On October 15th, Antai Group (600408.SH) announced that, after preliminary discussions, the company has reached a cooperation intention with Jiexiu Jing'an Coal Chemical Co., Ltd. (referred to as 'Jiexiu Coal Chemical Company'). Antai Group's wholly-owned subsidiary, Shanxi Hong'an Coking Technology Co., Ltd. (referred to as 'Hong'an Coking'), will process and produce coke for Jiexiu Coal Chemical Company using its own equipment under commission. The coke produced under commission and the ownership of the surplus coal gas will belong to Jiexiu Coal Chemical Company, with Hong'an Coking receiving the corresponding processing fees. Since the surplus coal gas needs further processing and Jiexiu Coal Chemical Company does not have processing capabilities, they have agreed to resell the surplus coal gas to Hong'an Coking on-site.

The coking industry in which the company operates has experienced a downward trend in recent years, with the gross margin of coking products under continuous pressure, leading to significant losses in operational performance. This cooperation will help the company mitigate the risk of fluctuations in coal and coke product prices, receive stable processing fees and production income, and reduce operational risks. During this and the previous entrusted processing business cooperation periods, the company's coke product production and sales volume and revenue will be significantly reduced, possibly ceasing to produce coke by itself. However, this will correspondingly reduce the operational losses of coke products in the current market, which is beneficial for improving the company's operational performance.