GEM held a 2023 Full-Year&2024 Q1 Performance Briefing
Publish Date:2024-05-10 Hits:80

On May 9, 2024, GEM's FY2023 and Q1 2024 results announcement was held in GEM (Shenzhen) Super Green Technology Institute and PT.QMB-GEM Indonesia at the same time. Professor Xu Kaihua, Founder and Board Chairman of GEM and Ms. Wang Min, Co-founder, Joint Actual Controller and Board Director of GEM, and Mr. Liu Zhonghua, independent director of GEM, were present at the conference. Over 20 investment institutions and media attended the conference on-site, and the conference was broadcasted live globally as well.

At the meeting, Chairman Xu Kaihua, firstly saluted global investors and all sectors of the society in his speech, sincerely appreciated the strong support of global friends for GEM green recycling industry, and explained the 2023 Annual Report under the title of "Ride the Wave Forward, Build a Stronger Chassis, and Open the Gateway". In the report, Chairman Xu Kaihua, recalled the historic achievement of GEM in 2023, under the unfavorable situation and multiple challenges, such as global industry involution, nickel resources project equipment blockade, power battery recycling chaos, sudden fire in Taixing Park, the challenge of Chinese enterprises going to the overseas market, and the downward trend of the stock price, etc. GEM has stepped forward on the waves, made precise moves, met the involution in the spirit of struggle, broke out of the world's pattern of strategy, and went through the ordeal with a strong will to build the chassis for the stability of the Company's. The company's overall operation has successfully built up the chassis of the stability, and opened up the channel of growth for the year of 2024.

In 2023, GEM's "urban mining + new energy materials manufacturing" blossomed on both tracks, stabilizing its total business volume. The company has achieved operating income of RMB 30.529 billion, an increase of 3.87% year on year, a historical high; achieved net profit attributable to shareholders of listed companies of RMB 934 million, a 27.89% decrease year on year; achieved net cash flow from operating activities of RMB 2.164 billion, up 12,608.74% year on year, and the quality of operation has been well improved. In 2023, the company's new energy materials business achieved operating income of RMB22.969 billion, up 5.38% year-on-year, accounting for 75.23% of the total sales scale.

In the year 2023, GEM's core product capacity has been released, solidifying the core position of the global industry. The annual shipment of ternary precursor materials for core products used in power batteries has reached 180,300 tons, with a 18.40% year-on-year growth, ranking the top two in the global market. In particular, the shipment of high-end products such as 8-series and 9-series ultra-high nickel (Ni90 and above) precursors amounted to 137,100 tons, accounting for more than 76% of the total shipments and ranking first in the world; the export of ternary precursor materials amounted to nearly 100,000 tons, with a year-on-year growth of 16.14%, accounting for 55% of the total shipments.  The sales of cathode materials exceeded 10,000 tons, with a year-on-year growth of 18.89%. Cathode materials passed the demonstration of high-end power battery project in Japan, opening the channel for global marketization of ternary cathode; Breakthrough in 9-series high nickel products, supplying 4680 large cylindrical battery market in bulk.

In 2023, GEM's nickel resource project has achieved a technological breakthrough, operated beyond production capacity and has upgraded its planned production capacity. Nickel is the lifeblood of new energy as well as the blood of GEM. In 2023, the first phase of the Nickel Resource Project of PT.QMB-GEM Indonesia has been successfully completed the four phases of commissioning ramp-up, reaching production, stable production and overproduction. It shipped 27,050 tons of metal in annual, with an overproduction rate of over 30%, with world-class product quality and a nickel, cobalt and manganese recovery rate over 95%, which signifies the world's first high-pressure hydrometallurgical project with the company's self-owned technology, self-designed and self-operated. This marks the complete success of the world's first HPAL project of nickel laterite ore with independent technology, design and operation, and realizes the great success of Chinese enterprises' engineering technology and Chinese equipment. At the same time, we comprehensively launched the construction of the second phase of Indonesia nickel resources project, completed the construction of the main foundation project and entered the equipment installation stage. After optimizing the design, the capacity of nickel resources was raised from the estimated total of 123,000 tons to a total of 150,000 tons, which has strengthened the company's global position in nickel resources and ensured the global core competitiveness of the company's ternary precursor materials.

In 2023, the capacity of GEM's recycling business was released, maintaining a stable incremental volume. Power battery recycling and dismantling reached 27,454 tons (3.05GWh), a 57.49% year-on-year increase, accounting for more than 10% of the total amount of decommissioned power batteries in China; lithium carbonate recycling production capacity expanded to 10,000 tons/year, with a lithium recycling rate of more than 95%, heading for the ultra-high level of 97%; ultra-fine cobalt powder sales of 5,505 tons, a year-on-year increase of 32.55%, taking up more than 50% of the global market, occupying the first place in the global market for 11 consecutive years; recycled nickel resources reached more than 20,000 tons, with more than 30% year-on-year growth, accounting for more than 20% of China's primary nickel mining quantities; recycled cobalt resources reached more than 8,000 tons, with 6.67% year-on-year growth, accounting for more than 350% of China's primary cobalt mining quantities; recycled tungsten resources reached 4,680 tons (up 9.07% year-on-year, representing 6% of China's primary tungsten mining quantity); the recycling quantity of waste plastics reached 65,000 tons, up 10% year-on-year.

In 2023, GEM has strongly invested in R&D to achieve a transformation from multiplication of innovation facilities to multiplication of innovation results. The company has made breakthroughs in industry key and difficult technologies to meet the competitive needs of industrial evolution. Awarded National Key Laboratory of Energy Metal Resources and New Materials, Taixing Branch of National Enterprise Technology Center, and Hubei Provincial Key Laboratory of High-value Utilization of Decommissioned Power Batteries, and other major innovation platforms at the national and provincial levels. By the end of 2023, the company has applied for a total of 3,767 patents globally, a 27.57% year-on-year increase; led/participated in a total of 475 standards, a 17.00% year-on-year increase; the company and its subsidiaries, PT.QMB and Wuhan Power Battery Recycling, have registered a large number of trademarks overseas, escorting the development of overseas business.

In 2023, GEM has created the "technology + culture" flexible power to go to overseas model, which has been everlasting and recognized by the governments of China and Indonesia, as well as by all sectors of the Indonesian society. Investment in technology: GEM built the first world-leading engineering research center for nickel laterite ore hydrometallurgy and new energy materials in Indonesia, and cooperated with Bandung Institute of Technology (ITB) to build the China-Indonesia Joint Research Laboratory for New Energy Materials and Metallurgical Engineering Technology, marking the first China-Indonesia joint scientific laboratory in the history of the enterprise. Investment in culture and education: GEM led the "Indonesian Government(CMMAI)-GEM-CSU Joint Cultivation of Master of Engineering in Materials Science and Metallurgy" to complete the three phases of enrollment and classes, complete the fourth phase of the signing of the contract, and to move from "1" to "1+N" training mode, to expand the enrollment from new energy materials and metallurgical technology engineering to transportation, non-ferrous metal international trade and other three professional enrollment, to create a "Belt and Road" science and culture highlights of the project, and to provide comprehensive support for Indonesian Government (CMMAI)-GEM-CSU joint cultivation of materials science and metallurgical technology engineering master's program. It will be a "Belt and Road" science and technology project and a cultural highlight project, providing strong talent support for Indonesia's economic and social development. Supporting the development of nickel resources by local enterprises in Indonesia: witnessed by President of Indonesia Joko Widodo, GEM has established ESG company in a joint venture with MDK, the owner of local nickel mines in Indonesia, which has become the first project in Indonesia's history to develop nickel laterite mines for the production of new energy raw materials under the control of a local enterprise in Indonesia, and has promoted the in-depth fusion of Chinese technology and Indonesian resources.

"2024 is a big year for GEM." Looking ahead to 2024, Chairman Xu Kaihua pointed out that the national policy of promoting large-scale equipment renewal and the trade-in of consumer goods is like a huge blue ocean, representing a trillion-dollar market. As a leading enterprise in the field of recycling economy, GEM has 7 recycling bases for end-of-life automobiles, 7 green treatment bases for Waste Electrical and Electronic Equipment (WEEE), and 6 recycling bases for power batteries in China, and it has a strong recycling system advantage, industrial advantage, and technological advantage in the areas of power battery remanufacturing, automobile parts and components remanufacturing, and instrument remanufacturing, and etc. In 2024, GEM has grasped the opportunity to play the role of a core enterprise and joined hands with leading enterprises in various fields upstream and downstream. The company has entered into cooperation with Midea Group, DFPV, and Jingdong Group to promote recycling, digitalized supply chain, and waste commodity recycling, and has announced the equipment renewal of the company. The company also has joined hands with more than 20 large equipment companies at both domestic and international levels to promote equipment renewal and remanufacturing, and to build a large market system for the whole process of equipment renewal supply chain, and to deeply participate in and promote the national strategy of "trade-in".

In the first quarter of 2024, GEM delivered a beautiful report card of "core product capacity release, business increment and performance growth", recognizing a good start! Revenue of RMB 8.354 billion, a year-on-year increase of 36.31%; net profit attributable to shareholders from listed companies of RMB 456 million, an increase of 164.48%; net cash flow from operating activities of RMB 356 million, a growth of 199.33%. The capacity of core products was greatly released, with 130% capacity release rate of nickel resources, 93% capacity release rate of ternary precursor, and 100% capacity release rate of cobalt resources and tungsten resources respectively. The production and sales volume of the company's major products all increased significantly. Specifically, the shipment of ternary precursor was 51,000 tons, representing a significant year-on-year growth of 113.72%, which strongly guaranteed the target of 220,000 tons of precursor sales for the annual year; the shipment of tricobalt tetroxide was 6,058 tons, representing a significant year-on-year growth of 293.38%, and the company is striving to achieve the target of 25,000 tons of cobalt products for the annual year. The production and sales of 10,500 tons of nickel metal MHP for the Indonesian nickel resources project exceeded production by 30%, representing a significant year-on-year growth of 133.33%, and the company will make every effort to achieve the shipment target of 60,000 tons of nickel resources for the whole year; the recycling and dismantling of power batteries of 0.790 million tons (0.88GWh), representing a year-on-year growth of 27.47%, and we plan to achieve the recycling and dismantling of 45,000 tons of power batteries for the full year. In 2024, GEM will focus on the three operational keywords of "capacity release, minimizing cost and efficiency improvement", lead the competition in the world industry with the spirit of struggle, promote capacity release, implement the super-technology and super-quality plan, comprehensively improve the profitability of the core business, realize the significant growth of sales and performance, determinedly win the battle of the world industry competition and the defense of domestic rolls. We are determined to win the competition in the world industry and the battle for the defense of involution. Looking into the future, Chairman Xu Kaihua confidently puts forward the vision of achieving the business scale from RMB 30 billion to USD 30 billion by 2030 and entering into the world's top 500 enterprises, in order to build GEM into the world's urban mining leader and the promoter of the world's new energy industry!

Afterwards, Dr. Zhang Kun, Deputy General Manager of GEM and Dean of the Central Research Institute, introduced GEM's innovation achievement of  Super Talent+Super Equipment+Super Innovation=Super Technology in the report of "Super Innovation to Confront the Involution" in 2023, and put forward the innovation goal of "Dual-track Business Innovation to Promote Great Performance Growth" in 2024, and announced the future innovation strategy and topics, which will be used in the future to become a global leader in the recycling of wastes and the new energy material technology with the super technology. Dr. Zhang Yuping, Deputy General Manager of GEM and Chairman of the Board of Directors of Power Battery Recycling, summarized the operational achievements of the power battery recycling business, technological innovations and industrialization results in 2023 in his report "Strengthening the Foundation, Opening the Profit Channel", and put forward the operational objectives of the power battery recycling business in 2024, striving to be the world's leading technology, the largest scale, and marketable power battery recycling enterprise. Peng Yaguang, Deputy General Manager of the Group and General Manager of PT.QMB, introduced the operation of HPAL project in Indonesia by 2023, the operation target in 2024, the future project construction plan and commissioning plan, as well as the construction of ESG Indonesia in the Nickel Resource Development Report. He introduced the concept of "Cultural Integration, Growing Together with Indonesia" which has been put into practice in all aspects of the project, such as living conditions, cultural construction, social exchanges, staff development, and planting green and reducing carbon emissions.

In 2024, how the company will break the waves and harvest performance in the ever-changing environment has touched the hearts of investors. During the interactive Q&A session, investors and media friends enthusiastically asked questions on the planning and progress of the Indonesia project, the prospect of power battery recycling business, and the blue and red oceans of industrial development, etc. The management of the Group answered the questions one by one and carried out in-depth exchanges and discussions with investors and media friends.

Chairman Xu Kaihua expressed in his interaction that the market of top technology and top quality products serving the global head enterprises is always a blue ocean. Urban mining is always a blue ocean, and the recycling industry only has a starting point, but not an end point. GEM has opened up the whole industry chain from waste recycling to remanufacturing, and through innovation, it makes the waste into the best products and sells them to the best enterprises. In the future, under the historical opportunity of "large-scale equipment renewal and consumer goods trade-in", the company will actively explore new technology models and industry models, and grasp the blue ocean of internal circulation. The company is determined not to participate in vicious competition, and will promote the urban mining business to become a "double-track" profit source as the new energy materials business through extreme minimizing cost, gross margin improvement, and loss reduction strategies. Chairman Xu Kaihua said that by 2030, GEM will realize the leap of annual output value from RMB 30 billion to USD 30 billion, and become a world-class green industry group with good benefits and global recognition of brand value. Green cycle, let the world fall in love with GEM! Facing the sea with spring blossoms.

Mu Menggang, Deputy General Manager and CFO of GEM, and Pan Hua, Deputy General Manager and Secretary of the Board of Directors of the GEM, attended the meeting on site.


GEM's 2023 Annual and 2024 First Quarter Results Presentation (PT.QMB, Indonesia venue)

GEM's 2023 Annual and 2024 First Quarter Performance Briefing (Shenzhen Technology Institute Venue)

Professor Xu Kaihua, Founder and Board Chairman of GEM, delivered a keynote speech

Dr. Zhang Kun, Deputy General Manager of GEM and Dean of the Central Research Institute, delivered a keynote speech.

Dr. Zhang Yuping, Deputy General Manager of GEM and Chairman of Power Battery Recycling, delivered a keynote speech.

Peng Yaguang, Deputy General Manager of GEM and General Manager of PT.QMB, delivered a keynote report

Interactive exchange of Q&A sessions

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