China Shenhua Energy Company Limited, China’s top coal producer, said its net profits fell 28.3 percent year on year to 4.74 billion yuan ($734 million) in the first quarter of this year.
Shenhua, a state-owned enterprise listed both in Shanghai and Hong Kong, said in a statement that its revenue in the first quarter fell 4.6 percent to 39.4 billion yuan.
Shenhua’s coal segment reported a year-on-year decrease of 49.6 percent in gross profit in the first quarter of 2016, owing to falling coal prices and rising sales cost, the state-owned Xinhua news agency quoged the statement as saying.
China is the world’s largest coal producer, but the coal sector is hard hit by an industrial glut. In the first quarter this year, oversupply remained unsolved in the coal market, Shenhua said in the statement.
Yet the coal price bottomed out as the relation between the supply and demand tends to be favorable for the suppliers, it said.