Oct 29 (Reuters) - Ganfeng Lithium 002460.SZ 1772.HK , one of the world's top producers of the commodity used in electric-vehicle batteries, on Thursday reported a big jump in third-quarter profit but pulled out of a deal that would have boosted its output.
The Chinese company, which supplies lithium to automakers including Tesla Inc TSLA.O and BMW BMWG.DE , posted net income of 174 million yuan ($26 million) for July-September, a filing to the Shenzhen Stock Exchange showed.
That was up more than fivefold from 33.4 million yuan a year earlier, when Ganfeng had reported a sharp drop in the value of its financial assets, and marked its best result since the first quarter of 2019. rose 8.5% year-on-year to 1.51 billion yuan in the third quarter but fell 7.5% in the first nine months of 2020, in which Ganfeng managed to eke out only a 0.4% increase in profit.
In China, prices for battery chemical lithium carbonate AM-99C-LTCB are down some 10% year-to-date amid ample supply.
"The company's production and sales ... increased, but the price of lithium salt products fell," Ganfeng said, noting its lithium battery sales had also climbed.
In a separate filing, Ganfeng said it had terminated a deal announced in August that would have seen it take over 25,000 tonnes of annual lithium carbonate and 5,000 tonnes of lithium hydroxide production from smaller firms including Jiangxi Special Electric Motor Co 002176.SZ . two sides "failed to reach an agreement on the technological transformation plan for the lithium salt production lines" and opted to terminate the agreement, which would have run from this month to March 2023, it said.
Ganfeng produced just over 54,000 tonnes of lithium carbonate equivalent in 2019.
Upstream, one of its raw material suppliers, Australian spodumene producer Altura Mining AJM.AX , announced on Monday it had gone into receivership, although a Ganfeng spokesman played down the impact on the company. = 6.7029 Chinese yuan renminbi)