2025-10-20 01:19Summary of Zijin Mining Conference Call Company Overview - Company: Zijin Mining (2899.HK) - Market Cap: HK$866.4 billion / $111.5 billion - Industry: China Basic Materials Key Financial Highlights - 3Q25 Net Profit: Rmb14.6 billion, up 57% YoY - EPS: Rmb0.548 per share - 9M25 Recurring Net Profit: Rmb34.7 billion, representing 69% of the full-year estimate for 2025 and 73% of Bloomberg consensus [1][2] - Operating Cash Flow: Rmb52.1 billion in 9M25, up 44% YoY [26] - Free Cash Flow: Positive at Rmb14.3 billion in 9M25 [26] Production and Sales Performance - Copper Production: Total mined copper volume was 830kt in 9M25, up 5% YoY, reaching 75% of the full-year estimate [24] - Gold Production: 9M25 gold output was up 20% YoY, also at 76% of the full-year estimates [24] - Realized ASP for Copper: Rmb63,718/t in 3Q25, up 3% QoQ [24] - Realized ASP for Gold: Rmb768/g in 3Q25, up 4% QoQ [24] Cost and Profitability - Cost of Goods Sold (COGS): Increased by 3-4% QoQ for gold and copper in 3Q25; YoY increase of 11-20% due to declining grades and higher royalties [25] - Profit from Joint Ventures and Associates: Rmb4.1 billion in 9M25, increased by 32% YoY [25] Strategic Developments - Zijin Gold International Spin-off: Completed on September 30, raising HK$28.7 billion with Zijin retaining an 85% stake [27] - Acquisition of RG Gold Mine: Completed on October 10 for US$1.2 billion (Rmb8.6 billion), expected to boost gold output by 6.4% in 2026E [29] Commodity Price Forecasts - Copper Price Forecast: Revised up by 2-5% for 2025-26E; expected to reach US$4.44/lb in 2025E and US$4.76/lb in 2026E [30] - Gold Price Forecast: Revised up by 3% to US$3,400/oz for 2025E, with risks skewed to the upside [31] Valuation and Investment Outlook - Revised Target Prices: HK$37.50 for H shares and Rmb37.50 for A shares [2] - Earnings Growth: Expected ~50% profit growth CAGR for 2025-26E driven by rising gold/copper prices and volume growth [2] - Key Risks: Fluctuations in gold and copper prices, project execution delays, and currency/country risks associated with overseas assets [33] Financial Ratios and Projections - P/E Ratio: Expected to be 15.2x in 2025E [12] - Dividend Yield: Projected at 2.1% in 2025E [12] - Net Debt to Equity: Expected to decline to 33.3% by 2025E [12] Conclusion Zijin Mining is positioned for strong growth driven by rising commodity prices and strategic acquisitions. The company’s financial performance in 3Q25 and 9M25 indicates robust profitability and operational efficiency, making it a compelling investment opportunity in the basic materials sector.