SHANGHAI, Jul. 15 (SMM) - Leading rare earth producer China Minmetals Rare Earth Co. turned a loss into profit in this year’s first six months after assets restructuring.
The company is expected to record a profit of 9-15 million yuan ($1.5-2.4 million) or 0.009-0.015 yuan a share between January and June, it told Shenzhen Stock Exchange today. That compared to a loss of 169.2 million yuan or 0.26 yuan a share in the same period a year ago, it said.
Reason for the turnaround was that profitability of the rare earth assets acquired proved to be stronger than aluminium assets divested in its restructuring, China Minmetals said.
However, the company’s first-half profit would be 92.5-95.5% lower from a year ago after restating the year-ago financial statements to a more comparable basis, it said.
This was because ``as rare earth market has remained depressed, sales prices, volumes and gross margins of rare earth products declined quite much while inventories of some products were written down’’, it added.
China Minmetals Corp. injected Ganzhou Rare Earth Mineral Industry Co. and Baotou Research Institute of Rare Earths into loss-making aluminium maker Shanxi Guanlv in 2012 and restructured it into China Minmetals Rare Earth.