RHI Magnesita (RHIM) H2 2024 earnings summary

Executive summary

• Delivered resilient 2024 results in a challenging market, with operational improvements and M&A offsetting declining customer demand, weak global industrial output, and lower pricing and volumes.

• Adjusted EBITDA/EBITA margin increased to 11.7%, supported by cost reductions, synergies, and cash conversion above 100%.

• Major strategic step with the €391 million acquisition of Resco Products in the U.S., the largest since the 2017 merger, doubling U.S. industrial business and enhancing local-for-local production.

• Sustainability leadership maintained, with 14.2% recycled raw materials, 13.7% CO2 intensity reduction since 2018, and progress toward 2025 decarbonization targets.

• Safety culture transformation ongoing, with record low injury rates and launch of the RHIM HELP Fund raising over €800,000 for workplace accident support.

Financial highlights

• Revenue declined by 2% year-over-year to €3.49bn, with weak pricing and mix partially offset by M&A contributions.

• Adjusted EBITDA/EBITA of €407 million, margin improved by 30bps to 11.7%, and adjusted EPS grew 7% to €5.32, aided by FX and lower finance charges.

• Adjusted operating cash flow of €419m, with cash conversion at 103%.

• Final dividend of €1.20 per share, full-year payout €1.80 per share, unchanged from 2023.

• M&A contributed €40 million to EBITDA; group free cash flow funded M&A and dividends, with net debt reduced by €53 million.

Outlook and guidance

• 2025 expected to remain challenging, with no visible recovery in demand and continued pricing pressure, especially in H1.

• Adjusted EBITDA/EBITA for 2025 guided to be only modestly above 2024, including Resco contributions, with 45% weighted to H1 and 55% to H2.

• Capex guidance for 2025 at €145m, with gearing expected in the 2.0-2.5x range.

• Network optimization to deliver €10 million EBITDA benefit in 2025, €20 million in 2026, and €30 million annually thereafter.

• Industrial project business in 2024 will not be repeated in 2025; cement and non-ferrous/glass projects expected to be weaker.