Tianqi Lithium (002466) Q2 2024 earnings summary

Executive summary

• Revenue for H1 2024 was RMB 6.42 billion, down 74.14% year-over-year due to a sharp decline in lithium product prices and market volatility.

• Net loss attributable to shareholders was RMB -5.21 billion, a decrease of 180.68% compared to the same period last year.

• The company’s performance was impacted by a mismatch in pricing cycles between upstream lithium concentrate and downstream lithium chemical products, as well as a significant drop in investment income from SQM due to a one-time tax expense.

Financial highlights

• Operating cash flow was RMB 2.24 billion, down 81.52% year-over-year.

• Basic and diluted EPS were both -3.18 yuan, compared to 3.93 yuan in H1 2023.

• Gross margin for lithium mining dropped to 65.64% (down 26.14 percentage points), and for lithium compounds and derivatives to 42.56% (down 36.08 percentage points).

• Total assets at period end were RMB 69.26 billion, down 5.41% from year-end 2023.

• Net assets attributable to shareholders were RMB 44.58 billion, down 13.47% from year-end 2023.

Outlook and guidance

• The company expects the lithium industry’s fundamentals to remain positive in the medium to long term, supported by strong demand from new energy vehicles and energy storage.

• The company is accelerating the ramp-up of new projects, including the Kwinana lithium hydroxide plant and the Suining Anju lithium carbonate plant.

• No interim dividend will be distributed for H1 2024.