Profit Alert – Turnover and EBITDA

15:15 LONDON 17:15 HELSINKI, 01/07/2024 – AFARAK GROUP SE (“AFARAK” or the “Company) (LSE: AFRK, NASDAQ: AFAGR)

Repair: Earnings Alert – Decline in turnover and EBITDA

Edit: info class

Earnings Alert – Decline in turnover and EBITDA

Stock market issue

The board of Afarac Group SE (the “Company”) estimates that EBITDA in the first half of 2024 will be 4-5 million euros, i.e. a 70% decrease compared to 2023.

Additionally, turnover in the first half of 2024 is expected to be 70-75 million euros, a decrease of 26%.

In its 2023 Annual Report published on 27 March 2024, the Company has set out the following expectations – we would like to provide an update on these to our stakeholders:

Market overview

  • Price Stabilization: Prices of standard grades of low carbon ferrochrome are expected to remain stable but low. It is not possible to increase the production of these grades unless the stainless steel mill operations improve and the leading stainless steel groups improve their operations.
  • We are constantly improving productivity and efficiency to better survive this low-quality competition. We expect margin pressure to continue at least through the first half of 2024 due to the weak state of the stainless steel industry, particularly in Europe.

Update: The stainless steel market situation in Europe is sluggish as expected, unfortunately imports, especially from India, have increased and the price pressure of these imported products is higher than expected. Sanctions targeting Russian imports have so far not had a significant impact. We continue to be successful in reducing the cost of production.

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Specialty Market

In the annual report, the company expected the specialty grade market to continue to grow and show some upside potential. With our focus on this premium quality segment, the company expects a stable result in 2024.

Update: We can generally confirm that demand for these products has increased and market prices have increased somewhat, but the price environment for fixed grades (see above) has affected our margins in this segment as well. The extremely low value of the yen allows our main competitor in Japan to be aggressive in this segment. Contrary to expectations, interest rates have recently started to decline, and no significant further cuts are expected until the end of 2024.

Ferroalloy Division

We still expect positive developments in this segment for 2024.

Update: This has been confirmed and positive signs continue.

However, in light of these developments, the company is expected to make a sustainable decision in 2024, as reported earlier. EBITDA for the first half of 2024 is 4-5 million euros, which is a 70% decrease compared to the first half of 2023. Turnover in the first half of 2024 is expected to be 70-75 million euros, a decline of 26%.

in Helsinki on 01.7.2024

Afarak Group SE

Govt

More information:

Guy Konsbruck, CEO, +356 2122 1566, [email protected]

Annual reports and other information provided to investors can be viewed on the Company’s website at www.afarak.com.

Afarac Group manufactures specialty alloys aimed at sustainable development. The company has a specialty metals business in Southern Europe and a ferrous metals business in South Africa. The company’s shares are listed on the NASDAQ Helsinki (AFAGR) and the London Stock Exchange (AFRK).

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Distribution:

Nasdaq Helsinki
London Stock Exchange
mainstream media

www.afarak.com

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