Ladies and gentlemen, welcome. Thank you for joining the live webcast. Ladies and gentlemen, welcome. Thank you for joining the live webcast of ElvalHalcor for the first quarter of 2025 trading update. Angelos Giazitzoglou, Deputy Chief Financial Officer of ElvalHalcor Group and I, Demetrios Rakintizis, Consolidation and IR Management, ElvalHalcor Group, are going to provide you with key insights for our performance. After the end of the presentation, we will conduct a Q&A session where you are welcome to ask any questions regarding our group and its financial performance. Now, let me walk you through the highlights of this quarter and give you a clearer picture of our operational and financial trajectory. We are pleased to report a solid start of the year with encouraging performance despite continued macroeconomic pressures. The group managed to increase sales volumes and enhance profitability.
In the day, sales volume rose to 148,000 tons, marking a 1.5% year-on-year increase. This was primarily driven by higher volumes in the packaging sector of the aluminum segment. Our operational profitability, as measured by the adjusted EBITDA that excludes any impact from metal results, demonstrated a substantial increase of EUR 50 million compared to the first quarter of 2024, reaching EUR 64 million, supported by the favorable sales mix and higher conversion prices. In their turn, earnings before tax stood at EUR 45 million and have also benefited from a positive metal result. Furthermore, our net debt position improved sharply, declining by EUR 95 million year-on-year. This, combined with our increased profitability, enabled us to maintain a net debt to adjusted EBITDA ratio below three, with a year-on-year improvement of 0.9 basis points to 2.7.
I will now turn the floor over to Mr. Angelos Giazitzoglou who will share his comments and provide further insights into our performance.
Thank you, Demetrios. I will proceed by reviewing some data that illustrate the environment in which we operated during first quarter of 2025, a snapshot of key indicators. In the first quarter of 2025, we experienced a jump in the energy prices in both metals, and that posed pressure in our working capital. Fortunately, this increase was followed by a correction to lower levels. Natural gas prices also had an uptrend, increasing our production costs. At the same time, interest rates continued to decline while inflation seemed to be stabilized slightly above 2%. All this depict a complex macroeconomic environment in the first quarter of 2025 compared to 2024. On our next slide, we have our cost breakdown, excluding, of course, metal costs. The change that had an impact on our costs came from the energy prices.
We saw on the previous slide the graph with the TTF index and the uptrend in prices. Electricity prices have also experienced an upward trend. Additionally, the significant increase in production volumes led to higher needs for energy consumption. As a result, the percentage of the energy in total costs rose to 17% from 13% in the respective quarter of 2024. Except for that, all other costs remained pretty much at the same levels as 2024, affected of course by inflation. Moving on to the next slide with our volumes per quarter. Volumes in the first quarter of 2025 stood higher compared to 2024 in total. The aluminum segment reported an increase of 3.1%, while the copper segment saw a slight decline of 2%. The strong recovery in flexible packaging was the key driver for this increase in aluminum.
In the copper segment, the industrial application saw a slight decline, while energy markets and construction performed better than in 2024. All of this was achieved despite markets still operating under challenging and uncertain conditions due to the ongoing geopolitical factors and tariffs imposed. The total performance is definitely positive. Now, about the adjusted EBITDA evolution per quarter. As mentioned earlier, operating profitability is significantly higher compared to the first quarter of 2024, reaching the amount of EUR 64 million. In the aluminum segment, this was driven by higher volumes and improved conversion prices. The copper segment saw a slight decline in profitability due to increased energy prices and lower volumes. The segment is shifting to a more profitable product mix that is expected to improve results in the coming months. Let's see now the adjusted EBITDA per ton.
In the aluminum segment, operating profitability per ton in the first quarter of 2025 is well above the respective quarter of 2024 to EUR 378 per ton. The main contributors to this recovery were higher prices achieved in various product categories. As previously mentioned, flexible packaging performed much better in the first quarter of 2024 in volumes and pricing. In a highly demanding and fully competitive economic environment, uncertainty poses pressure in the copper segment. Compared to the last two quarters of 2024, profitability has improved significantly and is currently at high levels, demonstrating resilience at EUR 554 per ton. Moving on to an analysis of our products per market. The extensive diversification of our product range across both segments is a key factor in mitigating risks associated with challenges in specific markets.
In the aluminum segment, 2025 shows a clear increase in volumes of packaging, mainly due to the increase we achieved in flexible packaging. In the copper segment, the allocation of our products is more balanced between markets like energy, building and construction, and industrial applications. In the first quarter, we saw a slight increase in construction, while other markets remain stable or with mixed signs. Diversification is our strength. Next, the geographical distribution. Our export-oriented model remains consistent, with no major changes during the first quarter of 2025. Europe remains the primary market, while the Greek market accounts for 5% of total sales. ElvalHalcor is leveraging the diversification in product categories and in regions to mitigate the risk from volatility and potential slowdowns in markets. Now, let's move to numbers.
A strong start for a year in terms of volumes with 148,000 tons, despite the challenging global environment, which was further strained by the announcement of U.S. tariffs. Strong performance in operating profitability, which increased by 30.8% compared to 2024, reaching the amount of EUR 64 million. Sales revenue rose 14% due to increased volumes and metal prices. Because metal prices were favorable, EBITDA got a huge boost and jumped to EUR 71 million, up by 58.3%. Moving to some more financial figures. Adjusted earnings before interest and taxes to EUR 47 million puts the profitability way ahead of 2024. The very good performance of the company is also reflected in earnings before interest and taxes, which reached the amount of EUR 54 million, including, of course, better results of EUR 7 million.
The reduction of net debt, supported by interest rate cuts, resulted in an improvement of financial costs by EUR 3 million compared to the first quarter of 2024. As a result, earnings before taxes skyrocketed by 209%, reaching the amount of EUR 45 million. Now, moving to the next slide, let's see how we bridge the two quarters in terms of earnings before tax result. This strong EBT performance wasn't just one thing, but a combination. The increase in sales attributed to improved packaging despite challenging conditions, resulted in an additional EUR 2 million. At this point, we navigated some headwinds from the markets pretty effectively. Higher conversion prices also led to improved profitability by EUR 16 million. Both segments are fabricating products with increased recycled content.
During the first quarter, we managed to increase the use of recycled materials, offsetting the pressure posed from the elevated prices in energy. Lower interest costs by EUR 3 million due to improved net debt, minus EUR 95 million year on year and lower interest rates. Maintaining financial discipline is crucial in the current environment, and we have successfully sustained momentum from the previous year in this area.
Finally, positive metal results of EUR 11 million enhanced profits to EUR 45 million. Now let's see our cash flow bridge. We started with a solid cash position from 2024 of EUR 80 million, and we added another EUR 71 million during the first quarter of 2025. Despite a EUR 72 million increase in working capital, we closed the quarter with EUR 68 million in cash. In the meantime, we paid EUR 6 million in interest, EUR 16 million for CapEx, and we financed with EUR 10 million working capital needs.
Now, let's talk about working capital and net debt. The increase in metal prices presenting challenges for managing working capital, which was higher than the previous year to EUR 610 million. We remain optimistic while maintaining a disciplined approach, recognizing that increasing production needs higher inventory levels for a period, and the start of the year is that period. The working capital to sales ratio shows minor change at 17%, slightly below the expected 24%. Is it sustainable? We believe it is, especially if metal prices keep having the stability they are showing the last two months. Net debt was significantly lower than the first quarter of 2024, down 14% to EUR 669 million.
The increase from the end of 2024 is also linked to metal prices and efforts to boost production and sales. The numbers show the financial health we are trying to craft in our balance sheet. Last slide about CapEx. CapEx for 2025 is on track to EUR 16 million, focused mainly on maintenance spending to ensure our assets in optimal condition, just keeping things running smoothly. Given the current global economic conditions, we are cautious with large investments. However, the company is closely monitoring international developments, exploring potential strategic opportunities. To summarize before we address any questions. The first quarter of 2025 represents a strong rebound for the company, significantly improving upon the performance of the respective period of 2024. The success was driven by the strong recovery in the packaging market within the aluminum division, higher volumes, improved pricing, and effective debt management.
While challenges persist in the global market due to geopolitical tensions and rising costs, the company's diversified product portfolio and different financial management are helping to mitigate these risks. The focus on maintenance CapEx and cautious approach to large investments reflect a realistic strategy in the current economic climate, while the company remains open to exploring new opportunities. Thank you for your attention. Now, Demetrios, we can proceed to the Q&A session.
Thank you, Angelos. Yes, I would like you to inform that you can place your questions in two different ways, either by raising your hand or by submitting in the Q&A tab, that are available on the, at the bottom of the screen. Angelos, I see that they have already some of them at least have some questions.
Yes. I can see them. I will start with Maria Kanakanaki. Good evening and congratulations on your good results. Two questions, please. Is the strong recovery trend in the packaging sector continuing into the second quarter as well? The second part is, have President Trump’s tariff announcements weakened demand from abroad in anticipation of the tariff situation clearing up? I will start with the second part of the questions that has to do with tariffs. We believe that eventually, in a trade war, there are no real winners. The company’s sales in this market remain unchanged. Till now, we have not seen any slowdown in terms of orders from our customers, and we continue to provide them according to our schedule.
What we have seen till now is that immediately after the announcement of tariffs, prices increased, with many industries in the U.S. have already reported this rise. In addition, we know that the local capacity cannot meet the needs of domestic consumption. What do we want to happen? We want markets to operate freely and according to the laws established through healthy competition. The answer is that, no, till now we have no negative implication. Business as usual for us in the U.S. Now, about the first question for quarter two. Let us celebrate first the results for the first quarter of 2025, and then we will see what happens in the second quarter. You know that we don't give any guidance. Please allow us to stay this way. Another question from Dimitrios Akoulis.
First quarter. I will translate also. Sorry. First quarter of 2025, net debt was EUR 669 million. That means that is increased compared to the end of 2024 by EUR 26 million. I thought that the net debt would be lower, more compared to 2024. What's the reason for that? As I said, the reason mainly was from increased prices in metal. That put some pressure in our working capital. The second part for from this increase was that because we also had a plan to increase our production volumes, we knew that we had to increase our inventories. Additional to that, we were expecting that we would have an increased working capital in the first quarter.
As a result of this, we had an increased net debt compared to the end of the year. We don't feel unconfident about this. We think that we believe and we know that we are monitoring both working capital and net debt. During the year you will see that we will keep to deliver better in this area. One more question from Maria Kanakanaki. Do you expect the profit margin from the use of scrap to diminish as metal prices de-escalate? The price volatility affects the company in many ways. Yes, that's true. The LME prices affect only the working capital and the net debt and probably the revenue, but not the profit.
At least not the operational profit that we like to examine and monitor. In terms of profit, it has to do more with the discount at which we purchase the recycled materials and the premiums that we have in the market, the premiums that we can pass on to our customers. The fact is that all this uncertainty creates some disruption in markets and probably will have some effect in our results. We believe that this will not be so critical. Okay, now from Mr. Akoulis. Thank you for your answer. Do you see a decrease of the net debt within the year? Yes, we expect to decrease it further.
I believe we have another question from Mr. Mantzis.
I cannot see that question.
I will. It's in the chat.
Okay. Sorry.
If you can just-
Okay. I will open the tab.
Yeah.
Yes. Thank you for the presentation. I have two questions. Can you comment on Sofia Med's performance in first quarter of 2025? How do you see pricing in aluminum segment in the remainder of the year? Starting from the second part of the question, again, I will have to answer that we don't give any guidance. Let's say that if we don't see something significant to happen in markets, I think that we keep at the same pace. Now, about Sofia Med performance. Sofia Med is very strong contributor to ElvalHalcor. It operates in markets with highly profitable products. We expect to keep on contributing to our profits. Again, Maria Kanakanaki.
Do you expect the defense industry budget to become a new source of revenue? Have any deals been discussed on your recent participation in the fair exhibition? Very nice question. Yes, we had presence in the fair, but I think it's too early to speak about any contracts or anything that has to do with this. Let me say that this project is of significant interest to us, to ElvalHalcor, especially following the recent announcements and the substantial funding that will be allocated. We already has an established presence in this market, offering both copper and aluminum solutions already. We have recently issued a press release highlighting our key presence and implementation in this area.
We have the know-how, we have the production capabilities, and we are very well positioned to pursue any active role in the future. Yes, we want to be part of this big project and we expect from Europe to help local industries and we will be there. Yeah. We are already there in defense, but we seek for a bigger role. Definitely this will improve our profitability, of course. I don't see any other question. Let's wait for a few moments. Maybe someone wants to ask something. Okay. Thank you very much for your attention. Now, Demetrios, we can close the webcast.
Yes. Thank you, Agule. I would like to thank you once more for your questions and for being here with us today. We are looking forward to seeing you again on our next webcast, for the first half of 2025 financial results in September. Until then, have a good afternoon to everyone, and see you again. Bye-bye, Angelos.
Bye.