Ferrexpo (FXPO) H1 2025 earnings summary

Executive summary

• Maintained resilient operations despite ongoing war in Ukraine, adapting production and sales to market and logistical challenges, but Q2 saw a 40% drop in output due to VAT refund suspension and workforce furloughs.

• Revenue fell 17% year-over-year to $453M, with a net loss of $196M (vs. $55M profit in 1H 2024), mainly due to a $154M impairment linked to VAT refund suspension and lower iron ore prices.

• Pivoted sales strategy toward high-grade concentrates for the Chinese market and increased seaborne exports, with 60% of sales by sea.

• Production mix shifted to 64% pellets and 36% concentrates, reflecting flexibility to meet demand.

• Continued commitment to sustainability, safety, and humanitarian support, though some initiatives paused due to liquidity constraints.

Financial highlights

• Revenue declined 17% year-over-year to $453M due to lower prices and product mix.

• Underlying EBITDA dropped to $4M from $79M in 1H 2024, with EBITDA margin at 1%.

• Net loss of $196M, compared to a $55M profit in 1H 2024; diluted EPS at -33.31 US cents.

• Net cash position decreased to $50M from $112M in 1H 2024.

• Capital investment was $28M, down 49% year-over-year, with 55% sustaining and 45% development.

Outlook and guidance

• Ongoing war, VAT refund suspension, and legal risks present material uncertainties for future operations and liquidity.

• Management remains focused on operational flexibility, cost control, and adapting to market demand.

• No interim dividend declared due to liquidity constraints and going concern risks.

• Continued emphasis on high-grade products and logistics agility to capture market opportunities.

• Outlook for 2H 2025 remains challenging; continued reduced operations expected unless VAT refunds resume.