GrafTech International(US:EAF)2025-04-25 15:00Financial Data and Key Metrics Changes - The company reported a net loss of $39 million or $0.15 per share for Q1 2025, with adjusted EBITDA at negative $4 million compared to flat adjusted EBITDA in Q1 2024 [32] - Cash COGS per metric ton was approximately $3,650 for Q1 2025, reflecting a 21% year-over-year reduction [34] - Total liquidity at the end of Q1 2025 was $421 million, consisting of $214 million in cash and $107 million available under the revolving credit facility [36] Business Line Data and Key Metrics Changes - Sales volume increased by 2% year-over-year in Q1 2025, with a total of 25,000 metric tons sold [27] - The average selling price for Q1 2025 was $4,100 per metric ton, representing a 20% year-over-year decline [28] - Sales volume in the U.S. grew by nearly 25% year-over-year in Q1 2025, significantly increasing market share [10][27] Market Data and Key Metrics Changes - Global steel production outside of China was approximately 209 million tons in Q1 2025, slightly below the previous year [24] - U.S. steel production saw a 1% reduction in Q1 2025, while EU steel output decreased by 3% year-to-date [25] - The capacity utilization rate for the company was 63%, a more than 500 basis point increase from the prior year [26] Company Strategy and Development Direction - The company is focused on increasing sales volume, regaining market share, and improving financial performance through strategic initiatives [6][8] - A key goal is to grow volume and market share in the U.S., which is the highest-priced region in the industry [9] - The company plans to increase prices by 15% on uncommitted volumes for 2025 to restore pricing and profitability levels [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that current market conditions remain challenging, but expressed optimism about future opportunities [7] - The company is well-positioned to capitalize on potential recovery in the EU market due to supportive policy changes and infrastructure investments [39] - Management emphasized the importance of a healthy graphite electrode industry for the steel industry and the need for pricing improvements [8][10] Other Important Information - The company has made significant strides in reducing costs, achieving a 23% year-over-year reduction in cash COGS per metric ton in 2024 [13] - The company is actively assessing global trade policies and tariffs to mitigate potential impacts on its business [14][18] - The company maintains a strong focus on safety, achieving a reduction in total recordable incident rates [23] Q&A Session Summary Question: Impact of tariffs on U.S. market pricing - Management noted that tariffs on Indian materials could significantly impact their availability in the U.S. market, potentially benefiting the company [46][47] Question: Market share recovery and growth potential - Management indicated that they are ahead of previous market share levels and expect continued growth throughout the year [47][49] Question: Sales percentage from U.S. and Western Europe - Management confirmed that over 50% of sales now come from the U.S. and Western Europe combined [54] Question: Pricing acceptance for the 15% increase - Management expressed optimism about customer acceptance of the price increase, emphasizing the importance of their value proposition [58][60] Question: Long-term outlook for steel utilization rates - Management remains cautiously optimistic about steel utilization rates, citing potential opportunities for growth despite current uncertainties [68][70] Question: Pricing guidance for electrodes and needle coke - Management indicated that while there is uncertainty, they expect some price stability and potential increases in both needle coke and electrode pricing [75][76]