Eramet (ERA) H2 2024 earnings summary

Executive summary

• Delivered adjusted EBITDA of €814m (excluding SLN) and net income of €144m, demonstrating resilience amid depressed nickel prices, volatile manganese markets, and challenging macroeconomic conditions.

• Regained full ownership of the Centenario lithium deposit in Argentina for €663m and started industrial-scale battery-grade lithium carbonate production.

• SLN’s financial needs fully covered by the French state, removing its impact from group financials.

• Advanced CSR initiatives, achieving a 94% completion rate for the "Act for Positive Mining" roadmap, with improvements in safety, diversity, and decarbonization.

• Maintained a stable dividend proposal of €1.5 per share for 2024.

Financial highlights

• Adjusted EBITDA (excluding SLN) at €814m, down from €910m, with adjusted turnover (excluding SLN) at €3,377m, down 7% year-over-year.

• Net income (excluding SLN) at €144m; reported net income group share at €14m.

• Net debt increased to €1,297m, with adjusted leverage at 1.8x and gearing at 61%.

• Group liquidity remained strong at €2.2bn, including €900m cash and €1.2bn undrawn facilities.

• Adjusted free cash flow was negative at -€308m, reflecting heavy investment in lithium and logistics.

Outlook and guidance

• 2025 focus on operational performance, ramping up Centenario lithium plant to 24,000 tons capacity (10,000–13,000 tons expected in 2025).

• Manganese ore production guidance: 6.7–7.2m tons, cash cost $2–$2.2/dmtu; nickel ore at Weda Bay: 29m tons, in line with permits.

• Capex for 2025: €400–450m, with gross capex €250m focused on logistics and lithium.

• Market expected to remain volatile in 2025, with weak demand and stable or lower prices across key segments.

• Market consensus for 2025: manganese ore at $4.5/dmtu, LME nickel at $16,450/t, lithium carbonate at $10,900/t-LCE.