Zangge Mining H1 Net Profit Up 102% to RMB 3.638 Billion, JV Julong Copper Contributes RMB 2.839 Billion

Zangge Mining's semi-annual report for 2026 shows revenue of RMB 2.065 billion in the reporting period, up 23.05% year-on-year. Net profit attributable to shareholders of the listed company reached RMB 3.638 billion, up 102.09% year-on-year. Excluding non-recurring items, net profit was RMB 3.706 billion, up 104.92%. In the second quarter alone, revenue was RMB 1.349 billion, up 19.83% year-on-year and 88.54% quarter-on-quarter. Q2 attributable net profit was RMB 2.064 billion, up 96.05% year-on-year and 31.17% quarter-on-quarter. As of the end of the period, total assets stood at RMB 18.602 billion, net assets attributable to the parent were RMB 17.197 billion, and the debt-to-asset ratio was 7.77%.

By segment, in the potash business, potassium chloride output in H1 was 510,300 tonnes, with sales of 525,300 tonnes. The average selling price (including tax) was RMB 3,055.25 per tonne, up 7.40% year-on-year, while the average cost of sales was RMB 975.75 per tonne, down 2.02%. Potassium chloride revenue was RMB 1.472 billion, up 5.28%, with a gross margin of 65.19%, up 3.35 percentage points. In the lithium business, lithium carbonate output was 5,400 tonnes and sales were 3,990 tonnes. The average selling price (including tax) was RMB 164,900 per tonne, and the average cost of sales was RMB 42,200 per tonne. Revenue reached RMB 582 million, up 118.22%, with a gross margin of 71.08%, up 40.55 percentage points year-on-year.

The copper business was the core driver of earnings growth. Associate company Julong Copper produced 134,000 tonnes of mined copper and sold 133,500 tonnes in H1. It also produced and sold 423 kilograms of gold, produced 80.35 tonnes of silver and 4,711 tonnes of molybdenum. Revenue was RMB 15.004 billion, with net profit of RMB 9.223 billion and net profit per tonne of copper of RMB 69,100.

Zangge holds a 30.78% stake in Julong Copper and recognized investment income of RMB 2.839 billion under the equity method, up 124.57% year-on-year, representing 78.03% of the company's attributable net profit. Since the start of 2026, Zangge has received RMB 3.078 billion in dividends from Julong Copper. The Julong Copper Mine has cumulative proven copper metal resources of 25.88 million tonnes, the largest copper mine by certified resources in China.

Application reports for the Jiezechaka and Longmucuo salt lake projects have been completed. The environmental impact assessment approval for the Longmucuo 70,000-tonne lithium carbonate project has been obtained, and the EIA for the Jiezechaka 30,000-tonne lithium hydroxide project is complete. The EIA report for the 30,000-tonne lithium carbonate project is being prepared for submission. The Mamecuo salt lake in the Ali region of Tibet covers a mining area of 115.36 square kilometers, with proven lithium chloride reserves in liquid brine of 2.5011 million tonnes, equivalent to about 2.1774 million tonnes of lithium carbonate. The company said the brine has high lithium concentration and can be directly collected from the lake surface for production, reducing upfront process costs, while technical process optimization improves lithium extraction and recovery rates.

On the potash resource side, within the Vientiane project in Laos, certified potassium chloride resources total approximately 984 million tonnes, with a planned annual output of 2 million tonnes of potassium chloride, of which the first phase plans 1 million tonnes per year. The temporary construction project has passed completion acceptance, and feasibility study and environmental impact assessment are progressing in parallel. The company is developing key technologies for underground cemented filling mining. In H1, the company completed a share buyback of RMB 400 million, bringing total dividends and buybacks to approximately RMB 1.96 billion. The dividend plan is based on increased profits from the potash and lithium main businesses, higher investment income from associated projects, and overall stable operations, while considering capital needs for the Qarhan Salt Lake technical upgrade, the Mamecuo equity acquisition, and the Laos project investment.

Founded in 1996 and listed through a backdoor listing in 2016, Zangge Mining started from the Qarhan Salt Lake in Qinghai. In January 2025, Zijin Mining acquired 24.82% of the company's shares for RMB 13.729 billion. The company's core assets include a 100% interest in the Qarhan Salt Lake project in Qinghai, a 70% interest in the Vientiane Pakoe and Setthani potash projects in Laos, a 24.01% interest in the Mamecuo salt lake in Tibet, a 21.09% interest in the Longmucuo and Jiezechaka salt lakes in Tibet, and a 30.78% interest in the Julong Copper Mine in Tibet. As of the close on August 12, the stock price was RMB 81.15, down 1.49%, with a latest market capitalization of RMB 127.317 billion. The stock has fallen nearly 10% over the past three trading days.