Public Joint Stock Company Mining and Metallurgical Company Norilsk Nickel (GMKN) H2 2024 earnings summary

Executive summary

• Revenue declined 13% year-over-year to $12.5bn, mainly due to lower realized prices for palladium, nickel, and PGMs, as well as export duties.

• EBITDA dropped 25% to $5.2bn, with margin falling to 41% from 48% last year, impacted by macroeconomic factors and export duties.

• Free cash flow decreased 31% to $1.9bn, reflecting lower EBITDA and higher interest payments; adjusted free cash flow fell 75% to $335m.

• Net profit dropped 37% year-over-year to $1.8bn.

• Sulfur Program at Nadezhda Plant reached full capacity, achieving 99% efficiency and reducing SO₂ emissions by 390,000 tonnes.

Financial highlights

• Revenue: $12.5bn (-13% year-over-year); EBITDA: $5.2bn (-25%); EBITDA margin: 41% (-7 p.p.).

• Cash operating costs fell 3% to $5.1bn, despite inflation and new export duties.

• Net working capital decreased 3% to $3.0bn, aided by lower inventories and tax payments.

• Net debt/EBITDA increased to 1.7x, up from 1.2x; net debt rose 6% to $8.6bn.

• CAPEX reduced 20% to $2.4bn, reflecting rouble depreciation and investment efficiency.

Outlook and guidance

• 2025 production expected to remain at 2024 levels for all key metals.

• Capital investments for 2025 set at RUB 215bn, focusing on safety, risk reduction, and strategic projects.

• Nickel market expected to remain in surplus (~150 kt) in 2025, with possible rebalancing from high-cost closures.

• Copper demand projected to grow 3% in 2025, with a slight market surplus anticipated.

• Palladium and platinum markets seen as balanced or in slight deficit, with demand flat or slightly down in 2025.