Affected by the price of rare earths and the net profit of resources fell by more than 60% last year

SMM4, March 27: Shenghe Resources recently released its 2019 annual report, announcing that revenue during the reporting period reached 6.96 billion yuan, an increase of 11.76 percent over the same period last year, and net profit was 102 million yuan, down 64.55 percent from the same period last year.

Shenghe Resources said that in 2019, due to fluctuations in the market prices of its main products, the gross profit margin of the company's main products decreased from the previous year, and rare earth prices fell in the second half of 2019. Shenghe Resources Holdings Co., Ltd. posted a loss in the fourth quarter.

Sheng and Resources said that last year, in addition to a few heavy rare earth elements such as terbium, dysprosium year-on-year average price rose, other rare earth element annual average price has experienced the same large decline, which is the main reason for the decline in the company's performance.

The global supply of rare earths increased sharply last year, Shenghe Resources said in an announcement. Of these, China's total rare earth production control plan is 132000 tons, an increase of 10 percent over the same period last year, and the production of rare earths abroad has also continued to increase.

Sheng and Resources said that at the beginning of last year, due to short-term structural contradiction between supply and demand and other factors, the prices of major rare earth products remained low. By mid-May, Sino-US trade frictions intensified, coupled with Myanmar's imported minerals affected by customs closure, the prices of major rare earth products rose rapidly. In June, as the trade situation between China and the United States eased and rare earth prices fell rapidly, the weak market continued in the second half of the year.

In addition, due to the impairment of goodwill led to a decline in net profit from the previous year.

Shenghe resources are mainly engaged in rare earth mining and separation, smelting separation, metal processing and zirconium titanium mineral processing business.

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