Tianqi Lithium guides interim profit to RMB 4.25B on lithium price recovery

Tianqi Lithium Corp. expects interim net profit of as much as RMB 4.25 billion ($585 million), up from RMB 84 million a year earlier, driven by higher lithium prices and downstream demand growth.

"The company expected to record a significant increase in revenue for the reporting period as compared with the corresponding period of last year," Tianqi said in a Hong Kong stock exchange filing. "Benefiting from multiple favorable factors, including the development of the new energy industry and the growth in downstream demand, the average selling prices of the company's major lithium products increased significantly."

Net profit for the six months ended June 30 is expected to range from RMB 2.85 billion to RMB 4.25 billion, compared with RMB 84.41 million in the same period last year. After stripping out non-recurring items, profit is seen at RMB 2.81 billion to RMB 4.2 billion, versus RMB 1.32 million a year earlier. Basic earnings per share are expected at RMB 1.68 to RMB 2.51, compared with RMB 0.05. The company did not declare an interim dividend.

The guidance signals a dramatic recovery for one of the world's largest lithium chemicals producers after a prolonged downturn. Tianqi and peer Ganfeng Lithium Co. have both benefited from a rebound in lithium prices, driven by electric vehicle adoption and energy storage deployment, according to a South China Morning Post report. The recovery in China's new energy vehicle sector has supported demand for battery-grade lithium compounds.

Tianqi shares fell 3.6% on July 17 ahead of the announcement. The profit alert positions Tianqi for its strongest interim result since the 2022 lithium boom. Investors will watch for the full interim report, expected in late August, for revenue details, margin trends, and production guidance.

This article is for informational purposes only and does not constitute investment advice.