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Ferroglobe Reports Record Financial Performance in Second Quarter 2022

Ferroglobe PLC
Ferroglobe PLC

LONDON, Aug. 15, 2022 (GLOBE NEWSWIRE) -- Ferroglobe PLC (NASDAQ: GSM) (“Ferroglobe”, the “Company”, or the “Parent”), a leading producer globally of silicon metal, silicon-based and manganese-based specialty alloys, today announced results for the second quarter 2022.

FINANCIAL HIGHLIGHTS

  • Record Q2 2022 revenue of $840.8 million, up 17.6% over the prior quarter

  • Record Q2 2022 Adjusted EBITDA of $303.2 million, up 25.7% over the prior quarter

  • Adjusted EBITDA margin improvement of 234 basis points to 36.1% in Q2 2022, up from 33.7% the prior quarter

  • Record net profit of $185.1 million (diluted earnings per share of $0.98), compared to net profit of $150.8 million (diluted earnings per share of $0.80) in Q1 2022

  • Net debt of $194 million at quarter end, significant decrease from $342 million at the end of Q1

  • Bolstered liquidity: total cash of $306.5 million at quarter-end, up $130.5 million from the prior quarter, and new $100 million asset based loan (undrawn)

BUSINESS HIGHLIGHTS

  • Stellar performance across the platform; strong pricing across all product categories

  • Robust volume demand in manganese alloys

  • Successful execution of corporate priorities: significant reduction in net debt and bolstering of liquidity

  • Increased run-rate cost savings targets relating to the strategic turnaround plan:

    • from the initial run-rate target of $180 million to the revised target of $225 million

  • Restart of the second furnace at the Selma, Alabama facility during the quarter; current run-rate annual silicon metal production of 22,000 tons

  • Achieved new industry milestones in our silicon metal powders for batteries

  • Signing of MOU in the United States to establish low-carbon and fully traceable solar supply chain

  • Published inaugural ESG report

Dr. Marco Levi, Ferroglobe’s Chief Executive Officer, commented, “Since designing our transformation plan in 2020, our team has been resilient in pushing forward to bolster our overall competitiveness by refocusing the product portfolio towards higher value added products and continuously improving our cost position. I am proud that for six consecutive quarters now, we have steadily improved our financial results on the back of these various initiatives, and are currently reporting a record-setting second quarter. Our profitablity is the highest in company history, our net debt is the lowest since the formation of Ferroglobe, and our daily operations are running seamlessly. This drastic improvement in our operational and financial results reinforce our current strategy and approach to driving change so that we can ensure that our company remains competitive for the long-term.”

“As the operating environment evolves, our business continues to evolve. We recently published our inaugural ESG report as an initial step towards increased transparency through reporting of key performance metrics. We continue to feel good about the near-term fundamentals in terms of overall demand and pricing, relative to historical pricing levels. However, in the face of macro uncertainty, inflation, and the global energy crisis, we are entering the second half of the year with a degree of caution. Our primary focus remains on driving profitability and cash generation so that we can deliver on our goals,” concluded Dr. Levi.

Second Quarter 2022 Financial Highlights

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter
Ended

 

Quarter
Ended

 

Quarter
Ended

 

 

 

 

 

Six Months
Ended

 

Six Months
Ended

 

 

$,000 (unaudited)

 

June 30,
2022

 

March 31,
2022

 

June 30,
2021

 

%
CQ/PQ

 

%
CYQ/PYQ

 

June 30,
2022

 

June 30,
2021

 

%
CY/PY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

840,808

 

 

$

715,265

 

 

$

418,538

 

 

18%

 

101%

 

$

1,556,073

 

 

$

779,928

 

 

100%

Raw materials and energy consumption for production

 

$

(369,749

)

 

$

(340,555

)

 

$

(267,939

)

 

9%

 

38%

 

$

(710,304

)

 

$

(518,104)

 

 

37%

Operating profit (loss)

 

$

265,298

 

 

$

211,130

 

 

$

8,421

 

 

26%

 

3,050%

 

$

476,428

 

 

$

(35,762)

 

 

1,432%

Operating margin

 

 

31.6%

 

 

 

29.5%

 

 

 

2%

 

 

 

 

 

 

 

30.6%

 

 

 

(5%

)

 

 

Adjusted net income (loss)
attributable to the parent

 

$

213,170

 

 

$

165,303

 

 

$

2,964

 

 

29%

 

7,092%

 

$

378,472

 

 

$

(15,208)

 

 

2,589%

Adjusted diluted EPS

 

$

1.14

 

 

$

0.88

 

 

$

0.02

 

 

 

 

 

 

$

2.02

 

 

$

(0.10)

 

 

 

Adjusted EBITDA

 

$

303,159

 

 

$

241,119

 

 

$

34,088

 

 

26%

 

789%

 

$

544,277

 

 

$

56,157

 

 

869%

Adjusted EBITDA margin

 

 

36.1%

 

 

 

33.7%

 

 

 

8.1%

 

 

 

 

 

 

 

35.0%

 

 

 

7.2%

 

 

 

Operating cash flow

 

$

164,818

 

 

$

65,908

 

 

$

(3,164

)

 

150%

 

5,309%

 

$

230,726

 

 

$

11,627

 

 

1,884%

Free cash flow1

 

$

151,109

 

 

$

56,783

 

 

$

(5,738

)

 

166%

 

2,733%

 

$

207,892

 

 

$

3,405

 

 

6,005%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Working Capital

 

$

687,345

 

 

$

613,187

 

 

$

334,291

 

 

12%

 

106%

 

$

687,345

 

 

$

334,291

 

 

106%

Working Capital as % of Sales2

 

 

20.4%

 

 

 

21.4%

 

 

 

20.0%

 

 

 

 

 

 

 

22.1%

 

 

 

21.4%

 

 

 

Cash and Restricted Cash

 

$

306,511

 

 

$

176,022

 

 

$

106,089

 

 

74%

 

189%

 

$

306,511

 

 

$

106,089

 

 

189%

Adjusted Gross Debt3

 

$

500,472

 

 

$

518,093

 

 

$

464,078

 

 

(3%)

 

8%

 

$

500,472

 

 

$

464,078

 

 

8%

Equity

 

$

637,710

 

 

$

475,477

 

 

$

299,469

 

 

34%

 

113%

 

$

637,710

 

 

$

299,469

 

 

113%

(1)  Free cash flow is calculated as operating cash flow plus investing cash flow
(2)  Working capital based on annualized quarterly sales respectively
(3)  Adjusted gross debt excludes bank borrowings on factoring program and impact of leasing standard IFRS16 at June 30, 2022 Mar 31, 2022 & June 30, 2021


Sales

In the second quarter of 2022, Ferroglobe reported net sales of $840.8 million, up 18% over the prior quarter and up 101% over Q2 2021.   The improvement in our second quarter results is primarily attributable to higher volumes across our product portfolio, and higher pricing primarily in silicon based alloys and manganese based alloys. The $126 million increase in sales over the prior quarter was primarily driven by silicon metal, which accounted for $43 million, and manganese-based alloys, which accounted for $48 million.

Raw materials and energy consumption for production

Raw materials and energy consumption for production was $369.8 million in Q2 2022 versus $340.6 million in the prior quarter, an increase of 9%. As a percentage of sales, raw materials and energy consumption for production was 44% in the second quarter of 2022 versus 47.6% in the prior quarter. Costs of several key inputs such as electrodes, paste and coal were adversely impacted by inflationary pressures. Partially offsetting this was a $31.2 milion energy cost benefit in France, which will continue to benefit our costs for the remainder of 2022.

Net Income (Loss) Attributable to the Parent

In Q2 2022, net profit attributable to the Parent was $185.3 million, or $0.98 per diluted share, compared to a net profit attributable to the Parent of $151.2 million, or $0.80 per diluted share in Q1 2022.

Adjusted EBITDA

In Q2 2022, Adjusted EBITDA was $303.2 million, or 36.1% of sales, an increase of 25.7% compared to adjusted EBITDA of $241.1 million, or 33.7% of sales in Q1 2022. The increase in the Q2 2022 Adjusted EBITDA is primarily attributable to volume products increase across all the products. Overall, the positive impact from pricing was $13.4 million and the impact from higher volumes was $49.6 million. During the quarter, the impact of higher costs was $3.9 million, primarily due to the raw material price inflation, partially offset by improved energy costs in Spain and France.

Total Cash

The total cash balance was $306.5 million as of June 30, 2022, up $130.5 million from $176.0 million as of March 31, 2022.

During Q2 2022, we generated positive operating cash flow of $164.8 million, had negative cash flow from investing activities of $13.7 million, and $14.8 million in cash flow from financing activities.

Total Working Capital  

Total working capital was $687.3 million in the second quarter of 2022, increasing from $613.2 million at March 31, 2022. The $74.1 million increase in working capital was due primarily to a $40.7 million increase in inventories as a result of higher sales, and a $34.8 million decrease in accounts payables. On a relative basis, we successfully kept working capital as a percentage of sales flat during the second quarter at 20.4%, compared to 21.4% during the prior quarter. This is largely attributable to the financial discipline introduced to our operations over the past year.

Closing of Asset-Based Revolving Credit Facility

The Company closed a new, five-year $100 million North American asset-based revolving credit facility (the “ABL Revolver”), involving Ferroglobe’s subsidiary, Globe Specialty Metals, Inc. (“Globe”), and its wholly owned North American subsidiaries, as borrowers, and Bank of Montreal (“BMO”), as lender and agent, on June 30, 2022.

At closing, there was no drawing under the ABL Revolver. Going forward, potential drawings under the ABL Revolver will be used for general corporate purposes.
The ABL Revolver is subject to a borrowing base comprising North American inventory and accounts receivable of Globe (and certain of its subsidiaries) and bears interest of SOFR plus a spread of 150-175 basis points depending on the level of utilization.

Beatriz García-Cos, Ferroglobe’s Chief Financial Officer, commented, “During the second quarter we successfully executed a number of initiatives, in addition to delivering record setting results. We strengthened our balance sheet by increasing liquidity with a new $100 million asset based loan which offers significantly lower cost of capital relative to our existing debt instruments. Furthermore, we are delivering on our key priority which is significant deleveraging of the balance sheet, with a gross debt target of $200 million. We opportunistically repurchased senior notes in the open market and we successfully redeemed the full $60 million of 9% senior notes in July. The recent upgrades to our credit rating is a further testament to the strengthening of our credit profile.”

“While we have been performing well in a market with strong prices and healthy demand, a significant part of our outperformance has been the result of our transformation initiatives, which should enable us to ensure positive cash generation through the cycle. Since initiating this plan, we have increased our target cost savings from $180 million to $225 million as we identify new areas for further cost reduction, improve efficiencies within our organization, and optimize our working capital in a collective effort to drive cash generation,” added Mrs. García-Cos.

Product Category Highlights

Silicon Metal

 

 

Quarter
Ended

 

Quarter
Ended

 

 

 

Quarter
Ended

 

 

 

 

Six Months
Ended

 

Six Months
Ended

 

 

 

June 30,
2022

 

March 31,
2022

 

Change

 

June 30,
2021

 

Change

 

June 30,
2022

 

June 30,
2021

 

Change

Shipments in metric tons:

 

 

62,988

 

 

 

56,349

 

 

11.8

%

 

 

67,322

 

 

(6.4

)%

 

 

119,337

 

 

 

128,597

 

 

(7.2

)%

Average selling price ($/MT):

 

 

5,649

 

 

 

5,552

 

 

1.7

%

 

 

2,347

 

 

140.7

%

 

 

5,603

 

 

 

2,317

 

 

141.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Silicon Metal Revenue ($,000)

 

 

355,819

 

 

 

312,850

 

 

13.7

%

 

 

158,005

 

 

125.2

%

 

 

668,669

 

 

 

297,959

 

 

124.4

%

Silicon Metal Adj.EBITDA ($,000)

 

 

175,108

 

 

 

151,661

 

 

15.5

%

 

 

13,655

 

 

1182.4

%

 

 

326,769

 

 

 

28,417

 

 

1049.9

%

Silicon Metal Adj.EBITDA Mgns

 

 

49.2

%

 

 

48.5

%

 

 

 

 

8.6

%

 

 

 

 

 

48.9

%

 

 

9.5

%

 

 


Silicon metal revenue in the second quarter was $355.8 million, an increase of 13.7% over the prior quarter. Total shipments of silicon metal increased 11.8% due to continued demand strength in the chemical and aluminum end markets, the restart of our Selma, Alabama facility, some carry over from Q1´22 due to logistical challenges. Costs were adversely impacted by inflationary pressure on raw materials and general operating costs ($10.4 million), increases across several other areas ($2.2 million), and positively offset by the current quarter’s net impact on the energy price adjustment in France ($12.2 million). Adjusted EBITDA for silicon metal increased to $175.1 million during the second quarter, up 15.5% from $151.7 million the prior quarter.

Silicon-Based Alloys

 

 

Quarter
Ended

 

Quarter
Ended

 

 

 

Quarter
Ended

 

 

 

Six Months
Ended

 

Six Months
Ended

 

 

 

June 30,
2022

 

March 31,
2022

 

Change

 

June 30,
2021

 

Change

 

June 30,
2022

 

June 30,
2021

 

Change

Shipments in metric tons:

 

 

57,658

 

 

 

57,594

 

 

0.1

%

 

 

65,222

 

 

(11.6

)%

 

 

115,252

 

 

 

126,826

 

 

(9.1

)%

Average selling price ($/MT):

 

 

4,097

 

 

 

3,680

 

 

11.3

%

 

 

1,830

 

 

123.9

%

 

 

3,889

 

 

 

1,750

 

 

122.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Silicon-based Alloys Revenue ($,000)

 

 

236,225

 

 

 

211,946

 

 

11.5

%

 

 

119,356

 

 

97.9

%

 

 

448,171

 

 

 

221,946

 

 

101.9

%

Silicon-based Alloys Adj.EBITDA ($,000)

 

 

97,141

 

 

 

78,411

 

 

23.9

%

 

 

11,380

 

 

753.6

%

 

 

175,552

 

 

 

21,474

 

 

717.5

%

Silicon-based Alloys Adj.EBITDA Mgns

 

 

41.1

%

 

 

37.0

%

 

 

 

 

9.5

%

 

 

 

 

39.2

%

 

 

9.7

%

 

 


Silicon-based alloy revenue in the second quarter was $236.2 million, an increase of 11.5% over the prior quarter. The average realized selling price improve by 11.3%, due to product mix, with a greater weighting towards specialty grades and higher priced foundry products. Total shipments were in-line over the prior quarter. Costs were adversely impacted by inflationary pressures across raw materials and general operating costs ($6.6 million), and expenses related to the Chateau Feulliet facility in France ($4.1 million). This part of our business benefited from the positive energy price adjustment in Frnace ($2.9 million). Adjusted EBITDA for the silicon- based alloys portfolio increased to $97.1 million, up 23.9% from $78.4 million the prior quarter.

Manganese-Based Alloys

 

 

Quarter
Ended

 

Quarter
Ended

 

 

 

Quarter
Ended

 

 

 

Six Months
Ended

 

Six Months
Ended

 

 

 

June 30,
2022

 

March 31,
2022

 

Change

 

June 30,
2021

 

Change

 

June 30,
2022

 

June 30,
2021

 

Change

Shipments in metric tons:

 

 

97,007

 

 

 

75,082

 

 

29.2

%

 

 

68,323

 

 

42.0

%

 

 

172,089

 

 

 

140,932

 

 

22.1

%

Average selling price ($/MT):

 

 

1,986

 

 

 

1,925

 

 

3.2

%

 

 

1,414

 

 

40.5

%

 

 

1,959

 

 

 

1,290

 

 

51.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Manganese-based Alloys Revenue ($,000)

 

 

192,656

 

 

 

144,533

 

 

33.3

%

 

 

96,609

 

 

99.4

%

 

 

337,189

 

 

 

181,802

 

 

85.5

%

Manganese-based Alloys Adj.EBITDA ($,000)

 

 

32,871

 

 

 

20,371

 

 

61.4

%

 

 

15,662

 

 

109.9

%

 

 

53,242

 

 

 

25,836

 

 

106.1

%

Manganese-based Alloys Adj.EBITDA Mgns

 

 

17.1

%

 

 

14.1

%

 

 

 

 

16.2

%

 

 

 

 

15.8

%

 

 

14.2

%

 

 


Manganese-based alloy revenue in the second quarter was $192.7 million, an increase of 33.3% over the prior quarter. Total shipments of manganese-based alloys increased 29.2%. Averaged realized selling prices were positively impacted by the increase in index pricing which continued in Q2 2022. During the quarter, Adjusted EBITDA from our manganese-based alloys portfolio was $32.9 million, up 61.4% over the prior quarter as a result of higher volumes. Costs were adversely impacted by the mark-to-market accounting treatment relating to the earn-out provision ($6.7 million), an increase in raw material costs ($0.5 million), and positively offset by improved energy costs in Spain and France ($6.1 million).

Russia – Ukraine War

The recent outbreak of war between Russia and Ukraine has disrupted supply chains and caused instability in the global economy, while the United States and the European Union, among other countries, announced sanctions against Russia. The ongoing conflict could result in the imposition of further economic sanctions against Russia. Sanctions imposed on coal & assimilated products such as anthracite and metallurgical coke have obliged Ferroglobe to redirect its sourcing of such products to other origins at a moment of strong market demand. The uncertain supply and logistical conditions in Russia have also led Ferroglobe to diversify its sourcing of carbon electrodes. New sourcing were put in place during the course of Q2 2022 allowing Ferroglobe to ensure supply continuity to its operations worldwide. Although Ferroglobe managed successfully to ensure supply continuity at its operations, it was impacted by the short-term increase of raw materials prices linked to the conflict.

Subsequent events

Redemption of 9.0% Senior Secured Notes due 2025  

On July 11, the Company announce the giving of a notice of redemption of all of the 9.0% Senior Secured Notes due 2025 issued by the Issuer (the “Notes”) at 100% of the principal amount thereof plus accrued interest. On the date hereof, $60 million in aggregate principal amount was outstanding. The redemption has been carried out on July 21, 2022.        

Conference Call

Ferroglobe invites all interested persons to participate on its conference call at 8:30 AM, U.S. Eastern Daylight Time on August 16, 2022. Please dial-in at least five minutes prior to the call to register. The call may also be accessed via an audio webcast.

To join via phone:  
Conference call participants should pre-register using this link:
https://register.vevent.com/register/BIff8f07e860f54efe8cf0e341348f49d0 
Once registered, you will receive the dial-in numbers and a personal PIN, which are required to access the conference call.

To join via webcast: 
A simultaneous audio webcast, and replay will be accessible here:
https://edge.media-server.com/mmc/p/rvdq3dxw

About Ferroglobe

Ferroglobe is one of the world’s leading suppliers of silicon metal, silicon- and manganese-based specialty alloys, and other ferroalloys serving a customer base across the globe in dynamic and fast-growing end markets, such as solar, automotive, consumer products, construction and energy. The Company is based in London. For more information, visit http://investor.ferroglobe.com.

Forward-Looking Statements

This release contains “forward-looking statements” within the meaning of U.S. securities laws. Forward-looking statements are not historical facts but are based on certain assumptions of management and describe the Company’s future plans, strategies and expectations. Forward-looking statements often use forward-looking terminology, including words such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “forecast”, “guidance”, “intends”, “likely”, “may”, “plan”, “potential”, “predicts”, “seek”, “target”, “will” and words of similar meaning or the negative thereof.

Forward-looking statements contained in this press release are based on information currently available to the Company and assumptions that management believe to be reasonable, but are inherently uncertain. As a result, Ferroglobe’s actual results, performance or achievements may differ materially from those expressed or implied by these forward-looking statements, which are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company’s control.

Forward-looking financial information and other metrics presented herein represent the Company’s goals and are not intended as guidance or projections for the periods referenced herein or any future periods.

All information in this press release is as of the date of its release. Ferroglobe does not undertake any obligation to update publicly any of the forward-looking statements contained herein to reflect new information, events or circumstances arising after the date of this press release. You should not place undue reliance on any forward-looking statements, which are made only as of the date of this press release.

Non-IFRS Measures

This document may contain summarized, non-audited or non-GAAP financial information. The information contained herein should therefore be considered as a whole and in conjunction with all the public information regarding the Company available, including any other documents released by the Company that may contain more detailed information. Adjusted EBITDA, adjusted EBITDA margin, adjusted net profit, adjusted profit per share, working capital and net debt, are non-IFRS financial metrics that management uses in its decision making. Ferroglobe has included these financial metrics to provide supplemental measures of its performance. The Company believes these metrics are important and useful to investors because they eliminate items that have less bearing on the Company’s current and future operating performance and highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures.

INVESTOR CONTACT:

Gaurav Mehta
Executive Vice President – Investor Relations 
Email:   investor.relations@ferroglobe.com

MEDIA CONTACT:

Cristina Feliu Roig
Executive Director – Communications & Public Affairs
Email:   corporate.comms@ferroglobe.com


Ferroglobe PLC and Subsidiaries
Unaudited Condensed Consolidated Income Statement
(in thousands of U.S. dollars, except per share amounts)

 

 

Quarter Ended

 

Quarter Ended

 

Quarter Ended

 

Six Months Ended

 

Six Months Ended

 

 

June 30, 2022

 

March 31, 2022

 

June 30, 2021

 

June 30, 2022

 

June 30, 2021

Sales

 

$

840,808

 

 

$

715,265

 

 

$

418,538

 

 

$

1,556,073

 

 

$

779,928

 

Raw materials and energy consumption for production

 

 

(369,749

)

 

 

(340,555

)

 

 

(267,939

)

 

 

(710,304

)

 

 

(518,104

)

Other operating income

 

 

26,223

 

 

 

23,008

 

 

 

37,105

 

 

 

49,231

 

 

 

39,018

 

Staff costs

 

 

(80,704

)

 

 

(81,986

)

 

 

(63,197

)

 

 

(162,690

)

 

 

(158,464

)

Other operating expense

 

 

(130,992

)

 

 

(83,176

)

 

 

(93,171

)

 

 

(214,168

)

 

 

(130,006

)

Depreciation and amortization charges, operating allowances and write-downs

 

 

(20,185

)

 

 

(21,109

)

 

 

(23,523

)

 

 

(41,294

)

 

 

(48,808

)

Other gain (loss)

 

 

(103

)

 

 

(317

)

 

 

608

 

 

 

(420

)

 

 

674

 

Operating profit (loss)

 

 

265,298

 

 

 

211,130

 

 

 

8,421

 

 

 

476,428

 

 

 

(35,762

)

Net finance expense

 

 

(12,829

)

 

 

(12,455

)

 

 

(11,178

)

 

 

(25,284

)

 

 

(27,042

)

Exchange differences

 

 

(7,882

)

 

 

(4,393

)

 

 

3,237

 

 

 

(12,275

)

 

 

(6,077

)

Profit (loss) before tax

  

 

244,587

 

  

 

194,282

 

 

 

480

 

 

 

438,869

 

 

 

(68,881

)

Income tax benefit (loss)

 

 

(59,529

)

 

 

(43,495

)

 

 

250

 

 

 

(103,024

)

 

 

1,094

 

Profit (loss) for the period

 

 

185,058

 

 

 

150,787

 

 

 

730

 

 

 

335,845

 

 

 

(67,787

)

Loss attributable to non-controlling interest

 

 

265

 

 

 

376

 

 

 

1,180

 

 

 

641

 

 

 

2,315

 

Profit (loss) attributable to the parent

 

$

185,323

 

 

$

151,163

 

 

$

1,910

 

 

$

336,486

 

 

$

(65,472

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA

 

$

285,483

 

 

$

232,239

 

 

$

31,944

 

 

$

517,722

 

 

$

13,046

 

Adjusted EBITDA

 

$

303,159

 

 

$

241,119

 

 

$

34,088

 

 

$

544,277

 

 

$

56,157

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

187,441

 

 

 

187,408

 

 

 

169,298

 

 

 

187,424

 

 

 

169,295

 

Diluted

 

 

188,538

 

 

 

188,583

 

 

 

169,298

 

 

 

188,567

 

 

 

169,295

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit (loss) per ordinary share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.99

 

 

$

0.81

 

 

$

0.01

 

 

$

1.80

 

 

$

(0.39

)

Diluted

 

$

0.98

 

 

$

0.80

 

 

$

0.01

 

 

$

1.78

 

 

$

(0.39

)


Ferroglobe PLC and Subsidiaries
Unaudited Condensed Consolidated Statement of Financial Position
(in thousands of U.S. dollars)

 

 

June 30,

 

March 31,

 

December 31,

 

 

2022

 

2022

 

2021

ASSETS

Non-current assets

 

 

 

 

 

 

 

 

 

 

 

 

Goodwill

 

$

29,702

 

 

$

29,702

 

 

$

29,702

 

Other intangible assets

 

 

94,866

 

 

 

188,407

 

 

 

100,642

 

Property, plant and equipment

 

 

528,198

 

 

 

548,862

 

 

 

554,914

 

Other non-current financial assets

 

 

3,920

 

 

 

3,977

 

 

 

4,091

 

Deferred tax assets

 

 

124

 

 

 

246

 

 

 

7,010

 

Non-current receivables from related parties

 

 

1,558

 

 

 

1,665

 

 

 

1,699

 

Other non-current assets

 

 

17,818

 

 

 

18,819

 

 

 

18,734

 

Non-current restricted cash and cash equivalents

 

 

2,077

 

 

 

2,220

 

 

 

2,272

 

Total non-current assets

 

 

678,263

 

 

 

793,898

 

 

 

719,064

 

Current assets

 

 

 

 

 

 

 

 

 

 

 

 

Inventories

 

 

403,004

 

 

 

362,298

 

 

 

289,797

 

Trade and other receivables

 

 

498,619

 

 

 

499,953

 

 

 

381,073

 

Current receivables from related parties

 

 

2,605

 

 

 

2,784

 

 

 

2,841

 

Current income tax assets

 

 

2,314

 

 

 

408

 

 

 

7,660

 

Other current financial assets

 

 

203

 

 

 

203

 

 

 

104

 

Other current assets

 

 

15,518

 

 

 

11,838

 

 

 

8,408

 

Current restricted cash and cash equivalents

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

304,434

 

 

 

173,802

 

 

 

114,391

 

Total current assets

 

 

1,226,697

 

 

 

1,051,286

 

 

 

804,274

 

Total assets

 

$

1,904,960

 

 

$

1,845,184

 

 

$

1,523,338

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EQUITY AND LIABILITIES

Equity

 

$

637,710

 

 

$

475,477

 

 

$

320,031

 

Non-current liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Deferred income

 

 

48,961

 

 

 

70,699

 

 

 

895

 

Provisions

 

 

55,771

 

 

 

57,858

 

 

 

60,958

 

Bank borrowings

 

 

2,922

 

 

 

3,360

 

 

 

3,670

 

Lease liabilities

 

 

9,514

 

 

 

10,636

 

 

 

9,968

 

Debt instruments

 

 

385,911

 

 

 

404,954

 

 

 

404,938

 

Other financial liabilities (1)

 

 

37,020

 

 

 

38,674

 

 

 

4,549

 

Other Obligations (2)

 

 

43,232

 

 

 

37,241

 

 

 

38,082

 

Other non-current liabilities (2)

 

 

 

 

 

 

 

 

1,476

 

Deferred tax liabilities

 

 

41,228

 

 

 

35,423

 

 

 

25,145

 

Total non-current liabilities

 

 

624,559

 

 

 

658,845

 

 

 

549,681

 

Current liabilities

 

 

 

 

 

 

 

 

 

 

 

 

Provisions

 

 

95,300

 

 

 

159,386

 

 

 

137,625

 

Bank borrowings

 

 

96,412

 

 

 

95,359

 

 

 

95,297

 

Lease liabilities

 

 

7,342

 

 

 

7,869

 

 

 

8,390

 

Debt instruments

 

 

15,075

 

 

 

6,382

 

 

 

35,359

 

Other financial liabilities (1)

 

 

57,653

 

 

 

62,141

 

 

 

62,464

 

Payables to related parties

 

 

9,605

 

 

 

8,685

 

 

 

9,545

 

Trade and other payables

 

 

214,278

 

 

 

249,064

 

 

 

206,000

 

Current income tax liabilities

 

 

43,193

 

 

 

21,208

 

 

 

1,775

 

Other Obligations (2)

 

 

16,469

 

 

 

18,369

 

 

 

22,843

 

Other current liabilities (2)

 

 

87,364

 

 

 

82,399

 

 

 

74,328

 

Total current liabilities

 

 

642,691

 

 

 

710,862

 

 

 

653,626

 

Total equity and liabilities

 

$

1,904,960

 

 

$

1,845,184

 

 

$

1,523,338

 

(1)  On January 25, 2022, the Ministry opened a hearing to decide on reimbursement of the loan. The company presented its allegations on February 15, 2022. Based on those allegations, the reimbursement procedure has been suspended and a new final report is expected to be made by the Ministry by the end of 2022 ending the administrative procedure and establishing the definitive amount of the partial reimbursement to be made. However, for accounting purposes the entire loan was considered short-term
(2)  In 2021 we disaggregated “Other liabilities” into an additional line to the balance sheet “Other obligations“ to separately present certain contractual obligations whose nature and function differs from other items presented in the “Other liabilities line”, so as to allow a better understanding of the Company´s financial position.


Ferroglobe PLC and Subsidiaries
Unaudited Condensed Consolidated Statement of Cash Flows

 

 

Quarter Ended

 

Quarter Ended

 

Quarter Ended

 

Six Months Ended

 

Six Months Ended

 

 

June 30, 2022

 

March 31, 2022

 

June 30, 2021

 

June 30, 2022

 

June 30, 2021

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit (loss) for the period

 

$

185,058

 

 

$

150,787

 

 

$

730

 

 

$

335,845

 

 

$

(67,787

)

Adjustments to reconcile net (loss) profit to net cash used by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax (benefit) expense

 

 

59,529

 

 

 

43,495

 

 

 

(250

)

 

 

103,024

 

 

 

(1,094

)

Depreciation and amortization charges, operating allowances and write-downs

 

 

20,185

 

 

 

21,109

 

 

 

23,523

 

 

 

41,294

 

 

 

48,808

 

Net finance expense

 

 

12,829

 

 

 

12,455

 

 

 

11,178

 

 

 

25,284

 

 

 

27,042

 

Exchange differences

 

 

7,882

 

 

 

4,393

 

 

 

(3,237

)

 

 

12,275

 

 

 

6,077

 

Net loss (gain) due to changes in the value of asset

 

 

(10

)

 

 

(6

)

 

 

(243

)

 

 

(16

)

 

 

(264

)

Gain on disposal of non-current assets

 

 

 

 

 

302

 

 

 

 

 

 

302

 

 

 

(43

)

Share-based compensation

 

 

970

 

 

 

1,807

 

 

 

673

 

 

 

2,777

 

 

 

886

 

Other adjustments (1)

 

 

112

 

 

 

21

 

 

 

(366

)

 

 

133

 

 

 

(368

)

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Increase) decrease in inventories

 

 

(59,568

)

 

 

(73,611

)

 

 

(8,770

)

 

 

(133,179

)

 

 

2,676

 

(Increase) decrease in trade receivables

 

 

(25,963

)

 

 

(121,767

)

 

 

(8,625

)

 

 

(147,730

)

 

 

(50,317

)

Increase (decrease) in trade payables

 

 

(10,959

)

 

 

40,073

 

 

 

16,184

 

 

 

29,114

 

 

 

42,336

 

Other

 

 

5,654

 

 

 

(12,463

)

 

 

(32,783

)

 

 

(6,809

)

 

 

4,910

 

Income taxes paid

 

 

(30,901

)

 

 

(687

)

 

 

(1,178

)

 

 

(31,588

)

 

 

(1,235

)

Net cash provided (used) by operating activities

 

 

164,818

 

 

 

65,908

 

 

 

(3,164

)

 

 

230,726

 

 

 

11,627

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and finance income received

 

 

140

 

 

 

68

 

 

 

128

 

 

 

208

 

 

 

163

 

Payments due to investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other intangible assets (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment

 

 

(13,855

)

 

 

(9,193

)

 

 

(3,245

)

 

 

(23,048

)

 

 

(8,928

)

Other

 

 

6

 

 

 

 

 

 

 

 

 

6

 

 

 

 

Disposals:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other non-current assets

 

 

 

 

 

 

 

 

543

 

 

 

 

 

 

543

 

Net cash (used) provided by investing activities

 

 

(13,709

)

 

 

(9,125

)

 

 

(2,574

)

 

 

(22,834

)

 

 

(8,222

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment for debt and equity issuance costs

 

 

(100

)

 

 

 

 

 

(11,093

)

 

 

(100

)

 

 

(17,691

)

Proceeds from debt issuance

 

 

 

 

 

(4,943

)

 

 

40,000

 

 

 

(4,943

)

 

 

40,000

 

Increase/(decrease) in bank borrowings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowings

 

 

301,360

 

 

 

244,164

 

 

 

149,945

 

 

 

545,524

 

 

 

277,635

 

Payments

 

 

(292,253

)

 

 

(237,627

)

 

 

(144,983

)

 

 

(529,880

)

 

 

(302,447

)

Amounts paid due to leases

 

 

(2,277

)

 

 

(2,518

)

 

 

(3,157

)

 

 

(4,795

)

 

 

(6,013

)

Other amounts received/(paid) due to financing activities

 

 

(19,119

)

 

 

38,298

 

 

 

 

 

 

19,179

 

 

 

 

Interest paid

 

 

(2,376

)

 

 

(34,799

)

 

 

(3,333

)

 

 

(37,175

)

 

 

(20,348

)

Net cash (used) provided by financing activities

 

 

(14,765

)

 

 

2,575

 

 

 

27,379

 

 

 

(12,190

)

 

 

(28,864

)

Total net cash flows for the period

 

 

136,344

 

 

 

59,358

 

 

 

21,641

 

 

 

195,702

 

 

 

(25,459

)

Beginning balance of cash and cash equivalents

 

 

176,022

 

 

 

116,663

 

 

 

84,367

 

 

 

116,663

 

 

 

131,557

 

Exchange differences on cash and cash equivalents in foreign currencies

 

 

(5,855

)

 

 

1

 

 

 

81

 

 

 

(5,854

)

 

 

(9

)

Ending balance of cash and cash equivalents

 

$

306,511

 

 

$

176,022

 

 

$

106,089

 

 

$

306,511

 

 

$

106,089

 

Cash from continuing operations

 

 

304,434

 

 

 

173,802

 

 

 

99,940

 

 

 

304,434

 

 

 

99,940

 

Current/Non-current restricted cash and cash equivalents

 

 

2,077

 

 

 

2,220

 

 

 

6,149

 

 

 

2,077

 

 

 

6,149

 

Cash and restricted cash in the statement of financial position

 

$

306,511

 

 

$

176,022

 

 

$

106,089

 

 

$

306,511

 

 

$

106,089

 


Adjusted EBITDA ($,000):

 

 

Quarter Ended

 

Quarter Ended

 

Quarter Ended

 

Six Months Ended

 

Six Months Ended

 

 

June 30, 2022

 

March 31, 2022

 

June 30, 2021

 

June 30, 2022

 

June 30, 2021

Profit (loss) attributable to the parent

 

$

185,323

 

 

$

151,163

 

 

$

1,910

 

 

$

336,486

 

 

$

(65,472

)

Profit (loss) attributable to non-controlling interest

 

 

(265

)

 

 

(376

)

 

 

(1,180

)

 

 

(641

)

 

 

(2,315

)

Income tax (benefit) expense

 

 

59,529

 

 

 

43,495

 

 

 

(250

)

 

 

103,024

 

 

 

(1,094

)

Net finance expense

 

 

12,829

 

 

 

12,455

 

 

 

11,178

 

 

 

25,284

 

 

 

27,042

 

Exchange differences

 

 

7,882

 

 

 

4,393

 

 

 

(3,237

)

 

 

12,275

 

 

 

6,077

 

Depreciation and amortization charges, operating allowances and write-downs

 

 

20,185

 

 

 

21,109

 

 

 

23,523

 

 

 

41,294

 

 

 

48,808

 

EBITDA

 

 

285,483

 

 

 

232,239

 

 

 

31,944

 

 

 

517,722

 

 

 

13,046

 

Restructuring and termination costs

 

 

3,406

 

 

 

5,909

 

 

 

2,144

 

 

 

9,315

 

 

 

43,111

 

New strategy implementation

 

 

14,270

 

 

 

2,971

 

 

 

 

 

 

17,240

 

 

 

 

Adjusted EBITDA

 

$

303,159

 

 

$

241,119

 

 

$

34,088

 

 

$

544,277

 

 

$

56,157

 


Adjusted profit attributable to Ferroglobe ($,000):

 

 

Quarter Ended

 

Quarter Ended

 

Quarter Ended

 

Six Months Ended

 

Six Months Ended

 

 

June 30, 2022

 

March 31, 2022

 

June 30, 2021

 

June 30, 2022

 

June 30, 2021

Profit (loss) attributable to the parent

 

$

185,323

 

 

$

151,163

 

 

$

1,910

 

 

$

336,486

 

 

$

(65,472

)

Tax rate adjustment

 

 

13,498

 

 

 

6,931

 

 

 

(404

)

 

 

20,429

 

 

 

20,948

 

Restructuring and termination costs

 

 

2,765

 

 

 

4,797

 

 

 

1,458

 

 

 

7,562

 

 

 

29,315

 

New strategy implementation

 

 

11,584

 

 

 

2,412

 

 

 

 

 

 

13,995

 

 

 

 

Adjusted profit (loss) attributable to the parent

 

$

213,170

 

 

$

165,303

 

 

$

2,964

 

 

$

378,472

 

 

$

(15,208

)


Adjusted diluted profit per share:

 

 

Quarter Ended

 

Quarter Ended

 

Quarter Ended

 

Six Months Ended

 

Six Months Ended

 

 

June 30, 2022

 

March 31, 2022

 

June 30, 2021

 

June 30, 2022

 

June 30, 2021

Diluted profit (loss) per ordinary share

 

$

0.98

 

 

$

0.80

 

 

$

0.01

 

 

$

1.78

 

 

$

(0.39

)

Tax rate adjustment

 

 

0.08

 

 

 

0.04

 

 

 

(0.00

)

 

 

0.12

 

 

 

0.12

 

Restructuring and termination costs

 

 

0.02

 

 

 

0.03

 

 

 

0.01

 

 

 

0.04

 

 

 

0.17

 

New strategy implementation

 

 

0.06

 

 

 

0.01

 

 

 

 

 

 

0.08

 

 

 

 

Adjusted diluted profit (loss) per ordinary share

 

$

1.14

 

 

$

0.88

 

 

$

0.02

 

 

$

2.02

 

 

$

(0.10

)