Ferrexpo (FXPO) H1 2024 earnings summary

Executive summary

• Revenue rose 64% year-over-year to $549M, driven by an 85% increase in sales volume and improved access to Ukrainian Black Sea ports.

• Achieved best production result since the invasion, with 3.7Mt produced and 3.8Mt sold, up 75% and 85% year-over-year.

• Net cash position remained stable at $112M after $55M capital investment, with minimal debt.

• Net profit after tax doubled to $55M, and underlying EBITDA increased 24% to $79M.

• Operations adapted to war conditions, with restored Black Sea port access enabling seaborne exports.

Financial highlights

• Revenue: $549M (+64% YoY); sales volume: 3.8Mt (+85% YoY); average iron ore price: $117.3/t (-1% YoY).

• Underlying EBITDA: $79M (+24% YoY); EBITDA margin: 14% (down from 19.2%).

• Net profit: $55M (+104% YoY); diluted EPS: 9.26c (up from 4.54c).

• C1 cash cost: $78.8/t (+11% YoY), mainly due to higher energy and mining costs.

• Net cash from operations: $56M (down from $80M YoY); capital investment: $55M.

Outlook and guidance

• Ongoing war in Ukraine continues to pose material uncertainty to operations, with risks from logistics, energy supply, and workforce availability.

• Focus for H2 2024 is on sustaining current production levels, contingent on continued safe seaborne exports and stable power supply.

• No interim dividend declared for 2024 due to ongoing legal disputes and war-related uncertainties.

• Management expects continued cost pressure from high electricity prices until domestic supply improves.

• Management remains focused on operational flexibility, cost control, and supporting humanitarian initiatives.