Chairman's Statement

Message from Chairman 

Yancoal achieved considerable success in 2023 and met numerous key objectives, following several years of difficult operating and trading conditions. The key outputs were to deliver improving production rates across 2023 and to reduce operating costs, particularly those temporary costs that had been incurred as part of site recovery plans, resulting from adverse wet weather in 2021 and 2022.

Yancoal’s recovery can be attributed to the robust and appropriate strategies that were developed and implemented by the Board and management. Internally, management actions were directed by the existing "Six Measures" strategy to:

•    Operate efficiently;
•    Ensure safety at all times;
•    Prepare for possible negative external shocks and events;
•    Maximise production and productivity;
•    Achieve production targets; and
•    Achieve management objectives.

As part of this strategy, the “Key Tasks” initiative focused on 50 workstreams across the Group, with a particular focus on delivering sustainable improvements in vital productivity drivers and managing inventory levels as part of business recovery plans and water management. Examples of how the “Six Measures” strategy and “Key Tasks” initiative combined to deliver positive outcomes in 2023, included:

•    Productivity improved in every quarter and production in the final quarter was Yancoal’s best performance since 2020;
•    At the end of the year, the rolling Total Recordable Injury Frequency Rate was 5.1, a significant improvement of the rate of 7.9 recorded by Yancoal at the end of 2022;
•    The second year of implementation of the ‘Safe Way Every Day’ program, which is designed to provide a consistent approach to health, safety and training management across all Yancoal operations; and
•    A 21% reduction in cash operating costs from first half to second half after engaging in additional activities to recover production.

Having weathered a difficult period, Yancoal is now focused on building an even more robust and resilient business for the future. Yancoal is considering strategies that could potentially diversify the business into commodities beyond coal, as well as alternative energy opportunities.  Building a resilient future business will also require an evaluation of current practices and an evolutionary approach as to how Yancoal should improve operations in certain areas of the business. The Board is committed to establishing a sustainability strategy which provides a framework on how such a step change could be implemented.

In 2024, Yancoal celebrates 20 years of operating in Australia. The company has played an important role in progressing the international objectives of Yankuang Energy Group and in establishing a world-class coal mining business in Australia. Having started as a single mine operation in 2004, Yancoal has transformed challenges into opportunities and achieved extraordinary results. Yancoal has developed a unique workforce with a mix of Chinese and Australian cultures, and this has benefited both our shareholders and the communities in which we operate. 

Chairman of the Board