already established as a project. And for the CO2 capture and utilization, we are doing some early phase preparations. For the existing land of the headquarters, we are also trying to utilize the resource. We are trying to find some industry projects that fits that piece of land because the headquarters has very good business environment and very good conditions, and we have the green power and our own grid. And our power price is pretty low, and we have our reserved land. We have a very mature industry supply. So we want to consolidate further our headquarter space so that we can build a foundation for the industry migration. And the other is about the Kunshan base, our affiliated company, Datun Co-power, we are doing some preparation with them. And as requested by the group, we want to migrate our main business. And for the prospecting right, we are also following up the exploration there. We will form a capacity of 12 million tonnes to 15 million tonnes. So that's for the coal production capacity. We will move it or migrate it outwards. And we will also match it up with the co-power and the new energy facilities there. And the third is the Xinjiang base. For the Xinjiang base, we will further expand the capacity, for example, the Weizigou Mine. The plan was already approved, and we also made some adjustments. And also for the mine production scale, it was already reported to the Administration of Energy for approval, and we will also adjust our scale. Then for Tianshan coal power, we also will adjust the capacity there. And for the new energy electricity, we will also make some new deployments for [indiscernible] Mine area. The coal there is quite rare, low ash, low sodium, low sulfur, very good for coal chemical industry. So we are doing some early phase survey and study. So to rebuild [indiscernible] that is our task and our goal for Shanghai Energy. Around the target we will try to accelerate the implementation.

Thank you, Mr. Zhang. Please.

So my name is [ Sugapong ]. I have 2 questions. First is about the Chemical segment. Since beginning of '25, we saw some fluctuation of some chemical products, for example, olefin and urea. Actually, the price was lower than the previous. So considering the cost down of the raw coal, so I just want to ask about the business situation of the Chemical segment and also any methods for improving the efficiency. So that's for chemical. The second question is about cost as well. So just now some other investors asked about the cost control of the listed company. I saw in '24 the reports, I think the unit cost relevant to chemical, they all went down. So I just want to ask the 2 companies in terms of your cost control.

So for the Chemical, [indiscernible], our Chief expert.

So let me answer about the chemical part. So in '25, as you said, you noticed that for the olefin or urea, the price went down, but then for the coal price, the raw material is also going down. So in Chemicals segment, since we conducted lean management, we tried to mine our potential. So from January to February, it seems that we maintained very good profitability. And it is due to several aspects. First, for Chemicals segment, we've been in this segment for more than 10 years. Now we have a very refined management. It is deeply rooted in every enterprise. And second, we control very strictly the production cost, and all enterprises went into much detail when they calculate the cost. And third, for the Chemical segment, after 10 years of accumulation, we already congregated a batch of management personnel. So in management, we are always seeking excellence in material consumption and energy consumption. We also went to the extreme. And then, for olefin or urea or other products, especially for PO, we are promoting the high-end nameplates or high-end grade to sell a better price in the market. Then maybe Shanghai Energy first.

Thank you for the question. So I think I can answer your question from several aspects. First, for the raw coal cost of Shanghai Energy in '24 compared to the same period in '23, it was down from CNY 510 to CNY 476. So it's a big reduction. So actually, Shanghai Energy has an outline. And for our fixed cost, it is pretty high. Labor, material and depreciation around 70% of the cost. So basically, it's a lot of pressure to push down the cost. But I think we always have this awareness that every part of the cost is reducible, first is to improve efficiency, and we've tried to mine the high heat value coal and try to improve the production efficiency. And the second part is that on the cost side, we went from 3 perspectives. First is to establish the standard system. So Mr. Chai already talked about it. And the second part is about the special campaign of maintenance, and we set up the KPI for price down to improve in those key areas. And the third is to strengthen the procurement cost control throughout the process and try to establish a mechanism to utilize the waste or the legacy equipment. So in terms of efficiency, being an old enterprise, we still want to control the cost, and we want to treat that as one of the key works that we are doing. So that is my answer. So Mr. [indiscernible].

Thank you for your attention to us. So I think for the cost management of the enterprise, it is something that a mature enterprise must rely on for survival. And for the day-to-day management, it couldn't have been achieved without the control of the cost. For coal, coal chemical enterprises, the cost of the coal, it's management, it's actually more complex than coal power, and it is harder. So for the coal producer, Xinji is in East China. So actually, it's just like Shanghai Energy. We have a very complex situation on the coal belt, and it's harder to explore. So for Xinji for our company, we always try to have the cost leadership regionally. So with the same system, which is the standard cost management system, we start from the source, and we have total management of the whole process to realize the effective control of the cost. So to control from the source, that means we will start from the design phase. And we went from the design of the layout and the selection of the equipment and the choice of the processes to control the source of the cost. Therefore, process control is mainly reflected in the implementation of the exploration and also the improvement of the efficiency and the utilization or use of the equipment and the maintenance of the equipment. So we will control the cost in all those areas. For total management, means for all of our staff, so based on the process management from the source of the exploitation to the transportation, to the washing of coal, to the management organization, we realized the total management of the cost and improvement of the awareness of all staff. So we can conduct the whole process management of a period of time for the coal. So for our company, in raw coal and commercial coal or product coal, our result of our management is pretty clear. In '24, for the product coal, the volume actually was down year-on-year, and the unit cost was actually cheaper compared to the budget as well as the same period last year. And then for power, since for power plants there are mature factories, the key of cost control is to reduce coal consumption. So from the design of the generator to the process control, to the raw coal quality and fuel coal quality control to reduce the consumption so that we can control the cost of power segment. I believe that through our company's effort -- through our collective effort, coal and power segment cost and the unit cost will definitely be controlled within our expectation. And we can definitely realize the continuous stabilization and improvement of our performance. Thank you.

So the lady from the third row, please.

My name is [ Lim Yang ] from Dongfang Caifu Securities. I have 2 questions. The first question is regarding shareholder returns. So I saw that for Xinji and Shanghai Energy, there has been -- both companies issued the action plans to improve returns to shareholders. And Shanghai Energy launched the plan for improving market valuation. So these are very detailed plans. But when we talk to investors, investors tend to think that both companies are pretty depressed in terms of their stock prices on shares. Will there be proactive actions on the part of the management, especially when it comes to increasing of stock holdings, which happened in -- with China Coal in 2023? And also will there be any repos? So with the depressed share prices going on right now, will there be proactive actions like that? That was my first question. Second question is regarding Xinji Energy. Since last year, there has been attention -- a lot of attention on the coal power integration projects on the part Xinji, but the downward trend of power prices, witnessed since last year, made people worry about the sustainability of the company. So for the power prices in Anhui and -- what was your outlook on that? And what are your measures going to be?

Thank you very much for your attention, said Mr. Zhang. So yes, indeed, the China Coal Group did launch a plan to increase holdings, and it has been implemented. And as of now, we haven't received any further plans to increase holdings. But, of course, I understand in order to sustain share prices, to maintain the share prices to be higher than earnings per share, we will be focusing on our operations and other aspects to take comprehensive measures. So it comes down to solidifying our operational foundation, improving our profitability to provide the basis for long-term and sustainable growth of our business. So that was for your question regarding -- that was to your question regarding whether there will be any further plans to increase stock holdings. Mr. Wang will be taking the second question regarding Xinji.

Thank you very much for your attention. So we uphold the new energy strategy of 4 reforms and 1 collaboration, and we uphold the dual carbon target, and we're pushing for the 2 joint operations, especially when it comes to the coal power integration, which is one of the joint operation. So for -- we control 4 coal power projects. One is Phase 2 [indiscernible]. Second is the two 1 million for [indiscernible] and also 2 units for [indiscernible] and also [indiscernible]. The projects, all of them, are going very smoothly. And just now you were asking about now we are using spot prices, what will that have in terms of impact on us? We are faced with both opportunities and challenges, especially for Anhui Province, we started doing a pilot project for stock prices starting January 2025. And at the beginning of this year, NDRC and the National Energy Bureau launched a notice regarding the reform of power prices, so basically #136 -- a document #136. And since the issuance of this document, the renewable energy-generated power will be marketized fully. And since January 2025, Anhui-powered market started doing this kind of project using spot prices. So right now, we are seeing that the trading -- the prices in the long term have come down. So the spot prices in -- spot price market in Anhui is just starting, and there's still a lot of room for improvement. And so for the existing power capacity and the incremental growth, there might be some impact, but I believe as market gets more improvement, things will get better.

Thank you very much, Mr. Wang. For the interest of time, we will answer the last set of questions.

My name is [indiscernible] from [indiscernible] Securities. Congratulations on achieving such great results. So I have a question regarding industry. So China Coal has a capacity of 300 million tonnes, accounting for -- so raw coal is about 6%, and you have gone through the entire coal cycle, basically. And what's your take about the transition from the golden 10 years to the downward period of '12 through '16. And now we are -- the prices are coming down again. What should we -- what do you think about the secrecy of the coal industry? And how do you offset and minimize the impact from the cyclicality of this industry? And some analysts, colleagues have already mentioned about measures taken to reduce costs. So we -- some investors are worried that the cost might come back to the 2016-2017 level. We've talked with investors about this. What's -- what should be the medium or averages for the prices?

So you mentioned the cyclicality of the call. It goes to show your research is pretty profound. And when it comes -- if you further analyze the cycles, we are -- so we can see that the period during which -- the periods or duration for troughs of the cycles are shortening. And this is thanks to our lean management and our technological breakthroughs. Our productivity has improved greatly. And our safety standards have also greatly improved. Compared to the last cycle, so for the entire last cycle or if you look to 1980s and 1990s, the entire industry was a downward one. Then since 2003, we had a golden decade, and then, there was another downturn in 2014 through 2016, but we quickly exited that downturn. And today, we are on a very different ground in terms of management and production. And the entire macro environment -- the entire macro economy is very resilient and will continue to be so. And coal will continue to serve as a strategic resource and a foundational resource for energy supply in China. So even though there is fluctuation, I don't think the industry will stay at the bottom for long. As for the median -- medium prices, would one of you like to take this question? Guo Xiu or Ying Ping, would one of you like to take this question?

This is a great question. Thank you very much for that. So since 2004, the industry has come back, and we did have our expectations. In 2004, 2005, we thought -- we believe that the prices will be coming down, and that trend was already very clear because there's national strategies and things like that. But based on our understanding of this industry, the cost structure of this industry, the cost is actually on the rise. And the power generated in China has been steadily on the rise as well over the last couple of years. So according to market expectation, the power generated in 2025 will be 600 billion kWh more than 2024. So that means there will be 20 million of coal aside from renewable. So the capacity would be 4.8 billion in 2025 to 20 million-plus compared to now. So for coal chemicals and metallurgy, there might be a slight increase for chemicals, but we don't think -- we don't hope to see great increases in metallurgy. So demand-wise, there won't be a lot of the changes. So even though there has been great price declines in 2 to 3 months, the coal will still be 50% of our energy mix in China. So supply is stable. Demand will come down slightly. So we believe in 2025, medium prices will come down slightly. And I think we are already pretty much around the point of equilibrium. So this is pretty much in line with our expectation for '24 and '25. So we don't need to be overly bearish about this industry. Thank you.

Okay. One last question. Mr. Chen.

My name is [ Jintao ] from Guangfa Securities. What do you think about the rationale for price drops? Will the prices continue to drop until end of April and the beginning of May? What's -- second question is regarding the gap between long-term contract coal prices and the market prices. And could you break it down by regions, Shaanxi, Shanxi, Inner Mongolia, et cetera?

Mr. Ying Ping will take this question again. So 2 questions here. For the first question, the reasons for the price drops. Like I was saying earlier, for the second half of '24, the prices were already starting to drop. We all know about what happened with the imported coal, 640 million tonnes. That was a lot of impact for the total supply. Another big impact is metallurgical coal. And the total demand was not in line with expectation, so barring some environmental protection reasons, so production was pretty stable. Demand was weak. Of course, prices were going to come down and their inventory became more. So that was a normal phenomenon in my opinion. So I think reallocating resources is conducive. I think the biggest impact was imported coal. Everybody was asking whether there could be restrictions put on imported coal. But from a strategic point of view, or rather from a market perspective, imported coal is an important complement to China's coal supply. But from a security perspective, it's having a lot of impact on the total coal market. So I think that is the driver, and that's what we believe is the main driver for the price drops. In terms of the gap between long term and spot, there's not a lot of differences by regions for these main regions of coal production. Price mechanisms are different. So for North ports, they go with the NDRC prices. And China Coal go with NDRC prices. So right now, it's 5,500 calories. So RMB 26 gap for 5,000 calories, and RMB 40-something gap for 4,500 calories. So for a production company, I think we just need to adjust our production layout. I think this is beneficial for us. So for China Coal in the last 2 years, we always adhered to NDRC's requirement. For the long-term contract, we signed a bit less, 75%. Last year, it was 80%. NDRC required 75%. And for our customers, end market was pretty stable. So for China Coal, in terms of the long-term contract and spot price, the gap doesn't affect us that much. But for other coal producers, especially, I think it's more influential for the ones that will sell in the region, but it's a pain that you need to deal with. Okay. Thank you.

Thank you, Ying Ping. So that is the end for Q&A. Dear friends, dear guests, the 3 companies introduced their business and answered the questions. Since time is really limited, in order to facilitate more thorough communication, after the meeting, you can keep in touch with the IR of the 3 companies, and we are willing to answer your questions. So for China Coal and listed companies, received a lot of support from all aspects of the society, and we are in the new era of high-quality development. We will further improve our quality and try to build ourselves as a world-class energy enterprise. I want to thank the leaders for their sharing and answering. I want to thank you for participating. That is the end for the performance release. Thank you.