{"text":[[{"start":7.94,"text":"This article only represents the author's own views."}],[{"start":12.07,"text":"Coming soon to the Hong Kong Stock Exchange: The first international gold miner minted in China."}],[{"start":19.25,"text":"After delivering world-class manufacturers in nearly every product class, the country often called the “workshop to the world” is getting ready to serve up its first such company to investors in the lucrative mineral resource sector. That company comes in the form of Zijin Gold International Co. Ltd., which was recently spun off from one of China’s leading miners and has filed for a separate listing in Hong Kong."}],[{"start":47.8,"text":"By spinning off its international gold mining arm, Zijin Mining (2899.HK; 601899.SH) seeks to create a pure-play gold company for global investors, positioning it alongside industry leaders such as Newmont (NEM.US) and Barrick (B.US). It hopes to lure those investors with its rapid expansion in recent years, including 43% revenue growth in the first half of 2025 and profits that more than doubled during that time."}],[{"start":87.9,"text":"Part of that growth story is coming from booming gold prices, which are up 37% over the last 52 weeks and have risen by similar amounts over the last four years. But Zijin Gold also wants to show that it’s outperforming the market through improving operational efficiencies as it hones its mining skills and takes advantage of its parent’s rich resources and experience."}],[{"start":115.09,"text":"Equally important, the company wants to show it can adhere to high global standards for environment, social and governance, or ESG, which are closely followed by many investors. Following such standards is not only important for environmental protection, but also to show that companies can benefit the regions and communities where they mine, instead of simply digging out natural resources for processing and sale somewhere else."}],[{"start":141.89000000000001,"text":"Zijin Gold formally launched its IPO on Sept. 19, when it disclosed it plans to sell about 349 million shares for HK$71.59 apiece, which would raise roughly HK$25 billion ($3.21 billion). The stock is scheduled to make its trading debut at the end of September."}],[{"start":165.87,"text":"A Hong Kong listing would allow Zijin Gold to better benchmark itself against the likes of Newmont and Barrick, providing a new choice for investors among such global gold miners. It would also accelerate the company’s internationalization, and boost its offshore financing capabilities to fund future project development as well as M&A."}],[{"start":188.15,"text":"The company’s parent, Zijin Mining, is one of world’s top five miners globally in terms of resources, reserves and output. Gold accounts for nearly half of its revenue, though the parent company also produces copper, lithium and zinc at 30 projects across 17 countries. It first disclosed its intent to spin off its international gold assets in late April, and submitted its first formal listing application for Zijin Gold International in June."}],[{"start":223.28,"text":"An updated prospectus, submitted on Sept. 19, shows that Zijin Gold’s revenue and profit growth in the first half of the year accelerated from gains that were already quite strong in the last three years. The company’s 43% year-on-year revenue growth to $2 billion in the first half of 2025 marked an acceleration from the 32% growth for all of 2024. And its 143% profit growth to $520 million over that time also marked a big acceleration from its 109% growth for 2024."}],[{"start":266.93,"text":"Zijin Gold and its peers hope to benefit not only from booming demand for gold from individual consumers as a hedge against economic uncertainty, but also from the increasing use of gold as an important part of many central banks’ asset reserves. It pointed out that central banks in emerging economies kept only about 8.9% of their asset reserves in gold at the end of last year – well below the 25.2% average for developed economies. “This disparity highlights significant potential for increasing strategic reserves of gold among emerging countries,” it said."}],[{"start":308.73,"text":"Improving margins"}],[{"start":310.51,"text":"Zijin Gold was a relatively late arrival to the global gold mining scene, only entering the arena in 2007 with its purchase of its Jilau/Taror gold mines in the Central Asian nation of Tajikistan. After that, it purchased stakes in another seven projects globally, including additional Central Asian assets in the nation of Kyrgyzstan; South American ones in Colombia, Suriname and Guyana; an African project in Ghana; and mines in the Oceania nations of Australia and Papua New Guinea. With the exception of Papua New Guinea, the company owns controlling stakes in all the projects, including its most recent acquisition in Ghana this year."}],[{"start":356.53999999999996,"text":"It estimated its gold reserves at 1,176.2 metric tons as of June 30, ranking it ninth globally. It was also the world’s 11th largest player in terms of gold production last year, according to third-party market data in the prospectus."}],[{"start":375.58,"text":"The company pointed out that its late arrival to global gold mining meant that most of the world’s best resources were already purchased and producing, leaving mostly subpar assets for new buyers. It said many of its acquisitions were underperforming mines with “poor operational management or resource endowments not fully identified,” with the result that many were losing money at the time of their purchase."}],[{"start":404.13,"text":"Using its own expertise and expertise of its parent, the company was able to improve efficiency at those underperforming mines and make them operate more profitably. As a result, its Guyana Aurora Gold Mine, acquired in 2020, and Suriname Rosebel Gold Mine, acquired in 2023, both turned profitable within a year of being acquired, it said."}],[{"start":429.63,"text":"As it acquired new projects and its efficiency improved, the company’s gold production rose at an average rate of 21.4% in the three years from 2022 to 2024. Its mining cost per ton has generally been falling from $38.70 in 2022 to $32.70 in the first half of this year, while its processing cost per ton has also fallen from $20.60 to $17.20 over that period."}],[{"start":463.46,"text":"As its operations improved, the company’s gross margin has risen considerably over the last three years from 34.1% in 2022 to 46.5% in the first half of this year. That latest figure puts the company in a similar league with Newmont and Barrick, whose latest annual gross margins came in at 44.9% and 44.2%, respectively."}],[{"start":493.60999999999996,"text":"While operational efficiency is important, Zijin Gold also spent considerable space in its prospectus discussing its ESG efforts, aiming to show it will adhere to global standards. Chinese mining companies have often been criticized in the past for going into foreign countries to extract their mineral wealth, but then doing very little otherwise to benefit local populations and protect the environment."}],[{"start":522.3399999999999,"text":"“We place significant emphasis on ESG by prioritizing mine safety and green mining initiative, fully integrating into local communities, (and) adhering to the principle of ‘sharing project development benefits with local stakeholders’” it said in the prospectus. To meet such strict conditions, the company said it complies with international standards such as United Nations Sustainable Development Goals, and “deeply integrates ESG concepts into the entire corporate development process,” including ecological restoration and environmental protection."}],[{"start":569.78,"text":""}]],"url":"https://audio.ftmailbox.cn/album/a_1758704530_6236.mp3"}