DJ Aperam update on Q2 2024 market & financial trends
Aperam S.A. / Key word(s): Miscellaneous
Aperam update on Q2 2024 market & financial trends
01-Jul-2024 / 06:59 CET/CEST
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Aperam update on Q2 2024 market & financial trends
Luxembourg, July 1, 2024 (07:00 CET) - In preparation of the quarterly results release scheduled for 1 August 2024, we
would like to remind market participants of the standing guidance, earnings drivers and events that should be
considered.
The Q2 outlook, as specified in the Q1 presentation, the management podcast and during the conference call was:
-- Q2 group adj. EBITDA higher than Q1-24 (EUR55m) but below Bloomberg consensus at the time of the earnings
release on 3 May 2024. This was based on slightly higher volumes, the segment trends stated in the table below and
stable commodity prices resulting in a neutral inventory valuation.
-- This compares to the Aperam compiled Q2 adj. EBITDA consensus at EUR73m currently. The consensus is
updated & published at https://www.aperam.com/investors/news-contacts/results/
Recycling & Normalised annual EBITDA of EUR80-85m. We projected Q2 to be a normal quarter for the segment.
Renewables:
Stainless & For Q2 we projected the segment to benefit from a neutral inventory valuation and a seasonal volume
Electrical Europe improvement in Europe. This will be partly offset by a price / cost squeeze in Europe.
Stainless & The delayed ramp-up of the hot rolling mill was followed by operational instability. This will fully
Electrical Brazil impact Q2 with EUR10m.
Alloys & For Q2 we expected a somewhat lower EBITDA in line with Q4-23 after completion of a one off project.
Specialties:
Services & Assuming no further distortion from raw material prices, we expected a comparable EBITDA in Q2 and
Solutions: the year should demonstrate a clear step towards the 2025 improvement target.
Others & Q1 was consistent with the normal high single digit negative EBITDA that should be expected. For Q2,
Eliminations it could be a negative low double digit number.
NWC: EUR120m release till YE-24 with some release in Q2.
Cash Flow & Net Capex EUR150m for 2024, Q2 capex lower than Q1 (EUR81m) and within the EUR150m capex guidance for
Fin. Debt: 2024.
Q2 net debt: Lower due to the release of net working capital.
Please note that forward guidance for adj. EBITDA, cash flow and net debt is always provided on a stable commodity price assumption.
Commodity prices & FX:
MAR 24 APR 24 MAY 24 JUN 24 Nickel LME USD/t 17,409 18,204 19,605 17,602 Ferrochrome USD/t 3,483 3,218 3,174 3,163 Stainless Scrap USD/t 1,478 1,463 1,552 1,538 Stainless CR 2mm 304 USD/t 2,889 2,944 3,040 3,191 USD/EUR x 1.09 1.07 1.08 1.08 USD/BRL x 4.98 5.13 5.14 5.38
Source: Bloomberg, Fastmarkets
Other items:
Seasonality: In a normal market, Q2 is the seasonal peak in Europe while Q3 marks the peak quarter in Brazil.
Leadership Journey On track to realise the target gains of EUR75m in 2024.
Phase 5:
Commodity prices & At face value, the commodity price development would indicate a positive high single digit / very
inventory valuation: low double digit inventory valuation. It should remain consistent with the EBITDA ceiling guided
for Q2.
Brazil hot rolling The mill is operating normally and no further impact is expected post Q2.
mill:
Distributor Marked a new post GFC all time low.
Inventory:
A positive price / volume correlation can be observed more recently. However, it remains open if
Current trading: this is the start of a sustained recovery or short lived pre-buying ahead of the summer holiday
season
Restructuring: Negotiations with our workforce are ongoing.
Forward Looking Statements
This document may contain forward-looking information and statements about Aperam SA and its subsidiaries. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance. Forward-looking statements may be identified by the words "believe", "expect", "anticipate", "target" or similar expressions. Although Aperam's management believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of Aperam's securities are cautioned that forward-looking information and statements are subject to numerous risks and uncertainties, many of which are difficult to predict and generally beyond the control of Aperam, that could cause actual results and developments to differ materially and adversely from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those discussed or identified in Aperam's filings with the Luxembourg Stock Market Authority for the Financial Markets (Commission de Surveillance du Secteur Financier). The information is valid only at the time of release and Aperam does not assume any obligation to update or revise its forward-looking statements on the basis of new information, future events, subject to applicable regulation.
Contact
Company Secretary / Delphine Féraud Valendru: aperam.corporate@aperam.com
Investor Relations / Thorsten Zimmermann: +352 27 36 27 304; thorsten.zimmermann@aperam.com
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1936231 01-Jul-2024 CET/CEST
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July 01, 2024 00:59 ET (04:59 GMT)
