RHI Magnesita (RHIM) Q4 2025 earnings summary

Executive summary

• Delivered full-year profit guidance in 2025 through structural, cost-based self-help initiatives, despite unprecedented market challenges and no visible market recovery, with strong H2 recovery driven by internal measures.

• Revenue declined 3% year-over-year to €3.37bn, with gross profit down 10% and adjusted EBITA down 8%.

• Strategic focus on operational discipline, safety, sustainability, and local-for-local production, with significant progress in safety culture and CO2 intensity reduction.

• Strategic acquisition of Resco transformed North American footprint, increased US local production, and contributed to earnings.

• No expectation of market recovery before 2027; guidance for 2026 is based on controllable factors.

Financial highlights

• Revenue: €3.37bn (-3% YoY); Adjusted EBITDA declined to EUR 373 million in 2025 from EUR 407 million in 2024, with a margin of 11.1%.

• Operating cash flow was EUR 391 million, with cash conversion over 100% and free cash flow of EUR 214 million.

• Net debt increased to EUR 1.5 billion due to the Resco acquisition; leverage at 2.9x net debt to EBITDA.

• Final dividend of EUR 1.20 per share, full-year dividend EUR 1.80, in line with 2024.

• Working capital intensity improved to 21.7%, with ~€90m released via improved inventory and AR management.

Outlook and guidance

• 2026 adjusted EBITDA/EBITA guidance: EUR 435 million constant currency, EUR 400 million reported, margin ~11.5%.

• No demand improvement expected in steel; gradual improvement in industrial business anticipated, especially in H2 2026.

• Currency headwinds expected to negatively impact earnings by EUR 35 million in 2026.

• Deleveraging target of 2.6x by end 2026, with strong cash generation supporting balance sheet.

• No meaningful cash outflows for M&A expected in 2026; focus on future opportunities.