Magontec Reports $9.3M Gross Profit and Positive Q3 Cashflow in 2025

Strong Third Quarter Performance

Magontec Limited has delivered a robust performance in the nine months ending September 2025, with gross profit climbing 20.1% to $9.3 million compared to the prior corresponding period. The third quarter alone saw gross profit surge to $4.0 million, more than doubling the $1.6 million recorded in the same quarter last year. This improvement reflects a sharp recovery in magnesium alloy recycling volumes and the successful rollout of a new electronic anode product line.

Despite ongoing economic challenges in key markets such as the US, Europe, and Asia, Magontec’s operational efficiency gains and product innovation have helped reverse earlier volume declines. The company’s net cash position stands at $0.9 million, and net assets per share have increased by 37.2% to 84.1 cents, underscoring a strengthened balance sheet.

Operational Highlights and Product Innovation

The magnesium anode business experienced a 29% volume increase in Q3 over the previous year, supported by capital expenditure programs that introduced robotics and new processing equipment in Xi’an and Santana. These upgrades have boosted output per employee and overall production efficiency.

Meanwhile, the CCP division, which includes magnesium and electronic anodes, recorded an 11% revenue increase and a 42% jump in gross profit year-to-date. The standout performer has been the ICAS electronic anode series, launched in March 2025, which has seen sales rise 28% and gross profit by 41% compared to the prior period. This product targets the growing market for greener hot water systems using heat pump technology, positioning Magontec as an industry leader in this niche.

Metals Business Recovery and Strategic Outlook

Following the closure of its magnesium alloy manufacturing plant in China, Magontec has focused on rebuilding primary magnesium supply volumes through partnerships with major Chinese manufacturers. This strategy supports the European recycling business and leverages the company’s German and Romanian plants, which are critical for profitability.

After a slow start to 2025 due to contract issues, metals recycling volumes rebounded strongly in Q3, with gross profit returning to positive territory. Higher-margin specialist metals sales, particularly to North American aerospace customers, have contributed to this turnaround.

Looking ahead, Magontec is exploring new magnesium projects in Eastern Europe, the US, Asia (excluding China), and the Middle East. The ongoing strategic review aims to enhance capital efficiency and is expected to conclude by year-end, potentially unlocking further growth opportunities.

Financial and Market Implications

While underlying operating cashflow remains negative year-to-date at $1.3 million, the positive cash generation in Q3 signals improving operational cash management. The company’s focus on innovation, efficiency, and strategic partnerships positions it well to capitalize on recovering demand and evolving market trends toward sustainable technologies.