Nemak (NEMAKA) Q2 2025 earnings summary

Executive summary

• EBITDA increased 12% year-over-year to $182M in 2Q25, driven by operational efficiencies, cost discipline, and stable revenues despite a 4% decline in volume.

• Free cash flow improved, reaching $57M for the quarter, supported by higher EBITDA, lower capex, and streamlined working capital.

• Net debt reduced by 8% year-over-year to $1.61B, with leverage and liquidity metrics improving.

• Full-year 2025 guidance reaffirmed, reflecting confidence in operational execution and market outlook.

• Advanced production ramp-up at the Czech Republic facility for EV components, expanding global footprint.

Financial highlights

• Revenue was $1.27B, up 1% year-over-year, supported by favorable pricing, product mix, and euro appreciation.

• EBITDA rose to $182M, with EBITDA per equivalent unit at $18.5 (+16%).

• Operating income increased 35% year-over-year to $77M, aided by cost efficiencies and absence of prior-year asset impairments.

• Net result was a loss of $24M, mainly due to $69M in non-cash FX effects on euro-denominated liabilities; adjusted net income would have been $45M.

• CapEx for the quarter was $73M, 8% below prior year, reflecting investment optimization.

Outlook and guidance

• Full-year 2025 guidance reaffirmed, with expected volumes of 37–38 million equivalent units and projected free cash flow of $130M.

• Net debt to EBITDA target of 2x expected to be reached next year.

• Second half of the year expected to be seasonally lower due to customer shutdowns and holidays.

• Focus remains on innovation, operational excellence, and sustainability.

• Well-positioned for long-term value creation, supported by strong liquidity and resilient strategy.