JL Mag Rare-Earth (300748) Q2 2024 earnings summary

Executive summary

• H1 revenue was RMB 3.362bn, down 2.00% YoY; attributable net income was RMB 119.7m, down 64.02%, amid lower rare-earth prices, delayed fixed-price orders and stronger competition.

• High-performance magnetic material production and sales rose over 40% YoY, with capacity utilization above 90%; new capacity projects continued to ramp.

Financial highlights

• Revenue RMB 3.362bn; operating costs RMB 3.070bn, up 6.21% YoY; attributable net income RMB 119.7m versus RMB 332.6m in H1 2023.

• Adjusted for non-recurring items, attributable net income was RMB 34.0m, down 88.18% YoY; non-recurring gains totaled RMB 85.7m, including RMB 102.7m of government grants before related adjustments.

• Operating cash flow was RMB 330.8m, down 57.55% YoY; investing cash flow was negative RMB 506.1m, mainly reflecting increased fixed-asset purchases.

• R&D expense was RMB 152.8m, 4.55% of revenue, versus RMB 174.7m in H1 2023.

Outlook and guidance

• Targeting 40,000 tonnes of high-performance rare-earth permanent-magnet capacity and advanced magnetic-component production lines by 2025.

• Baotou Phase II 12,000-tonne project, Ningbo 3,000-tonne high-end materials and 100-million component-capacity project, and Ganzhou energy-efficient motor materials base were under construction.

• Industry forecasts cited global high-performance rare-earth permanent-magnet consumption reaching 227.1 kilotonnes by 2028, with 17.2% CAGR for 2023–2028.