ANNUAL%20REPORT%202015%20eng

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Corporate Governance Report Contact Details Shareholders may send their enquiries or requests as mentioned above to the following: Address: Email: 16th Floor, Central Tower Sukhbaatar District Ulaanbaatar 14200 Mongolia (For the attention of the Board of Directors/Chief Investment Officer) contact@mmc.mn For the avoidance of doubt, shareholder(s) must deposit and send the original duly signed written requisition, notice or statement, or enquiry (as the case may be) to the above address apart from other specified address, if any, and provide their full name, contact details and identification in order to give effect thereto. Shareholders’ information may be disclosed as required by law. COMMUNICATION WITH SHAREHOLDERS AND INVESTOR RELATIONS The Company considers that effective communication with shareholders is essential for enhancing investor relations and investor understanding of the Group’s business performance and strategies. The Company endeavours to maintain an on-going dialogue with shareholders and in particular, through AGMs and other general meetings. All members of the Board including non-executive Directors, independent non-executive Directors, and the chairmen of all Board committees (or their delegates) will use their best efforts to make themselves available at the AGMs to meet shareholders and answer their enquiries. According to CG Code Provision E.1.2, the chairman of the board should attend the AGM. Mr. Odjargal Jambaljamts, Chairman of the Board was unable to attend the 2015 AGM held on 29 May 2015 due to a business engagement. He will use his best endeavours to attend all future shareholders’ meetings of the Company. During the year under review, the Company has not made any changes to its Articles. An up to date version of the Company’s Articles is also available on the Company’s website and the Stock Exchange’s website. Annual Report 2015 87
Directors’ Report The Directors submit herewith their annual report together with the audited consolidated financial statements of the Group for the year ended 31 December 2015. PRINCIPAL PLACE OF BUSINESS The Company is incorporated in the Cayman Islands with its registered office at Cricket Square, Hutchins Drive, PO Box 2681, Grand Cayman, KY1-1111, Cayman Islands, its headquarters and principal place of business in Mongolia is located at 16th Floor, Central Tower, Sukhbaatar District, Ulaanbaatar 14200, Mongolia, and its principal place of business in Hong Kong is located at Level 54, Hopewell Centre, 183 Queen’s Road East, Hong Kong. PRINCIPAL ACTIVITIES The principal activities of the Company are mining, production, transportation and sale of coking coal products. The principal activities and other particulars of the subsidiaries and associates are set out in note 17 and note 18 to the consolidated financial statements. The analysis of the principal activities and geographical locations of the operations of the Group during the financial year are set out in note 12 to the consolidated financial statements. BUSINESS REVIEW Overview and performance of the Year A review of the business of the Group and analysis of the Group’s performance using financial KPIs is provided in the Management Discussion and Analysis section on pages 34 to 47 and Financial Summary section on pages 197 and 198 of this annual report. The Group’s total sales volume for the year ended 31 December 2015 was approximately 1.5 Mt of coal products generating total revenue of USD99.5 million, whilst in 2014 the total sales volume was 5.4 Mt of coal products with total revenue of USD328.3 million. The lower total revenue compared to the corresponding period in 2014 was essentially attributable to the continuing further downward pressure on coking coal price due to the oversupplied market, which ultimately led to a lower sales volume of HCC. The Group’s pricing reflected the current deteriorating price trend apparent to all coking coal products in the global market. The ASP of HCC achieved on a combined basis at all selling points was USD63.2 per tonne for the year ended 31 December 2015, supported by higher HCC selling prices of inland China sales. The ASP of HCC under FOT and C&F terms sales were USD66.3 per tonne and USD104.4 per tonne, respectively for the year ended 31 December 2015, compared to USD91.4 per tonne and USD119.4 per tonne in 2014 respectively. It is worth noting that the ASP of sales under C&F terms is an average price of sold quantity across different locations in China, therefore year-on-year comparison may not depict the true trend as selling quantity and locations will differ each year. The ASP of HCC sales under DAP GM term was USD53.2 per tonne for the year ended 31 December 2015 which was approximately 23.2% lower compared to USD69.3 per tonne in 2014. 88 Annual Report 2015
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(Incorporated in the Cayman Islands
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Company Profile Mongolian Mining Co
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Corporate Information BOARD OF DIRE
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Directors and Senior Management BOA
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Management Discussion and Analysis
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