Yanzhou Coal Mining, the listed unit of the nation's fourth-largest coal producer, yesterday forecast a more than 190 per cent jump in net profit for the full year after posting a four-fold increase in earnings for the third quarter.
The company attributed the spectacular jump in quarterly profit to an 83.4 per cent rise in the average selling price of coal, which reached 795 yuan (HK$900) per tonne, as well as a 2.36 per cent increase in sales volume to 8.66 million tonnes.
Analysts say Yanzhou is the biggest beneficiary of the rise in spot coal prices among the three largest state-backed listed coal companies because it has the highest proportion of sales in that market. Sales through long-term contracts commanded much lower prices for all producers.
Yanzhou also benefited because a high proportion of its sales comes from coking coal used in steel smelting plants.
These prices have risen more than power-station coal.
'Due to the increase in domestic and international prices of coal, it is estimated that net profit attributable to shareholders will increase more than 190 per cent, compared with the same period last year,' Yanzhou Coal said last night.
Separately, Yanzhou said its board had approved a proposal to acquire a 74 per cent stake in Shandong Hua Ju Energy from its parent Yankuang Group for 593.24 million yuan. It did not provide details.
