Ladies and gentlemen, welcome to the first half of the 2025 Results Presentation Conference call. I am Serge, the Chorus Call operator. I would like to remind you that all participants will be in a listen-only mode and the conference is being recorded. The presentation will be followed by a question-and-answer session. You can register for questions at any time by pressing star and then one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. The forecasts, plans, future-related assessments, and statements contained in this presentation were made on the basis of all information available to AMAG up to 14 July 2025. The economic and trade policy environment has changed several times in recent weeks. Internal calculations, earnings, and lines are based on various assumptions.
These include, among other things, the continuous validity of global U.S. import tariffs on aluminium products. If the assumptions underlying the forecast do not materialize, targets are not achieved, or risks arise, actual earnings may differ from those currently anticipated. We assume no obligation to update such forecasts in light of new information or future events. This presentation has been prepared with the greatest possible care and the data has been checked. However, rounding, transmission, or printing errors cannot be ruled out. AMAG and its representatives accept no liability for the completeness or accuracy of the information contained in this presentation. This presentation is also available in German, whereby the German version shall prevail in case of doubt. This presentation do not constitute a recommendation or invitation to buy or sell securities of AMAG .
At this time, it's my pleasure to hand over to Christoph Gabriel, Head of Investor Relations. Please go ahead.
Good morning, ladies and gentlemen, and welcome to our conference call for the first half of 2025. Today we have Helmut Kaufmann, CEO, Claudia Trampitsch, CFO, as well as Victor Breguncci, CSO, who will present the development and results of the first six months of this year. As usual, after the presentation, you have the opportunity to ask questions during the Q&A session. I would now like to hand over to Helmut. Please start the presentation. Thank you.
Good morning, ladies and gentlemen. From our side, I would like to start with the financial highlights on slide number three. Once again, we can say that our broad setup, especially our broad product portfolio, as well as our regional activities, combined with flexibility, helped us to achieve a solid half-year result in a difficult environment. The H1 2025 result reflects, and we can say, as expected, the negative impact of the trade policy, especially U.S. tariffs. This negative impact was visible, especially in Q2 of this year. Despite that, our revenues grew by 11.1% to EUR 786.2 million as a result, especially of the higher aluminum prices and increased shipment volumes compared to the same period of last year, where we were able to achieve EUR 707.7 million revenues. EBITDA reached a level of EUR 80.6 million, and this was increasingly affected by U.S.
tariffs and higher energy, raw material, and personnel costs, and is down by 15.4% compared to last year's period, where we achieved EUR 95.3 million. Net income after taxes reached EUR 23.4 million and is 29.9% down to the last year's first half of 2024. The cash flow from operating activities of EUR 76.2 million was roughly the same as in the previous year, where we achieved EUR 75.7 million. The EBITDA range that we provided last time was slightly adjusted from now EUR 110 million to EUR 130 million as a result of the market conditions, especially. Details on financials will be provided by my colleague, Claudia Trampitsch, later on. Let me move on to slide number four.
We would say, from our point of view, the most important positive highlight in this first half here was the MOU agreement for our contract for a future power contract for our smelter participation at Alouette in Canada. This is so important because it secures a profitable continuation of this smelter, and we can say for the next 20 years seen from today. As you know, Alouette has been an integral part of the AMAG group and AMAG positioning over the past 30 years. This agreement that was basically signed between the Alouette company, the Government of Quebec in Canada, as well as the energy supplier Hydro-Québec, is agreed to provide an energy of 1,085 MW , covers 100% of today's requirement of electricity power, and enables slight future growth. Today's contract expires end of 2029. The new contract starts January 1, 2030, and continues for 15 years to 2045.
As already mentioned, this secures and enables long-term planning and is very essential for future investment in this activity to produce primary metal there. The electricity price depends on aluminum price as well as Midwest Premium. It is a risk-sharing contract. This creates competitive conditions for AMAG and partners at this Alouette smelter. Let us move on to slide number five. We always told you that the aircraft industry is important for us, and it is important for us how our main customers see us. We are very proud to say that for the fourth time in a row, AMAG managed to get the top rating at the Airbus SKID program. This is a supplier quality program. I think it is unique that for four times in a row, we received this highest award.
We are happy to say that we were able to get the so-called win-win cooperation award of the Chinese manufacturer COMAC because it is also important for AMAG to spread the customer, to widen the customer base in the aerospace industry. On slide number six, we continue to be active in the area of sustainability. We did commission a new preheating station for the supply of liquid metal for foundries. We are a producer of recycling foundry alloys in Ranshofen. What is special about this equipment, this is so to say to make AMAG casting fit for the future. This new equipment is already suitable also for natural gas or hydrogen operation, which might be required in the near future to reduce the CO2 emissions at the location in Austria.
Finally, I would like to announce that we, again, are listed in the Phoenix Sustainability Index in Austria, and we have been listed since 2014 continuously. With this short introduction, I would like to hand over to my colleague, Victor Breguncci, who will tell you now about market achievements in the first half.
Thank you very much, Helmut. Good morning, everyone, from my side. If we move forward to page eight, we see the traditional sentence indicator that we always present. As this is no surprise to all of us, it remains very uncertain where we stand. There are plenty of reasons in the market today that make us believe it can remain a little bit longer in that direction. It remains true, the global sentiment, eurozone, to our qualitative renovations. We see signs of improvement in each economy, especially seeing Spain, a very positive growth. Europe as a whole has been very much impacted manufacturing-wise. Besides the geopolitical discussions we're having, it will be a topic going further. Before we go into our shipments, it is important to look in page nine that the fundamentals have remained unchanged.
The demand for aluminum, according to the Commodity Research Unit that we always use as a reference, remains stable and positive in the future. When we look from 2010 to 2024 and 2025, we see a steep increase in demand for primary aluminum. We see this trend remains unchanged for the next five years. When you go into roll products, we see a steep increase driven especially by the transport and packaging industry, where aluminization, as we say, has been happening. We've seen that the geopolitical and all the discussions we're having are impacting on how this product portfolio and how the customer matrix has impacted us in the first six months.
In page 10, we bring also some statistics reconfirming what I just said before: transport and packaging driving the whole demand for aluminum, roll products, and the mechanical engineering also being a strong focus on the first six months of this year, given the shift into the product mix. On page 11, we have a little bit more numbers on shipments. We show, compared to 2024, an increase of 3% in our top line, especially driven by the rolling division. The metal impact has remained stable.
Rolling, we see a growth that we normally captured into the industrial segments, which is an area where we saw, based on our product portfolio flexibility, the capability of our staff in Ranshofen to shift from one segment to the other, the adjustments into the demands from our traditional OEMs in automotive and aerospace, given the dilemmas and challenges in the supply chain, we're able to adjust our capacity in a very quick way and capture opportunities in the industrial market. I see this with a lot of effort and capabilities in our mills that we're able to not only capture this very important demand from the industrial, but also given the capability to put a real ramp up of the automotive, the grazing, and the aerospace sector when this demand comes back in fruition.
With a little bit more detail on page 11, page 12, we see what happened in all the segments compared to 2024, first half. In automotive and aerospace, we see a little bit of a retraction, not driven by demand, but driven by the supply chain dilemmas that we see today in aerospace, but also in automotive, given the uncertainty that we have in our OEM customers. We see the top of this trend in industrial, 10,000 tons more compared to 2024. Also in packaging, where we have almost 2.3 thousand tons more, which is adjusting our capacity to fit what the market needs. We have volume-wise a very good first six months. We have challenging markets in realization of our margins because of these mixed changes. As you can see in page 13, we're navigating the turbulent waters with stable order intake.
In Q1 and Q2, we have the same level of order intake, but still remains a lot of uncertainties. What could be the impact in Q3 and Q4, depending on what the tariff scenario brings, not only directly business to us in North America, but also indirect with regards to our customers in Europe and Asia, given the whole communication of the market because of that reality. I try to end with a positive feeling for the first six months. I transition now to my colleague, Claudia Trampitsch, who's going to bring us to the numbers side of the equation. Thank you very much.
Thank you. Good morning from my side as well. Before I go in detail with our results of the first six months, 2025, I want to give you some information on the developments of market prices. First of all, the aluminum price, which you see on page 15, rose around 6% compared to last year. This has an impact on our sales in the metal division. When you go to page 16, this is perhaps the more relevant development we can see now, the development of the U.S. Midwest Premium. As you can see on this page, due to the announcement of the U.S. tariffs this year, we saw three big increases in the U.S. Midwest Premium. One was in February, which I talked about last quarter, where we already had the announcement of 25% tariffs for aluminum shipped to the U.S.
The second one was the announcement of the 50% tariffs, which we saw in May. Thereof, you see on the one hand that we had an increase in the Midwest Premium, but what we also see is that this doesn't reflect completely the costs we are facing because of these duties. What we also can say out of this page is that before May and March 2025, Canada had an exemption of the sectoral tariff, which were 10% at these times. This profit or benefit we had until then now is not there anymore. We are negatively affected by the U.S. tariffs. This we will then see later on in our results. A positive development we can see when you go to page 17 on the aluminum price. Last year, it skyrocketed in some kind due to shortages on the bauxite and aluminum production sites. Now it is stable.
Especially for Q2 2025 onwards, we can see this now in our results that our aluminum price and the costs we have in our P&L decreased on that side. In the first half of the year 2025, our costs are still higher on that side than it was last year. Now let's move on to the revenues of our group. As my colleagues pointed out before, we had a growth. We had a growth tonnage-wise. At the end, we also had a growth on the price side. In total, our revenues went up from EUR 707.7 million up to EUR 786.2 million. They increased with 11%. What are the reasons for that? The main reason is, as I told you before, the aluminum price went up. When we had the main increase, you can see the EUR 51 million due to this price increase.
The second one, as my colleague said before, we had an increase in volume and mix on the rolling side, especially. Therefore, we had also here an increase on our revenues. Let me move on to page 19, where you see the EBITDA of AMAG Group. Here you can see that despite the revenue increases we could show you before, at the EBITDA level, we could not see this. We cannot see the same increase because of costs due to personnel costs, energy costs, raw material costs, and the effects of the U.S. tariffs affecting our results. To an extent, we at the end have a lower EBITDA than last year. We went down perhaps 15% from EUR 95.3 million to EUR 80.6 million. When you look at the reconciliation, here are the main reasons. We already talked before. You see the effect of the aluminum price.
You see the prices premiums went down. This is, as we already talked before, one hand effect on the metal side, but especially on the rolling side due to the product mix we had in the first half of this year. When we look at the EBITDA change by division for the Metal Division, you see the biggest effect at the Metal Division. This is really due to the higher aluminum costs that we had in the first half of 2025 compared to the first half of 2024. As I said before, the high prices we faced last year at the end of last year are now reflected in our costs. The Casting Division is affected by the market environment in the automotive industry and the high energy costs as well.
You can also see that we had a lower EBITDA on the rolling sides for the reason I mentioned before. Even more, when we look at the EBITDA of Q2 2025, which you can find on the next page, it's even more evident that all the market development, which we talked before and which we saw in the market prices, combined with increased costs and U.S. tariffs, leads to a lower EBITDA for the second quarter 2025 compared to 2024, even though we also had a higher revenue in the second quarter. Here, you really can see that due to the U.S. tariffs and the increased price pressure, we had a lower EBITDA than last year. A positive effect you can negatively affect, you also can see here is still the raw materials and energy is affecting the EBITDA.
Nevertheless, the aluminum price is at the moment going back and will get a better effect in the future. When we look at our net income after taxes, there's nothing in particular to say about it. It's also lower than last year, affected by depreciation, financial results, and income taxes. All these things, there's nothing extraordinary in it. It's just the development for us, normal development. When we look at the cash flow, you can see that we had an increase in our operating cash flow. It's quite stable at the end. What we can show you is that we had an investing cash flow that is significantly lower than last year. Here, you also can see that we are flexible, and we are at the moment looking at every position there to go with our investment accordingly to our operating results and activities.
What I also can tell you is that we are doing that quite thoroughly so that we have our plants at the best condition needed. Therefore, at the end, for the free cash flow, you see an increase with benefits from our work we do on the working capital side and on-farm investment side. When I now move on to page 25 to give you some information on our balance sheet figures, I can tell you that despite all the negative effects we talked before, we still at the end have a stable and solid and good result for the first half of the year. This is also reflected in our net financial debt and also in our balance sheet equity ratios and so on.
The effects we saw on the financial debt side are mainly due to some repayments of debts that we paid this quarter and some smaller other effects. At the end, nothing special or extraordinary. The net debt EBITDA ratio is mainly determined by the lower EBITDA we had this half of compared to the last half of the year. The same is true for our equity, which remains stable and is not 1% less than at the end of the year. Also on the cash and cash equivalent side, we see that there is a little downside on the cash and cash equivalent, but this is due to refinancing activities where we had our borrowings already last year. On the following pages, you see the information for each division, but I will not go through all of this.
As I already told you, the main reasons for the development of our EBITDA beforehand. Let me move on to our last slide. I will present you with this about our ESG key figures. There you can see that I point out the first one, which is the scrap utilization rate. Even though we had a changing product mix, which always can affect this number, we are still on a high level and have an even higher utilization rate than compared to last year. I think when you look at everything else, these are stable numbers. I finally want to point out our exit rate, which is very low, which is a good sign for us. Now I want to hand over to Helmut to give us some information about the outlook 2025.
Thank you. I move on to slide 32. With all the explanation given by my colleagues, I think it's fair to say that we can expect a difficult, a challenging economic environment for this second half of 2025. Volatility will remain. We know that there are lots of political negotiations underway, but this might change daily. With all our outlooks that we did, we assume that it continues the way it is at the moment. This looks for the metal division. As Claudia explained, it's, of course, strongly dependent on the price development for aluminium, the premiums, as well as raw materials. The influence of the expired tariff exemption for Canada was already explained. This does have a negative impact on our results. We have to stay flexible in terms of the region of delivery of our product.
More or less on a daily basis, our colleagues judge whether we should deliver into the U.S. or bring the primary metal to Europe. For the casting division, we expect a weak demand from the automotive industry. Casting foundry alloys are a local business, a local difficulties for the automotive industry here in Europe. For the rolling division, Victor nicely explained the shift in product mix with our usual specialties, automotive, aircraft, forwards, bracing materials. Being under pressure, we were able to shift to other areas, especially industrial application and packaging. Nevertheless, this will remain difficult in the second half, and region's earnings compared to last year are expected. In total, this made us reduce our upper limit for the EBITDA range compared to our last announcement. Therefore, we forecast an EBITDA range between EUR 110 million to EUR 130 million as a result of these changed conditions on the market.
We have to say, unfortunately, this high uncertainty concerning the U.S. tariffs remains. This will have a major impact because the 50% were not really influencing the first half of this year. Thank you very much. We are now all ready to answer questions.
Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star followed by one on the telephone. You will hear a tone to confirm that you have entered the queue. If you wish to move yourself from the question queue, you may press star and two. Questioners on the phone are requested to say the last week's most by asking a question. Anyone who has a question may press star and one at this time. You have the first question coming from the line of Christian Ostheim Baader Bank. Please go ahead.
Yes, good morning. Thank you. I have two questions. First, in one of your last sentences, you said that it's more complicated in the second half to shift from auto, airlines, or aircraft business to other business. Can you give us more detail why this shift is more complicated in the second half and what has driven this kind of possibility in the first half and what changed then into the second half? The second one is looking at Airbus, especially, I think the development is not that bad. Why is the current situation that difficult and why should it not improve going forward? Thank you.
Good. Thank you very much. Let me just go into the shift from aero from auto and grazing into industrial. We can use within flex the team. We can flex the organization to produce. When you're talking about specialties, you're talking about things that are unique and very much relevant to specific customers. When we try to bring this capacity into a market that has a dependence on markets where I cannot drive this, this is in the end, this is a commodity. When you have a 50% tariff on a product that is close to a commodity level, there is no kind of room of negotiation that I can bring this forward. In the end, when you have a market that has overcapacity globally for flexible products, you cannot simply bring your product forward in this reality.
I'm trying to tell you in a very "make the truth," as we could say, this is not possible, right? Second, in the aero, the supply chain to produce an airplane depends on all the parts that go into an airplane. Raw material is not a problem. If you look at the whole supply chain for aluminum, steel, titanium today, I think the main OEMs have orchestrated that demand. There are difficulties in the supply chain and inventory that prevent the build rates to go at the speed rate that they wanted to. There are expectations that this will increase starting now in the second half of 2025, beginning of 2026. You cannot forget that the demand from the raw material always has a lag, you can say, between 10 to 12 months.
There is inventory that can cover for this ramp up, and it will then for sure accommodate the growth that might come early in 2026 or middle of 2026. There are elements that are away from specific demand because demand for airplanes remains stable. Backlogs are huge. It's not a matter of demand. It's a matter of having the supply chain deliver what they need.
Okay. Very good. I have another question concerning the person that calls. Having in mind maybe that the overall tariffs, maybe they're stickler than 50% or whatsoever, and volatility remains, a little bit further going forward, that the entire framework might not change dramatically over the coming months and quarters. Have you any plan to take some special initiatives on the personal cost side?
We are not so sure if we acoustically, if we really were able to catch. Can you please repeat the final question?
Yeah, okay. Very easily. Have you any plans to maybe reduce the cost base on the personnel cost side because of the ongoing uncertainty and volatility in the markets?
Honestly speaking, we are always controlling our cost. We do have an internal program, which we call Challenge 25, which keeps costs within the limits that we set ourselves. Honestly, we did this in the past. In German, we say if you're far enough fish, so we, of course, do not grow our personnel. We look at adjustment accordingly. At the same time, especially in operations, flexibility that we need on the market needs that we keep all our equipment running. It's not so easy to just switch off a piece of equipment because then this and reduce the staff there. This automatically means that we would go out of this business area. Flexibility is super important in this environment.
Okay, thank you very much and all the best.
Yeah, thank you too.
As a reminder, if you wish to register for questions, please press star four one. We have the next question coming from the line of Patrick Steiner from Oddo BHF . Please go ahead.
Good morning. Patrick Steiner speaking from Oddo BHF . I had some technical issues since the beginning of the call. Could you therefore, please give us a bit more color on the impact of declining aluminium prices on the second half of 2025 in the light of the pressing material since issue?
We are now at the aluminum price level, let's say, of around 14%. If you compare this with the highest range percentage we had at the end of 2024, where we were around 28-30%, it almost doubled. We will see a decline on this side as well in the second half of 2025. On the other hand, the second half will also be the one where we will really see the impact of the 50% tariffs as well. This has two sides at the end. If the Midwest Premium Zone covered a 50% increase, a tariff as an increase in the Midwest Premium, then we will see a development in the other direction. We will see an impact on that in the raw material cost for sure in the second half.
Okay. Perfect. Thanks.
The next question comes from the line of Michael Marschallinger from Erste Group. Please go ahead.
Yes. Good morning, everybody. Just one question from my side. I'm on slide 16, the U.S. premium development. Not a strong increase now from $400 to $150. This does not really seem sustainable. Could you maybe give us some color of what you're seeing? How this premium is impacting the U.S. aluminum market? If the 50% are going to stay, is that really a sustainable environment? Could you maybe comment on that, please?
You're right. When you see the increase in the premium, you see it's really the increase is big. When you look, you can also look at the U.S. Midwest Premium duty unpaid. When you deduct the duties, you would see that it decreases. Putting into account, you have to pay the tariff. It would be lower than before. That shows that the U.S. market has not so much demand or had already inventories before that they are using now at the moment. I think it's not normally on the commodity side. It's easier to say if there is demand or not. Here, you also have the inventories and you have perhaps also the, you can see the impact in the lower demand on the end customer side as well, and therefore a lower demand for rolling mills and so on in the U.S.
Is it sustainable to have 50% tariffs and what's the effect on that? I can tell you that I would like to know that as well because it's something that has a very big impact on our side. You can't know because as this is something that comes, was it political decision? It only can get away with decisions or agreements on the political side. Therefore, it's difficult from an economic point of view as a company to see if how long it will stay or not. That's nothing we can evaluate or say something about.
Okay, understood. Thank you.
There are no more questions at this time. I would now like to turn the conference back over to Christoph Gabriel for any closing remarks.
Thanks to all of you for attending this call. As always, I am pleased and happy to answer any further questions. In that case, I invite you politely to just give me a call or write me an email. Thanks a lot and have a wonderful Thursday.
Thank you very much.
Thank you, good night.
Thank you.
Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your line. Good bye.