China Coal Energy : THIRD QUARTERLY REPORT 2019

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

中國中煤能源股份有限公司

(a joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 01898)

THIRD QUARTERLY REPORT 2019

Pursuant to the regulations and rules of China Securities Regulatory Commission and Shanghai Stock Exchange (the "SSE"), China Coal Energy Company Limited (the "Company" or "China Coal Energy", together with its subsidiaries, collectively the "Group") is required to publish reports on a quarterly basis.

This announcement is made pursuant to Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) and Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

This announcement is a summary of the 2019 third quarterly financial report of the Company for the three months ended 30 September 2019. The full text of the quarterly financial report will be available on the website of The Stock Exchange of Hong Kong Limited (the "HKSE") on 28 October 2019. The full text of the quarterly financial report is in Chinese only.

I.	IMPORTANT NOTICE
	1.1		The board of directors and the supervisory committee of the Company together with
		the directors, supervisors and the senior management thereof guarantee that the content
		of this quarterly report is true, accurate and complete and does not contain any false
		representations, misleading statements or material omissions, and severally and jointly
		accept legal responsibility for the content of this report.
	1.2		Absence of directors
			Name of		Position of	Reason	Name
			absent director		absent director	for absence	of proxy
			Zhang Ke		Independent Director	Other work commitment	Zhang Chengjie
			Zhao Rongzhe		Director	Other work commitment	Du Ji'an
	1.3		Li Yanjiang (the person-in-charge of the Company), Chai Qiaolin (the person-in-charge
			of accounting affairs) and Zheng Weili (the person responsible for the accounting
			department, i.e. head of the accounting department) guarantee that the financial
			statements set out in this quarterly report are true, accurate and complete.
	1.4		The third quarterly report of the Company is unaudited.

1

1. BASIC INFORMATION OF THE COMPANY 2.1 Major financial data

			Unit：RMB'000
			Increase/decrease at
			the end of the
			reporting period as
	As at the end of	As at the end of	compared to the end
	the reporting	the previous year	of the previous
Items	period	(Restated)	year (%)
Total assets	276,679,168	264,365,047	4.7
Net assets attributable to shareholders
of the listed company	97,621,224	92,107,431	6.0
	From the	From the beginning of the
	beginning of the	previous year to the end	Increase/decrease
	year to the end of	of the corresponding	compared to the
	the reporting	period of the previous	corresponding
	period (January	year (January to	period of the
	to September)	September) (Restated)	previous year (%)
Net cash flows generated from
operating activities	16,906,475	16,767,210	0.8
	From the	From the beginning of the
	beginning of the	previous year to the end	Increase/decrease
	year to the end	of the corresponding	compared to the
	of the reporting	period of the previous	corresponding
	period (January	year (January to	period of the
	to September)	September) (Restated)	previous year (%)
Operational revenue	94,238,593	77,137,425	22.2
Net profit attributable to shareholders
of the listed company	5,761,125	4,063,985	41.8
Net profit attributable to shareholders
of the listed company net of non-
recurring gains or losses	5,572,279	4,121,774	35.2
Weighted average return on net			Increased by 1.59
assets (%)	6.07	4.48	percentage points
Basic earnings per share
(RMB per share)	0.43	0.31	38.7
Diluted earnings per share
(RMB per share)	0.43	0.31	38.7

2

Non-recurring gains or losses and relevant amounts

✓ Applicable	□ Not applicable
			Unit：RMB'000
			Amount for the period
			from the beginning of
		Amount for	the year to the end of
		the current	the reporting period
		period (July to	(January to
Items		September)	September)	Explanations
Profit and loss on disposal of
non-current assets	118	4,032	-
Government grants included in profit or
loss for the current period, excluding
those closely related to the Company's
ordinary business and granted on an on-
going basis in fixed amount or volume
according to certain principles under
national policies		31,988	117,172	-
Net profit or loss for the period of
subsidiaries formed by business
combination under common control
from the beginning of the period to the
date of combination	-	-9,715	-
Investment gain generated from disposal
of long-term equity investment	143	692	-
Reversal of impairment provisions for
receivables and contract assets subject
to individual impairment test	2,178	6,682	-
Other non-operating income and expenses
apart from the foregoing	225,682	192,313	-
Impact on minority shareholders'
interests (after tax)	-51,136	-45,808	-
Effect of income tax	-62,152	-76,522	-
Total		146,821	188,846	-

3

2.2 Major production and operational data

				Unit：RMB
			January to
		January to	September
		September	2018	Percentage
Items	Unit	2019	(Restated)	change %
I. Coal operations
1. Production volume of commercial
coal	10,000 tonnes	7,716	5,587	38.1
Of which: Thermal coal	10,000 tonnes	6,878	4,924	39.7
Coking coal	10,000 tonnes	838	662.9	26.4
2. Sales volume of commercial coal	10,000 tonnes	16,229	12,194	33.1
(1) Sales volume of self produced
coal	10,000 tonnes	7,749	5,552	39.6
Of which: external sales volume	10,000 tonnes	7,254	5,377	34.9
(2) Sales volume of proprietary coal
trading	10,000 tonnes	8,046	6,139	31.1
Of which: external sales volume	10,000 tonnes	7,487	5,558	34.7
(3) Agency sales of coal	10,000 tonnes	434	503	-13.7

4

				January to
			January to	September
			September	2018	Percentage
Items		Unit	2019	(Restated)	change %
II. Coal chemical operations
(I) Polyolefin
1.	Polyethylene production volume	10,000 tonnes	55.0	54.7	0.5
	Sales volume	10,000 tonnes	55.1	54.5	1.1
2.	Polypropylene production volume	10,000 tonnes	52.6	54.2	-3.0
	Sales volume	10,000 tonnes	51.9	54.8	-5.3
(II) Urea
1.	Production volume	10,000 tonnes	151.5	130.3	16.3
2.	Sales volume	10,000 tonnes	187.5	154.7	21.2
(III) Methanol
1.	Production volume	10,000 tonnes	72.8	52.1	39.7
2.	Sales volume	10,000 tonnes	72.8	52.5	38.7
	Of which: external sales volume	10,000 tonnes	11.7	5.1	129.4
III. Coal mining equipment operations
1. Output value of coal mining	RMB100
equipment	million	65.6	51.7	26.9

Note: The sales volume of commercial coal and methanol of the Company in 2019 includes the internal self-consumption, and the relative data of 2018 is adjusted correspondingly.

5

2.3 Major differences arising from the adoption of different accounting standards in preparing the financial statements

Unit:RMB'000

		Net profit attributable to	Net assets attributable to
		shareholders of the	shareholders of
		listed company	the listed company
			January to		As at 31
		January to	September	As at 30	December
		September	2018	September	2018
Items		2019	(Restated)	2019	(Restated)
According to PRC GAAP		5,761,125	4,063,985	97,621,224	92,107,431
Items and amounts adjusted according to IAS:
(a) Adjustment to special funds and
deferred tax of the coal industry		802,345	1,000,956	-36,015	28,680
(b) Adjustment to floating of non-tradable
shares under equity split		-	-	-155,259	-155,259
(c) Adjustment to government grants		2,783	2,783	-26,897	-29,680
According to IAS		6,566,253	5,067,724	97,403,053	91,951,172

Explanations on major reconciliations are as follows:

1. Adjustment to special reserves and relevant deferred tax: special reserves comprise maintenance fee, safety fund, coal mine transformation fund, mining environmental restoration security deposit and sustainable development reserve. Under PRC GAAP, the Group should make provisions for the special reserves which will be accounted as the production cost and contributions made to the special reserves of equity attributable to shareholders. Non-capital expenditure incurred should be directly offset against special reserves upon occurrence, while capital expenditure incurred should be recorded as fixed assets upon completion, and offset against special reserves based on the cost of the fixed assets with accumulated depreciation fully recognised. After that, no subsequent provisions for depreciation would be made to the relevant fixed assets. Under IFRS, provisions made for the special reserves should be recorded as retained earnings provision while the relevant expenditures are recognised upon occurrence and the special reserves are accordingly transferred to retained earnings.
2. Under PRC GAAP, the consideration paid by holders of non-tradable shares to holders of tradable shares in accordance with the reform proposal of equity split should be recorded as long-term equity investments in the balance sheet. Under IFRS, such consideration shall be recorded as interests of minority shareholders directly deducted from the equity attributable to shareholders.
3. Under PRC GAAP, subsidies considered as capital investment by the government should be recorded in "capital reserve". Under IFRS, the subsidies mentioned above shall be treated as government grants.

6

2.4 Total number of shareholders, top 10 shareholders and top 10 shareholders holding tradable shares (or shareholders not subject to trading moratorium) as at the end of the reporting period

						Unit: Share
Total number of shareholders						153,317
	Particulars of top 10 shareholders
	Number of shares		Number of	Shares pledged
	held as at the	Shareholding	shares subject
	or frozen
Name of	end of the	percentage	to trading		Nature of
shareholders (full name)	reporting period	(%)	moratorium	Status	Number		shareholders
China National Coal Group Corporation	7,605,207,608	57.36	-	Nil	0		State-owned
							legal person
HKSCC NOMINEES LIMITED	3,952,875,163	29.81	-	Unknown	-		Foreign legal
							person
China Securities Finance Corporation	346,112,355	2.61	-	Nil	0		State-owned
Limited (中國證券金融股份有限公司)							legal person
China Coal Hong Kong Limited	132,351,000	1.00	-	Nil	0		State-owned
(中煤能源香港有限公司)							legal person
Central Huijin Asset Management Company	83,035,400	0.63	-	Nil	0		State-owned
Limited (中央匯金資產管理有限責任公							legal person
司)
Hong Kong Securities Clearing	49,752,568	0.38	-	Nil	0		Foreign legal
Company Limited							person
Xu Kaidong (徐開東)	26,000,000	0.20	-	Nil	0		Domestic
							natural
							person
Abu Dhabi Investment Authority	15,960,613	0.12	-	Nil	0		Foreign legal
							person
Hejin Wannianchun Real Estate Co., Ltd. (河	10,329,500	0.08	-	Nil	0		Domestic non
津市萬年春置業有限公司)							state-owned
							legal person
China Everbright Bank Co., Ltd. -	9,684,471	0.07	-	Nil	0		Others
Everbright Pramerica Quantitative Core
Securities Investment Fund
(中國光大銀行股份有限公司－
光大保德信量化核心證券投資基金)

7

Particulars of top 10 shareholders not subject to trading moratorium

	Number of listed
	shares held not		Type and number of Shares
Name of shareholders	subject to trading
moratorium		Type	Number
China National Coal Group Corporation			Ordinary shares
(中國中煤能源集團有限公司)	7,605,207,608		denominated in RMB	7,605,207,608
HKSCC NOMINEES LIMITED			Overseas listed foreign
	3,952,875,163		shares	3,952,875,163
China Securities Finance Corporation Limited			Ordinary shares
(中國證券金融股份有限公司)	346,112,355		denominated in RMB	346,112,355
China Coal Hong Kong Limited			Overseas listed foreign
(中煤能源香港有限公司)	132,351,000		shares	132,351,000
Central Huijin Asset Management Company Limited			Ordinary shares
(中央匯金資產管理有限責任公司)	83,035,400		denominated in RMB	83,035,400
Hong Kong Securities Clearing Company Limited			Ordinary shares
	49,752,568		denominated in RMB	49,752,568
Xu Kaidong (徐開東)			Ordinary shares
	26,000,000		denominated in RMB	26,000,000
Abu Dhabi Investment Authority			Ordinary shares
	15,960,613		denominated in RMB	15,960,613
Hejin Wannianchun Real Estate Co., Ltd.			Ordinary shares
(河津市萬年春置業有限公司)	10,329,500		denominated in RMB	10,329,500
China Everbright Bank Co., Ltd. - Everbright Pramerica
Quantitative Core Securities Investment Fund
(中國光大銀行股份有限公司－			Ordinary shares
光大保德信量化核心證券投資基金)	9,684,471		denominated in RMB	9,684,471
Explanations on affiliated relationship or parties	China Coal Hong Kong Limited (中煤能源香港有限公司) is a wholly-
acting in concert among the abovementioned	owned subsidiary of China Coal Group, the controlling shareholder of the
shareholders	Company. It is not certain if any of the other shareholders are affiliated
	or acting in concert with each other.
Explanations on preference shareholders with voting	The Company does not	have preference shares and has no preference
rights restored and the number of shares held	shareholders with voting rights restored.

8

Notes: The above tables of particulars of top 10 shareholders and particulars of top 10 shareholders not subject to trading moratorium are based on the followings:

1. The above information was prepared in accordance with the register of shareholders of the Company as at 30 September 2019 provided by the China Securities Depository and Clearing Corporation Limited Shanghai Branch and Computershare Hong Kong Investor Services Limited.
2. The A shares held by Hong Kong Securities Clearing Company Limited are held on behalf of various customers.
3. The H shares held by HKSCC Nominees Limited are held on behalf of various customers.
4. As at 30 September 2019, according to the disclosure of interests published on the website of HKSE, Funde Sino Life Insurance Co., Ltd. had long positions in 2,012,858,147 H shares of the Company.

2.5 Total number of holders of preference shares, top 10 holders of preference shares and top 10 holders of preference shares (not subject to trading moratorium) as at the end of the reporting period

• Applicable ✓ Not applicable

9

1. SIGNIFICANT EVENTS
   3.1 Significant changes of the major accounting items and financial indicators of the Company and the reasons thereof
   ✓ Applicable □ Not applicable

3.1.1 Analysis on reasons for the major changes in items on the balance sheet

				Unit: RMB'000
	As at	As at
	30 September	31 December	Increase/
Items	2019	2018 (Restated)	decrease (%)	Major reasons for the changes
Cash at bank and	31,345,687	23,879,163	31.3	Mainly due to the fact that the Company
on hand				further enhanced its profitability and
				maintained a good level of cash inflow
				from operations.
Trade receivable	8,704,574	4,881,389	78.3	Mainly due to the increment in the Group's
				revenue which increased the trade
				receivables within the settlement period
				accordingly.
Prepayments	2,072,768	1,591,545	30.2	Mainly due to an increase in prepayments
				caused by the expansion of the Company's
				business scale.
Other receivables	3,012,994	1,884,845	59.9	Mainly due to the fact that in order to
				implement the national energy strategy
				and deepen the energy cooperation
				between Jiangsu province and Shanxi
				province, Pingshuo Group made capital
				contribution to Sujin Energy Holding
				Company Limited by injecting its 51%
				equity interests in China Coal Pingshuo
				No.1 Coal Gangue Power Generation
				Company Limited. As such, China
				Coal Pingshuo No.1 Coal Gangue
				Power Generation Company Limited
				was no longer included in the scope of
				consolidation and Pingshuo Group no
				longer offset its receivables.
Other current assets	2,346,102	3,455,409	-32.1	Mainly due to the short-term loan provided
				by China Coal Finance Company to the
				members within the Group (other than
				China Coal Energy) became overdue.

10

	As at	As at
	30 September	31 December	Increase/
Items	2019	2018 (Restated)	decrease (%)	Major reasons for the changes
Other investments	2,332,305	4,563,851	-48.9	Mainly because part of the Company's other
in equity				investments in equity instruments were
instruments				changed to long-term equity investment
				for accounting measurement.
Construction in	17,092,518	25,662,240	-33.4	Mainly due to the combined effects of
progress				the Company's partial transfers of its
				construction-in-progress projects to
				fixed assets, the exclusion of China
				Coal Pingshuo No.1 Coal Gangue Power
				Generation Company Limited from the
				scope of consolidation and the increase
				in the Company's contribution to
				infrastructures in the current period.
Right-of-use assets	438,356	-	-	The Company recognizes the right to use
				leased assets during the lease term as
				right-to-use assets in accordance to the
				newly revised "Accounting Standards for
				Business Enterprises No. 21 - Leasing".
Other non-current	9,958,381	6,686,012	48.9	Mainly due to the increase in long-term loan
assets				provided by China Coal Finance Company
				to other members within the Group
				(except China Coal Group) and the fact
				that the shareholder loans provided by
				Pingshuo Group previously was no longer
				counted in due to the exclusion of China
				Coal Pingshuo No.1 Coal Gangue Power
				Generation Company Limited from the
				scope of consolidation.
Non-current	35,793,219	17,825,310	100.8	Mainly due to an increase in the long-term
liabilities due				borrowings and bonds payable that are
within one year				due within one year.
Lease liability	440,405	-	-	The Company recognizes the portion of the
				outstanding lease payments that was more
				than one year overdue as lease liability
				in accordance to the newly revised
				"Accounting Standards for Business
				Enterprises No. 21 - Leasing".

11

	As at	As at
	30 September	31 December	Increase/
Items	2019	2018 (Restated)	decrease (%)	Major reasons for the changes
Provisions	2,510,798	1,495,978	67.8	Mainly due to the fact that the coal producing
				enterprises of the Company recognized
				the estimated expenditure related to
				environmental governance and restoration
				as fixed assets and increased estimated
				liabilities accordingly in accordance
				with relevant management rules of the
				mine geological environment governance
				and restoration fund issued by the state
				and local governments and the mine
				geological environment governance
				and restoration plans prepared by the
				enterprises.

3.1.2 Analysis on reasons for the major changes in items on the income statement Unit: RMB'000

	January to	January to
	September	September	Increase/
Items	2019	2018 (Restated)	decrease (%)	Major reasons for the changes
Operating revenue	94,238,593	77,137,425	22.2	Mainly due to a year-on-year increase in sales
				of coal and other major products of the
				Company.
Operating cost	65,157,302	54,342,203	19.9	Same as above.
Tax and surcharges	3,054,167	2,304,694	32.5	Mainly due to a year-on-year increase in the
				resource tax and additional taxes and
				fees as a result of the increase in sales
				revenue of the Company's self-produced
				commercial coal.
Selling expenses	10,190,006	7,667,160	32.9	Mainly due to the increase in sales volume of
				coal that bears the railroad transportation
				costs and port expenses as a result of the
				expansion of coal sales scale.
Research and	156,053	117,141	33.2	Mainly due to the Company's increased
development				investment in the research and
expenses				development on science and technology,
				resulting in the corresponding increase in
				research and development expenses.

12

	January to	January to
	September	September	Increase/
Items	2019	2018 (Restated)	decrease (%)	Major reasons for the changes
Finance costs	3,558,380	2,704,383	31.6	Mainly attributable to, among others, the
				effect that certain construction projects
				were put into production whereby the
				relevant interest expenses were ceased to
				be capitalized.
Investment gain	2,029,427	1,323,297	53.4	Mainly due to the increase in investment
				gains recognized by the Company in
				proportion to shareholding as a result
				of better economic benefits of equity
				investment companies.
Non-operating	285,837	40,936	598.3	Mainly due to the fact that in the process of
income				implementing the supply side structural
				reform, relevant coal enterprises
				transferred their surplus coal capacity
				indicators to enhance income in
				accordance with relevant coal capacity
				replacement policies issued by the state.

3.1.3 Analysis on reasons for major changes in items on the cash flow statement Unit: RMB'000

		January to	Increase/
	January to	September	decrease in
Items	September 2019	2018 (Restated)	amount	Major reasons for the changes
Net cash flows	16,906,475	16,767,210	139,265	Mainly attributable to the year-on-year
generated from				increase of the operating results of
operating				the Company, and the simultaneous
activities				streamlined capital management, which
				resulted in the year-on-year increase
				in the net cash inflow from operating
				activities.
Net cash flows	-7,892,789	-13,735,251	5,842,462	Mainly due to the combined effect of the
generated				year-on-year decrease in the capital
from investment				expenditure of the Company, the year-on-
activities				year decrease in the cash outflow arised
				from the change in time deposits with an
				initial deposit period of more than three
				months, and the year-on-year increase
				in the cash outflow generated from the
				issuance of self-operated loan by China
				Coal Finance to the members within the
				Group (other than China Coal Energy).

13

		January to	Increase/
	January to	September	decrease in
Items	September 2019	2018 (Restated)	amount	Major reasons for the changes
Net cash flows	-2,402,313	-1,471,544	-930,769	Mainly due to the year-on-year decrease in
generated from				the net increase in debt facility of the
financing				Company and the year-on-year increase in
activities				the cash paid for dividend distribution..

3.1.4 Revenue, cost and gross profit of coal operations

For the period from January to September 2019, the release of the advanced production capacity of the Company's self-owned coal mines and the further expansion in the market of purchased and exported coal led to an increase in the sales volume of coal and the further optimization of the variety structure of self- produced commercial coal, which resulted in a significant year-on-year increase in the revenue, cost of sales and gross profit of the Group's coal operations. For the period from January to September 2019, the revenue from coal operations of the Company increased from RMB59.486 billion for the same period of last year to RMB75.156 billion, representing an increase of RMB15.670 billion; the cost of sales of coal operations increased from RMB40.685 billion for the same period of last year to RMB50.729 billion, representing an increase of RMB10.044 billion; and the gross profit of coal operations increased from RMB18.801 billion for the same period of last year to RMB24.427 billion, representing an increase of RMB5.626 billion.

14

3.1.5 Coal sales volume and selling prices before netting of inter-segmental sales and the year-on-year changes

Currency: RMB

				January to	January to	Increase/		Increase/decrease
				September 2019	September 2018	decrease in amount	in percentage
				Sales	Selling	Sales	Selling	Sales		Selling
				volume	price	volume	price	volume		price	Sales	Selling
				(10,000	(RMB/	(10,000	(RMB/	(10,000		(RMB/	volume	price
Items				tonnes)	tonne)	tonnes)	tonne)	tonnes)		tonne)	(%)	(%)
I. Self-produced	Total		7,749	498	5,552	514	2,197		-16	39.6	-3.1
commercial coal
(I) Thermal coal	6,911	437	4,889	448	2,022		-11	41.4	-2.5
		1.	Domestic sale	6,897	437	4,889	448	2,008		-11	41.1	-2.5
		2.	Export	14	590	☆	☆	14		-	-	-
	(II) Coking coal	838	995	663	997	175		-2	26.4	-0.2
		1.	Domestic sale	838	995	663	997	175		-2	26.4	-0.2
II. Proprietary coal trading	Total		8,046	455	6,139	504	1,907		-49	31.1	-9.7
	(I) Domestic resale	7,939	453	6,110	501	1,829		-48	29.9	-9.6
	(II) Self-operated	23	1,282	19	1,333	4		-51	21.1	-3.8
			exports*
	(III) Import trading	84	403	10	478	74		-75	740.0	-15.7
III. Import and export and	Total		434	5	503	6	-69		-1	-13.7	-16.7
domestic agency★
(I)	Import agency	83	4	74	2	9		2	12.2	100.0
	(II)	Export agency	125	8	183	8	-58		-	-31.7	-
	(III) Domestic agency	226	3	246	6	-20		-3	-8.1	-50.0

☆： N/A for the period.

*： Briquette export.

★： Selling price is agency service fee.

Note: Sales volume of the commercial coal includes the amount of inter-segmentalself-consumption volume within the Company, which was 10.54 million tonnes for January to September 2019 and 7.56 million tonnes for January to September 2018.

15

3.1.6 The unit cost of sales of self-produced commercial coal and the year-on-year changes

Unit: RMB/tonne Currency: RMB

			Year-on-year
				Increase/
	January to	January to	Increase/	decrease in
	September	September	decrease	percentage
Items	2019	2018	in amount	(%)
Materials costs	59.09	48.10	10.99	22.8
Staff costs	30.13	36.25	-6.12	-16.9
Depreciation and
amortization	52.33	47.40	4.93	10.4
Repair expenses	8.38	10.41	-2.03	-19.5
Outsourcing mining
engineering fee	30.24	21.42	8.82	41.2
Other costs	32.46	44.45	-11.99	-27.0
Unit cost of sales of
self-produced
commercial coal	212.63	208.03	4.60	2.2

For the period from January to September 2019, the Company's unit cost of sales of self-produced commercial coal was RMB212.63/tonne, representing an increase of RMB4.60/tonne or 2.2% as compared to RMB208.03/tonne for the same period of last year, which was mainly attributable to the increase in the unit outsourcing mining engineering fees and costs of materials due to the increase in the mining engineering volume and materials consumed as the Company increased its efforts to strip the open-pit mines and excavate the underground mines in accordance with the needs of continuous production. In the second half of 2018, certain infrastructure and technological innovation projects were gradually transferred to fixed assets, resulting in an increase in depreciation and amortization, which led to an increase in the unit costs of depreciation and amortization. Meanwhile, the dilutive effect of the release of the advanced production capacity of the Company's self-owned coal mines resulted in the increase in the production of self-produced commercial coal, which led to the decrease in unit staff cost and repair expenditures. In addition, a year-on-year increase in the capitalization of special reserves such as the safety fund and maintenance fees used to ensure production safety led to a decrease in the special reserve balances of other costs.

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3.1.7 Sales volume and price of major chemical products and the year-on-year changes

Currency: RMB

	January to	January to	Increase/decrease	Increase/decrease
	September 2019	September 2018	in amount	in percentage
	Sales	Selling	Sales	Selling	Sales	Selling
	volume	price	volume	price	volume	price	Sales	Selling
	(10,000	(RMB/	(10,000	(RMB/	(10,000	(RMB/	volume	price
Items	tonnes)	tonne)	tonnes)	tonne)	tonnes)	tonne)	(%)	(%)
(I) Polyolefin	107.0	7,350	109.4	8,059	-2.4	-709	-2.2	-8.8
1. Polyethylene	55.1	7,112	54.5	8,234	0.6	-1,122	1.1	-13.6
2. Polypropylene	51.9	7,603	54.8	7,885	-2.9	-282	-5.3	-3.6
(II) Urea	187.5	1,795	154.7	1,786	32.8	9	21.2	0.5
(III) Methanol	72.8	1,506	52.5	2,117	20.3	-611	38.7	-28.9
Of which: Inter-segment	61.1	1,495	47.4	2,092	13.7	-597	28.9	-28.5
self-consumption
volume◆
External sales	11.7	1,567	5.1	2,351	6.6	-784	129.4	-33.3

◆： The amount of inter-segmentself-consumption volume represents the supply of methanol by China Coal Yuanxing Company and China Coal Shaanxi Company to Mengda Chemical Company and Ordos Energy Chemical Company.

3.1.8 Unit cost of sales of major chemical products and year-on-year changes

Unit: RMB/tonne Currency: RMB

			Year-on-year
					Increase/
	January to	January to	Increase/		decrease in
	September	September	decrease		percentage
Items	2019	2018	in amount		(%)
(I) Polyolefin	5,508	6,166	-658		-10.7
1. Polyethylene	5,564	6,156	-592		-9.6
2. Polypropylene	5,449	6,176	-727		-11.8
(II) Urea	1,095	1,103	-8		-0.7
(III) Methanol	1,377	1,470	-93		-6.3

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1. Analysis and explanation on the progress of significant events and their impacts and solutions
2. • Applicable ✓ Not applicable
3. Undertakings not yet fully performed during the reporting period
4. • Applicable ✓ Not applicable
5. Warning in respect of possible loss or any significant changes in aggregate net profit from beginning of the year until the end of the next reporting period as compared with that of the corresponding period of the previous year and the reasons thereof
   ✓ Applicable □ Not applicable
   In 2019, the Company will continue to deepen the supply-side structural reform, strive to promote high-quality development, further release its advanced production capacity as well as further optimize its structure in industrial organization and product portfolio, in order to achieve further improvement in its profitability. It is expected that the net profit of the Company for 2019 may increase substantially as compared to that of last year.

By Order of the Board

China Coal Energy Company Limited

Li Yanjiang

Chairman of the Board, Executive Director

Beijing, the PRC, 28 October 2019

As at the date of this announcement, the executive directors of the Company are Li Yanjiang, Peng Yi and Niu Jianhua; the non-executive directors of the Company are Du Ji'an, Zhao Rongzhe and Xu Qian; and the independent non-executive directors of the Company are Zhang Ke, Zhang Chengjie, and Leung Chong Shun.

This English language version is provided for reference purpose only. In the event of any inconsistency between the English and the Chinese version, the Chinese version shall prevail.

• For identification purpose only

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