SMM7 16 June news: cold sharp cobalt industry issued a performance forecast, the net profit of shareholders of listed companies from January to June 2019 is expected to be-65 million to-60 million, a year-on-year change of-112.29% to-111.35%, the average net profit growth rate of the non-ferrous smelting and processing industry is-25.97%. The cold sharp cobalt industry explained several reasons for the pre-loss of the company's performance. The main reason for the significant decline in the 2019 semi-annual performance forecast of the cold sharp cobalt industry compared with the same period last year was due to the continued decline in cobalt metal prices since the fourth quarter of 2018, which led to the loss of the company's inventory price and the decline in the sales price of the company's cobalt products, which reduced the company's profitability. During the reporting period, it is estimated that the impact of non-recurrent profit and loss on the net profit attributable to shareholders of listed companies is about 1.8 million yuan.
It is understood that the main products of cold cobalt industry are cobalt powder, cobalt concentrate, cobalt salt and electrolytic copper. Cold sharp cobalt industry achieved 2.46 billion yuan in sales revenue of cobalt products in 2018, accounting for 88.43% of operating income, an increase of 94.25% over the same period last year. However, due to the sharp decline in cobalt prices in 2018, the gross profit margin of cobalt products was 47.71%, down 3.61% from a year earlier.
In the first quarter of 2019, the total operating income was 518.3963 million yuan, down 29.69% from the same period last year, of which the main business income decreased by 29.71%, realizing the net profit of-55.3208 million yuan belonging to the common shareholders of listed companies, down 121.71% from the same period last year. The decline in operating income and the decrease in net profit attributable to common shareholders of listed companies were mainly due to the decline in cobalt prices and the provision for lower inventory prices.
SMM believes that the decline in profitability of the cold cobalt industry is mainly due to the rapid decline in the price of domestic cobalt products. At present, the cobalt price drops rapidly, the buyer's market competition is fierce, the cold sharp faces the product to reduce the inventory and the new production capacity after the sales pressure, the profitability shrinks. SMM expects cobalt prices to still show a volatile downward trend in the second half of the year, and improved supply and demand expectations may lead to a short-term rebound.
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