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Befesa Reports Q2 Results

Metal News - Published on Wed, 05 Aug 2020

Image Source: Befesa
European market leader for steel dust and aluminium salt slags recycling services Befesa SA reported Q2 EBITDA of EUR 22 million, representing a decrease of 41% compared to the previous year mainly as a result of COVID-19 pandemic pressuring metal prices. H1 EBITDA came in at EUR 55 million, down 31% compared to the previous year.

Main operational highlights in Q2:

Q2 steel dust throughput of 156 kt, up +5% YoY driven by Turkey expansion; Aluminium Salt Slags & SPL volume of 106 kt down 15% YoY due to lower demand from the automotive sector

Resilient plant utilization of around 80% in both core businesses, Steel Dust and Salt Slags

Zinc market prices averaged at €1,780/t in Q2 (down 28% YoY) and treatment charges settled at ~$300/t (~$245/t in 2019), resulting in a combined price decrease of 37% YoY

Aluminium alloy prices continue to be affected by lower demand, down 8% YoY to €1,282/t

Befesa’s expansion in China is progressing as expected. The construction works of both, the plant in Jiangsu and in Henan, are on track and expected to be completed on schedule by the beginning of 2021 and mid-2021, respectively. The long-term financing for the Jiangsu plant was successfully secured on 30 July and, similarly, Befesa is targeting the financing for Henan next.

Javier Molina, CEO of Befesa commented: “We anticipate the second quarter to be the weakest quarter in 2020 as we see signs of a moderate recovery. I’m confident that our strong balance sheet, high liquidity, and resilient business model will help us to navigate through the current environment. We expect our operational performance to improve as the economy starts to recover in the second half of the year. Meanwhile, we are making important progress with our expansion in China, which will set the foundation for accelerated volume and earnings growth in the coming years.”

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Posted By : Yogender Pancholi on Wed, 05 Aug 2020
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