JCHX Mining Management Plans to Invest US$230 Million to Build Alacran Copper-Gold-Silver Mine, with Q1 Net Profit Up 54.1% YoY

JCHX Mining Management Co., Ltd. announced in the evening of May 8 that, given the company's plan to acquire an additional 5% stake in CMH Colombia S.A.S., and upon completion of the acquisition, the company will indirectly hold a 55% stake in CMH Colombia S.A.S. as the controlling shareholder, leading the subsequent development and construction of the Alacran copper-gold-silver mine. To continuously advance the progress of the Alacran copper-gold-silver mine project, the company plans to contribute approximately $231.22 million in proportion to its shareholding for the construction of the Alacran copper-gold-silver mine project. This project is a mining and beneficiation project, with the mine adopting open-pit mining methods. The total ore quantity within the designed pit limit is 97.9 million mt. The estimated project investment is $420.4 million, with a construction period of 2 years. Upon completion, the mine's expected lifespan is 14.2 years. The project's after-tax net present value (NPV) is $360 million (with a discount rate of 8%), and the internal rate of return (IRR) is 23.8%, with an estimated payback period of 3 years. This investment does not constitute a major asset restructuring and is not a related-party transaction.

Regarding the prerequisites for this investment, JCHX Mining Management Co., Ltd. announced: This investment is contingent upon the company's completion of the equity acquisition of CMH and obtaining control over CMH.

Regarding the impact of the investment on publicly listed firms, JCHX Mining Management Co., Ltd. stated: (1) The company acquired a stake in Cordoba Minerals Corp. in 2019 and subsequently directly held a 50% interest in CMH. This planned additional acquisition of a 5% stake in CMH aims to deeply participate in the subsequent development and construction of the Alacran copper-gold-silver mine. Investing in the subsequent construction of this project in proportion to its shareholding after this equity acquisition aligns with the company's long-term development plan, is conducive to promoting the company's sustained, stable, and healthy development, and does not harm the interests of the company, its shareholders, especially minority shareholders. (2) After the project is put into operation, it is expected to have a certain impact on the company's future business development and operating performance, facilitating the company's further expansion into the field of mine resource development, improving the company's industrial layout, and promoting the company's sustained, stable, and healthy development.

JCHX Mining Management Co., Ltd. cautions: This investment is contingent upon the company's completion of the equity acquisition of CMH and obtaining control over CMH, and related matters are still subject to uncertainties.

JCHX Mining Management Co., Ltd. announced in the evening of April 27 that the company has renewed the mining production contracting agreement with Western Mining Co., Ltd. for the Xitieshan lead-zinc mine and recently obtained the contract document signed and sealed by both parties. Based on the estimated workload, the contract amount is approximately 377 million yuan. The fulfillment of this contract will have a certain impact on the company's performance and is conducive to promoting the company's future business development.

JCHX Mining Management Co., Ltd. disclosed its 2024 annual report on April 25.In 2024, the company achieved a total operating revenue of 9.942 billion yuan, up 34.37% YoY, and a net profit attributable to shareholders of 1.584 billion yuan, up 53.59% YoY. Regarding the reasons for the performance growth in 2024, the company stated that it was mainly due to the increased production and efficiency of mine projects in the mine resource development business during the reporting period. Specifically, the company achieved resource sales revenue of 3.209 billion yuan in 2024, up 412.85% from the same period last year, with its share of the company's operating revenue during the reporting period increasing from 8.46% in 2023 to 32.28%. The company produced 48,700 mt of copper metal (equivalent) throughout the year, up 238.19% YoY, and 356,500 mt of phosphate ore, up 115.67% YoY.

JCHX Mining Management also announced its 2025 business plan, which includes the following for the mine services segment: completing a total underground excavation volume of 3.8694 million m³ and a total underground mining and ore supply volume of 44.1729 million mt (including ore volume extracted using the natural caving method), with YoY changes of -7.25% and 6.46%, respectively. For the resource development segment, the company plans to produce 79,400 mt of copper metal, up 63.04% YoY, and 300,000 mt of phosphate ore, down 15.85% YoY.

JCHX Mining Management also announced its Q1 2025 performance on April 25, achieving a revenue of 2.811 billion yuan in the first quarter, up 42.49% YoY, and a net profit attributable to shareholders of 422 million yuan, up 54.10% YoY.

On May 6, Huayuan Securities issued a research report, giving JCHX Mining Management an "accumulate" rating. The main reasons for the rating include: 1) The total volume of mining services business remains stable, with a decline in unit gross profit; 2) Accelerated release of resource development business; 3) In 2025, it is planned to continue increasing copper mine production, with the rest remaining relatively stable; 4) In Q1 2025, the copper business continued to increase production, contributing to significant performance growth. Risk warnings: Risks of slower-than-expected progress in ongoing projects; risks of metal prices falling more than expected; risks of work safety; and geopolitical risks.

On April 27, Hua'an Securities issued a research report, giving JCHX Mining Management a "buy" rating. The main reasons for the rating include: 1) The company released its 2024 annual report and Q1 report; 2) The mining services business is operating steadily; 3) The release of self-owned resources is expected to drive performance growth. Risk warnings: Risks of capacity release falling short of expectations; risks of volatile copper and phosphate prices; risks of mine safety and environmental protection; and risks of overseas operations, among others.