Almonty's Accounting Alchemy: How a $182 Million Paper Gain Masks a Real Tungsten Turnaround

Almonty's Q2 revenue jumps 498% on tungsten prices, but $173M profit is non-cash. Sangdong starts operations, balance sheet transformed.

The tungsten market's extraordinary rally has done more than flatter Almonty Industries' income statement — it has transformed the company's entire financial architecture. But the headline numbers from the Canadian miner's second quarter deserve a closer look than the market gave them on Friday.

Shares of the Toronto-headquartered company closed the week at $15.09 on the Nasdaq, up as much as 8.9 percent in a single session as investors digested a quarterly report that showed revenue nearly quintupling and a bottom line that swung from a deep loss to a nine-figure profit. The move came alongside a fresh wave of bullish analyst commentary, with Diamond Equity Research publishing an update that reframed Almonty's investment case from development-stage risk to cash-flow generation.

The Fine Print Behind the Profit Surge

Revenue for the quarter ended June 30 reached C$43.0 million, a 498 percent jump from the C$7.2 million posted in the same period a year earlier. Net income came in at C$181.8 million, or C$0.62 per diluted share, against a loss of C$58.2 million in the prior-year quarter.

The asterisk: C$173.1 million of that profit came from non-cash fair-value gains on derivatives and warrants. Strip those out and the operating picture is more modest — though still a clear improvement. Adjusted EBITDA turned positive at C$17.6 million, reversing a C$4.8 million loss a year ago, while gross margin in the mining business reached 60.7 percent.

The revenue surge traces directly to pricing. European ammonium paratungstate (APT) prices averaged roughly $3,075 per metric tonne unit during the quarter, a staggering climb from $453 a year earlier. That price spike has transformed the economics of Almonty's Portuguese Panasqueira mine, which still supplied the bulk of quarterly sales while the company's flagship Sangdong operation in South Korea remained in commissioning.

A Balance Sheet Transformed

The quarter also marked a watershed moment for Almonty's finances. In June, the company closed an oversubscribed $800 million convertible bond offering, lifting cash from C$268.4 million at the end of 2025 to C$1.23 billion by June 30. Management has signaled the war chest will fund multiple projects simultaneously, including Sangdong's Phase II expansion and the Gentung tungsten project in Montana.

The improved liquidity had immediate consequences. After the quarter closed, Almonty repaid its KfW loan in full and renegotiated its offtake agreement with Global Tungsten & Powders LLC, extending the term by six years, increasing volumes by 40 percent and improving pricing by 6.3 percent. The expanded contract now runs 21 years and covers roughly 90 percent of Phase I production — worth an estimated $490 million in annual revenue at current market prices.

Sangdong's Moment Arrives

The real test begins now. Sangdong's processing plant officially started operations on July 1, with an ore stockpile of approximately 139,700 tonnes to support the ramp-up. At full capacity, the first phase will process 640,000 tonnes of ore annually.

The third quarter will mark the first time Sangdong contributes meaningful sales of tungsten concentrate — the moment investors have been waiting for since the mine's development began. The market's forward-looking assessment is already visible in analyst price targets: DA Davidson maintains a Buy with a $33.00 target, Oppenheimer lifted its target to $25.00 with an Outperform rating, and the Wall Street consensus sits between $25.20 and $27.00 — roughly double the current share price. Both StockAnalysis and Zacks Investment Research now rate the stock a consensus "Strong Buy," with Zacks assigning its Rank 2.

Streamlining the Listing Footprint

Amid the operational ramp-up, Almonty has been quietly simplifying its corporate structure. The company voluntarily delisted from the Toronto Stock Exchange on July 31 and will exit the Australian Securities Exchange on September 1, with trading in CHESS Depositary Interests expected to be suspended from August 28. Going forward, the stock will trade on the Nasdaq under the ticker ALM and in Frankfurt under ALI1.

The consolidation follows Almonty's inclusion in the Russell 1000 and Russell 3000 indices on June 29, which has already boosted institutional demand. Technically, the shares sit just below their 50-day moving average of $15.17 and their 200-day average of $16.82 — a sign that while the fundamental story has improved dramatically, the market is still weighing how much of the tungsten windfall is cyclical versus structural.

The answer to that question will come with the third-quarter report, when Sangdong's contribution finally appears in the revenue line. For now, the market has chosen to focus on the trajectory rather than the accounting mechanics behind this quarter's headline profit — a bet that the Korean mine can turn paper gains into real, repeatable cash flow.