The company was concerned sky rocketing thermal coal prices could eat into full-year profits, after announcing it had recorded an 8.58% year-on-year increase in interim net profit.

The company named drastic coal price increases and declining coal quality as two main threats on profits.

“We will work with our coal suppliers to increase the realisation rate of signed contracts and strengthen internal management to boost coal utilisation efficiency,” said chairman Li Xiaopeng.

Huaneng admitted it had experienced trouble in some companies failing to honour coal supply contracts.

South China Morning Post reported Li did not respond directly when asked whether Huaneng had been able to settle some contracts since a directive last week allowing coal and power firms to renegotiate contract prices with upward adjustments of not more than 8 percent.

He told analysts that the company hoped to secure 70% of its coal needs for next year through one-year contracts.