Vesuvius (VSVS) Q1 2025 TU earnings summary

Executive summary

• Revenue and trading profit were in line with expectations despite challenging end markets, with global steel production down 0.8% and foundry markets down 8% year-over-year.

• Market share gains achieved in all business units, supported by technological differentiation and R&D investment.

• Trading profit declined year-over-year due to higher labor and raw material costs, with price increases planned to offset inflation.

• Integration of the Pyromet/PiroMet acquisition is progressing well.

Financial highlights

• Revenue remained flat year-over-year on a constant currency basis, with a slight 0.5% decline in selling prices.

• Trading profit was lower than last year, as expected, due to increased costs, but supported by cost savings.

• FY24 revenue: £1,820.1m (reported), £1,764.8m (restated); trading profit: £188.0m (reported), £178.8m (restated); return on sales: 10.3% (reported), 10.1% (restated).

• H1 2024 revenue: £936.5m (reported), £905.6m (restated); trading profit: £97.2m (reported), £91.5m (restated); return on sales: 10.4% (reported), 10.1% (restated).

• One-off tax cost of $3.4 million/£3.4m related to China remittance may be reclassified as an exceptional item, with a ~2-year payback.

Outlook and guidance

• Full-year results are now anticipated to be slightly lower than previous guidance on a constant currency basis due to increased caution for H2 and global industrial slowdown.

• Price increases are being implemented globally to offset cost inflation, though full compensation is expected to be slower than usual.

• Trading profit for FY25 now expected to be slightly lower than FY24; uncertainty remains high.

• Improvement in H2 is expected to be more moderate than previously forecast, with more significant recovery anticipated in 2026.

• US tariffs expected to have a neutral direct impact; macroeconomic environment and end-market softness remain risks.