Battery Network learned from the specific object research activities held by Rongjie (002192) that the company's mines sold a total of 70700 tons of lithium concentrate last year.
In terms of project progress, at present, the first publicity period of environmental assessment for the 2.5 million t / a lithium ore cleaning project in Yuanyangba has been completed and is now moving forward in accordance with the relevant procedures. Chengdu Rongjie Lithium Industry Phase I project is undergoing equipment commissioning and strives to be completed and put into production in the second quarter of 2021.
In addition, Dongguan Derui, a subsidiary of Rongjie Lithium equipment, is currently saturated with orders, and the enterprise is now operating at full capacity. BYD is the strategic shareholder of Dongguan Dirui, which has a 32.5% stake. Dongguan Dirui's main customers are various lithium battery factories under BYD.
The following is the full text of the research activities:
Q: what is the general production situation after the resumption of production in the mine?
A: the mine resumed production in June 2019, producing 27300 tons of lithium concentrate that year; the winter break from January to March 2020, superimposed the impact of the epidemic, resumed work at the end of March 2020, producing 58400 tons of lithium concentrate that year, plus 2019 inventory, a total of 70700 tons of lithium concentrate were sold in 2020.
Q: at present, the company's lithium ore selection is 450000 tons / year, will the future 2.5 million tons / year project be incremental?
A: not a complete increment. According to the investment agreement signed between the company and the government, after the 2.5 million t / a concentrator is put into operation, the 450000 t / a concentrator in the original mine area will be dismantled by itself.
Q: how is the progress of the 2.5 million t / a lithium ore cleaning project in Yuanyangba?
A: the company submitted the application materials for the project to the Sichuan Provincial Development and Reform Commission in November 2020. At present, it has completed a lot of examination and approval procedures; the project design has been completed; the environmental impact assessment work is also being carried out at the same time, and the first publicity period has ended; construction of auxiliary facilities has also started.
Q: how to solve the matching problem between the mining capacity of 1.05 million tons / year and the lithium ore concentration capacity of 2.5 million tons / year?
A: at present, there are several plans under discussion, and specific plans have not yet been formed, so it is not convenient to disclose them.
Q: does the company have a plan for the development of new resources? has Methyl Caxin No. 3 Company considered taking it down?
A: the company has 28.99 million tons of methyl card 134 vein ore reserves, and 1.368 million tons of ore has been used before 2020. The remaining reserves can be mined for at least 20 years according to the company's current production capacity, even according to the new production capacity for more than 10 years. At present, the most important thing for the company is to complete the existing planning first, and the follow-up development plan should be comprehensively considered.
Q: what is the concentrate cost of the company?
A: the cost of obtaining lithium ore resources in the early stage of the company is very low, so the cost is very competitive. Several key data related to cost are: the company's sales of lithium concentrate in 2020 is about 195 million yuan, because the price has been low, the gross profit margin is 48.21%. According to the new revenue criteria, transportation costs for concentrate sales have been included in operating costs. In addition, the government will share 40 million of the funds according to the production capacity data in 2020, which is included in the management expenses. The above information has been disclosed in the 2020 annual report, details can be found in the annual report.
Q: in addition to paying government benefit sharing funds, what other local support does the company have?
A: first of all, the company's mines are local, which has made tax contributions to the local area; now it is coupled with the sharing of government interests; secondly, we will also recruit some local staff, or some engineering projects will employ local labor services; thirdly, last year, we invested more than 80 million to widen and harden nearly 30 kilometers of rural roads from the mine to Tagong Town, bringing great convenience to the local people. In addition, we will also donate to local public welfare undertakings to support local education and the improvement of residents' living environment. In a word, the company's development of lithium ore resources in the local area is a win-win situation for the government and the local people.
Q: is there any difficulty in transporting the concentrate from the mine?
A: the terrain of the mining area is not very steep, and the road company from the mine to Tagong Town has invested in widening and solidifying, which has greatly improved the transportation environment; the road surface from Tagong Town to other places is not complicated and there is no difficulty.
Q: what are the main capital expenditures of the company in the future? How to solve the source of funds?
A: there is no need for too much investment in the mine, mainly the investment of the new project 2.5 million tons / year concentrator. The new selection plant has an investment of more than 700 million in fixed assets, and there are a variety of sources of funds, such as the company's own funds, funds raised by non-public offerings, project construction loans, government industry support, and so on. In addition, the company's controlling shareholders support the company greatly and provide financial assistance and guarantee to the company every year according to the company's needs.
Q: personnel status of mining and mineral processing?
A: at present, the company's mining business is outsourced, there are not many mineral processing personnel, and it is a non-labor-intensive industry.
Q: Chengdu Rongjie Lithium Industry has a capacity of 40,000 tons / year of lithium salt, can it support mines?
A: it can digest most of the company's lithium concentrate. According to the lithium salt production capacity of 40,000 tons per year, it needs more than 300,000 tons of lithium concentrate, and the surplus lithium concentrate is sold to the outside world.
Q: is Chengdu Rongjie Lithium Industry mainly digesting lithium concentrates from its own mines this year?
A: it depends specifically on the time when Chengdu Rongjie lithium industry will be put into production, but at present, resources are relatively tight, so the demand for self-use will be considered first. Based on the consideration of long-term strategic cooperation, we are also willing to contact and discuss with other customers.
Q: what is the progress of Chengdu Rongjie Lithium Industry? The company currently holds 50% of its shares. Will it be incorporated into the listed company system in the future?
A: Chengdu Rongjie Lithium Industry Phase I project is undergoing equipment commissioning and striving to be completed and put into production in the second quarter of 2021, but the specific commissioning time depends on the actual equipment commissioning situation. There are no other plans at present.
Q: how is Dongguan Derui, a subsidiary of lithium power equipment?
A: Dongguan Derry is currently saturated with orders, and the enterprise is now operating at full capacity. BYD is the strategic shareholder of Dongguan Dirui, which has a 32.5% stake. Dongguan Dirui's main customers are various lithium battery factories under BYD. Dongguan Derry's capacity bottleneck is related to skilled workers and venues, and we will expand it according to the order situation. Dongguan Derry is mainly engaged in design, assembly and so on, most of the equipment parts are purchased from abroad, and a small part of them are processed by themselves, which belongs to light asset enterprises. Dongguan Derry basically maintained its income at around 120 million a few years ago, lost money for the first time under the influence of the industry in 2019, and made a small profit in 2020. Dongguan Derry's business goal is to expand the scale of revenue and improve profitability.
Q: the gross profit margin of the lithium equipment business has fallen sharply since 2019. Is it because of cooperation with BYD?
A: the decline in gross profit margin of lithium power equipment business is due not only to the industry, but also to the enterprises themselves. In 2020, the gross profit margin of equipment business rebounded by 2.75 percentage points. BYD purchases lithium power equipment in the form of bidding, and the company, like other suppliers, obtains orders through competitive bidding, which is bound to squeeze some profit margins compared with negotiated pricing. However, the cooperation between the company's lithium equipment business and BYD can not only expand the size of orders, but also speed up the iteration of product updates. As we all know, BYD is one of the leaders in the field of lithium batteries and new energy vehicles, with a series of global leading forward-looking technologies and global leading technological advantages; BYD's demand for lithium devices represents the cutting-edge technology direction of the industry, which plays a leading role in the technology research and development and product renewal iteration of our equipment business.
Q: does the company have a plan for employee motivation?
A: the company's employee motivation is mainly at the subsidiary level. Dongguan Delui, Chang and Huali all have employee stock ownership platforms. The management team of the company is still being built step by step, and the incentive at the level of listed companies has not yet been considered.
In addition, Battery Network also noted that on April 27, Rongjie shares also released a report for the first quarter of 2021, saying that the company's operating income from January to March was 109 million yuan, an increase of 263.23% over the same period last year; the net profit belonging to shareholders of listed companies was 1.8021 million yuan, a year-on-year return to profit, an increase of 148%.
