Increase production capacity and continuous cost reduction for mining operations

Our company’s mining management will continue to work closely with mining experts and technical consultants to plan, model and strategies our mining operations to optimise production capacity and maximise production efficiency. The production structure of our coal mines have been carefully organised and optimised to realise stable growth in production and efficiency. The Group will also upgrade and improve existing logistics and infrastructure facilities such as securing exclusive rights to use the hauling road for coal delivery and improving the capacity and efficiency of the stockpiles, jetty and loading facilities. These measures were pursued to improve access to transportation infrastructure, and to enhance the supply network and distribution in order to deliver more cost effective coal products to endusers. The improvement in the coal supply chain is expected to increase the Group’s market penetration, thereby strengthening the Group’s position as a reliable coal supplier and enhancing our brand reputation in the target markets.

Market and business diversification

We believe that the strategy of market and business diversification will minimise its business risk, especially in volatile market conditions. As a major coal mine operator, the Group has kept expanding its coal mine portfolio for the past few years including the acquisition of the Merge Mine in 2015. Through such expansion, the Group has successfully transformed from a single-mine operator to a multi-mine and multi-product integrated coal producer with diversified coal product types ranging from low CV, sub-bituminous to high CV bituminous thermal coal. The target markets for the Group’s coal export are similarly diversified from mainly China and India to other Asian countries and regions with strong demand for high quality coal such as South Korea, Taiwan and Japan. Furthermore, subsequent to the current financial year, the Group has penetrated into the fastgrowing China market for the first time through acquisition of a coal mine located in Shaanxi Province of China. Such acquisition has marked the Group’s first foray into the promising China market which can effectively diversify the Group’s business risk to a new geographical location.

Besides new acquisitions within the mining segment, the Group is also active in diversifying its business portfolio by entering other new business segments. During the current financial year, the Group has successfully completed the acquisition of the 600MW SKS Power Plant located in India. The acquisition of the SKS Power Plant represents a remarkable milestone for the Group, that it can effectively diversify its business to the new energy business segment in thermal power plant and to the new geographical segment in India as one of the fast growing markets in the world.

Strong customer base in top international coal markets

We have established a strong customer base within the domestic Indonesian market and fast growing Asian coal markets such as China and India. Currently, China and India are among the top countries with strongest coal demand in the world. Also, the Group could gain further access to high-end customers from Asian markets like Japan and South Korea for our high-quality coal products from the Merge Mine. In the year ahead, the Group will continue to expand its international customer base and will continue to put its focus on coal exports to top-tier international coal markets with the aim of becoming a more international and global coal industry player.