Ganfeng, the Hong Kong-listed lithium giant, sent shudders through the battery metals sector as it reported profits had been almost wiped out in its latest three months.
Based in China, Ganfeng said profit fell 98% to CNY159 million as revenues slid 43% to CNY7.54 billion (£6.2 billion).
Higher operating costs due to rising raw material prices on new projects were blamed for the drop alongside a slump in the spot price of lithium.
Shares fell 14% to register their biggest one-day fall since April 2022.
Analysts at Nomura attributed the weak sales to lower lithium prices and highlighted a contraction in gross profit margin, "likely owing to higher inventory cost for [lithium ore] spodumene".
"Despite lower spot prices for feedstock, we believe Ganfeng still faced sluggish downstream demand on industry destocking, as well as elevated inventory cost, squeezing its profitability" in the quarter, they said.
Nomura added it’s a fourth-quarter recovery due to steadier lithium-carbonate prices and lower spodumene prices.