Daqin Railway Co., Ltd., the operator of China's busiest coal-transport corridor, reported a 34.73% year-on-year plunge in net profit last year, pressured by shrinking coal shipments and a costly shift in its freight mix. Yet the company set an unchanged 2026 throughput target of 400 million tonnes for its flagship Daqin line.

Net profit attributable to shareholders fell to 5.9 billion yuan, while revenue rose 4.04% year on year to 77.65 billion yuan, Daqin Railway said in its annual report. Adjusted net profit dropped 35.14% to 5.86 billion yuan. Operating cash flow shrank 46.47% to 4.99 billion yuan.

Daqin Railway slipped to a loss of 324 million yuan in the fourth quarter, which the company attributed to a seasonal jump in labor costs, heavy maintenance and logistics-support expenses.

Four forces drove the steep profit decline last year, the report said. Shipments of coal, a high-yield segment, dropped by 40.23 million tonnes, of which Daqin line contracted by 2.11 million tonnes.

A restructuring of the transport portfolio, with non-coal bulk cargo up 13%, saddled the company with higher freight service charges because many new destinations lie beyond its own network, swelling through-transport expenses.

The push into modern logistics and multi-modal services remains in a market-cultivation phase where margins are sacrificed to build volumes. Meanwhile, flexible pricing strategies adopted across the sector shifted negotiation power to the demand side, compressing the company's composite revenue per tonne-kilometer.

Freight remains the backbone, generating 71.09% of main operating revenue last year, with thermal coal the dominant commodity mainly from Shanxi, Inner Mongolia and Shaanxi. Other commodities include coke, steel and iron ore.

In 2025, the company handled 680.73 million tonnes of cargoes, down 3.6% year on year, accounting for 12.9% of China's total rail freight and 16.7% of China Railway's freight. The company's coal shipments fell 6.8% to 548.84 million tonnes, representing 19.9% of the country's total rail coal deliveries and 26.3% of China Railway's share.

The flagship Daqin railway moved 390.04 million tonnes of freight, down 0.5% on the year. The railway operated 81.6 heavy-haul trains each day on average over the past year, including 50.7 trains with a capacity of 20,000 tonnes.

The coal shipment decline came amid weak demand and competition from imports. China's thermal power generation fell 0.7% from the year before to 6,327.2 TWh in 2025, the first annual contraction since 2016, as hydro, nuclear, wind and solar output climbed year on year. Non-power sector's coal use was squeezed by slumping property and infrastructure.

Cement output contracted 6.9% to 1.69 billion tonnes, and crude steel production slipped 4.4% to 961 million tonnes.

Meanwhile, coal imports remained high at 490 million tonnes last year, overlapping the coastal and riverine markets served by Daqin Railway's rail-sea intermodal chain. Intensifying competitive pressure came from ample capacity on nearby rail corridors and lower road-transport costs driven by new-energy trucks in Shanxi.

Despite the margin squeeze, the board proposed a final cash dividend of 0.14 yuan per share, totaling 2.81 billion yuan.

Looking to 2026, Daqin Railway stated that coal demand is approaching a plateau under China's "dual-carbon" policy, with non-fossil fuels steadily displacing thermal coal, downstream sectors providing sluggish pull and competing coal corridors eroding the company's freight. Daqin railway has entered a period of stable, low-growth operations.

The company still targets freight volume of 710 million tonnes in 2026 and Daqin line coal shipment of 400 million tonnes, alongside a full-year revenue budget of 78 billion yuan.

In addition, first-quarter results for 2026 showed revenue of 18.57 billion yuan, a 4.32% increase year on year, while net profit attributable to shareholders dropped 7.26% to 2.38 billion yuan.