UBS released a research report stating that YANKUANG ENERGY (01171) delivered weak first-half results as expected, with net profit declining 39% year-on-year, indicating a 49% year-on-year drop in second-quarter net profit to RMB 2.021 billion. The company announced an interim dividend of RMB 0.18, representing a payout ratio of 38%, slightly higher than the 31% recorded in the same period last year. The firm expects investors to react neutrally to the results and has raised its earnings forecasts for YANKUANG ENERGY by 7% and 6% for this year and next year respectively. The target price has been increased from HK$6.8 to HK$7, while maintaining a "Sell" rating.