• Revenue: $1.6 billion for the full year 2024.
• Adjusted EBITDA: $154 million for the full year 2024; $10 million in Q4 2024.
• Free Cash Flow: $164 million for the full year 2024; $14 million in Q4 2024.
• Q4 Revenue: $368 million, an 18% sequential decline.
• Silicon Metal Revenue: $161 million in Q4, a 17% decline from Q3.
• Silicon-Based Alloys Adjusted EBITDA: $3 million in Q4.
• Manganese Alloys Revenue: $78 million in Q4, a 13% decline.
• Operating Cash Flow: $32 million in Q4, improved by $21 million.
• CapEx: $18 million in Q4; $79 million for the full year 2024.
• Dividend: $0.014 per share for Q1 2025, an 8% increase.
• Cash Balance: $133 million at the end of Q4 2024.
• Net Cash Position: Improved to $39 million at the end of Q4 2024.
• 2025 Adjusted EBITDA Guidance: $100 million to $170 million.

• Warning! GuruFocus has detected 3 Warning Sign with GSM.

Release Date: February 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Ferroglobe PLC (NASDAQ:GSM) achieved a revenue of $1.6 billion and adjusted EBITDA of $154 million in 2024.
• The company became net cash positive for the first time in its history and maintained a strong balance sheet.
• Ferroglobe initiated a capital return program, including quarterly dividends and share buybacks, with an 8% increase in dividends for the first quarter of 2025.
• The company is optimistic about the positive impact of trade measures on its market, which could drive future growth.
• Ferroglobe is well-positioned to capitalize on the shift to silicon-rich anodes in EV batteries, enhancing performance and reducing costs.

Negative Points

• Fourth quarter revenue declined due to lower volumes and prices across all segments, with adjusted EBITDA dropping to $10 million.
• Silicon metal revenue decreased by 17% in Q4, with realized prices declining by 5% and volumes down by 12%.
• The company faces uncertainties related to potential US tariffs, impacting purchasing decisions from solar customers.
• Ferroglobe's adjusted EBITDA guidance for 2025 is wide-ranging due to market condition uncertainties and potential trade measures.
• The company recognized a $61 million noncash impairment and goodwill write-off related to its operations.

Q & A Highlights

Q: Could you provide insights into the wider range of your annual guidance and the factors influencing the lower and higher ends, particularly regarding pricing and volume? A: Marco Levi, CEO: The guidance reflects a volatile environment with uncertainties in demand and trade measures in the US and Europe. The lower end is based on current conditions, while the higher end assumes partial success in government-imposed duties, with estimated prices and volumes driving the range of $100 million to $170 million.

Q: Can you provide sensitivity analysis for pricing and its impact on EBITDA? A: Beatriz Garcia-Cos, CFO: For every 1% variance in pricing, EBITDA is positively impacted by approximately $14 million.

Q: How do you view the growth markets for silicon metal, especially with the current softness in solar markets? A: Marco Levi, CEO: We believe in silicon's potential in the battery business, with ongoing developments to replace graphite in anodes. The solar market is impacted by overcapacity in China and US import investigations, but we expect demand to improve with new projects outside China and increased production in the US.

Q: What is the strategy for share repurchases, and how does it relate to market conditions and cash balance? A: Beatriz Garcia-Cos, CFO: We plan to continue an opportunistic approach to share buybacks without taking additional debt. Our liquidity needs guide our strategy, and as we release working capital, we aim to increase buybacks.

Q: If spot prices for silicon and alloys remain unchanged, can you still achieve the low end of your guidance? A: Marco Levi, CEO: Yes, we expect to achieve the low end due to factors like mix and anticipated business recovery in Asia in the second half of the year.

Q: How would the European quota system impact production costs per ton if finalized? A: Marco Levi, CEO: While the EU's measures are not finalized, increased capacity utilization is expected to improve cost absorption, benefiting production costs per ton.

Q: Have you observed reduced imports in the US following ferrosilicon rulings, and what is the expected pricing trend for 2025? A: Marco Levi, CEO: Imports from Russia have decreased, and pending decisions on other countries could further impact volumes. We expect ferrosilicon demand to rise as inventories deplete and new contracts are signed.

Q: What rate of return do you expect from the potential new US facility investment? A: Marco Levi, CEO: We anticipate a higher return than previous investments, leveraging advanced furnace technology for better performance and energy efficiency, aiming for returns above our WACC and cost of capital.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.