Elkem (ELK) Q3 2024 earnings summary

Executive summary

• EBITDA reached NOK 1,235 million in Q3 2024, the highest since Q1 2023, driven by Silicones and operational improvements.

• Total operating income was NOK 8,056 million, up 3% year-over-year, supported by Silicones division improvements and new China production line.

• Silicones and Silicon Products divisions showed strong recovery, while Carbon Solutions remained resilient despite low sales volumes.

• New bond loans of NOK 1,500 million were raised in September 2024, strengthening the financial position.

• Sustainability efforts recognized with a Platinum EcoVadis rating and S&P Global 98th percentile; ongoing CO2 reduction projects received NOK 51 million in grants.

Financial highlights

• Q3 2024 EBITDA up 131% year-over-year to NOK 1,235 million; EBITDA margin at 15% within target corridor.

• Silicones division operating income up 20% year-over-year to NOK 3,843 million; EBITDA improved to NOK 202 million from a loss.

• Silicon Products division EBITDA up 56% year-over-year to NOK 821 million, margin at 23%.

• Carbon Solutions EBITDA down 14% year-over-year to NOK 269 million, but stable performance due to diversification.

• EPS improved to NOK 0.15 in Q3 2024 and NOK 0.80 YTD; net profit for the period was NOK 117 million.

Outlook and guidance

• Market sentiment remains weak, but cost and market positions are strong.

• Silicones expected to benefit from improvement programs and higher sales volumes.

• Silicon Products to see stable market conditions but lower realized sales prices.

• Carbon Solutions to maintain stable performance leveraging strong market positions and diversification.

• Overcapacity in silicones and silicon expected to persist, keeping price pressure.