REG - RHI Magnesita N.V. - Trading Update

RHI Magnesita NVAnnouncement

10/11/2025 07:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20251110:nRSJ8392Ga&default-theme=true

RNS Number : 8392G  RHI Magnesita N.V.  10 November 2025

10(th) November 2025

RHI Magnesita N.V.

("RHI Magnesita" or "the Group")

 

TRADING UPDATE

Delivering in a challenging backdrop

 

RHI Magnesita, the leading global supplier of high-quality refractory
products, systems and solutions, today provides an update on trading for the
ten months ended 31 October 2025 (the "Period").  Given the strong
second-half weighting of earnings, this update covers the four months from
July to October 2025.

 

Trading

 

The Group delivered the expected improvement in performance over the four
months from July to October, in line with full-year guidance.

 

Adjusted EBITA for the four months was €136 million, representing a 12.7%
margin, significantly ahead of the run-rate in H1 2025 (six months ended 30
June 2025 of €141 million, 8.4% margin), despite the third quarter typically
being a seasonally weaker period due to northern hemisphere summer breaks.

 

Steel volumes for the period remained weak and broadly consistent with
full-year guidance, reflecting subdued but stable overall demand, with only
modest improvement compared to the first half. Demand for high-quality steel
for the automotive sector was particularly soft in western markets. The Group
saw growth in the Period in India, META (Middle East, Africa and Türkiye),
with European demand contracting further. Market share in India was
re-established during the Period, as expected.

 

The Industrial project order book has improved throughout the last months, in
line with guidance provided at the H1 2025 results, with clear visibility for
the remainder of 2025. High-margin industrial projects are however still at a
low point, with order volumes around 40% below recent years. The concentration
of industrial order delivery in H2 is caused by seasonality and customers
shifting orders.

 

The pricing environment remains highly competitive, particularly in markets
with overcapacity, such as China, and in regions heavily supplied by Chinese
exports, including India, East Asia and the Middle East.  Small price
increases were nevertheless achieved as our customers continue to value our
local-for-local supply, the value-creating 4PRO contracts and innovation
pipeline.

 

The Group's cost efficiency programmes remain solidly on track, with expected
SG&A reductions and fixed cost savings from two plant closures in Germany
in line with previous full-year guidance. These measures account for the vast
majority of the margin improvement in the Period.

 

Earnings growth from the former Resco plants is progressing well, with
integration advancing smoothly and synergies being delivered in line with
expectations. The integration is enabling the Group to generate enhanced
benefits from its North American footprint. US local-for-local production has
increased from 50% to 65% in 2025 and is expected to exceed 75% in H2 2026.
While increased US local production has mitigated the Group's overall tariff
exposure, more recent headwinds have emerged with tariffs on raw materials and
finished goods exported from Brazil to the US.

 

Backward integration margins remain near historical lows, at 1.1%
year-to-date, as a result of very low raw material pricing across most
categories. Further action around cost reduction and portfolio optimisation
are being implemented in the raw materials plants and mines to improve
earnings from backward integration stepwise over the next two years.

 

Financial Position

 

Working capital increased temporarily in the Period, to support delivery of
the stronger Q4 order book. The booked project deliveries in the remainder of
the year, together with the seasonal peak sales in the cement industry, will
enable the Group to de-lever during Q4 to approximately 3.0x by year-end.

 

Outlook

 

The Group remains on track to deliver the full-year Adjusted EBITA of
€370-390 million, supported by market share recovery in India and META,
executed management initiatives in cost reduction and the seasonal recovery
expected in China. The weak US Dollar and Indian Rupee continue to weigh on
reported financial performance.

 

The current industrial order book, in particular, underpins expectations that
the improved performance achieved in H2 2025 will continue into H1 2026, with
the modest pricing benefits retained. Nevertheless, end-markets demand
especially in the steel industry remains at a cyclical low, and a rapid
normalisation is not anticipated.

 

Global trade update:

·   The European Commission proposes cutting by almost half its tariff-free
steel import quota to support onshoring steel production volumes. While the
exact timing in 2026 is still uncertain, resultant higher steel production
in-region could stabilise refractory demand in Europe.

·   Brazil has officially launched an investigation into potential duty
protection for refractory materials. The outcome and timing is uncertain at
this point.

With strong market positions in both regions and a well-invested local
network, this could become a positive development for RHI Magnesita in late
2026 or 2027.

 

Stefan Borgas, Chief Executive Officer of RHI Magnesita, said:

 

"RHI Magnesita has delivered the expected step-up improvement through the
second half of 2025 by systematically implementing its self-help actions. This
is despite subdued demand conditions. The Group has successfully executed cost
reduction initiatives in all cost categories, progressed plant closures, and
captured synergies from the Resco acquisition. Market share in India has been
re-established, and modest pricing discipline has supported results despite
intense competition. I would like to thank the RHI Magnesita-team globally for
this outstanding operational performance. Looking ahead, our self-help actions
and innovation projects underpin confidence that the momentum from the second
half of 2025 will carry into the first half of 2026."

 

Conference Call

A conference call will be hosted at 8:15am UK time to discuss the trading
update:

 Dial in                        +44 20 3936 2999

                                +44 808 189 0158 (UK toll-free)
 Access code                     488947
 Webcast and playback facility  https://www.investis-live.com/rhimagnesita/68f9e645127f1e000e40ce22/ypkk

 

For further enquiries, please contact:

Alexander Ordosch, Head of Investor Relations

Tel +43 699 1870 6162

E‐mail: Alexander.Ordosch@rhimagnesita.com
(mailto:Alexander.Ordosch@rhimagnesita.com)

 

Media:

Hudson Sandler

Tel +44 020 7796 4133

E-mail: rhimagnesita@hudsonsandler.com (mailto:rhimagnesita@hudsonsandler.com)

 

About RHI Magnesita

RHI Magnesita is the leading global supplier of high-grade refractory
products, systems and solutions which are critical for high-temperature
processes exceeding 1,200°C in a wide range of industries, including steel,
cement, non-ferrous metals and glass. With a vertically integrated value
chain, from raw materials to refractory products and full performance-based
solutions, RHI Magnesita serves customers around the world, with over 20,000
employees in 65 main production sites (including raw material sites), 12
recycling facilities and more than 70 sales offices. RHI Magnesita intends to
leverage its leadership in terms of revenue, scale, product portfolio and
diversified geographic presence to target strategically those countries and
regions benefiting from more dynamic economic growth prospects.

RHI Magnesita offers investors EBITDA and free cash flow comparable to FTSE
100 peers, the highest free cash flow yield in the UK industrials sector, a
compelling M&A growth story and high operational gearing to market
recovery. The Group seeks to allocate capital to maximise value generation for
shareholders. After maintenance capex and dividend, M&A, organic
investments and buybacks compete for capital. The global refractory industry
remains fragmented and the M&A pipeline presents an opportunity to
continue a value-accretive consolidation strategy.

The Group is listed within the Equity Shares (Commercial Companies) category
("ESCC") of the Official List of the London Stock Exchange (symbol: RHIM) and
is a constituent of the FTSE 250 index, with a secondary listing on the Vienna
Stock Exchange (Wiener Börse). For more information please visit:
www.rhimagnesita.com

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTPKCBBCBDDPDK



            Copyright 2019 Regulatory News Service, all rights reserved