Cognor Holding (COG) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue declined to PLN 521.7m–543.3m, down 21% year-over-year, with net loss of PLN 11.3m–14.8m, driven by lower prices, volumes, and production stoppages from major investments.

• Gross profit decreased to PLN 18.7m–24.1m, while EBITDA dropped sharply to PLN 6.0m.

• Major capex projects advanced, including completion of the 450kT LSM mill in Siemianowice Śląskie and modernization in Kraków, leading to increased costs and temporary halts.

• Capacity utilization rose, especially at Cracow and Stalowa Wola, with group-wide utilization up to 74% in Q1 2025.

• For the trailing 12 months, revenue was PLN 2.06bn, with net profit at PLN 69.9m, down from 89.7m in the prior year.

Financial highlights

• Revenue fell 21% year-over-year due to lower prices for scrap metal and finished products and a 75k tonne drop in shipments.

• Net loss of PLN 11.3m–14.8m in Q1 2025, a swing from profit in Q1 2024; EBIT loss of PLN 7.9m.

• Gross margin remained positive at 4.4%, but net margin turned negative at -2.7%.

• EBITDA margin dropped to 1.1% from 3.9% a year earlier.

• Cash flow from operations was positive at PLN 21.1m–26.2m, but net debt increased to PLN 797m.

Outlook and guidance

• Market expected to improve for rebars and stabilize in automotive; scrap and billet prices to pick up slightly.

• Capacity utilization to remain high as new investments come online; LSM mill commissioning to boost output.

• Release of EU funds for Poland anticipated to support infrastructure demand.

• Management expects improved liquidity and financial stability after major investments and a new investment agreement.

• Ongoing negotiations with financial institutions to secure waivers for covenant breaches and maintain credit access.