道氏技术20240624

Summary of the Conference Call for Daoshi Technology Company Overview - Company: Daoshi Technology - Date of Call: June 25, 2024 - Participants: Board Secretary Wu Nan, Investor Relations Director Gao Jianfeng Key Points Industry and Company Performance - The company has faced significant inventory impacts over the past two years, particularly in Q2 2022, leading to asset impairments and losses in profitability for the previous year [3][4] - Current operational conditions are improving, with expectations of a substantial reduction in inventory impacts by Q2 2024 and a complete elimination by Q3 2024 [4] - The primary source of profitability is from the African operations, particularly in electrolytic copper, which is progressing as per previous expectations [4][12] Business Segments - Strategic Resources Division: This division has been the largest contributor to profitability, primarily through copper operations [22] - Lithium Battery Materials Division: This segment includes nickel precursors, with a significant contract with South Korea's POSCO, accounting for over 70% of sales [5][16] - Carbon Materials Division: Focuses on carbon nanotubes and graphene conductive agents, currently holding a second position in market share [6] - Ceramic Materials Division: Although revenue declined due to the real estate sector's impact, profitability remains stable due to the company's leading position in the industry [7] Financial Outlook - The company reported a cash position of 4.2 billion yuan at the end of 2023, with a strong ability to meet obligations despite recent volatility in convertible bond prices [42][44] - Plans for capital expenditures are modest, allowing for a comfortable liquidity position [42] - The company anticipates improved profitability in the lithium battery materials segment as inventory issues are resolved [18][55] Production and Expansion Plans - The company has achieved a production capacity of 38,000 tons of electrolytic copper, with plans to expand to 63,000-68,000 tons by 2025 and 78,000 tons by 2026 [14][15] - The lithium precursor production is set to expand by 30,000 tons in Wuhu, with trial production expected in the second half of the year [16][17] Market Conditions and Risks - The copper market has experienced volatility, with prices fluctuating significantly in recent months [22] - The company is actively managing inventory levels to mitigate risks associated with price declines [15][24] - The competitive landscape in the lithium battery materials sector is intensifying, but the company remains optimistic about maintaining stable profitability [54] Investor Communication - The company is committed to maintaining open communication with investors, addressing concerns regarding convertible bonds and overall financial health [40][44] - Recent measures include a dividend distribution of over 100 million yuan and a stock buyback plan [59] Conclusion - Daoshi Technology is navigating through past inventory challenges and is positioned for improved performance in 2024, with a focus on expanding production capabilities and maintaining financial stability [58][59]