CStone Pharmaceuticals — Interim / Quarterly Report 2008

Apr 28, 2008

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

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兖州煤业股份有限公司

YANZHOU COAL MINING COMPANY LIMITED

(a joint stock limited company incorporated in the People’s Republic of China (“PRC”) with limited liability)

(Stock Code: 1171)

OVERSEA REGULATORY ANNOUNCEMENT

First Quarterly Report for the Year 2008

IMPORTANT NOTICE

This announcement is made pursuant to Rule 13.09(2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

The board of directors (the “Board”), the supervisory committee, the directors, the supervisors, and the senior management of Yanzhou Coal Mining Company Limited (“Yanzhou Coal”, “the Company” or “Company”) warrant that this announcement does not contain any false information, misleading statements or material omissions, and accept joint and several responsibilities for the truthfulness, accuracy and completeness of the content contained herein.

The First Quarterly Report for the year 2008 of the Company (the “Report”) was considered and approved by the 17th meeting of the third session of the Board and all of the thirteen directors of the Board attended the meeting.

The Company’s chairman, Mr. Wang Xin, chief financial officer, Mr. Wu Yuxiang, and the chief of the planning and finance department, Mr. Zhao Qingchun, warrant that the financial statements of the Report are true and complete.

The financial statements in the Report have not been audited.

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Summary of the unaudited results for the first quarter ended 31st March 2008 are as followed:

• The Report is prepared in accordance with the relevant regulations on Disclosure of Information in Quarterly Reports for Listed Companies of the China Securities Regulatory Commission.

• All financial information contained in the Report is prepared in accordance with the PRC Accounting Standards. The Group has also provided the average coal prices of the first quarter of 2008 calculated on the basis as adopted in its previous periodical reports announced overseas. Please refer to the section headed “Details and explanation on material changes in major items of the financial statements and in the financial indicators of the Group and the relevant reasons”. Shareholders of the Company (the “Shareholders”) and public investors should be aware of the different calculation basis used in the Report, interim and annual reports of the Company when trading in shares of the Company.

• Unless otherwise specified, the currency in the Report is denominated in Renminbi (“RMB”).

• During the reporting period, the operating income of the Group was RMB5,552.258 million, representing an increase of RMB1,774.371 million, or 47.0%, as compared with the corresponding period last year. Net profit attributable to the Shareholders was RMB1,490.528 million, representing an increase of RMB789.861 million, or 112.7%, as compared with the corresponding period last year.

• The information in the Report is the same as that published on the Shanghai Stock Exchange. The Report is published simultaneously in the PRC and overseas.

1. General Information of the Company and its Subsidiaries (the “Group”)

1.1 Major accounting data and financial indicators

	As at the end of this reporting period	As at the end of last year	Increase/decrease as at the end of this reporting period as compared with the end of last year (%)
Total assets(RMB)	27,188,200,256	25,325,499,439	7.36
Shareholders’ equity (excluding minority interest) (RMB)	21,017,523,218	19,615,689,876	7.15
Net assets per share attributable to the shareholders of the Company (RMB)	4.27	3.99	7.15

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	From the beginning of the year to the end of this reporting period	From the beginning of the year to the end of this reporting period	Increase/decrease for the reporting period as compared with the same period last year (%)
Net cash flows from operating activities (RMB)	1,426,478,966		29.99
Net cash flows per share from operating activities(RMB)	0.29		29.99
	The Reporting Period	From the beginning of the year to the end of this reporting period	Increase/decrease for the reporting period as compared with the same period last year (%)
Net profit attributable to the shareholders of the Company (RMB)	1,490,527,536	1,490,527,536	112.73
Basic earnings per share(RMB)	0.303	0.303	112.73
Basic earnings per share less extraordinary gain and loss(RMB)	0.302	0.302	112.89
Return on diluted net assets(%)	7.09	7.09	increased by 3.31 percent
Return on diluted net assets less extraordinary gain and loss(%)	7.07	7.07	increased by 3.30 percent
Extraordinary gain and loss	Amount from the beginning of the year to the end of this reporting period(RMB)
Netprofit(RMB)	1,490,527,536
Minus：non-operating income	6,001,209
Plus ：non-operating expense	1,234,723
Income tax attributable to extraordinary gain and loss	1,191,622
Net profit less extraordinary gain and loss	1,486,952,672

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1.2 Total number of Shareholders at the end of this reporting period and the top 10 shareholders holding listed shares not subject to trading moratorium of the Company

Total number of Shareholders at the end	165,873	165,873	165,873
of this reporting period
Top 10 Shareholders holding tradable shares not subject to trading moratorium of the
Company
		Number of	Classes of
		tradable shares not	shares held (A
		subject to trading	share, B share,
**Full Name of Shareholders **
		moratorium at the end of	H share or
		this reporting period	others)
		(shares)
HKSCC Nominees Limited		1,956,586,346	H Shares
Fortune SGAM Industry Selected Shares Securities Investment Fund (华宝兴业行业精选股票型证券投资基金)		13,694,484	A Shares
Zhongyouhexin Selected SharesSecurities Investment Fund (中邮核心优选股票型证券投资基金)		5,438,248	A Shares
Yifangda Value Growing Combined Securities Investment Fund (易方达价值成长混合型证券投资基金)		5,250,000	A Shares
Jiashi CSI 300 Index Securities Investment Fund(嘉实沪深300指数证券投资基金)		3,780,100	A Shares
Yinhuafuyu Subject Shares Securities Investment Fund (银华富裕主题股票型证券投资基金)		3,030,139	A Shares
Chengxinxiji MixedSecurities Investment Fund (信诚四季红混合型证券投资基金)		2,999,958	A Shares
FORTIS BANK SA/NV		2,999,926	A Shares
Jinxing Ingredient Selected Securities Investment Fund (金鹰成份股优选证券投资基金)		2,454,600	A Shares
Zhongyouhexin Growing SharesSecurities Investment Fund (中邮核心成长股票型证券投资基金)		2,375,686	A Shares

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2. Significant Matters

2.1 “Details and explanation on material changes in the major items of the financial statements and the financial indicators of the Group and the relevant reasons”

(1) Production and operation of the Group during the reporting period

Items	As at 31st March	As at 31st March	Increase/decrease (%)
	2008	2007
Raw coal production (million tonnes)	8.98	9.07	-0.99
The Company	8.13	8.19	-0.73
Shanxi NenghuaNote1	0.30	0.26	15.38
Yancoal AustraliaNote2	0.55	0.62	-11.29
Salable coal production (million tonnes)	8.87	8.78	1.03
The Company	8.07	8.02	0.62
Shanxi Nenghua	0.30	0.26	15.38
Yancoal Australia	0.50	0.50	0.00
Coal Sales(million tonnes)	8.63	8.36	3.23
The Company	7.84	7.68	2.08
Export	0.10	1.04	-90.38
Domestic	7.74	6.64	16.57
Shanxi Nenghua	0.25	0.26	-3.85
Yancoal Australia	0.54	0.42	28.57
Transportation volume of Railway AssetsNote3 (million tonnes)	4.47	4.34	3.00
Operating income(RMB’000)	5,552,258	3,777,887	46.97
Coal business	5,043,174	3,448,749	46.23
RailwayAssets	59,601	44,262	34.66
Others	449,483	284,876	57.78
Operating cost(RMB’000)	2,376,364	1,807,969	31.44
Coal business	1,867,638	1,529,352	22.12
RailwayAssets	57,649	30,931	86.38
Others	451,077	247,686	82.12
Net profit attributable to shareholders of the Company (RMB’000)	1,490,528	700,667	112.73

Note：1 Shanxi Nenghua means Yanzhou Coal Shanxi Neng Hua Company Limited.

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• 2 Yancoal Australia means Yancoal Australia Pty Limited.

• 3 Railway Assets means the railway asset specifically used for transportation of coal for the Company.

(2) Analysis of the average coal price of the Group during the reporting period

The following table sets out the average coal sales price calculated on the same basis as adopted in its previous periodical reports announced in the PRC during the reporting period.

Unit: RMB /tonne

Items	First Quarter of 2008	First Quarter of 2007	For the year ended 31st December 2007
The Company	599.43	410.89	437.06
Domestic	600.87	405.49	435.02
Export	487.15	445.58	473.31
Shanxi Nenghua	211.99	176.81	208.68
Yancoal Australia	542.62	586.45	522.78

During this reporting period, the average coal sales price of the Company was RMB599.43/tonne, representing an increase of RMB188.54/tonne, or 45.9%, as compared to the same period last year, of which the average domestic coal price was RMB600.87/tonne, representing an increase of RMB195.38/tonne, or 48.2%, as compared to the same period last year. The average export coal price was RMB487.15/tonne, representing an increase of RMB41.57/tonne, or 9.3%, as compared to the same period last year.

The average coal price of Shanxi Nenghua was RMB211.99/tonne during this reporting period, representing an increase of RMB35.18/tonne, or 19.9%, as compared to the same period last year.

The average coal price of Yancoal Australia was RMB542.62/tonne during this reporting period, representing a decrease of RMB43.83/tonne, or 7.5%, as compared to the same period last year.

The following table sets out the Group’s average coal sales prices calculated on the same basis as adopted in its previous periodical reports announced overseas during the reporting period:

			Unit: RMB /tonne
	First Quarter of 2008	First Quarter of 2007	For the year ended 31st December 2007
The Company	580.25	382.70	414.02
Domestic	582.26	389.35	417.24

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Export	423.11	340.03	356.98
Shanxi Nenghua	208.09	172.54	204.13
Yancoal Australia	465.01	586.45	465.10

Note: The average coal sales price represents the invoice price of coal sales less the sale taxes, transportation costs, port charges and miscellaneous fees for coal sales.

During the reporting period, the average coal sales price of the Company was RMB580.25/tonne, representing an increase of RMB197.55/tonne, or 51.6%, as compared to the same period last year, of which the average domestic coal price was RMB582.26/tonne, representing an increase of RMB192.91/tonne, or 49.5%, as compared to the same period last year. The average export coal price was RMB423.11/tonne, representing an increase of RMB83.08/tonne, or 24.4%, as compared to the same period last year.

The average coal price of Shanxi Nenghua was RMB208.09/tonne during this reporting period, representing an increase of RMB35.55/tonne, or 20.6%, as compared to the same period last year.

The average coal price of Yancoal Australia was RMB465.01/tonne during this reporting period, representing a decrease of RMB121.44/tonne, or 20.7%, as compared to the same period last year.

3. Brief analysis of the items under the major financial statements and the financial indicators of the Company during the reporting period.

(1) Details and explanation on material changes in the items of the Company’s balance sheet during this reporting period

**balance sheet during this reporting **	period
Items	As at 31st March, 2008 (RMB’000)	As at 31st December, 2007 (RMB’000)	Increase/decrease during the reporting period (%)
Bank balances and cash	7,294,596	5,779,552	26.21
Account receivable	308,584	120,548	155.98
Prepayments	109,748	59,833	83.42
Other receivables	466,603	315,801	47.75
Inventories	495,580	440,134	12.60
Available-for-sale financial assets	284,052	409,086	-30.56
Materials held for construction of fixed assets	281,631	229,461	22.74
Taxespayable	379,982	228,657	66.18
Long-term payable due within one year	1,089,496	487,448	123.51
Deferred tax liabilities	55,468	86,726	-36.04
Foreign currencies translation reserve	-8,860	-13,942	—

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Account receivables were RMB308.584 million as at March 31st, 2008，representing an increase of RMB188.036 million, or 156.0%, as compared with that at the beginning of the reporting year. Such increase was mainly due to the increase in rolling settlement balance of strategic customers.

Prepayments made amount to RMB109.748 million as at March 31st, 2008， representing an increase of RMB49.915 million, or 83.4%, as compared with that at the beginning of the reporting year. Such increase was mainly due to the increase in prepayment for equipment purchase.

Other receivables were RMB466.603 million as at March 31st, 2008，representing an increase of RMB150.802 million, or 47.8%, as compared with that at the beginning of the reporting year. Such increase was mainly due to the increase in account receivable of connected companies.

Available-for-sale financial assets were RMB284.052 million as at March 31st,2008， representing a decrease of RMB125.034 million, or 30.6%, as compared with that at the beginning of the reporting year. Such decrease was mainly due to the devaluation of the shares in Shenergy Co., Ltd. and Lianyungang Co., Ltd., respectively held by the Company, as a result of the stock market fluctuation.

Taxes payable were RMB379.982 million as at March 31st, 2008，representing an increase of RMB151.325 million, or 66.2%, as compared with that at the beginning of the reporting year. Such increase was mainly due to the increase in profit which caused the increase in the balance of taxes payable.

Long-term payable due within one year were RMB1,089.496 million as at March 31st,2008，representing an increase of RMB 602.048 million, or 123.5%, as compared with that at the beginning of the reporting year. Such increase was mainly due to the bank loan of RMB481.8 million of Yancoal Australia.

Deferred tax liabilities were RMB55.468 million as at March 31st, 2008，representing a decrease of RMB31.258 million, or 36.0%, as compared with that at the beginning of the reporting year. Such decrease was mainly due to the devaluation of available-for-sale financial assets.

(2) Details and explanation on material changes in items of the income statement of the Group during the reporting period

Items	First Quarter of 2008 (RMB’000)	First Quarter of 2007 (RMB’000)	Increase /decrease (%)
Operatingincome	5,552,258	3,777,887	46.97
Operatingcost	2,376,364	1,807,969	31.44
Operatingtaxes and surcharges	96,176	66,660	44.28
Sellingexpense	125,090	204,851	-38.94
General and administrative expense	889,266	612,005	45.30

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Financial expense	55,359	24,987	121.55
Investment income	-18,524	0	—
Non-operatingincome	6,001	4,746	26.45
Non-operatingexpense	1,235	1,452	-14.95
Income taxes	507,343	364,089	39.35
Netprofit	1,488,903	700,619	112.51
Including: Net profit attributable to shareholders of the Company	1,490,528	700,667	112.73

Operating income was RMB 5,552.258 million during the reporting period, representing an increase of RMB 1,774.371 million, or 47.0%, as compared with the same period of last year. The increase was mainly due to the increase in average sales price of coal, which resulted in an increase of coal sales income of RMB1,483.95 million, as compared with the same period of last year.

Operating cost was RMB2,376.364 million during the reporting period, representing an increase of RMB568.395 million, or 31.4%, as compared with the same period of last year. Cost of coal sales was RMB1,867.638 million during the reporting period, presenting an increase of RMB338.286 million, or 22.1%, as compared with the same period of last year. Among which: (1) the cost of coal sales of the Company was RMB1,653.455 million during the reporting period, representing an increase of RMB 309.150 million, or 23.0%, as compared with the same period of last year. The cost of coal sales per tonne of the Company was RMB210.98 during the reporting period, representing an increase of RMB35.94/tonne, or 20.5%, as compared with the same period of last year. Such increase was mainly due to: (i) the Company has charged retirement insurance and wage surcharge of production workers (which was previously charged to general and administrative expenses) to sales cost, which has increased the cost of coal sales per tonne by RMB15.98; (ii) since 1st August ,2007, in accordance with the requirements of the People’s Government of Jining City, Shandong Province, the Company has made provision of RMB8 per tonne of raw coal production for coal price adjustment fund, which has increased the cost of coal sales per tonne by RMB8.01; (iii) the increase in wage surcharge of production workers resulting in an increase in the cost of coal sales per tonne by RMB4.24; (iv) during the reporting period, the Company paid a land subsidence fee of RMB188.429 million, resulting in an increase in the cost of coal sales per tonne by RMB11.95; (v) the Company has charged repair expenses (which was previously charged to sales cost) to general and administrative expenses, which caused the decrease of RMB9.52 of the cost of coal sales per tonne. (2) Cost of coal sales of Shanxi Nenghua was RMB41.677 million. The cost of coal sales per tonne of Shanxi Nenghua was RMB164.60 during the reporting period, representing an increase of RMB1.62/tonne, or 1.0%, as compared with the same period of last year. (3) Cost of coal sales of Yancoal Australia were RMB172.506 million. The cost of coal sales per tonne of Yancoal Australia were RMB320.83 during the reporting period, representing a decrease of RMB18.04/tonne, or 5.3%, as compared with the same period of last year.

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Operating taxes and surcharges were RMB96.176 million during the reporting period, representing an increase of RMB29.516 million, or 44.3%, as compared with the same period of last year.

Selling expenses were RMB125.090 million during the reporting period, representing a decrease of RMB 79.761 million, or 38.9%, as compared with the same period of last year. Such decrease was mainly due to the decrease in coal transport fees and export agent fees as a result of the decrease in the sales of coal export.

General and administrative expenses were RMB889.266 million during the reporting period, representing an increase of RMB277.261 million, or 45.3%, as compared with the same period of last year. Such increase was mainly due to: (1) the Company charged repair expenses (which were previously charged to sales cost) to general and administrative expenses, resulted in the increase of RMB74.112 million in general and administrative expense; and (2) in accordance with the performance and efficiency based remuneration policy, the Company paid additional wages amounting to RMB300 million during the reporting period.

Financial expenses were RMB55.359 million during the reporting period, representing an increase of RMB30.372 million, or 121.6%, as compared with the same period of last year. Such increase was mainly due to the increase of interest expenses attributable to the new bank loan of Yancoal Australia.

Investment income was RMB -18.524 million, which was mainly due to the loss of Huadian Zouxian Electric Co., Ltd.

(3) Details of changes in cash flows of the Group during the reporting period.

Items	First Quarter of 2008 (RMB’000)	First Quarter of 2007 (RMB’000)	Increase/ decrease (%)
Net cash flow from operatingactivities	1,426,479	1,097,376	29.99
Net cash flow from investingactivities	-393,231	-269,500	45.91
Net cash flow from financingactivities	481,796	0	－
Net increase in cash and cash equivalent	1,515,044	827,876	83.00
Balance of cash and cash equivalent at the end of the reporting period	7,294,596	6,738,351	8.25

Net cash flow from operating activities was RMB1426.479 million during the reporting period, presenting an increase of RMB329.103 million, or 30.0%, as compared with the same period of last year. Such increase was mainly due to the cash increase received for coal sales.

Net cash flow from investing activities were RMB393.231 million during the reporting period, presenting an increase of RMB123.731 million, or 45.9%, as compared with the same period of last year. Such increase was mainly due to the

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increase in payment for equipment purchase.

Net cash flow from financing activities were RMB481.796 million, and this was mainly due to the bank loan of Yancoal Australia. There was no net cash flow from financing activities during the same period of last year.

Net increase in cash and cash equivalent were RMB1,515.044 million during the reporting period, presenting an increase of RMB 687.168 million, or 83.0% , as compared with the same period of last year. Such increase was mainly due to the increase in net cash flow from operating activities.

2.2 Major events and their impact and analysis on the solutions

Nominated candidates of the fourth session of the Board

The “Resolution on the Re-election of the Board of Yanzhou Coal Mining Company Limited” was considered and approved in the 16th meeting of the third session of the Board which was held on 18th April, 2008. The Board has approved to the submission of the “Resolution on the Election of the Non-independent Directors to the Fourth Session of the Board” and the “Resolution on the Election of Independent Directors to the Fourth Session of the Board” for consideration and approval at the 2007 annual general meeting.

The Board has nominated Mr. Wang Xin, Mr. Geng Jiahuai, Mr. Yang Deyu, Mr. Shi Xuerang, Mr. Chen Changchun, Mr. Wu Yuxiang, Mr. Wang Xinkun, Mr. Zhang Baocai, Mr. Pu Hongjiu, Mr. Zhai Xigui, Mr. Li Weian, Mr. Wang Junyan as the candidates of the fourth session of the Board, among which Mr.Pu Hongjiu, Mr.Zhai Xigui, Mr. Li Weian, Mr. Wang Junyan were nominated as the candidates of independent non-executive Directors.

The labor union of the Company has nominated Mr. Dong Yunqing as the candidate of staff director of the fourth session of the Board.

Nominated candidates of the forth session of the Supervisory Committee

The “Resolution on the Re-election of the Supervisory Committee of Yanzhou Coal Mining Company Limited” was considered and approved in the 10th meeting of the third session of the Supervisory Committee which was held on 18th April, 2008. The Supervisory Committee has approved the submission of the same for consideration and approval in the 2007 annual general meeting.

The third session of the Supervisory Committee nominated Mr. Song Guo, Mr. Zhou Shoucheng, Mr. Zhang Shengdong, Ms. Zhen Ailan as candidates of the fourth session of Supervisory Committee.

The labor union of the Company nominated Mr.Wei Huanmin and Mr. Xu Bentai as the candidate of staff supervisor of the fourth session of the Supervisory Committee.

Re-appointment of Auditors

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In order to improve the corporate governance of the Company, the Board has recommended not to renew the appointment of Deloitte Touche Tohmatsu and Deloitte Touche Tohmatsu Certified Public Accountants Ltd as the auditor of the Company and recommended the appointment of Grant Thornton and Shine Wing Certified Public Accountants Ltd as the Company’s international and PRC auditors for the year 2008 respectively. Such proposal needs to be submitted for consideration and approval in the 2007 annual general meeting.

Amendments to the Articles of Association

As approved by the first extraordinary general meeting for the year 2008 held on 30th January, 2008, the Company amended the terms of the articles of association relating to certain powers of its independent directors. For details of such amendments, please refer to the announcement published on China Securities and Shanghai Securities and the website of Shanghai Stock Exchange on 31st January, 2008.

Material Litigation and Arbitration

On 13th December 2004, the Company made an entrusted loan of RMB640 million to Shandong Xin Jia Industrial Company Limited (the “Entrusted Loan”). On 6[th] September, 2005, the Higher People’s Court of Shandong Province arranged and auctioned 289 million shares out of the 360 million shares held by Lianda Group Limited, the guarantor of the Entrusted Loan, in Huaxia Bank Company Limited (“Huaxia Shares”) in accordance with the relevant laws. The proceeds of such auction were for the repayment of the Company’s principal, interest, penalty interest and relevant expenses of the Entrusted Loan. The auction price was RMB3.5 per Huaxia Share and the total auction amount was RMB1,011.5 million. As at the date of this report, the successful bidder of the Huaxia Shares is still undergoing the qualification review by China Banking Regulatory Commission.

While the successful bidder of the Huaxia Shares is undergoing the qualification review by CBRC, the Company noted that Shandong RunHua Group Company Limited (“RunHua Group”), a private enterprise, started legal proceedings claiming for the transfer of and entitlement to 240 million Huaxia Shares held by Lianda Group Limited.

As the two cases involve the same subject matter and as the Company has attached the Huaxia Shares in priority, the Supreme People’s Court is in the course of mediating the two cases. According to the mediation proposal of the Supreme People’s Court, RunHua Group shall voluntarily guarantee the realization of the debt of Yanzhou Coal and 200 million out of the 289 million Huaxia Shares attached to the Company shall be transferred to RunHua Group for RunHua Group to finance the settlement of debt whereas the 200 million Huaxia Shares and 89 million Huaxia Shares held by RunHua Group and Lianda Group, respectively, should continue to be attached to and frozen by the Company.

On 20[th] November, 2007, the Company received a notification from the Higher People’s Court of Shandong Province that the transfer of the 200 million Huaxia

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Shares has been implemented and the procedures relating to continuation of the attachment by the Company have also been completed.

The Company considers that the above arrangement is beneficial to the recovery of the principal and interest of the Entrusted Loan. The Company will promptly disclose any significant progress concerning the Entrusted Loan.

The Company was not involved in any other significant litigation or arbitration during the reporting period.

2.3 Special undertakings made by the Company, the Shareholders and the actual controlling person and the performance of the undertakings

(1) The special undertakings made by Yankuang Group Co., Ltd. (“Yankuang Group”) and the performance of the undertakings are as follows:

Name of Shareholder	Special undertakings	Performance of undertakings
	(1) The formerly non-tradable shares of the Company held by Yankuang Group should not be listed for trading purpose within forty-eight months from the date of execution of the relevant share reform plan;	The formerlynon-tradable shares in the Company held by Yankuang Group have not been traded.
Yankuang Group	(2) In 2006, Yankuang Group would transfer part of its operations and new projects relating to coal and power which are in line with the Company’s development strategies to the Company in accordance with the relevant PRC regulations, with a view to enhancing the operating results of the Company and reducing the connected transactions and competition between Yankuang Group and the Company. Yankuang Group should allow the Company to participate and invest in, for the purpose of co-development of, the coal liquefaction project, which is being developed by Yankuang Group. .	In 2006, Yankuang Group completed the transfer of the coal project and new electricity project to the Company, which are in line with the Company’s development strategies. Yankuang Group is in the process of implementing its other undertakings and there has not been material progress in this respect.

(2) Acquisition of Mining Right of Zhaolou Coalmine of Yanmei Heze Neng Hua Company Limited (the “Heze Neng Hua”)

The Company acquired 95.67% equity interest in Heze Neng Hua from Yankuang Group in December 2005. According to the relevant acquisition agreements, Heze

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Neng Hua has the right to acquire mining rights of Zhoulou Coalmine at any time within 12 months from Yankuang Group’s acquisition of the mining rights of Zhaolou Coalmine.

On 28th June, 2006, Yankuang Group obtained the mining right certificate of Zhaolou Coalmine from the Ministry of Land and Resources. At the first extraordinary general meeting of the Company for the year 2008 held on 30th January, 2008, the purchase of the mining rights of Zhaolou Coalmine by Heze Neng Hua from Yankuang Group at a consideration of RMB747.3 million was approved. The acquisition is still pending the final approval by the relevant regulatory authorities in charge of national land and resources.

2.4 Warning and explanation for possible loss or material changes in the net profit for the period from the beginning of this year to the end of the next reporting period as compared with the same period last year.

We predict that the net profit attributable to Shareholders in the first half of 2008 is to increased more than 100% as compared with the same period of last year, this increase was mainly caused by the increase in coal price and income tax rate adjustment. Net profit attributable to shareholders of the Company disclosed by the Group in the interim report for the first half of 2007 was RMB1,108.9 million.

2.5 details of securities investment

No.	Stock code	Stock abbreviation	Number of shares held at the end of this reporting period （share）	Investment cost at the beginning （RMB）	Book value at the end of the reporting period （RMB）	Book value at the beginning of the reporting period （RMB）	Accounting items
1	600642	Shenergy	22,323,900	60,420,274	272,574,819	393,123,879	available-for-sale financial assets
2	601008	Lianyungang	1,150,000	1,760,419	11,477,000	15,962,000	available-for-sale financial assets
total			－	62,180,693	284,051,819	409,085,879	－

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3. Directors

As at the date of this announcement, the Directors of the Company are Mr. Wang Xin, Mr. Geng Jiahuai, Mr. Yang Deyu, Mr. Shi Xuerang, Mr. Chen Changchun, Mr. Wu Yuxiang, Mr. Wang Xinkun, Mr. Zhang Baocai and Mr. Dong Yunqing and the independent non-executive Directors of the Company are Mr. Pu Hongjiu, Mr. Cui Jianmin, Mr. Wang Xiaojun and Mr. Wang Quanxi.

The full version of the Company’s balance sheet, income statement and cash flow statement for the first quarter of 2008 are published on the website of The Stock Exchange of Hong Kong Limited at http://www.hkex.com.hk and Shanghai Stock Exchange at http://www.sse.com.cn.

By order of the Board of Directors of Yanzhou Coal Mining Company Limited Wang Xin Chairman of the Board

Shandong Province, PRC, Yanzhou Coal Mining Company Limited 28th April, 2008

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Appendices:

Yanzhou Coal Mining Co.,Ltd. BALANCE SHEET AS AT MARCH 31, 2008

Unit: RMB

ASSETS	The	Group	The Company	The Company
	At March 31, 2008 RMB (Unaudited)	At December 31, 2007 RMB (Unaudited)	At March 31, 2008 RMB (Unaudited)	At December 31, 2007 RMB (Unaudited)
CURRENT ASSETS: Bank balances and cash Notes receivable Accounts receivable Prepayments Interest receivable Dividends receivable Other receivables Inventories Entrust loan due within one year Other current assets TOTAL CURRENT ASSETS NON CURRENT ASSETS: Available-for-sale financial assets Entrust loan Long-term equity investments Fixed assets and accumulated depreciation Fixed assets under construction Materials held for construction of fixed assets Intangible assets Goodwill Long-term deferred assets Deferred tax assets Other non_current assets TOTAL NON_CURRENT ASSETS TOTAL ASSETS	7,294,596,389 2,906,705,590 308,584,360 109,747,735 - - 466,602,866 495,580,438 640,000,000 11,468,731 12,233,286,109 - 284,051,819 - 879,477,605 7,964,165,656 4,415,889,589 281,630,875 765,164,265 10,045,361 23,272,766 31,174,701 300,041,510 14,954,914,147 27,188,200,256	5,779,552,295 2,732,422,448 120,548,231 59,832,653 - - 315,801,434 440,133,628 640,000,000 10,933,507 10,099,224,196 - 409,085,879 - 898,001,770 8,242,576,351 4,289,220,537 229,460,787 788,504,784 10,045,361 21,728,081 31,174,701 306,476,992 15,226,275,243 25,325,499,439	7,102,369,561 2,904,238,430 183,329,888 92,341,438 - - 748,557,129 409,678,493 1,240,124,500 11,468,731 12,692,108,170 - 284,051,819 1,940,009,150 4,076,770,617 6,629,459,677 110,948,248 1,541,815 642,784,560 - - - 117,925,900 13,803,491,786 26,495,599,956	5,635,285,807 2,730,805,288 90,610,323 57,089,331 76,482,715 - 956,461,123 325,619,749 837,224,200 10,933,507 10,720,512,043 - 409,085,879 2,170,189,800 4,023,118,868 6,849,270,087 70,713,274 1,656,966 647,787,472 - - - 117,925,900 14,289,748,246 25,010,260,289

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The financial statements were signed by the following:

WANG Xin Wu Yuxiang Zhao Qingchun Head of the Company Chief Financial Officer Head of Accounting Department

17

Yanzhou Coal Mining Co.,Ltd. BALANCE SHEET(Continued) AS AT MARCH 31, 2008

Unit: RMB

LIABILITIES AND SHAREHOLDERS' EQUITY	The Group	The Group	The Company	The Company
	At March 31, 2008 RMB (Unaudited)	At December 31, 2007 RMB (Unaudited)	At March 31, 2008 RMB (Unaudited)	At December 31, 2007 RMB (Unaudited)
CURRENT LIABILITIES: Notes payable Accounts payable Advances from customers Salaries and wages payable Taxes payable Other payables Long-term payable due within one year Other current liabilities TOTAL CURRENT LIABILITIES NON CURRENT LIABILITIES Bank borrowings Long-term payable Deferred tax liabilities TOTAL NON CURRENT LIABILITIES TOTAL LIABILITIES SHAREHOLDERS' EQUITY: Share capital Capital reserves Surplus reserves Unappropriated profits Translation reserve Equity attributable to shareholders of the Company	173,285,054 465,123,491 1,043,131,488 290,108,036 379,982,333 1,671,668,795 1,089,495,874 19,634,780 5,132,429,851 258,000,000 676,861,101 55,467,782 990,328,883	154,519,715 559,346,058 983,294,466 337,275,927 228,657,191 1,909,171,032 487,447,969 19,634,780 4,679,347,138 258,000,000 636,193,076 86,726,297 980,919,373	173,285,054 343,375,103 1,018,833,464 273,538,830 376,528,235 1,375,787,044 509,708,425 19,634,780 4,090,690,935 - 676,861,101 55,467,781 732,328,882	154,519,715 484,693,966 963,437,277 299,831,899 225,673,305 1,480,813,707 395,837,955 19,634,780 4,024,442,604 - 636,193,076 86,726,297 722,919,373
	6,122,758,734 4,918,400,000 4,849,593,537 2,037,940,337 9,220,449,627 -8,860,283 21,017,523,218	5,660,266,511 4,918,400,000 4,943,369,082 2,037,940,337 7,729,922,091 -13,941,634 19,615,689,876	4,823,019,817 4,918,400,000 4,849,025,972 2,037,940,337 9,867,213,830 - 21,672,580,139	4,747,361,977 4,918,400,000 4,942,801,517 2,037,940,337 8,363,756,458 - 20,262,898,312

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Minority interest TOTAL SHAREHOLDERS' EQUITY TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	47,918,304 21,065,441,522 27,188,200,256	49,543,052 19,665,232,928 25,325,499,439	- 21,672,580,139 26,495,599,956	- 20,262,898,312 25,010,260,289

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Yanzhou Coal Mining Co.,Ltd. INCOME STATEMENT

FOR THE PERIOD ENDED MARCH 31, 2008

				Unit: RMB
Items	The	Group	The	Company
	1 QUARTER ENDED MARCH 31,2008 (Unaudited)	1 QUARTER ENDED MARCH 31,2007 (Unaudited)	1 QUARTER ENDED MARCH 31,2008 (Unaudited)	1 QUARTER ENDED MARCH 31,2007 (Unaudited)
1. Operating income Less: Operating cost Operating taxes and surcharges Selling expense General and administrative expense Financial expense Impairment loss of assets Add: Investment income 2. Operating profit Add: Non-operating income Less: Non-operating expense 3. Total profit Less: Income tax 4. Net profit Including: Attribute to shareholders of the Company Minority interest 5. Earnings per share （1）Basic （2）Diluted	5,552,257,727 2,376,363,930 96,175,565 125,090,140 889,265,719 55,359,294 - -18,524,165 1,991,478,914 6,001,209 1,234,723 1,996,245,400 507,342,612 1,488,902,788 1,490,527,536 -1,624,748 0.30 0.30	3,777,886,890 1,807,969,160 66,660,227 204,850,917 612,005,217 24,987,428 - 1,061,413,941 4,745,728 1,451,693 1,064,707,976 364,088,923 700,619,053 700,667,193 -48,140 0.14 0.14	5,196,489,828 2,153,506,705 94,913,046 71,125,668 831,635,443 59,816,936 - 20,441,555 2,005,933,585 5,985,689 1,134,723 2,010,784,551 507,327,179 1,503,457,372 - - 0.31 0.31	3,510,313,845 1,653,716,103 65,760,328 162,865,362 544,448,571 27,745,632 - 5,344,052 1,061,121,901 4,624,105 1,451,693 1,064,294,313 363,627,120 700,667,193 - - 0.14 0.14

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Yanzhou Coal Mining Co.,Ltd. CSAH FLOW STATEMENT

FOR THE PERIOD ENDED MARCH 31, 2008

Unit: RMB

Items	The Group	The Group	The Company	The Company
	1 QUARTER ENDED MARCH 31,2008 (Unaudited)	1 QUARTER ENDED MARCH 31,2007 (Unaudited)	1 QUARTER ENDED MARCH 31,2008 (Unaudited)	1 QUARTER ENDED MARCH 31,2007 (Unaudited)
1.CASH FLOW FROM OPERATING ACTIVITIES Cash received from sales of goods or rendering of services Taxes refunded Other cash received relating to operating activities Sub-total of cash inflows Cash paid for goods and services Cash paid to and on behalf of employees Taxes and surcharges paid Other cash paid relating to operating activities Sub-total of cash outflows NET CASH FLOW FROM OPERATING ACTIVITIES 2.CASH FLOW FROM INVESTING ACTIVITIES Cash received from return on investments Net cash received from investment income Net cash received from disposal of fixed assets and other long-term assets decrease in restricted cash Sub-total of cash inflows Cash paid to acquire fixed assets and other long-term assets Cash paid to acquire investments Sub-total of cash outflows NET CASH FLOW FROM INVESTING ACTIVITIES 3.CASH FLOW FROM FINANCING ACTIVITIES Cash received from equity investment Cash received from bank borrowings Sub-total of cash inflows Cash paid for distribution of dividends or profits, or cash paid for interest expenses Sub-total of cash outflows	5,670,737,903 - 84,644,718 5,755,382,621 1,856,853,506 708,340,139 1,274,833,381 488,876,629 4,328,903,655 1,426,478,966 - - 2,385,182 - 2,385,182 395,616,471 - 395,616,471 -393,231,289 - 481,796,417 481,796,417 - -	4,750,469,050 - 52,306,838 4,802,775,888 1,766,654,940 537,717,319 958,477,507 442,550,255 3,705,400,021 1,097,375,867 - - 694,499 - 694,499 270,194,437 - 270,194,437 -269,499,938 - - - - -	5,198,114,261 - 45,685,235 5,243,799,496 1,794,324,575 589,432,673 1,262,704,647 309,390,243 3,955,852,138 1,287,947,358 372,559,711 70,109,228 2,385,182 - 445,054,121 45,917,725 220,000,000 265,917,725 179,136,396 - - - - -	4,337,190,371 - 37,948,365 4,375,138,736 1,706,639,912 480,396,159 953,002,474 291,360,657 3,431,399,202 943,739,534 - - 694,499 - 694,499 18,851,507 81,966,200 100,817,707 -100,123,208 - - - - -

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NET CASH FLOW FROM FINANCING
ACTIVITIES	481,796,417	-	-	-
4.EFFECT OF FOREIGN EXCHANGE RATE
	-	-	-	-
CHANGES ON CASH
5.NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	1,515,044,094	827,875,929	1,467,083,754	843,616,326
Add: Cash and cash equivalent, opening	5,779,552,295	5,910,475,432	5,635,285,807	5,599,896,104
Cash and cash equivalents, ending	7,294,596,389	6,738,351,361	7,102,369,561	6,443,512,430

22