In a recent communication, Arcerinox indicate that highlights from the first half of the year include the following:
Second Quarter
• EBITDA totalled €97 million, a figure 7% higher than that of the first quarter of 2019 and 36% lower than that of the second quarter of 2018.
• A negative inventory adjustment to net realisable value was made, totalling €13 million.
• Profits after taxes and minority interests totalled €37 million, 13% more than in the previous quarter and 54% less than in the same period of 2018.
• Melting production (570,119 tonnes) fell by 9% with respect to the first quarter of 2019 and by 11% compared to the second quarter of 2018.
• Net financial debt as of 30 June 2019 stood at €642 million (€573 million as at 31 March 2019).
• Free cash flow (before dividends) reached €22 million.
First Half of the Year
• EBITDA totalled €186 million, a figure 30% higher than that of the first half of 2018 and 12% lower than that of the previous half.
• Profits after taxes and minority interests totalled €69 million, 50% less than in the first half of 2018 and 30% less than in the second half of 2018.
• Melting production (1,198,039 tonnes) was 8% lower than in the first half of 2018 and 6% lower than in the previous half.
• The General Shareholders’ Meeting approved an 11% increase in the dividend (from €0.45/share to €0.50/share) and the redemption of 2% of Acerinox’s shares.
• The first six months of the Excellence 360º Plan have materialised within the goals set, with improvements in the EBITDA totalling 24 million recurring euros.
• Free cash flow (before dividends) was €39 million.
Further discussing the market outlook, Arcerinox state that Market conditions in different regions are very competitive: in Europe, import pressure and macroeconomic uncertainties continue and visibility is reduced; on the other hand, in the Asian market the excess of supply persists and we estimate prices to remain low. On the positive side, we expect the strength of the American market, the main market of the Acerinox Group, to be maintained.
Raw material prices remain very volatile, which is a complication added to manage the business.
Despite these difficult market conditions and the seasonal slowdown in Europe, we expect EBIT DA in the third quarter to be similar to that in the second quarter.
