| Over a week ago | ||||
BMO Capital takes over… BMO Capital takes over coverage of GrafTech with an unchanged rating of Market Perform and unchanged price target of $6.00. | ||||
| Over a month ago | ||||
GrafTech is down -15.7%,… GrafTech is down -15.7%, or -$1.03 to $5.55. | ||||
GrafTech is down -14.3%,… GrafTech is down -14.3%, or -94c to $5.65. | ||||
The company said,… The company said, "As we enter 2023, we anticipate continued soft demand for graphite electrodes due to ongoing economic uncertainty and geopolitical conflict. In addition, we expect the suspension of our operations in Monterrey, Mexico in late 2022 will have a significant impact on our sales volume for the first half of 2023. Although the facility has resumed production, the suspension resulted in uncertainty during a key commitment window for customer purchases covering the first six months of 2023. Reflecting these factors, we estimate our sales volume for the first six months of 2023 will be approximately half of the level reported in the same period of 2022, with the largest impact occurring in the first quarter. As we proceed into the second half of the year, we expect sales volume levels to recover, as we move past Monterrey suspension-driven uncertainty and anticipate that a gradual improvement in market conditions will strengthen demand for graphite electrodes. In 2023, we expect a significant year-over-year increase in our cost of goods sold per metric ton as fixed costs will be recognized over a smaller volume base and reflecting the full year impact of higher raw material costs that increased throughout 2022. In response, we are closely managing all of our operating costs and capital expenditures, as well as our working capital levels. Towards the end of the fourth quarter of 2022, we began proactively reducing production at our European graphite electrode manufacturing facilities, to align our production volume with our current demand outlook. Longer term, we remain confident that the steel industry's accelerating efforts to decarbonize will lead to increased adoption of the electric arc furnace method of steelmaking, driving long-term demand growth for graphite electrodes. We believe that the near-term actions we are taking, supported by an industry-leading position and our sustainable competitive advantages, will optimally position GrafTech to benefit from that long-term growth." | ||||
Reports Q4 revenue… Reports Q4 revenue $247.52M, consensus $221M. "Our year-over-year performance for the fourth quarter was impacted by higher costs, softer industry demand and the impact of the temporary suspension of our operations in Mexico," said Marcel Kessler, CEO and President. "As we announced in November, we are pleased to have reached an agreement that allowed for the restart of our Monterrey, Mexico facility. While our activities to ramp back up are proceeding according to plan, we expect the negative impact of the suspension, ongoing inflationary pressures and the effects of slowing global economic growth on our operating performance in 2023 will be significant, particularly in the first half of the year." "We remain disciplined in our approach to managing costs and allocating capital," saidKessler. "We are aligning our production to reflect current market demand while remaining focused on delivering excellent customer service and being highly responsive to customers' needs. As we look ahead, we have identified opportunities to make targeted investments to strengthen our strategic position, commercial capabilities and product offerings. Through execution of these cost actions and investments, we are confident GrafTech will successfully navigate the near-term environment and emerge well positioned to benefit from the anticipated long-term demand growth for graphite electrodes." | ||||
| Over a quarter ago | ||||
GrafTech is up 26.3%, or… GrafTech is up 26.3%, or $1.11 to $5.33. | ||||
GrafTech is up 16.1%, or… GrafTech is up 16.1%, or 68c to $4.90. | ||||
GrafTech is up 18.7%, or… GrafTech is up 18.7%, or 79c to $5.01. | ||||
GrafTech provided an… GrafTech provided an outlook, stating: "the current environment for the steel industry remains volatile with key markets, such as Europe, continuing to experience weakening demand as broader macroeconomic conditions deteriorate. Steel industry trends have also softened somewhat in the U.S., although the market remains comparatively healthy and more stable. As a result, we expect graphite electrode demand to remain soft in the fourth quarter of 2022 and into 2023 reflecting market dynamics, which continue to be dictated by geopolitical conflict and economic uncertainty. At the same time, as is the case for nearly all industries, costs remain elevated for raw materials, energy and logistics. Due to the current inflationary environment, we anticipate sequential cost increases to continue in 4Q22. In addition to the efforts to resolve the situation involving our Monterrey, Mexico facility, we are aligning operating and capital expenditures with the current environment as we remain committed to maintaining a strong balance sheet. Longer term, we remain confident that the steel industry's accelerating efforts to decarbonize will lead to increased adoption of the electric arc furnace method of steelmaking, driving long-term demand for graphite electrodes. The actions we are taking will optimally position GrafTech to benefit from that long-term growth. In addition, our vertical integration into petroleum needle coke production via our Seadrift facility is a critical differentiator from our competitors and foundational for our ability to reliably deliver high-quality graphite electrodes". | ||||
Reports Q3 revenue… Reports Q3 revenue $303.84M, consensus $351.5M. Reports Q3 sales volume of 36 thousand metric tons and production volume of 38 thousand MT. "Q3 results fell short of our expectations, reflecting near-term challenges in the operating environment," said CEO Marcel Kessler. "Ongoing geopolitical tensions and global economic uncertainty have softened near-term demand for steel and, therefore, graphite electrodes. This, combined with the current inflationary environment and the impact of the suspension of our operations in Mexico, led to declines in our key operating and financial metrics for the quarter. I am proud of our team as they are working tirelessly to navigate the current market uncertainties, while pursuing all options to ensure our operations in Mexico can resume as promptly as possible," said Mr. Kessler. "In addition, we are aligning operating and capital expenditures with the current environment as we remain committed to maintaining a strong balance sheet. We are confident that these actions, supported by an industry-leading position and our sustainable competitive advantages, will optimally position GrafTech to benefit from the long-term growth of the graphite electrode market and to deliver future shareholder value." | ||||
