In This Article:
-
Sales: Below previous year's level due to divestment of Mannesmann Stainless Tubes, lower average selling prices, and reduced volumes in the trading business.
-
Earnings Before Taxes (EBT): Adjusted for non-operating special items, approximately breakeven.
-
Negative Effects on EBT: EUR32 million due to currency exchange rate impact on derivatives and risk provisioning for a planned portfolio measure.
-
Working Capital: Rose to EUR2.67 billion, EUR200 million higher than year-end 2024, but EUR360 million lower than Q1 of the previous year.
-
Gross Cash Flow: Improved by around EUR100 million compared to the previous year's figure, though still slightly negative.
-
Cash Flow from Investing Activities: Almost balanced due to EUR155 million public funding for the SALCOS project.
-
Net Financial Position: Minus EUR624 million, a slight decline of approximately EUR50 million from year-end 2024.
Release Date: May 12, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Salzgitter AG (SZGPY) reported a significant improvement in gross cash flow, which increased by around EUR100 million compared to the previous year.
-
The company's cash flow from investing activities was almost balanced in the first quarter, aided by a EUR155 million public funding receipt for the SALCOS project.
-
Despite a challenging environment, Salzgitter AG (SZGPY) confirmed its full-year 2025 sales and earnings forecast, indicating confidence in its financial outlook.
-
The spot prices for steel rose in the first quarter, which could positively impact future sales as contracts are renewed.
-
The company has a strong inventory management strategy, which contributed to better working capital management and a decent free cash flow in the first quarter.
Negative Points
-
Sales for the first quarter were below the previous year's level due to the divestment of Mannesmann Stainless Tubes, lower average selling prices, and reduced trading volumes.
-
The company faced a negative impact of EUR23 million from the valuation of derivatives due to currency exchange rate fluctuations.
-
A risk provisioning of EUR10 million was made for a planned portfolio measure, impacting earnings before taxes.
-
Working capital rose seasonally to EUR2.67 billion, which was EUR200 million higher than at the end of the previous year.
-
The maintenance activities, including those at blast furnace C, are expected to impact production output and EBITDA contribution in the second quarter.
Q & A Highlights
Q: What has been driving the strong steel volumes in Q1 2025, and do you think this was due to customers buying ahead of anticipated tariffs? A: Birgit Potrafki, CFO, confirmed that the strong volumes were indeed influenced by customers buying ahead of anticipated tariffs, aligning with the analyst's interpretation.