Yancoal talks up its ESG cred

YANCOAL is reiterating its achievements in safety and environmental, social and governance under challenging conditions as its independent directors advise its minority shareholders to reject a proposed US$1.8 (A$2.5) billion takeover by Chinese giant and major shareholder Yankuang Energy.
Yancoal talks up its ESG cred Yancoal talks up its ESG cred Yancoal talks up its ESG cred Yancoal talks up its ESG cred Yancoal talks up its ESG cred

Yancoal CEO David Moult.

Yancoal said it had not, to date, received any formal offer or proposal from Yankuang in relation to the potential transaction capable of acceptance by Yancoal shareholders or otherwise giving rise to any binding contract or commitment.

Yancoal CEO David Moult told the company's annual general meeting that the company had moved to keep the safety and productivity above industry standards.

"The year 2021 presented challenges, particularly the ongoing COVID-19 pandemic and rainfall associated with the La Niña weather pattern," he said. 

"As it met these challenges, Yancoal maintained the health and wellbeing of all our employees. 

"The work practices and measures we implemented to mitigate COVID-19 related risks, I am pleased to say, have proven successful with disruption to the organisation limited to the mandatory government isolation requirements. 

"We remain vigilant to the continued risks posed by the pandemic and broader health and safety issues across all of our sites."

Moult said Yancoal's 12-month total recordable injury frequency rate of 8.2 remained below the comparable industry average throughout 2021.              

"Yancoal continually learns from its interactions with stakeholders, as well as the activities of peers in the industry," he said.

"In 2021 we made a concerted effort to lift corporate oversight of Aboriginal cultural heritage across our operations. 

"Yancoal is active in the pursuit of emissions reductions, with two key focus areas being the assessment of replacing diesel-powered equipment and introducing renewable power generation as part of our operations."

Moult said overall Yancoal had a strong performance across all aspects of its operations that allowed it to report an annual operating earnings before interest tax depreciation and amortisation margin of 46%.

However, he warned the exceptional rainfall received so far in 2022, along with COVID-19 linked absenteeism and higher diesel prices, were pushing production volumes towards the bottom of its guidance range of between 35 million tonnes and 38Mt and unit costs towards the top of its guidance range of $71 to $76 per tonne.