NYSE$EAF

GrafTech International Ltd. · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Achieved sequential improvement in key operating and financial metrics due to business recovery from the suspension of operations in Mexico.

GrafTech reported a net loss of $8 million, or $0.03 per share, with adjusted EBITDA of $26 million. Sales volume reached 26 thousand MT, and production volume was 25 thousand MT. The company extended its debt maturity profile by completing a private offering of $450 million senior secured notes due 2028.

  • Net loss of $8 million, or $0.03 per share.
  • Adjusted EBITDA of $26 million.
  • Sales volume of 26 thousand metric tons.
  • Production volume of 25 thousand metric tons.

Headline financials

Total Revenue

$186M

Previous: $364M-49.0%
EPS (adj)

-$0.02

Previous: $0.44-104.5%
Capital Expenditures

-$39.8M

Previous: -$29.3M-35.6%
Free Cash Flow

-$47.6M

Previous: $85.6M-155.6%
Net Income

-$7.85M

Previous: $115M-106.8%
Operating Income

$8.6M

Previous: $143M-94.0%
Gross Profit

$28.3M

Previous: $162M-82.5%
Cash & Equivalents

$132M

Previous: $55.8M+136.7%
Total Assets

$1.53B

Previous: $1.52B+0.6%
Stock-Based Comp

$1.39M

Previous: $573K+141.7%

Revenue & EPS history

GrafTech · Revenue · Quarterly

$186M

Q2 2023-49%vs Q2 2022
Beat estimate in 8 of 15 quarters(53%)
ActualEstimate

Forward guidance

Demand for graphite electrodes in the second half of 2023 will be tempered by ongoing softness in the commercial environment. Sales volume in the third quarter of 2023 is expected to be broadly in line with sales volume for the second quarter of 2023.

Tailwinds

  • The steel industry’s accelerating efforts to decarbonize will lead to increased adoption of the electric arc furnace method of steelmaking, driving long-term demand growth for graphite electrodes.
  • The demand for petroleum needle coke is expected to accelerate driven by its utilization in producing synthetic graphite for use in lithium-ion batteries for the growing electric vehicle market.
  • The company has substantial vertical integration into petroleum needle coke via their Seadrift facility, which will optimally position GrafTech to benefit from sustainable industry tailwinds.
  • Cash cost of goods sold per MT in the second half of 2023 will be below the level recognized for the first half of the year.
  • Company continues to closely manage operating costs, capital expenditures, and working capital levels.

Headwinds

  • Demand for graphite electrodes in the second half of 2023 will be tempered by ongoing softness in the commercial environment.
  • Sales volume for the full year of 2023 is estimated to be in the range of 95 thousand MT to 105 thousand MT, as compared to the previous estimate of 100 thousand MT to 115 thousand MT.
  • For the full year of 2023, a significant year-over-year increase in cash cost of goods sold per MT is expected.
  • Fixed costs are recognized over a smaller volume base.
  • Excess fixed costs that would have otherwise been inventoried are recognized when incurred due to reduced production levels.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

-4.0%

Avg return

Earnings day

-4.9%

Avg return

5 days after

-3.1%

Avg return

30 days after

39%

13 / 33 earnings

Positive

+14.3%

Q4 2020

Best reaction

-46.2%

Q4 2025

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-1.7%+11.2%+15.6%
Q4 2025-46.2%-51.7%-62.8%
Q3 2025-1.9%-24.7%-30.0%
Q1 2025+7.8%-3.1%+59.3%
Q4 2024-9.4%-31.5%-22.1%
Q3 2024+3.9%+2.4%-7.2%
Q2 2024-3.5%-8.9%-13.0%
Q1 2024+3.1%+3.7%+10.6%
Q4 2023+7.6%+5.3%+26.5%
Q3 2023-23.6%-28.9%-22.1%
Q2 2023-21.8%-15.7%-31.5%
Q1 2023-9.9%-14.0%-5.7%
Q4 2022-16.2%-17.9%-12.3%
Q3 2022-3.1%-10.5%+7.6%
Q2 2022-13.0%-11.6%-25.6%
Q1 2022-8.9%-13.0%-2.0%
Q4 2021-12.6%-8.0%-13.2%
Q3 2021+12.7%+11.4%+5.6%
Q2 2021-6.6%-0.3%-4.1%
Q1 2021-2.0%-6.2%-2.0%
Q4 2020+14.3%+20.4%+11.8%
Q3 2020-9.3%+0.3%+39.2%
Q2 2020+9.3%+9.3%+1.9%
Q1 2020-14.3%-14.8%+11.5%
Q4 2019-5.6%-5.4%-31.9%
Q3 2019+2.2%+8.6%-3.0%
Q2 2019-1.6%-5.3%+9.0%
Q1 2019+2.2%+6.7%-13.4%
Q4 2018+0.8%+7.6%-5.8%
Q3 2018-0.6%-4.3%-13.6%
Q2 2018+0.4%-2.5%-15.6%
Q4 2017+8.3%+14.0%+18.6%
Q1 2018+8.3%+14.0%+18.6%
Q3 2017
Q2 2017
Q4 2016
Q1 2017
Q3 2016
Q2 2016
Q1 2016
Q4 2015
Q3 2015
Q2 2015
Q1 2015
Q4 2014
Q3 2014
Q2 2014
Q1 2014
Q4 2013
Q3 2013
Q2 2013
Q1 2013
Q4 2012
Q3 2012
Q2 2012
Q1 2012
Q4 2011
Q3 2011
Q2 2011
Q1 2011
Q4 2010
Q3 2010
Q2 2010
Q1 2009
Q1 2010
Q4 2009
Q3 2009
Q3 2008
Q2 2009
Q4 2008
Q4 2007
Q2 2008

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