Company Review: Yongxing Special Materials to Benefit from Lithium Price Recovery as Leading Lepidolite Producer

Deep News11-10

1. Q3 earnings decline was mainly affected by non-recurring items and investment income. 2. Lithium prices rebounded in Q3, signaling a market bottom.

**Key Points** Yongxing Special Materials Technology Co., Ltd. released its Q3 2025 financial report: - Revenue for the first three quarters reached RMB 5.547 billion, down 10.98% YoY. - Net profit attributable to shareholders was RMB 532 million, a 45.25% YoY decline. - Adjusted net profit (excluding non-recurring items) stood at RMB 466 million, down 39.79% YoY.

In Q3 alone: - Revenue was RMB 1.853 billion, up 6.61% YoY but down 2.7% QoQ. - Net profit attributable to shareholders fell 33.69% YoY and 37.55% QoQ to RMB 131 million. - Adjusted net profit dropped 17.8% YoY and 3.83% QoQ to RMB 139 million.

**Factors Behind Q3 Earnings Decline** Non-recurring expenses and investment losses significantly impacted profits: - Non-operating expenses rose by RMB 29.71 million QoQ to RMB 34.1 million. - Other income decreased by RMB 56.35 million QoQ to RMB 13.18 million. - Investment losses widened by RMB 37.86 million QoQ to RMB 1.19 million. These three items collectively reduced Q3 pre-tax profit by over RMB 120 million.

**Lithium Price Recovery and Market Bottom** According to BaiChuan Info, the average Q3 price of battery-grade lithium carbonate (99.5%) in Jiangxi was RMB 76,000/ton (tax-inclusive), down 8% YoY but up 12% QoQ, indicating a rebound after hitting bottom in Q2.

The company has optimized its strategy by shifting from spot sales to a hybrid "spot + futures" model to mitigate price volatility. Cost control measures and strong demand from the energy storage sector have further supported profitability. As of October 30, lithium carbonate prices rose 12% monthly, suggesting continued recovery.

**Investment Outlook** As China’s leading lepidolite producer, Yongxing maintains cost advantages and market share even during downturns. Its integrated expansion in mining and processing enhances resource security.

**Risks** 1) Sharp decline in downstream lithium demand. 2) Significant lithium price drop. 3) Delays in new project ramp-ups. 4) Underperformance of newly added capacity.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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