Earth-Panda: It has successively obtained the export licenses for dual-use items and technologies issued by the Ministry of Commerce. The raw material inventory is basically maintained at around two months.

On June 30, Earth-Panda's share price rose. By the close of trading on the 30th, Earth-Panda's shares had increased by 4.96%, closing at 31.95 yuan per share.

Earth-Panda announced in the evening of June 27 that Xiong Yongfei, the company's controlling shareholder, actual controller, chairman, and general manager, intends to reduce his shareholding in the company by no more than 2.2896 million shares, accounting for no more than 2% of the company's total share capital. Cao Qingxiang, the company's actual controller and director, intends to reduce her shareholding in the company by no more than 1.1448 million shares, accounting for no more than 1% of the company's total share capital.

The record of investor relations activities released by Earth-Panda on June 26 showed:

1. Could you please introduce the current capacity situation of the company?

Earth-Panda responded: The company has three major production sites in Hefei, Baotou, and Ningguo. Currently, the total annual capacity of sintered NdFeB is approximately 10,000 mt, including: approximately 3,000 mt/year at the Hefei factory, approximately 4,000 mt/year at the Baotou factory, and approximately 3,000 mt/year at the Ningguo factory.

2. What is the structure of downstream customers and the sales proportion of the company?

Earth-Panda responded: The downstream customer structure of the company's high-performance sintered NdFeB products mainly includes industrial motors, automotive industry, high-end consumer electronics, and other fields. Among them, industrial motors account for approximately 42%, automotive industry accounts for approximately 28%, high-end consumer electronics account for approximately 19%, and other categories account for approximately 11%.

3. What is the current situation of the company's export licenses?

Earth-Panda responded: Since the Ministry of Commerce and the General Administration of Customs implemented export controls on items related to medium-heavy rare earth, the company has strictly complied with the requirements of the Ministry of Commerce and the General Administration of Customs and applied for export licenses for permanent magnet products subject to export controls. Since early May, the company has successively obtained dual-use items and technology export licenses issued by the Ministry of Commerce, with export regions including the US, Europe, ASEAN, and other countries and regions.

4. Which countries and regions are the company's NdFeB products mainly exported to? What is the proportion of exports to the US?

Earth-Panda responded: The company's NdFeB products are mainly exported to European and American countries and regions such as Germany, the US, and South Korea, as well as Asian countries and regions. In the first quarter of 2025, the company's export business revenue was 110 million yuan, accounting for 31.98% of the operating revenue. Among them, exports to the US were 36.177 million yuan, accounting for 10.61% of the operating revenue.

5. What is the situation of the company's main raw material procurement and inventory?

Earth-Panda responded: The company maintains stable cooperation with China Northern Rare Earth and other rare earth suppliers to ensure a multi-channel and stable supply of rare earth raw materials. The raw material inventory is basically maintained at around 2 months, and the procurement and inventory strategies will be adjusted in a timely manner based on the orders on hand and the trend of material prices.

6. What is the pricing model for your company's products? Have there been any significant changes in the prices of exported products?

Earth-Panda responded: Our company's product pricing model primarily follows a cost-plus approach, while also comprehensively considering factors such as customer loyalty, product performance, processing complexity, and personalized packaging requirements. For high-end customers, factors like product performance indicators, product consistency, and delivery capabilities are often given more weight than price considerations. Our company maintains good communication with customers and adopts a dynamically balanced price management model. Currently, the prices of exported products have been mutually agreed upon with customers, with no significant changes.

7. What is the progress of your investment in Thailand?

Earth-Panda responded: To further optimize our strategic layout and expand our overseas market business, our company plans to establish a wholly-owned subsidiary in the Asian Industrial Park in Thailand, with an initial investment amount of $10 million. Currently, we are in the process of applying for investment approval from the Thailand Board of Investment (BOI). The next step will be to apply to domestic authorities for the registration of overseas enterprises and investment projects in accordance with the progress of the approval process.

Earth-Panda's Q1 2025 report showed that in the first quarter, the company achieved operating revenue of 341 million yuan, up 14.6% YoY; net profit attributable to shareholders was 6.8 million yuan, down 16.9% YoY.

Earth-Panda's 2024 annual report showed that in 2024, the company achieved operating revenue of 1.32 billion yuan, down 7.8% YoY; net profit attributable to shareholders successfully turned from a loss of 42.81 million yuan in the same period last year to a profit of 31.87 million yuan.

Earth-Panda stated: 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 by 74.6792 million yuan and 60.9683 million yuan respectively compared to the previous year, mainly due to the YoY increase in product production and sales volume during the reporting period, coupled with the stabilization of rare earth raw material prices, which led to an improvement in product gross profit margins.

When introducing the development of upstream rare earth raw materials, Earth-Panda stated: Rare earths, known as the "vitamins of industry," are key strategic raw materials for key industries such as metallurgy, petrochemicals, new energy, and military industries. The upstream of rare earth permanent magnets mainly involves rare earth mining, smelting, and separation industries. The main rare earth raw materials for high-performance NdFeB permanent magnet materials are rare earth products such as Pr-Nd alloy, dysprosium-iron alloy, and terbium metal.

When discussing the company's development strategy, Earth-Panda stated in its 2024 annual report: During the "14th Five-Year Plan" period, the company will continue to focus on high-performance sintered NdFeB permanent magnet materials as its main business. Centering around major strategic needs of the country such as NEVs, information technology, and clean energy, and facing the development needs of the rare earth permanent magnet industry, the company will mainly research high-performance sintered NdFeB permanent magnet materials and their preparation technologies, green surface protection technologies for sintered NdFeB permanent magnet materials, and resourceful reuse technologies for waste rare earth permanent magnets. Taking key customers such as well-known domestic and overseas enterprises as the starting point, we will further tap into market potential and actively expand the market demand for magnetic component businesses and emerging application scenarios. Faced with an increasingly competitive market environment, the company will continue to enhance its core competitiveness, improve its standardized governance capabilities, continuous innovation capabilities, refined production and manufacturing capabilities, and international market development capabilities. With the vision of "leading the magnetic world and creating a better life" and the mission of "creating value for customers and becoming the most competitive and trustworthy supplier in the rare earth permanent magnet field," we strive to become a world-class advanced manufacturer of high-performance rare earth permanent magnet materials.

Reviewing the price trend of Pr-Nd alloy in 2024, it can be seen that the price of Pr-Nd alloy fell in 2024. The average price of Pr-Nd alloy on December 31, 2024, was 489,000 yuan/mt, compared with the average price of 542,000 yuan/mt on December 29, 2023, the average price fell by 53,000 yuan/mt in 2024, with a decline rate of 9.78%. The annual daily average price of Pr-Nd alloy in 2024 was 484,704.55 yuan/mt, compared with the annual daily average price of 645,330.58 yuan/mt in 2023, the annual daily average price fell by 160,626.03 yuan/mt, with a YoY decline rate of 24.89%.

》Click to view SMM rare earth spot prices

》Subscribe to view historical price trends of SMM metal spot prices

On June 30, the average price of Pr-Nd alloy was 543,000 yuan/mt, down 1,000 yuan/mt from the previous trading day, with a decline rate of 0.18%. Recently, the price of rare earth metals has been slightly weak, mainly due to suppliers cashing in at low prices at month-end. However, the mainstream quotations in the market remain firm due to the influence of the oxide market. Meanwhile, for medium-heavy rare earths, suppliers have lowered their quotations to test market sentiment due to the continued sluggish market demand.

It is worth noting that some magnetic material enterprises have reported that orders in June have shown certain improvements compared to May. In addition, tender activities by leading magnetic material producers have also become increasingly frequent recently, which is undoubtedly a positive signal indicating the emergence of marginal recovery signs in the downstream demand side. This recovery not only brings more vitality to the industry chain but also provides a solid foundation for the stability of market prices. Regarding the future market of rare earths, industry insiders generally hold an optimistic attitude due to the solid cost support and the positive outlook for demand. Driven by this sentiment, bullish expectations have gradually occupied the mainstream in the market. Therefore, it can be foreseen that rare earth prices will show a tendency to rise more easily than fall in the short term, and the overall market outlook is relatively clear.