OM (OMH) H1 2024 earnings summary

Executive summary

• Revenue for 1H 2024 was US$308.4 million, down 4% year-over-year due to lower ore volumes and reduced average selling prices, despite higher alloy volumes traded and resilient operational performance.

• Net profit after tax for 1H 2024 was US$12.9 million, down from US$19.3 million in 1H 2023, reflecting weaker global economic activity and higher interest rates.

• EBITDA for 1H 2024 was US$46.6 million, compared to US$56.9 million in 1H 2023.

• Basic and diluted EPS was 1.67 US cents, down from 2.59 US cents in 1H 2023.

• Production volumes remained within guidance, with a continued focus on cost management and operational efficiency.

Financial highlights

• Cash flow from operations was US$69.4 million, a significant improvement from net cash used of US$3.6 million in 1H 2023.

• Total borrowings reduced to US$213.2 million from US$265.5 million at year-end, lowering the borrowings-to-equity ratio to 0.50x.

• Gross profit margin for 1H 2024 was 16.1%–19%, down from 19%–21% in 1H 2023, mainly due to lower alloy prices and traded ore volumes.

• Cash and cash equivalents stood at US$57.5–66.5 million as of June 2024.

• Inventories increased to US$312.7 million, with a US$12.7 million write-back due to higher net realisable values.

Outlook and guidance

• Ultra Fines Plant restart at Bootu Creek is on track, with production targeted for Q4 2024.

• Production guidance for FeSi is 53–63 kmt and for Mn alloy is 151–171 kmt for FY2024.

• Hot commissioning of MetSi furnace began in July 2024; full commercial production depends on strategic review.

• Management expects financial impacts from current market conditions to be reflected with a lag due to forward delivery sales.

• No interim dividend declared for 1H 2024.