China Shenhua Energy Company Limited reported a 4.1% year-on-year rise in first-half net profit, driven by higher coal sales and the consolidation of newly acquired assets from its parent group.

Revenue reached 189.34 billion yuan ($28 billion)  in January-June, up 7.9% from a year earlier, while net profit attributable to shareholders stood at 28.72 billion yuan, the company said in its interim report released on August 29.

Second-quarter performance accelerated sharply, with revenue surging 73.6% year on year to 118.94 billion yuan — the first time quarterly revenue surpassed the 100 billion yuan mark — and net profit rising 42.2% to 18.05 billion yuan.

The company completed the acquisition of equity interests in 12 target companies from its controlling shareholder, China Energy Investment Corp (CHN Energy), and its wholly owned subsidiary Western Energy during the first half, significantly expanding business volumes and reinforcing its integrated operations advantage.

Coal remained the primary profit driver. The coal segment posted total profit of 27.0 billion yuan, up 1.3% year on year. The coal chemical business swung to a profit of 2.13 billion yuan from a loss of 338 million yuan a year earlier, with gross margin jumping to 28.8% from 9.5%. The power generation segment faced pressure, with average electricity selling price easing to 370 yuan/MWh from 372 yuan/MWh, dragging segment profit down 3.5% year on year. The transportation segment remained stable, with railway, port and shipping profits rising 8.9%, 15.5% and 51.4% respectively.

Coal sales volumes and average selling prices both increased year on year, reflecting market supply-demand conditions, the company said. Coal chemical product sales also rose, particularly oil products and ethylene glycol.

Net cash inflow from operating activities totaled 54.66 billion yuan in the first half, up 6.1% year on year, supported by higher revenue from coal, coal chemical and transportation businesses.

The company also reported a substantial increase in coal resources and production capacity during the period, ensuring stable development amid a complex market environment.

As of end-June, China Shenhua held coal resources of 101.08 billion tonnes and recoverable reserves of 35.77 billion tonnes under Chinese standards. The company operated 70.64 GW of installed power generation capacity, 2,408 km of coal railway lines, combined port loading capacity of about 270 million tonnes per annum (Mtpa) at Huanghua port and other facilities, a shipping fleet of approximately 3.7 million deadweight tonnes, and modern coal chemical plants with annual production capacity of about 1.88 million tonnes of coal-to-olefins and 1.08 million tonnes of coal-to-oil.

Total assets reached 920.9 billion yuan at end-June, up 1.9% from the start of the year, while total liabilities rose 23.5% to 370.9 billion yuan, mainly due to increased borrowings from the acquisition and higher operating liabilities. The debt-to-asset ratio climbed to 40.3% from 33.2% at the beginning of the year. Financial expenses rose 46.4% to 1.64 billion yuan, which the company attributed to lower interest income from reduced deposit balances and increased exchange losses from currency fluctuations.

The company proposed an interim dividend of 0.98 yuan per share (including tax) for 2026, totaling 21.26 billion yuan.

Looking ahead to the second half, China Shenhua expects coal demand to return to seasonal fluctuations as geopolitical conflicts ease, with hot summer weather and chemical sector coal use providing support. Supply elasticity remains limited amid ongoing safety inspections and capacity supervision policies, while import volumes are expected to stay elevated. Overall, the company forecasts a balanced-to-tight coal market in the second half, with prices trending higher within a reasonable range.