For stock investors, analyst research reports are authoritative, professional, timely, and comprehensive, helping you uncover potential thematic opportunities. In the first three quarters of 2026, Zijin Mining Group Company Limited (601899.SH / 02899.HK) reported attributable net profit of 57.5 billion yuan, up 52% year on year, while non-GAAP net profit reached 55.8 billion yuan, up 63.63% year on year.
Breaking this down by quarter, third-quarter attributable net profit was 18.4 billion yuan, up 26% year on year, and non-GAAP net profit was 17.8 billion yuan, up 42.43% year on year.
Profit growth significantly outpaced revenue growth 鈥?operating revenue was 283.453 billion yuan, up only 11.51% year on year, with third-quarter revenue alone at 89.274 billion yuan, up just 3.22% year on year.
This scissors gap of "revenue taking small steps while profit takes big strides" is itself the most direct evidence of a leap in profitability.
Why is profit growing faster than revenue?
The answer lies in the change in gross margins. In the first three quarters, the gross margin of mining enterprises reached 68.38%, up nearly 8 percentage points from 60.62% in the same period last year, while the consolidated gross margin was 38.44%, compared with only 24.93% a year earlier.
Behind this is the simultaneous effect of two forces: rising volumes and prices on one hand, and controllable costs on the other.
There is also an easily overlooked structural factor: operating costs in the first three quarters were 174.506 billion yuan, down 8.55% year on year, while operating revenue grew 11.51%, with low-margin smelting operations contracting in tandem 鈥?smelted copper sales fell 7.0% and smelted zinc fell 14.6%.
This also explains why the increase in consolidated gross margin of 13.51 percentage points was noticeably larger than the 7.76 percentage point increase in mining enterprise gross margin.
On the price side, the sharp rise in prices of main metals is an open secret. The unit price of gold bullion from mined gold rose from 746.43 yuan per gram to 995.77 yuan per gram, copper concentrate from 60,878 yuan per tonne to 84,545 yuan per tonne, and lithium salt from 53,431 yuan per tonne to 127,719 yuan per tonne.
But Zijin did not leave profit entirely to the mercy of favorable conditions 鈥?the growth rate of cash costs per tonne of ore was effectively controlled. The unit price of gold concentrate from mined gold rose from 685.21 yuan per gram to 903.25 yuan per gram, while unit sales cost only rose from 186.36 yuan per gram to 207.60 yuan per gram; copper concentrate cost rose from 21,446 yuan per tonne to 25,075 yuan per tonne, far below the price increase.
With cost growth slower than price growth, gross margins were naturally stretched wider.
On the production side, volumes also contributed incremental gains. Mined gold output was 70.13 tonnes, up 8% year on year, with incremental projects such as the Akyem gold mine and the Reko Diq gold mine continuing to ramp up capacity. Mined copper output was 815,700 tonnes, down 1.7% from 829,900 tonnes a year earlier, but excluding the Kamoa mine which is undergoing production cuts, own-mine output on a like-for-like basis was 731,200 tonnes, up 6.08% year on year. Lithium carbonate equivalent reached 79,000 tonnes, including 10,000 tonnes from Zangge Mining, a substantial year-on-year increase.
The gold and lithium mainlines are clearly trending upward, while copper saw a slight decline in total volume due to the Kamoa drag even as own-mine production continued to grow. Moreover, the incremental volumes come from different projects and different regions 鈥?this "multiple growth points" production structure is more sustainable than relying on a single mine for volume expansion.
Project pipeline: more than just looking good now
The value of a quarterly report lies not only in the numbers already realized, but also in the rhythm of capacity succession it reveals for the next two to three years. Zijin provided several key signposts in this report.
In the copper segment, the Juno copper mine added 2.75 million tonnes of registered copper metal during the reporting period, with cumulative identified resources of 5.69 million tonnes 鈥?equivalent to "creating another Juno copper mine." The project is expected to commence production by the end of 2026. The Xiongcun copper mine's main works have successively begun construction, with production expected by the end of 2028.
Against the backdrop of slowing global copper output growth, the staggered implementation of these two projects means Zijin's copper growth is not a one-off event but has continuity and rhythm.
The biggest variable in the gold segment is the acquisition of control of Chifeng Gold (600988.SH / 06693.HK), which was completed on October 22, 2026. Zijin paid a total consideration of approximately 18.258 billion yuan through a combination of agreed transfer of A-shares and subscription to privately placed H-shares, acquiring a 25.85% stake in Chifeng Gold and consolidating it. The Shanghang County Finance Bureau became the latter's actual controller.
Chifeng Gold owns six gold mines and one polymetallic mine, with gold resources of 583 tonnes and mined gold output of 14.5 tonnes in 2025. With favorable mineralization conditions and excellent resource endowments, this acquisition represents a new layout by Zijin in an important gold metallogenic belt, directly enhancing gold resource reserves and production scale.
However, the target's current profitability is also under pressure: Chifeng Gold's third-quarter attributable net profit was 553 million yuan, down 41.84% year on year, mainly affected by declining gold sales volumes. Considering Chifeng Gold's nature as a producing mine, its contribution to output after consolidation will come faster than greenfield projects, but the incremental profit contribution will depend on subsequent cost reduction and production enhancement upgrades.
The rhythm of the lithium segment also deserves attention. The 3Q salt lake, Laguocuo salt lake, and Xiangyuan hard-rock lithium mine are steadily ramping up capacity. The Manono lithium mine completed flotation system feed trial in July 2026, and the Kigoma port has begun upgrade and renovation, expected to be completed in the second half of 2027, at which point the eastern Africa transport corridor is expected to be fully opened.
The lithium segment's gross margin jumped from 17.03% in the same period last year to 62.09%, but this jump comes first from price: in the first three quarters, lithium salt unit price rose from 53,431 yuan per tonne to 127,719 yuan per tonne, an increase of about 1.4 times, while unit sales cost only rose from 44,332 yuan per tonne to 48,416 yuan per tonne. Beyond price elasticity, whether the position on the cost curve can be maintained depends on performance when lithium prices decline.
Cash flow and balance sheet: the "gold content" of profit
Net profit can be affected by accounting policies, but cash flow is hard to fake. In the first three quarters, net cash flow from operating activities was 84.3 billion yuan, up 61.74% year on year, reaching 1.47 times the attributable net profit. This means profit is not a paper number sitting in accounts receivable but cash genuinely collected.
Cash received from sales of goods and provision of services was 308.1 billion yuan, up 11.3% year on year, basically matching revenue growth, with stable collection quality. It should be noted that the 60% surge in operating cash flow was driven not only by collections but also by the cost side: cash paid for goods purchased and services received fell from 195.547 billion yuan to 174.931 billion yuan, down 10.5% year on year, in line with the contraction in smelting operations. Meanwhile, taxes and fees paid increased by about 80% due to price increases, from 18.612 billion yuan to 33.488 billion yuan, partially offsetting the two.
On the balance sheet side, total assets were 559.3 billion yuan, up 9.24% from the end of last year; attributable net assets were 212.5 billion yuan, up 14.52%. While profit grew substantially, net assets accumulated at an even faster pace, indicating the company did not drive growth through large-scale leverage. Short-term borrowings were 35.2 billion yuan, only slightly up from 32.4 billion yuan at the end of last year; long-term borrowings were 41.9 billion yuan, actually down significantly from 58.5 billion yuan at the end of last year.
However, bonds payable rose from 47.4 billion yuan to 64.6 billion yuan over the same period, and non-current liabilities due within one year also rose from 26 billion yuan to 27.9 billion yuan. Adding these together, total interest-bearing debt was approximately 169.7 billion yuan, an increase of about 5.5 billion yuan from 164.2 billion yuan at the end of last year rather than a decrease. So a more accurate description is not "deleveraging" but a switch in financing channels from bank loans to bonds. On the positive side, the debt-to-asset ratio fell from 51.56% to 49.90%.
Interest expense within financial expenses dropped from 2.934 billion yuan to 2.912 billion yuan. With a sizable debt scale, interest expenditure remained stable, indicating proper control of financing costs. One point worth noting: the foreign currency translation difference in other comprehensive income was -5.979 billion yuan in the first three quarters, compared with -1.022 billion yuan in the same period last year. The impact of exchange rate fluctuations on the translation of overseas assets is amplifying. This is an inevitable companion of globalization and does not change the substance at the operational level, but it is worth keeping in mind when reading the growth rate of attributable net assets.
Additionally, fair value changes in other equity instrument investments also formed a negative value of -3.577 billion yuan. Combined with the foreign currency translation difference, other comprehensive income attributable to the parent company was -9.388 billion yuan. There is another point that needs to be examined under a microscope: the sequential momentum in the third quarter was already weakening. The quarterly gold bullion unit price was 916.39 yuan per gram, down 6.7% from 982.36 yuan per gram in the second quarter; mining enterprise gross margin was 66.47%, down 1.27 percentage points sequentially, and consolidated gross margin was 39.93%, up only 0.72 percentage points sequentially.
The third quarter's attributable net profit growth of 25.97% year on year was supported more by volume releases and the lithium segment ramp-up than by continued price increases. The price dividend is fading, and future elasticity will depend on whether volume succession and cost control can take over the baton.
In summary, the core message of Zijin Mining's third-quarter report is not simply that "gold prices rose so profits improved." The price dividend is industry-wide, but the magnitude of gross margin improvement, the intensity of cost control, the depth of the project pipeline, and the matching of cash flow are company-specific.
Looking at the eight words "improve quality, increase production, control costs, and enhance efficiency," production increase has incremental projects advancing across gold, copper, and lithium; cost control has large-scale application of electric mining trucks and intelligent transformation being implemented; and efficiency enhancement has associated rare and precious metals and comprehensive utilization of sulfur resources contributing incremental profit. When a mining company, in an environment of high and volatile commodity prices and with third-quarter gold prices already declining sequentially, still achieves volume releases, cost restraint, and abundant cash flow, its earnings elasticity will not merely be a byproduct of cyclical fluctuations. The 57.5 billion yuan attributable net profit is a result, but the operating system supporting that result is the variable more worthy of attention.
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