Acerinox (ACX) Q3 2024 earnings summary

Executive summary

• Q3 2024 EBITDA reached €114 million, with YTD EBITDA at €350 million and a 9% margin, demonstrating resilience amid the toughest market conditions in over a decade.

• Operating cash flow for Q3 was -€63 million, mainly due to a €122 million increase in working capital.

• Successfully restarted Acerinox Europa after a five-month strike, boosting production and impacting inventories and working capital.

• Announced the sale of Bahru Stainless for $95 million, expected to close in Q4, with regulatory approvals nearly complete.

• Haynes International acquisition received UK antitrust clearance; Austria's decision pending.

Financial highlights

• Q3 EBITDA: €114 million (9% margin); Q1: €111 million; Q2: €125 million; YTD EBITDA: €350 million.

• Q3 revenue was €1,307 million, down 16% year-over-year; 9M revenue at €4,088 million, down 20%.

• Net financial debt at September: €453 million, up from December but down from Q3 2023.

• Operating cash flow for nine months: €203 million; dividend payments: €154 million YTD, with a 7% yield.

• Q3 profit after tax and non-controlling interests was €48 million; 9M profit was €162 million.

Outlook and guidance

• Q4 adjusted EBITDA expected to be lower than Q3 due to seasonality and weak demand, but reported EBITDA will be highest of the year due to Bahru sale.

• Working capital and net debt increases in Q3 expected to normalize in Q4.

• No clear visibility for stainless in Q4; high-performance alloys expected to remain stable but affected by seasonality.

• Gradual demand recovery anticipated in 2025, especially in the U.S.

• Haynes acquisition closing expected in Q4, pending Austrian antitrust approval.