SHANGHAI, Apr. 23 (SMM) – Yuguang Gold & Lead realized RMB 57.92 million in net profit last year, down 36.56% from 2011, and with the net profit distributable to the parent company down 44.88% to RMB 48.53 million.

Yuguang’s refined lead output rose 3.5% to 396,200 mt in 2012, but its gold output fell 15.66% to 2,926 kg. Yuguang’s sulfuric acid output increased 2.72% to 275,100 mt. Sales income hit RMB 12.497 billion, up 7.1%.

Four factors contributed to the decline in Yuguang’s profits. First, tight supply has raised raw material costs and lowered TC. Second, the price of recycled products, including sulfuric acid and zinc oxide, fell last year, pulling profits on these products down 23.97% and 10.45%, respectively. Third, the company made provisions for inventory value losses in response to price volatility in refined lead and silver, its chief products. Lead prices fell 7% and silver prices fell 10% last year. Finally, the company’s cost of financing surged RMB 81.38 million (64.13%) to RMB 208.26 million as the slowing appreciation of the RMB cut into exchange gains while interest payments and gold lease rates both grew.