Almonty Faces Execution and Control Risks Despite Strong Q3 Earnings and Growth Capital
Almonty Industries posted a strong Q3 net income driven by rising tungsten prices and strategic financing, while advancing its flagship Sangdong Mine and acquiring new US exploration rights.
- Q3 2025 net income of $33.2 million despite nine-month net loss
- Nasdaq IPO raised US$90 million to fund Tungsten Oxide Facility and working capital
- Sangdong Mine on track for Q4 2025 production start with Phase II expansion potential
- Acquisition of Montana-based Gentung Browns Lake Tungsten Project underway
- Ongoing remediation of internal control weaknesses and detailed risk disclosures
Financial Performance Highlights
Almonty Industries Inc. (ASX – AII) reported a robust financial performance for the third quarter ended September 30, 2025, posting a net income of $33.2 million. This marks a significant turnaround compared to prior periods, largely driven by a surge in tungsten prices and a non-cash gain from warrant revaluation. However, the company recorded a net loss of $59.6 million for the nine months ended September 30, 2025, reflecting the impact of non-cash accounting adjustments and ongoing investments in growth projects.
Revenue for Q3 increased to $8.7 million, up from $6.8 million in the same quarter last year, despite a 14.8% decline in production volumes at the Panasqueira Mine in Portugal. The revenue uplift was primarily due to a substantial rise in the spot price of ammonium para tungstate (APT), a key tungsten intermediate product.
Strategic Capital Raise and Project Development
In July 2025, Almonty successfully completed a Nasdaq initial public offering (IPO), raising gross proceeds of US$90 million. The capital injection is earmarked mainly for the development of a new Tungsten Oxide Facility in South Korea, designed to process tungsten oxide for the local battery manufacturing industry, and for general working capital purposes. To date, the company has not yet deployed these funds, signaling a strong cash position heading into the final quarter of the year.
The flagship Sangdong Mine in South Korea remains on schedule for production commencement in Q4 2025. The mine is fully permitted, with underground development and processing plant construction progressing as planned. Management is also exploring a Phase II expansion, which could significantly increase throughput capacity, subject to positive Phase I results and market conditions.
Expansion and New Ventures
Almonty is actively expanding its portfolio, having initiated a drilling program at the adjacent Sangdong Molybdenum Project to assess potential reserves. Additionally, the company entered into a binding agreement to acquire exclusive exploration and mining rights for the Gentung Browns Lake Tungsten Project in Montana, USA. This acquisition aligns with Almonty’s strategy to diversify geographically and capitalize on tungsten’s critical material status amid global supply chain tensions.
Operational and Financial Risks
The company’s MD&A provides a comprehensive overview of risks, including commodity price volatility, foreign exchange fluctuations, and operational challenges inherent in mining projects. Notably, Almonty continues to address material weaknesses in its internal controls over financial reporting, with remediation efforts underway and expected to conclude by the end of 2025. The company also highlights geopolitical risks, particularly related to its South Korean operations, and regulatory compliance complexities across multiple jurisdictions.
Despite these challenges, Almonty’s diversified asset base, including mines in Portugal and Spain, and its strategic capital position post-IPO, position it well to navigate market uncertainties and pursue growth opportunities.
Looking Ahead
As Almonty transitions from development to production at Sangdong and advances its downstream processing ambitions, market participants will be watching closely for operational milestones and the company’s ability to sustain positive cash flows. The successful integration of new assets and continued management of financial and operational risks will be critical to delivering shareholder value in the evolving tungsten market.
Bottom Line?
Almonty’s Q3 financial strength and strategic moves set the stage for a pivotal production ramp-up and growth phase, but execution risks and market volatility remain key watchpoints.
Questions in the middle?
- Will the Sangdong Mine meet its Q4 2025 production targets and support Phase II expansion?
- How will Almonty deploy the substantial IPO proceeds, particularly regarding the Tungsten Oxide Facility?
- What progress will be made in remediating internal control weaknesses and ensuring financial reporting reliability?