Recently, certain companies were sued for potential infringement of the invention patents of conductive silver paste company DKEM. The plaintiff has filed separate lawsuits against Jiangsu Riyu Photovoltaic New Material Co., Ltd. and Suzhou Jingyin New Material Technology Co., Ltd., with the amount involved in each case being 200 million yuan, totaling 400 million yuan.
DKEM demands that the defendants cease manufacturing, selling, and offering for sale the series of photovoltaic conductive silver paste products that infringe the patents, destroy related equipment and molds, and also seeks compensation for economic losses and reasonable legal fees.
DKEM disclosed that its subsidiary, SolarPast LLC, is the patent holder for the inventions "Thick Film Paste Comprising Lead-Tellurium-Lithium-Titanium-Oxide and Use Thereof in the Manufacture of Semiconductor Devices" (Patent No. ZL201180032359.1) and "Thick Film Paste Comprising Lead-Tellurium-Lithium-Oxide and Use Thereof in the Manufacture of Semiconductor Devices" (Patent No. ZL201180032701.8), which remain legally valid. The plaintiff acquired the rights to use the patents and the right to sue from the patent holder through a licensing agreement. The plaintiff discovered that a certain company, without permission from the patent holder and the plaintiff, practiced the patents in question, with a large volume of products, a long duration of infringement, and a wide sales area, causing significant economic losses to the plaintiff and infringing upon its legitimate rights and interests. To protect its rights, the plaintiff has filed lawsuits with the court.
Currently, DKEM is facing challenging times.
On the evening of January 14th, DKEM announced that it expects a net loss attributable to shareholders of 200 to 300 million yuan for the 2025 fiscal year. DKEM stated that the performance change during the reporting period was mainly due to non-recurring gains and losses, which impacted the net profit attributable to shareholders by approximately -400 to -500 million yuan.
To mitigate the risk of silver powder price fluctuations, the company engaged in hedging operations through silver futures contracts; to reduce silver powder procurement costs and manage price volatility risks, the company conducted silver leasing business.
During this period, the silver spot price rose rapidly and significantly, leading to substantial fair value change losses recognized by the company for its silver futures and silver leasing positions based on the silver spot price at the balance sheet date. Within the reporting period, the company incurred share-based payment expenses related to its equity incentive plan, amounting to approximately 120 million yuan attributable to shareholders of the listed company.
DKEM began to report losses in its third-quarter report last year. At that time, the company's single-quarter revenue was 4.384 billion yuan, with a single-quarter net loss attributable to shareholders exceeding 40 million yuan, a year-on-year decrease of 167 percentage points; it also decreased by over 200% compared to the previous quarter.
For the first three quarters, although the company's revenue exceeded 12.7 billion yuan, its net profit attributable to the parent company was only 30 million yuan, a year-on-year decline of nearly 90 percentage points. The primary reason for this is likely attributable to the rising silver price.
Changes in the silver price have a significant impact on the company's gross profit margin: in the third quarter of 2020, the company's gross margin was over 15 percentage points; it was 10.6 percentage points for the same period in 2023, but by the third quarter of 2025, the gross margin had fallen to only 7.6%, with a net profit margin of less than 1 percentage point.
If DKEM can win the patent lawsuit and receive the compensation as scheduled, it would have a very positive impact on the company's cash flow and financial position.
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