According to the Zhitong Finance App, Jixing New Energy (03395) announced that the company expects to record a net loss and overall loss of about 3.7 million Canadian dollars for the nine months ending September 30, 2026 (this period), a decrease of about 76% from the net loss and overall loss of about 15.2 million Canadian dollars for the nine months ended September 30, 2025 (corresponding period).
The expected narrowing of the loss margin for the period is mainly due to the following factors: (1) The Company's operating costs were reduced from approximately $11.7 million in the corresponding period to approximately $5.4 million in the current period, or about $6.3 million, or approximately 53.5%, mainly due to revisions to the natural gas processing and gas compression agreement between the Company and Jixing Energy (Canada) Ltd. As a result, no related expenses were incurred during the period; (2) The amount of impairment recovery and write-off was reduced by approximately $3.7 million, from approximately $3.8 million to $3.8 million during the corresponding period Approximately $100,000 of Canadian dollars during the period mainly reflects a significant reduction in the amount of write-off of exploration and assessment assets; (3) Sales revenue from products obtained from production increased from about 5.3 million Canadian dollars in the corresponding period to about 8.2 million Canadian dollars during the current period, an increase of about 2.9 million Canadian dollars, or about 56%, mainly reflecting an increase in natural gas sales volume and an increase in the average sales price of natural gas with the support of the Company's fixed price hedging arrangements. The increase in sales volume also reflects a lower comparative production base in the third quarter of 2025, when natural gas production was suspended for most of the quarter due to weak market prices; and (4) asset disposal revenue of $500,000 was recorded during the period, compared to zero in the corresponding period.
This positive impact was partly offset by the following factors: (i) the increase in royalty expenses from approximately $400,000 during the corresponding period to approximately $1.4 million, an increase of approximately $1 million, reflecting factors such as increased production revenue, changes in applicable cost credits, and royalties reassessment; and (ii) the increase in financial expenses from approximately $2.4 million in the corresponding period to approximately $3.3 million in the current period, an increase of approximately $900,000, or about 38%, mainly reflecting the transformation of exchange gains from the corresponding period into exchange losses for the current period, and an increase in value-added expenses. Offset by reduced interest charges and financing costs.