Zhejiang Huayou Cobalt (603799) Q4 2024 earnings summary

Executive summary

• Achieved record net profit attributable to shareholders of RMB 4.16 billion, up 23.99% year-over-year, despite an 8.08% decline in revenue to RMB 60.95 billion due to strategic reduction of low-margin product shipments and product mix optimization.

• Maintained industry leadership in cobalt and nickel, with cobalt product shipments up 13% and nickel product shipments up 46% year-over-year.

• Expanded global footprint with new projects in Indonesia, Zimbabwe, South Korea, and Europe, enhancing upstream resource security and downstream market access.

• Strengthened R&D, launching over 30 new products and achieving breakthroughs in high-nickel and solid-state battery materials.

• Advanced ESG initiatives, increasing clean power usage to 40% and investing over RMB 400 million in environmental protection.

Financial highlights

• Operating income: RMB 60.95 billion, down 8.08% year-over-year.

• Net profit attributable to shareholders: RMB 4.16 billion, up 23.99% year-over-year.

• Net cash flow from operating activities: RMB 12.43 billion, up 256.61% year-over-year.

• Basic EPS: RMB 2.50, up 21.95% year-over-year.

• Gross margin improved in key segments, notably nickel products (up 8.51 percentage points) and cobalt products (up 6.82 percentage points).

• Net assets attributable to shareholders: RMB 36.95 billion, up 7.78% year-over-year.

• Total assets: RMB 136.59 billion, up 8.82% year-over-year.

Outlook and guidance

• Expects continued growth in global new energy vehicle and battery markets, with high-nickel ternary materials and solid-state batteries as key drivers.

• Plans to accelerate technological innovation, expand international manufacturing, and deepen ESG integration.

• 2025 strategy focuses on quality, cost, and efficiency improvements, with targeted expansion in Indonesia, Europe, and Africa.

• Proposes a cash dividend of RMB 5.00 per 10 shares for 2024, totaling RMB 840 million (20.2% payout ratio).