LB Group(SZ:002601) Chang Jiang Shang Bao·2025-06-10 23:27Core Viewpoint - Longbai Group, a leading global titanium dioxide and titanium products company, is facing increased pressure following the succession of the second generation of leadership, with significant cash dividends and share buybacks raising market skepticism about its financial health [1][3]. Financial Performance - Longbai Group announced a share buyback plan with a total expenditure of up to 1.086 billion yuan, alongside a cash dividend distribution of 1.186 billion yuan, resulting in a combined maximum expenditure of 2.186 billion yuan [2][5]. - As of the end of Q1 this year, the company reported monetary funds of 8.726 billion yuan against interest-bearing liabilities of approximately 26.3 billion yuan, indicating significant debt pressure [2][7]. - The company's net profit attributable to shareholders has been declining for three consecutive years, with Q1 2024 showing a further decrease [2][12]. Share Buyback and Dividend Strategy - The share buyback plan involves repurchasing shares at a maximum price of 24.82 yuan per share, which is approximately 50.15% higher than the market price of 16.53 yuan on the announcement date [3][4]. - The cash dividend for Q1 2024 is set at 5 yuan per 10 shares, totaling approximately 1.186 billion yuan, with a dividend payout ratio of 172.88% [4][5]. - For the entire year of 2024, the company plans to distribute cash dividends totaling 2.144 billion yuan, with a payout ratio nearing 98.89% of its annual profit [6]. Operational Challenges - Longbai Group's revenue and net profit have both declined in Q1 2024, with revenue at 7.06 billion yuan and net profit at 686 million yuan, representing year-on-year decreases of 3.21% and 27.86%, respectively [13]. - The company has faced operational pressures due to falling iron ore prices and underperformance in its new energy sector, contributing to the decline in net profit [2][12]. - The company has also recorded significant asset impairments, including a 342 million yuan impairment for goodwill related to previous acquisitions [12]. Company Background and Market Position - Longbai Group, originally known as Baili Union, has grown into a global leader in the titanium industry through a series of acquisitions and expansions, with a production capacity of 1.51 million tons per year for titanium dioxide and 80,000 tons for sponge titanium [10][12]. - The company holds over 1,270 patents in China, with a research and development investment of 1.175 billion yuan in 2024, maintaining a consistent R&D expenditure exceeding 1 billion yuan annually from 2021 to 2023 [11].