Yunnan Chihong Zn & Ge Co., Ltd.: The company's production of optical fiber-grade germanium products, PV-grade germanium products, and compound semiconductor materials has all achieved localisation.

On June 23, the share price of Yunnan Germanium Industry Co., Ltd. rose. By the close of trading on the 23rd, the company's shares had increased by 1.22%, closing at 18.32 yuan per share.

On June 23, Yunnan Germanium Industry Co., Ltd. stated on the investor interaction platform that,the company's current production and operation conditions are normal,and all matters that should be disclosed have been publicly disclosed in accordance with regulations. In addition to being influenced by the company's fundamentals, stock prices are also affected by various factors in the secondary market. Investors are advised to pay attention to investment risks.

On June 18, Yunnan Germanium Industry Co., Ltd. stated on the investor interaction platform that the company's fiber-optic grade germanium products, PV-grade germanium products, compound semiconductor materials, and other products have all achieved localisation. In 2024, the sales of PV-grade germanium products and compound semiconductor materials increased YoY, while the sales of fiber-optic grade germanium products decreased YoY.

On June 16, Yunnan Germanium Industry Co., Ltd. stated on the investor interaction platform that the gallium arsenide wafers and indium phosphide wafers produced by the company's holding subsidiary fall under the category of compound semiconductor materials. Currently, compound semiconductor materials (substrates) are mainly concentrated in developed countries such as the US and Japan. Internationally renowned enterprises such as Sumitomo Electric Industries, Ltd., JX Nippon Mining & Metals Corporation, AXT Inc. (US), and Freiberger Compound Materials GmbH (Germany) are engaged in the production and sales of compound semiconductor materials worldwide. These enterprises all possess strong R&D capabilities, technological reserves, sales channels, and market reputations. In recent years, the domestic compound semiconductor materials industry has accelerated its development pace, with a noticeable trend towards localisation.

On May 30, Yunnan Germanium Industry Co., Ltd. stated on the investor interaction platform that the company's "Germanium Wafer Construction Project for Space Solar Cells" is progressing normally.

On May 30, in response to an investor's question on the interaction platform, Yunnan Germanium Industry Co., Ltd. stated that in Q1 2025, the selling prices of the company's PV-grade germanium products, infrared-grade germanium products (blanks and coated lenses), material-grade germanium products, and fiber-optic grade germanium products increased YoY, while the selling prices of infrared-grade germanium products (lenses and optical systems) decreased YoY.

Yunnan Germanium Industry Co., Ltd. previously announced its Q1 2025 report, showing that in the first quarter of this year, the company achieved operating revenue of 240 million yuan, up 83.8% YoY. The net profit attributable to the parent company successfully turned around from a loss of 11.5 million yuan in the same period last year to a net profit of 10.2 million yuan.

Regarding the reasons for the change in Q1 performance, Yunnan Germanium Industry Co., Ltd. stated: (1) Operating revenue increased YoY, mainly due to: ① Changes in the sales volume of certain products compared to the same period last year, contributing an increase in operating revenue of 52.6634 million yuan. Among them, sales of PV-grade germanium products, compound semiconductor material products, infrared-grade germanium products, and optical fiber-grade germanium products increased, while sales of material-grade germanium products decreased. ② Changes in product prices compared to the same period last year led to an increase in operating revenue by 56.788 million yuan. Among them, selling prices of PV-grade germanium products, infrared-grade germanium products (blanks and coated lenses), material-grade germanium products, and optical fiber-grade germanium products increased, while selling prices of compound semiconductor material products and infrared-grade germanium products (lenses and optical systems) decreased. (2) Operating costs increased compared to the same period last year, primarily due to: ① An increase in operating costs by 30.2302 million yuan due to changes in sales volumes of certain products compared to the same period last year. ② An increase in operating costs by 37.2059 million yuan due to changes in unit costs of certain products compared to the same period last year. Among them, unit costs of material-grade germanium products, infrared-grade germanium products (blanks and coated lenses), optical fiber-grade germanium products, and compound semiconductor material products increased, while unit costs of PV-grade germanium products and infrared-grade germanium products (lenses and optical systems) decreased. (3) Operating profit increased compared to the same period last year, primarily due to an increase in sales revenue leading to a YoY increase in gross profit, despite YoY increases in period expenses, R&D expenses, and credit impairment losses. (4) Net profit attributable to shareholders of publicly listed firms and net profit attributable to shareholders of publicly listed firms after deducting non-recurring gains and losses increased compared to the same period last year, primarily due to an increase in operating revenue during the period leading to a YoY increase in gross profit.

The 2024 annual report of Yunnan Germanium Industry Co., Ltd. shows that in 2024, the demand for germanium in the PV and infrared sectors remained strong, with germanium prices rising rapidly from the end of Q2, reaching a record high. The company's material-grade germanium product prices increased significantly, followed by increases in prices of deep-processed products such as infrared-grade germanium products and optical fiber-grade germanium products, although the increases were lower than those of upstream products. With the increase in demand for low-orbit communication satellites downstream, the company's sales of PV-grade germanium products increased significantly, and the sales of compound semiconductor materials also improved due to the recovery in demand in the optical communication market. In 2024, the company achieved operating revenue of 767.4019 million yuan and net profit attributable to owners of the publicly listed firm of 53.0956 million yuan.

The 2024 annual report of Yunnan Germanium Industry Co., Ltd. shows that operating revenue increased in 2024 compared to the previous year, primarily due to: An increase in operating revenue by 83.2531 million yuan due to changes in product prices. Among them, the increase in prices of germanium metal materials led to an increase in the average prices of material-grade germanium products, infrared-grade germanium products (blanks and coated lenses), and optical fiber-grade germanium products; the increase in the proportion of sales of higher-priced indium phosphide products led to an increase in the average price of compound semiconductor materials; the impact of the product mix led to a decrease in the average price of infrared-grade germanium products (lenses and optical systems); and the impact of annual order prices signed in H1 led to a decrease in the average price of PV-grade germanium products. The increase in sales volume of major products boosted operating revenue by 12.172 million yuan. Specifically, sales of compound semiconductor materials, PV-grade germanium products, and infrared-grade germanium products (blanks and coated lenses) increased, while sales of infrared-grade germanium products (lenses and optical systems), fiber-optic-grade germanium products, and material-grade germanium products declined. The net profit attributable to owners of the parent company increased in 2024 compared to the previous year. This was primarily due to a significant increase in germanium metal prices during the period, leading to higher prices for the company's material-grade germanium products, infrared-grade germanium products (blanks and coated lenses), and fiber-optic-grade germanium products. Additionally, the increase in the proportion of sales of higher-priced indium phosphide products contributed to a rise in the average price of compound semiconductor materials, resulting in a 9.58 percentage point increase in the company's overall gross profit margin.

Regarding production, Yunnan Germanium Industry Co., Ltd. introduced the following: In 2024, the company and its subsidiaries produced 34.07 mt of material-grade germanium products (excluding internal sales and toll processing), 6.65 mt of infrared-grade germanium products (blanks and coated lenses) in terms of metal content, 1,828 sets of lenses and optical systems, 491,400 pieces of PV-grade germanium products (totaling 4-6 inches), 27.04 mt of fiber-optic-grade germanium products. For compound semiconductor materials, the company produced 87,500 pieces of gallium arsenide wafers (totaling 1-6 inches) and 64,400 pieces of indium phosphide wafers (totaling 2-4 inches).

In its 2024 annual report, Yunnan Germanium Industry Co., Ltd. stated that as of December 31, 2009, the company's mines had a total proven reserve of 689.55 mt of germanium metal. Subsequently, the company successively integrated five germanium mines through the acquisition of mining rights and equity, increasing its proven reserves of germanium metal by approximately 250 mt. The company conducted resource exploration at the Zhongzhai Germanium Mine, and the review of the mineral resource reserves in the "Verification Report on the Mineral Resource Reserves of the Zhongzhai Germanium Mine in Lincang City, Yunnan Province" was filed with the Ministry of Land and Resources on January 11, 2016. According to the report, the Zhongzhai Germanium Mine's reserves increased by 29.75 mt. In 2019, the company's Meiziqing Mine was closed and exited in accordance with national industrial policies, reducing its proven reserves by 66.97 mt (in terms of metal content). From 2010 to December 31, 2024, the company's captive mines cumulatively consumed approximately 291.68 mt of metal output from their resources.

Regarding the company's and its subsidiaries' plans for 2025, Yunnan Germanium Industry Co., Ltd. introduced the following in its 2024 annual report:The company plans to produce 69.45 mt of material-grade germanium products (including internal sales and toll processing), primarily considering customer demand and internal deep-processing needs; 3.90 mt of infrared-grade germanium products (blanks and coated lenses), 11,000 sets of infrared lenses and optical systems; 866,700 pieces of PV-grade germanium products (4-6 inches); 35 mt of fiber-optic-grade germanium products; 200,000 pieces of gallium arsenide wafers (3-6 inches); and 83,000 pieces of indium phosphide wafers (2-6 inches). The company will carefully organize production and strive to complete the above production plan.