Lithium hexafluorophosphate business is expected to reverse losses in the whole year, and the impairment pressure on Skyline shares will be greatly reduced.

As the performance of Xintai material, the subject of M & A, falls short of expectations, Skyline shares have made an impairment of goodwill for three consecutive years, and the book value of goodwill is still more than 1.4 billion yuan. A few days ago, it was learned through the company that the price of lithium hexafluorophosphate, the main product of Xintai materials, has been rising since September last year, and the business is expected to turn around for the whole year, but whether to include the impairment of goodwill depends on the final evaluation.

"from the downstream point of view, the demand is very strong. Since September last year, the price of lithium hexafluorophosphate has gone up all the way, and now it remains relatively high. "on the morning of January 8, the relevant person in charge of Tianji shares revealed to reporters that the company's existing production capacity of lithium hexafluorophosphate is 8000 tons. At present, it is basically in a state of full production and full sales.

In November 2016, Skyline acquired a 100% stake in Xintai material with a total consideration of 2.7 billion yuan, resulting in a goodwill of about 2.319 billion yuan. Xintai material's main business is the production and sales of lithium-ion battery materials (mainly lithium hexafluorophosphate). As a result, Skyline has added lithium-ion battery materials business to small household appliances, forming a dual-main business development model of "home appliances + lithium-ion battery materials".

Lithium hexafluorophosphate is the main electrolyte material, and electrolyte is the core component of electrolyte, one of the four major materials of lithium-ion battery. Therefore, the market situation of lithium hexafluorophosphate is strongly related to the trend of new energy vehicle market.

In 2019, affected by multiple factors such as subsidies, the sales of new energy vehicles in China have declined, and the demand and price of lithium hexafluorophosphate are also at a low level. Affected by this, the operating income of Xintai material lithium hexafluorophosphate products decreased by 16.21% compared with the previous period, and the gross profit margin also decreased by 28.57%. Tianji shares also made a goodwill impairment of 338 million yuan to Xintai Materials.

Tianji shares have accumulated 536 million yuan in goodwill impairment in 2017 and 2018 because the acquired results failed to meet expectations. At present, the book goodwill of Tianji shares is still more than 1.4 billion yuan.

The income performance of lithium hexafluorophosphate business is the key to evaluate whether there is a large goodwill impairment pressure on Tianji shares in 2020.

According to the data disclosed by (CIAPS), China Chemical and physical Power Industry Association, the latest quoted price of domestic lithium hexafluorophosphate is 11-120000 yuan per ton. After the price of lithium hexafluorophosphate began to pick up gradually in September last year, it has risen to about 100000 yuan / ton, and the relative low price has increased by more than 30%. The person in charge of the above-mentioned Tianji shares said that due to the good market since the third quarter, the company's lithium hexafluorophosphate business has made a profit in the first three quarters and is expected to reverse losses for the whole year. However, whether this performance is sufficient to support the company not to charge for goodwill impairment, the official said that whether to do so needs to be assessed by professional institutions, depending on the final data.

However, the industry is relatively optimistic about the market situation of lithium hexafluorophosphate for a period of time. A listed company whose main product also contains lithium hexafluorophosphate said it expects the price of lithium hexafluorophosphate to remain strong next year.