The lithium industry giant Ganfeng Lithium disclosed its financial report recently, showing a significant decrease in revenue in the first half of this year, with a net loss of 760 million yuan (RMB, same below) and a 113% decrease in net profit.
On the evening of August 28, Ganfeng Lithium released its financial report, stating that it achieved a revenue of 9.589 billion yuan in the first half of the year, a decrease of 47.16% compared to the same period last year. The net loss was 760 million yuan, a 113% decrease compared to the previous year’s net profit of 5.85 billion yuan.
According to data from East Money, this is the first loss for Ganfeng Lithium in the first half of the year since it went public on the Shenzhen Stock Exchange in 2010.
Ganfeng Lithium stated that the significant decline in revenue in the first half of the year was largely due to the downturn in the lithium industry cycle, resulting from the decrease in the selling prices of lithium salts and lithium battery products.
In terms of products, the revenue of Ganfeng Lithium’s lithium series products decreased by 52.40% year-on-year in the first half of the year, while the revenue of lithium battery series products decreased by 33.73%.
At the same time, the gross profit margins of the two major products also declined. The gross profit margin for Ganfeng Lithium’s lithium compounds and metallic lithium products was 11.75%, a decrease of 12.37% from the same period last year; and the gross profit margin for lithium batteries and battery cell products was 9.88%, a 9.06% decrease year-on-year.
Ganfeng Lithium stated that if the prices of lithium products continue to decline in the future, it may have an adverse impact on the company’s business, financial condition, and operating performance.
Due to supply and demand imbalances, the prices of major lithium compounds in China have seen significant declines in recent years.
The price of lithium carbonate has dropped from over 500,000 yuan/ton at the beginning of last year to around 100,000 yuan/ton by the end of the year, with an overall decline of over 80%. As of 28th August, the average price of battery-grade lithium carbonate was reported as 74,500 yuan/ton in Shanghai, a decrease of nearly 30% from the beginning of the year.
Established in 2000, Ganfeng Lithium is a global lithium industry leader, with production capacity for over 40 types of lithium compounds and metallic lithium products across five categories. It is one of the manufacturers with the most comprehensive supply of lithium series products. Its business covers upstream lithium resources, lithium compounds, lithium batteries, and lithium battery recycling, with core customers including LG Chem, Tesla, BMW, among others.