yanzhou coal mining company limited annual results 2011co., ltd –yancoal canada resources co., ltd...

1 兖州煤业股份有限公司

Yanzhou Coal Mining Company Limited


Annual Results 2011

March 2012



Geographical Coverage of Yanzhou Coal

昆士兰

新南威尔士

Yarrabee

AshtonMoolarben

Austar

Galilee Basin

Bowen Basin

Surat BasinGunnedah Basin

Sydney Basin

Gloucester Basin

Cameby Down

HarrybrandtWilpeena

Althena

澳大利亚

‘Wilga Basin’

‘Collie Basin’

兖煤拥有煤矿

西澳大利亚

Premiere Coal

Inner Mongolia Autonomous Region

Shanxi

Shaanxi

Shandong

Saskatchewan

Hong Kong

Australia

Western

Australia

Queensland

Coal mines Yanzhou coal owns

NSW



Part I Operation Review

Part II Capital Operation

Part III Market Analysis

Part IV Outlook & Operating Strategies



Record High of Economies of Scale

Continued Optimization of Financial Position

Significant Advantage of Three Business Operation Regions

Revenue and Efficiency Improved via Marketing and Sales

Sustained Reinforcement of Cost Control

Relatively High Gross Profit of Coal Business

Accelerating Construction of Key Projects

Part I Operation Review



Record High of Economies of Scale

Unit 2011 2010 Change % Change

(+ / -)

Raw coal

production

‘000

tonnes 55,680 49,400 6,270 12.69

Salable coal

production

‘000

tonnes 50,910 45,530 5,380 11.82

Saleable coal

sales volume

‘000

tonnes 64,250 49,630 14,620 29.46

Sales income RMB mn 47,065.8 33,944.3 13,121.5 38.66

Net income RMB mn 8,928.1 9,281.4 -353.3 -3.81

Net operating

income RMB mn 8,564.4 7,416.7 1,147.7 15.47

Total assets RMB mn 97,151.6 72,755.9 24,395.7 33.53

Cash dividend RMB 0.57 0.59 -0.02 -3.39



Continued Optimization of Financial Position

Unit: RMB mn

As at 31

December 2011

As at 31

December 2010 Change

% Change

(+/-)

Cash at bank and on hand 17,688.5 9,339.0 8,349.5 89.40

Note receivables &

accounts receivable 7,312.1 10,017.3 -2,705.2 -27.01

Bank loan 34,457.8 23,015.8 11,442.0 49.71

Shareholders’ equity 42,634.5 37,331.9 5,302.6 14.20

Net asset value per share

(RMB) 8.67 7.59 1.08 14.20

Net interest bearing gearing

ratio 17.26% 18.80% -1.54 % pts -

7

兖州煤业股份有限公司


Significant Advantage of Three Business Operation Regions

0

90

180

270

360 29

22.2

0.6

6.2

35.9

24.7

1.8

9.4

2010年 2011年

0

13,000

26,000

39,000

52,000

2010年 2011年

Sales volume of saleable coal Sales income of saleable coal

Unit: ’000 tonnes Unit: RMB bn

44,256

50,942

34,736

1,498

8,022

35,280

5,602

10,060

Total Mining

sites in

Shandong

Mining

sites in

other

provinces

Overseas

mining

sites

Total Mining

sites in

Shandong

Mining

sites in

other

provinces

Overseas

mining

sites



36

27

18

9



Revenue and Efficiency Improved via Marketing and Sales

2011 2010

Y-o-Y 4Q

2011

3Q

2011

2Q

2011

1Q

2011 Change

%

Change

The headquarters 686.01 633.59 52.42 8.27 699.25 688.70 665.39 691.59

• Domestic 685.87 633.55 52.32 8.26 698.93 688.70 665.39 691.40

• Export 991.20 736.44 254.76 34.59 1,129.63 – – 871.08

Shanxi Neng Hua 467.67 382.00 85.67 22.43 490.29 466.27 460.28 446.19

Heze Neng Hua 912.86 771.99 140.87 18.25 941.34 933.00 897.26 807.41

Ordos Neng Hua 290.71 – – – 288.70 278.97 286.06 314.53

Yancoal Australia 929.80 774.19 155.61 20.10 910.25 798.67 1,139.64 907.22

Increase in selling prices Unit: RMB/tonne



Sustained Reinforcement of Cost Control

2011 2010 Change % Change 1H 2011

The headquarters 288.53 258.87 29.66 11.46 286.20

Shanxi Neng Hua 332.70 249.59 83.11 33.30 312.66

Heze Neng Hua 649.10 659.68 -10.58 -1.60 715.47

Ordos Neng Hua 158.59 – – – 150.44

Yancoal Australia 426.27 393.28 32.99 8.39 453.85

Unit: RMB/tonne



Relatively High Gross Profit of Coal Business

Unit price

(RMB/tonne)

Unit cost

(RMB/tonne)

GP Margin

In 2011

GP margin

in 2010

% pts change of

GP margin

The headquarters 686.01 288.53 57.94% 59.14% -1.20

Shanxi Neng Hua 912.86 649.10 28.89% 14.55% 14.34

Heze Neng Hua 467.67 332.70 28.86% 34.66% -5.80

Ordos Neng Hua 290.71 158.59 45.45% - -

Yancoal Australia 929.80 426.27 54.15% 49.20% 4.95

11

Accelerating Construction of Key Projects



Project Equity

interests

Resource

volume

(m tonnes)

Planned

production

capacity

(m tonnes)

Progress

Shilawusu coal mine 61% 2,314 10 Under construction, expected to

commence production by the end

of the 12th Five-Year Plan

Zhuan Longwan

coal mine 100% 547.7 5

Under construction, expected to


of 2013

Ying Panho coal

mine 100% 2,168.2 12



of the 12th Five-Year Plan

Wanfu coal mine 98.33% 291.3 1.8 Under construction, expected to


of the12th Five-Year Plan

Ordos methanal

project (600,000

tonnes)

100% – 0.6 Under construction, expected the

trial production by the end of 2012

CTL project and Jin

Jitan coal mine 25% 1,736 8



of 2013



Expediting Capital Operation

Good Progress of Merger with Gloucester Coal Ltd.

Part II Capital Operation



Expediting Capital Operation

Seven Strategic Acquisitions One Strategic Disposal

One Technology Export

Six New Wholly-owned Overseas Subsidiaries

One Investment in a JV Company

3

1

5

4

2

– Acquired mining rights of Zhuan Longwan coal mine

– Increased 10% equity interests in Haosheng Company

– Acquired 80% equity interests in Inner Mongolia Xintai Coal

– Increased 30% equity interests in Aston coal mine JV

– Acquired 100% equity interests in Syntech Holdings Pty Ltd and Syntech Holdings II Pty Ltd

– Acquired 100% equity interests in Westfarmers Premier Coal

– Acquired 19 Potash exploration permits in Canada

– Disposal of 51% equity interests in Minerva Coal Mine JV

– Yancoal International (Holding) Co., Limited

– Yancoal International Trading Co., Ltd

– Yancoal International Technology Development Co., Ltd

– Yancoal International Resources Development Co., Ltd

– Yancoal Luxembourg Energy Holding Co., Ltd

– Yancoal Canada Resources Co., Ltd

– Longwall top coal caving technique

– Shaanxi Future Energy Chemical Corp Ltd.

14

Good Progress of Merger with Gloucester (I)

「Merger Proposal Deed」

「Supplementary Agreement to Merger Proposal Deed」



—Entered into Agreement



- Merger Proposal

Noble Group Other

shareholders

Gloucester

（Listed on ASX）

Yanzhou Coal

Yancoal Australia

Austar Coal Mine Pty Ltd

64.5% 100%

100% Issuing shares of

Yancoal Australia

Holding of

Gloucester shares

Yanzhou

Coal

Yancoal

International

Yancoal

Australia New Australian

company1

New

Australian

company2

New

Australian

company3

New

Australian

company 4

New

Australian

company 5

Austar Gloucester

Noble

Group

Other original

Gloucester

shareholders

Hong Kong

Australia

Yancoal Australia

Technology

Development Pty

UCC

Energy

Premier

Char

Existing coal mine

assets under

exploration by

Yancoal Australia

Syntech Premier

100%

100%

78% 14.2% 7.8%

35.5%

Good Progress of Merger with Gloucester (II)



-Gloucester at a glance

Equity

interests Coal type

Mining

method

Attributable

planned

capacity

(m tonnes)

Resource volume

(m tonnes)

Reserves

(m tonnes)

Total Attri-

butable Total

Attribu-

table

A. Coal mines in operation 10.6 1,200.9 1,200.9 247.7 247.7

(1) Gloucester Basin

(Duralie coal mine and

Stratford coal mine)

100%

- Semi-soft coking

coal

- Thermal coal

Open cut 5.1 315.9 315.9 87.0 87.0

(2) Donaldson

(Donaldson open cut mine,

Abel and Tasman

underground mines)

100%

- Semi-soft coking

coal

- Thermal coal

Open cut &

Under-

ground

5.5 885.0 885.0 160.7 160.7

B. Coal mines under construction 2.6 699.8 638.5 96.0 48.0

(1) Middlemount coal mine 49.9%

- PCI coal

- Semi-hard

coking coal

Open cut 2.6 122.6 61.3 96.0 48.0

(2) Monash coal mine 100%

- Semi-soft coking

coal

- Thermal coal

Under-

ground — 577.2 577.2 0.0 0.0

TOTAL 13.2 1,900.7 1,839.4 343.7 295.7

Coal mine assets

Good Progress of Merger with Gloucester (III)

11.6% of equity interests in NCIG Holdings Pty Ltd

17

Listing of Yancoal Australia Made Smooth Progress (IV)

Achieve the best listing efficiency

Accomplish expansion in scale

Exert unparalleled synergy



-Reasons for the merger

18

Part III Market Analysis

Coal Market Analysis

Domestic Coal Market Analysis

International Coal Market Analysis

Domestic Methanol Market Analysis



19

Domestic Coal Market Analysis

2011 coal market review

Supply and demand: slightly

tight in balance

Price: fluctuated at high levels



2012 coal market outlook

Supply and demand ：basically in balance

Price：tend to be stable

High

international

energy price

Coal Price

Intensified

transportation

bottleneck

Stable macro

economic

environment

Imbalanced in

supply and

demand

20

International Coal Market Analysis

2011 international coal price maintained at high levels

2012 international coal price will fluctuate at high levels

Strong demand in China and India

Export policy adjustments in Vietnam and Indonesia

International energy prices stay high



110

120

130

140

1/6 5/23 10/7 2/21

US

$/tonne

2011 BJ spot price of thermal coal in Australia

21

Domestic Methanol Market

◆ Supply and demand : constantly

imbalanced

◆Price：fluctuate at low level



2011 Methanol Market Review 2012 Methanol Market Outlook

◆ Production capacity: over supply

◆Demand: moderate recovered

◆Price：fluctuated

2011年国内甲醇平均价格

2600

2775

2950

3125

3300

2011年1月 2011年3月 2011年5月 2011年7月 2011年9月 2011年11月

元/吨

Average Domestic Methanol Price in 2011

RM

B/t

on

ne

Jan Mar May Jul Sep Nov



Part IV Outlook and Operating Strategies

2012 Outlook

Total coal production and operation volume to

exceed 100 million tonnes

To become listed in four stock exchange

markets

2012 Operating Strategies



Coal sales target: 75.9 million tonnes

Coal sales contracts in Shandong Province

2012 Outlook (I)

Contract Volume

(‘000 tonnes) Tax-inclusive price

2012 2011 % change 2012 2011 % change

Yanzhou Coal

(RMB/tonne) 7,720 8,995 -14.2 589.09 571.29 3.1

• National 4,290 4,290 — 529.05 503.86 5.0

• Provincial 3,250 3,630 -10.5 663.76 630.63 5.3

• Additional 180 1,075 -83.3 672.00 640.00 5.0

1Q contract for Yancoal

Australia (US$/tonne) 3,010 2,720 10.7 133.71 138.00 -3.1



2012 Outlook (II)

Cost control target: 10%

CAPEX in 2012: RMB11.8 billion



2012 Operating Strategies

Reinforce operating management to enhance our profitability

Strengthen capital operation to leap forward our development

Push forward the development of key projects to meet the

production capacity and efficiency standards

26

2012 Operating Strategies (I)

-Reinforce operating management to enhance our profitability



Implement the production strategy of

“stabilizing domestic and expanding

overseas”

Strengthen finance cost and cash

management

Optimize marketing and sales

strategies

To

maximize

Our

Benefits

Strengthen production safety risk

prevention and management

27

To complete Yancoal Australia’s listing in a timely manner

To achieve effective financing in a prudent manner

To implement resource acquisitions in a prudent manner

To proactively export technology

To optimize the resource allocations

2012 Operating Strategies (II)

-Strengthen capital operation to leap forward our development



28

Strengthen project management and construction

Speed up the development of existing projects

2012 Operating Strategies (III)



Expansion of Moolarben Coal Mine

Zhuan Longwan Coal Mine

Shilawusu Coal Mine

Ying Panhao Coal Mine

- Push forward the development of key projects to meet the

production capacity and efficiency standards



Achieved record high in various operating targets in 2011

Speed up capital operation and project construction at

the same time

Expect domestic and export coal prices to fluctuate at

high levels in 2012

Further enhance profitability and returns to shareholders

in 2012

Conclusion



Thank you

yanzhou coal mining company limited annual results 2011co., ltd –yancoal canada resources co., ltd...

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