Q1 2025 Befesa SA Earnings Call Transcript
Key Points
- Befesa SA (BFSAF) reported a strong first quarter with a 15% increase in adjusted EBITDA to EUR56 million, demonstrating resilience in a challenging macroeconomic environment.
- Operating cash flow increased by 134% year-on-year, showcasing strong cash conversion capabilities.
- Net income and EPS saw a significant rise of 97% year-on-year, indicating improved profitability.
- The company successfully reduced its leverage to 2.78x, continuing its quarter-on-quarter improvement.
- Befesa SA (BFSAF) has extended its zinc hedging program to 2027, providing stability and an expected EUR20 million incremental EBITDA for 2025.
- The Secondary Aluminum business continues to face challenges due to a weak European automotive market, impacting demand and compressing aluminum metal margins.
- Planned maintenance shutdowns led to lower volumes in the Steel Dust segment, affecting overall production levels.
- The Aluminum Salt Slag segment experienced a 32% year-on-year decrease in EBITDA due to lower aluminum metal margins and higher energy prices.
- The company anticipates continued pressure from higher energy costs, particularly in natural gas and electricity prices in Europe.
- Befesa SA (BFSAF) remains cautious about the unpredictable political and economic environment, which could impact future business operations.
Ladies and gentlemen, welcome to the first quarter 2025 results conference call. I am Yota the chorus call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a question and answer.
(Operator Instructions) The conference must not be recorded for publication or broadcast. At this time it's my pleasure to hand over to Rafael Perez. Please go ahead.
Good morning, and welcome to the First Quarter 2025 Results Conference Call of Befesa. I am Rafael Perez, CFO of Befesa. And this morning, I'm joined by our Group CEO, Asier Zarraonandia.
Asier will start with an executive summary of the period, and then he will cover the business highlights for the Steel Dust as well as Aluminum Salt Slags recycling business. I will then review the financials by business and will cover the evolution of commodity prices, our hedging program and finally, cash flow, net debt and capital allocation. Asier will
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