AMG Critical Materials (AMG) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $364 million, down 17% year-over-year due to lower lithium and vanadium prices, but adjusted EBITDA reached $39 million, reflecting resilience and the strength of a diversified portfolio.

• All operating units were profitable, with strong performance in aerospace, engineering, chrome, graphite, and antimony.

• Major lithium projects in Brazil and Germany remain on schedule, with a strategic acquisition in Savannah Resources expanding European lithium access.

• Vanadium business saw 23% volume growth, offsetting a 29% price decline; operations in Ohio and Germany remain low-cost and profitable.

• Total liquidity exceeded $500 million as of June 30, 2024, supporting ongoing growth initiatives.

Financial highlights

• Q2 2024 net loss attributable to shareholders was $11 million, impacted by strategic project costs, inventory adjustment, and restructuring charges.

• Adjusted EBITDA was $39 million, down 63% year-over-year, with a margin of 10.8%.

• SG&A expenses decreased to $45 million, mainly due to a one-time pension expense in 2023.

• Cash used in operating activities was $9 million, compared to $60 million generated in Q2 2023.

• Interim dividend of €0.20 per share declared for Q3 2024.

Outlook and guidance

• Adjusted EBITDA for full year 2024 expected to exceed $130 million.

• Targeting $125 million in capital expenditures for 2024.

• Five-year guidance: adjusted EBITDA of $500 million or more, assuming lithium carbonate equivalent price of $25,000/MT.

• Lithium hydroxide refinery in Germany to be commissioned in September 2024, with 20,000 tons annual capacity.

• Focus remains on ramping up lithium projects and anticipating improved market conditions.