Preliminary Q4 2024 Befesa SA Earnings Call Transcript
Key Points
- Befesa SA (WBO:BFSA) delivered a strong fourth quarter and full-year results, with adjusted EBITDA reaching EUR213 million, a 17% increase compared to the previous year.
- Operating cash flows increased by 30% year-on-year, driven by strong cash conversion.
- The company achieved a leverage ratio of 2.9 times, below the initial target of 3 times.
- Befesa's Steel Dust Recycling business delivered strong results in Europe and the US, with high capacity utilization rates.
- The company has extended its zinc hedging book to cover close to 24 months, providing earnings visibility and predictability.
- The secondary Aluminum business was impacted by a challenging automotive industry in Europe, affecting demand and compressing metal margins.
- The US zinc refining operations faced a EUR15 million negative contribution due to unfavorable market conditions.
- Chinese operations continue to run at low utilization levels, impacted by weak electrical furnace steel production.
- The Aluminum Salt Slags Recycling business saw a 10% year-on-year decrease in EBITDA due to lower aluminum metal margins.
- Befesa expects higher natural gas and electricity prices in Europe in 2025, which could impact operating costs.
Ladies and gentlemen, welcome to the Befesa preliminary year-end results 2024 conference call. I am Yusuf, the Chorus Call operator. (Operator Instructions)
At this time, it's my pleasure to hand over to Rafael Perez, CFO. Please go ahead.
Good morning, and welcome to the preliminary full-year 2024 results conference call of Befesa. I am Rafael Perez, CFO of Befesa. 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 of 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 close this presentation providing an update on the outlook for 2025 and an update of our growth plan. Finally, we will open the lines for the Q&A session. Before getting started, let me remind you that this
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