NYSE$EAF

GrafTech International Ltd. · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

Third quarter results reflected near-term challenges in the operating environment.

GrafTech's third quarter results fell short of expectations due to geopolitical tensions, global economic uncertainty, and the suspension of operations in Mexico. Net sales were $304 million, a 13% decrease compared to the same period in 2021. Net income was $93 million, or $0.36 per share, compared to $120 million, or $0.45 per share, in the third quarter of 2021.

  • Net income of $93 million
  • Earnings per share of $0.36 and adjusted EPS of $0.37
  • Adjusted EBITDA of $129 million, for a 42% adjusted EBITDA margin
  • Sales volume of 36 thousand metric tons

Headline financials

Total Revenue

$304M

Previous: $347M-12.5%
EPS (adj)

$0.37

Previous: $0.45-17.8%
Capital Expenditures

-$45.3M

Previous: -$40.4M-12.0%
Free Cash Flow

$48.2M

Previous: $79.5M-39.4%
Net Income

$93.5M

Previous: $120M-22.1%
Operating Income

$114M

Previous: $157M-27.4%
Gross Profit

$134M

Previous: $177M-24.5%
Cash & Equivalents

$109M

Previous: $86.7M+26.2%
Total Assets

$1.57B

Previous: $1.39B+12.5%
Stock-Based Comp

$628K

Previous: $262K+139.7%

Revenue & EPS history

GrafTech · Revenue · Quarterly

$304M

Q3 2022-12.5%vs Q3 2021
Beat estimate in 8 of 15 quarters(53%)
ActualEstimate

Forward guidance

GrafTech expects graphite electrode demand to remain soft in the fourth quarter of 2022 and into 2023, reflecting market dynamics that are dictated by geopolitical conflict and economic uncertainty. The company anticipates sequential cost increases to continue in the fourth quarter of 2022 due to the current inflationary environment.

Tailwinds

  • Steel industry’s accelerating efforts to decarbonize will lead to increased adoption of the electric arc furnace method of steelmaking, driving long-term demand for graphite electrodes.
  • Vertical integration into petroleum needle coke production via our Seadrift facility is a critical differentiator from our competitors
  • Vertical integration into petroleum needle coke production via our Seadrift facility is foundational for our ability to reliably deliver high-quality graphite electrodes.

Headwinds

  • The current environment for the steel industry remains volatile with key markets, such as Europe, continuing to experience weakening demand as broader macroeconomic conditions deteriorate.
  • Steel industry trends have also softened somewhat in the U.S.
  • Graphite electrode demand to remain soft in the fourth quarter of 2022 and into 2023 reflecting market dynamics, which continue to be dictated by geopolitical conflict and economic uncertainty.
  • Costs remain elevated for raw materials, energy and logistics.
  • Anticipate sequential cost increases to continue in the fourth quarter of 2022.

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 Q3 2022

Historical avgQ3 2022

-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
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Q4 2016
Q1 2017
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Q4 2014
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Q4 2013
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Q1 2012
Q4 2011
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Q1 2011
Q4 2010
Q3 2010
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Q1 2009
Q1 2010
Q4 2009
Q3 2009
Q3 2008
Q2 2009
Q4 2008
Q4 2007
Q2 2008

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