Aperam’s 3rd quarter 2020 results
by Hans Diederichs
Earnings improve on the back of tight cost control, flexible multi-product business in Brazil and some economic recovery in Europe
Aperam announced today results for the three months ending September 30, 2020.
Highlights
Health and Safety: LTI frequency rate of 2.2x in Q3 2020 compared to 0.6x in Q2 2020
Steel shipments of 432 thousand tonnes in Q3 2020, 15% increase compared to steel shipments of 376 thousand tonnes in Q2 2020
EBITDA of EUR 65 million in Q3 2020, compared to EUR 49 million in Q2 2020
Net income of EUR 24 million in Q3 2020, compared to EUR 21 million in Q2 2020
Basic earnings per share of EUR 0.30 in Q3 2020, compared to EUR 0.27 in Q2 2020
Cash flow from operations amounted to EUR 77 million in Q3 2020, compared to EUR 57 million in Q2 2020
Free cash flow before dividend of EUR 55 million in Q3 2020, compared to EUR 34 million in Q2 2020
Net financial debt of EUR 111 million as of September 30, 2020, compared to EUR 123 million as of June 30, 2020
Strategic initiatives
Leadership Journey®2 Phase 3: The annualized gains reached EUR 13 million in Q3 2020. Aperam realized cumulative annualized gains of EUR 184 million at the end of Q3 2020, compared to the target of EUR 200 million by the end of 2020
Leadership Journey® Phase 4: Target of EUR 150 million gains for the period 2021 - 2023 via a combination of cost, growth and mix improvement measures
Cash deployment
Share buyback program: Considering the remaining exceptional COVID related uncertainties, the Board of Directors has decided to cancel the 2020 share buyback program
Prospects
EBITDA in Q4 2020 is expected to increase versus Q3 2020
Net financial debt is expected to decline in Q4 2020
Timoteo Di Maulo, CEO of Aperam, commented:
"Business took a first step returning towards normalization in Q3 which we utilized as all our plants were fully operational. Our results improved due to a strict cost discipline across all segments, a flexible product mix management in Brazil and with higher volumes in Europe. Still, a challenging competitive environment persists combined with the threat of another COVID related slowdown and continued price pressure in Europe. Although we expect an improvement in Q4 some positive drivers might only prevail for the short term. We have used the crisis to sketch out phase 4 of our Leadership Journey(R)️ which will support and accelerate the recovery to a historic normal level."
Source: Aperam Photo: Fotolia