Elkem (ELK) Q2 2024 earnings summary

Executive summary

• EBITDA reached NOK 1,030 million in Q2 2024, driven by operational improvements and cost focus, matching last year and improving sequentially.

• Net profit for Q2 was NOK 881 million, with EPS of NOK 1.65; some reports state NOK 1.35, with YTD EPS at NOK 0.65.

• Silicones markets remain weak, but operational gains and new capacity in China support performance.

• Carbon Solutions delivered strong results, benefiting from favorable costs and stable demand.

• Strong ESG and sustainability performance recognized by external ratings and awards.

Financial highlights

• Total operating income for Q2 2024 was NOK 8,490 million, down 6% year-over-year but up sequentially.

• EBITDA margin stood at 12% for Q2 2024.

• EPS at NOK 1.65, positively impacted by tax effects from REC Solar acquisition; some reports state NOK 1.35.

• Net interest-bearing debt at NOK 10.3 billion; equity ratio at 51% as of June 30, 2024.

• Cash flow from operations at NOK 375 million, slightly lower year-over-year due to increased working capital.

Outlook and guidance

• Market sentiment remains weak but shows gradual improvement; Silicones expects better demand in Europe and the US, while China faces overcapacity.

• Silicon Products anticipates improved market conditions, offsetting seasonal slowdowns in Europe.

• Carbon Solutions expects continued weak demand but benefits from strong market positions.

• Management expects stable market conditions with limited downside and ongoing benefits from internal improvement programs.