SHOUGANG RES (00639) has issued a positive profit alert, a move that signals strong operational performance.

In a filing with the Hong Kong Stock Exchange, the company announced that for the six months ending June 30, 2026, it expects to record a comprehensive profit attributable to owners of the company of approximately HK$550 million to HK$600 million. This represents a significant increase of about 36% to 49% compared to the approximately HK$404 million reported for the same period in 2025.

The anticipated surge in profit is primarily attributed to several key factors. First, the market price of coking coal showed a volatile but strengthening trend during the first half of 2026. This was driven by geopolitical tensions disrupting energy supplies, along with factors such as mine accidents, safety inspections, and production suspensions in major producing regions. As a result, the average selling price of the company's self-produced clean coking coal rose by approximately 16%, even as the market price for its main products increased by 20% year-on-year.

Second, capitalizing on favorable market conditions and striving for full production, the company achieved a year-on-year increase in self-produced clean coking coal sales volume of no less than 20%.

Third, despite an increase in non-recurring one-off compensation expenses from reforms aimed at improving labor efficiency, the company continued to maintain strict cost control. It expects the production cost per tonne of raw coal (excluding the one-off compensation fees, uncontrollable resource taxes, and levies) to be lower than the full-year level for 2025.