Core Viewpoint - Itafos Inc. reported strong operational performance in Q1 2025, with production volumes exceeding prior year levels and a revenue growth of 6% year-over-year despite higher input costs [2][5][6]. Financial Performance - Q1 2025 revenues reached $135.7 million, up from $128.0 million in Q1 2024, while adjusted EBITDA was $39.3 million compared to $43.2 million in the previous year [7]. - Net income for Q1 2025 was $35.9 million, an increase from $23.7 million in Q1 2024, primarily due to a gain on the sale of the Araxá project [6][7]. - Free cash flow improved to $31.3 million in Q1 2025 from $17.7 million in Q1 2024 [7]. Operational Highlights - The company achieved a significant milestone by reducing net debt to below $0, with net debt recorded at $(1.7) million as of March 31, 2025 [4][18]. - The company maintained a net leverage ratio of (0.0)x, indicating strong financial health [7][18]. - The successful closure of the Araxa project sale resulted in a gain of $27.9 million [10]. Market Outlook - Phosphate pricing experienced a slight decrease in Q1 2025 but is expected to remain strong through 2025 due to strong global demand and limited supply from evolving tariff policies [11][16]. - The company anticipates sales volumes of 340-360 thousand tonnes of P2O5 for FY 2025, with corporate selling, general and administrative expenses projected between $17-20 million [14][13]. Mine Development - Progress continues on the mine life extension program at Husky 1 / North Dry Ridge, with first ore shipments expected in the second half of 2025 [3][21]. - The company is focused on resource evaluation and permitting at Conda, with an expected annual cost of approximately $6-8 million for exploration activities [21][25]. Recent Developments - The company declared a special dividend of C$0.05 per share following the successful sale of the Araxá project [15]. - The company reported strong environmental, health, and safety performance, with no reportable incidents in Q1 2025 [20].

Financial Performance - Sales from continuing operations for Q1 2025 were $131.7 million, a slight increase of 0.4% compared to $131.2 million in Q1 2024 [3][7] - Adjusted EBITDA decreased to $2.3 million, representing a margin of 1.7%, down from $4.9 million and a margin of 3.7% in the same period last year [3][9] - The net loss from continuing operations was $4.0 million, compared to a loss of $1.8 million in Q1 2024 [3][10] - Cash flow from operating activities decreased to $6.2 million from $11.7 million in the prior year [3][11] Financial Position - As of March 22, 2025, net debt was reduced to $47.1 million from $47.8 million at the end of 2024 [3][12] - The financial leverage ratio increased to 2.8x from 2.4x [3][4] - Working capital decreased to $45.8 million from $50.3 million at the end of the previous fiscal year, attributed to seasonal effects [11][12] Market Dynamics - The growth in purchasing volume with distribution clients is helping the company gain market share despite a slowdown in the restaurant industry [5] - The renewal of a supply agreement with an institutional client at lower margins than in 2024 is impacting financial performance [8][9] - Wholesale activities sales decreased by 3.8%, primarily due to the slowdown in the restaurant industry [8] Strategic Initiatives - The company announced an agreement to acquire the food distribution assets of Alimplus Inc. and its subsidiary Tout-Prêt Inc. for $51.5 million, pending closing conditions [7] - Management is focusing on sound financial management and aims to improve product and customer mix to mitigate the impact of lower-margin contracts [13]

Q1 2025 Performance - Shipments reached 372 thousand tons, a decrease of 2% year-over-year[11] - Revenue totaled $2.0 billion, an increase of 5% year-over-year[11] - Net income was $38 million[11] - Adjusted EBITDA was $186 million, including a positive $46 million non-cash metal price lag impact and a negative $10 million impact from the Valais flood[11] - Free Cash Flow was $(3) million, which includes a negative $27 million impact at Valais due to the flood[11] - The company repurchased 1.4 million shares for $15 million[11] - Leverage ratio stood at 3.3x at the end of March 31, 2025[11] Segment Performance - Aerospace & Transportation segment Adjusted EBITDA was $75 million, a decrease of 14% year-over-year, with shipments of 51 thousand tons, down 11%[14] - Packaging & Automotive Rolled Products segment Adjusted EBITDA was $60 million, an increase of 25% year-over-year, with shipments of 269 thousand tons, up 2%[18] - Automotive Structures & Industry segment Adjusted EBITDA was $16 million, a decrease of 50% year-over-year, with shipments of 52 thousand tons, down 12%[21] 2025 Expectations - The company expects Free Cash Flow to be greater than $120 million[28] - Capital expenditures are projected to be approximately $330 million[28] - Cash interest expenses are estimated at around $120 million[28] - Cash taxes are expected to be approximately $40 million[28] Targets - 2025 Adjusted EBITDA is targeted between $600 million and $630 million[43] - 2028 Adjusted EBITDA is targeted at $900 million[43] - 2028 Free Cash Flow is targeted at $300 million[43]