Eregli Demir ve Çelik Fabrikalari (EREGL) Q1 2025 earnings summary

Executive summary

• Achieved $1.5 billion in revenue, $99 million EBITDA, and $12 million net profit in Q1 2025, with total production and sales of 1.9 million tons each and sales and production in line with expectations despite lower capacity utilization due to planned maintenance.

• Export volume reached 422,000 tons, representing a record 22% export share in total sales, with 72% of revenue from domestic sales.

• Maintained sales targets of 8–8.2 million tons for 2025, expecting similar quarterly sales and EBITDA in Q2.

• Board elections on March 26, 2025, appointed three new independent board members for a one-year term.

• The company employs 12,526 personnel as of March 31, 2025, up from 12,366 at year-end 2024.

Financial highlights

• EBITDA per ton was $51 in Q1, with guidance for $90–$100 per ton for the full year.

• Net working capital decreased due to lower inventories and VAT receivables; net working capital stood at $724 million as of March 2025.

• $311 million spent on capital expenditures in Q1, with full-year CapEx expected at $800–$850 million, potentially rising to $1 billion if gold mine reserves are significant.

• Interest payments of $159 million in Q1 due to Eurobond, with no further payments expected in Q2.

• Free cash flow for the period was $293 million.

Outlook and guidance

• Sales volume guidance for 2025 remains at 8–8.2 million tons, with quarterly sales of 1.9–2 million tons.

• EBITDA and EBITDA per ton expected to remain similar in Q2, with possible slight price increases offset by costs from new investments.

• Sustainability targets include reducing greenhouse gas emissions by 25% by 2030 and 40% by 2040, aiming for net zero by 2050.

• No change in EBITDA per ton guidance ($90–$100) for the year.

• Ongoing investments in modernization and capacity expansion, with total investment expenditures reaching USD 311 million as of March 31, 2025.