JL Mag Rare-Earth (300748) Q3 2024 earnings summary

Executive summary

• 9M revenue was ¥5.014bn, down 0.72% YoY; attributable net income fell 60.17% to ¥196.9m as lower rare-earth prices, delayed input-cost adjustment and competition weighed on margins.

• Q3 revenue increased 1.99% YoY to ¥1.653bn, while attributable net income declined 52.24% to ¥77.2m; Q3 gross margin improved to 12.81%.

Financial highlights

• 9M adjusted net income, excluding non-recurring items, was ¥89.2m, down 79.63% YoY; non-recurring gains totaled ¥107.6m, including government grants.

• Q3 adjusted net income was ¥55.2m, down 63.25% YoY; Q3 non-recurring gains totaled ¥22.0m.

• 9M operating cash flow was ¥207.1m, down 74.65% YoY, reflecting higher material-purchase payments and lower cash receipts from product sales.

Outlook and guidance

• Ongoing priorities include expanding market share, investing in R&D for humanoid-robot magnets and components, and advancing digitalized, automated production to improve efficiency and reduce costs.

• Some fixed-price customer orders signed when rare-earth prices were relatively high were being fulfilled in Q3, supporting an improvement in profitability.