Q3 2024 Ferroglobe PLC Earnings Call Transcript
Key Points
- Ferroglobe PLC (GSM) reported an adjusted EBITDA of $60 million for Q3 2024, up from $58 million in the previous quarter, driven by higher realized pricing and improved spreads in manganese alloys.
- The company expects to benefit from improved ferrosilicon volumes and prices in the US due to favorable trade cases, which imposed significant duties on imports from Russia, Kazakhstan, Malaysia, and Brazil.
- Ferroglobe PLC (GSM) is implementing a new sales and operation planning process to optimize demand planning, raw material purchases, production, logistics, and sales, aiming to enhance financial performance and cash flow.
- The company is moving forward with long-term expansion plans to increase silicon metal capacity in the US, anticipating higher demand from solar and battery markets.
- Ferroglobe PLC (GSM) has secured a significant contract to supply silicon metal to a new large customer in the Middle East for their renewable energy initiative, highlighting its strong market position.
- End market demand remains muted, and pricing continues to soften, which is expected to pressure fourth-quarter results.
- The company's third-quarter revenue was slightly lower than the second quarter due to lower volumes across all segments.
- Silicon-based alloys segment saw a decline in adjusted EBITDA from $10 million in Q2 to $2 million in Q3, primarily due to lower fixed cost absorption.
- Free cash flow was negative $10 million in the third quarter, impacted by a $21 million use of cash by working capital.
- The silicon metal outlook is mixed, with weak demand in the aluminum sector in both Europe and the US in the short term.
Thanks Marvi, good morning everyone and thank you for joining Ferroglobe's Third Quarter 2024 Conference Call. I want to apologize for the delay. Our operator had technical issues with their phone line, so we apologize. Joining me today are Marco Levi, our Chief Executive Officer; and Beatriz Garcia-Cos, our Chief Financial Officer.
Before we get started with some prepared remarks, I'm going to read a brief statement. Please turn to slide 2 at this time. Statements made by management during this conference call that are forward-looking are based on current expectations. Factors that could cause actual results to differ materially from these forward-looking statements can be found in Ferroglobe's most recent SEC filings and exhibits to those filings, which are available on our website at ferroglobe.com.
In addition, this discussion includes references to EBITDA, adjusted EBITDA, adjusted gross debt, adjusted net debt, and adjusted diluted earnings per share, among other non-IFRS measures. Reconciliation of non-IFRS
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