Strong cash generation, operational discipline and structural cost savings offset weak demand and pricing pressure, supporting resilient margins and disciplined deleveraging in 2026.

A resilient financial performance – in line with expectations

Despite continued weak global industrial demand, increased Chinese exports and a soft pricing environment, RHI Magnesita delivered a performance in line with market guidance in 2025. This performance was driven by disciplined execution of management-led self-help measures and a strong second-half performance.

Adjusted EBITA reached €373 million, with an Adjusted EBITA margin of 11.1% (2024: 11.7%), reflecting pricing pressure and fixed cost underabsorption in the first half. Adjusted EPS decreased to €4.18 (2024: €5.32). Revenue amounted to €3.4 billion, down 3% year-on-year, or 1% on a constant currency basis, with sales volumes declining by 2%. Cash generation remained strong, with cash conversion of 105% (2024: 103%) and free cash flow of €214 million.

Following the completion of the €391 million acquisition of Resco in January 2025, net debt increased to €1.5 billion. The Group’s focus on de-leveraging during the year resulted in leverage of 2.9x Net Debt to Pro Forma Adjusted EBITDA at year end, ahead of guidance of 3.0x.

Watch the video with CEO Stefan Borgas and CFO Ian Botha about RHIM’s business performance in 2025:

Continued operational efficiencies and further strategic progress

Throughout 2025, RHI Magnesita executed cost-saving initiatives across operations, SG&A and plant network, delivering sustainable savings that largely offset weaker pricing and fixed cost underabsorption. The self-help measures implemented by management are structural and will deliver sustainable fixed cost savings, over temporary cost reductions, further supporting the Group’s resilience in years to come.

North America delivered strong revenue growth of 22% to €863 million, supported by the Resco acquisition, which contributed €184 million of revenue and €25 million of Adjusted EBITA over eleven months. Progression of the integration of Resco is on track and strengthens RHI Magnesita’s “local-for-local” production model in the strategically important US market.

Whilst M&A remains a key strategic pillar for RHI Magnesita, in the near term the Group’s operational focus is on integration, synergy realisation and deleveraging, ensuring value creation from recent transactions while maintaining disciplined capital allocation.

Expansion of 4PRO model and recycling performance enhance competitive positioning

The continued rollout of the 4PRO business model was an essential commercial driver in 2025. RHI Magnesita renewed long-term contracts with key customers and secured four new Green Steel contracts, while successfully expanding 4PRO into Industrial segments. By combining process optimisation, circular economy, technology and customer-centric services into a unique offering, 4PRO strengthens customer retention, supports value-based pricing and improves contract visibility.

Sustainability remains embedded in RHI Magnesita’s strategy with 2025 being marked by further innovation and expansion of the Company’s sustainable product offering. This continues to be an important commercial differentiator as customers in hard-to-abate industries seek solutions to help reduce their CO2 emissions. With a record recycling rate of 15.9% (2024: 14.2%), RHI Magnesita has exceeded its global target of 15%. Recycling continues to enhance margin resilience, reduce raw material dependency and support CO₂ reduction, reinforcing RHI Magnesita’s competitive positioning.

Outlook 2026: Focus on cash generation, synergy realisation and deleveraging

Market conditions are expected to remain challenging in 2026, with steel end-markets still at a cyclical low and no near-term demand recovery reflected in the order book. Despite this, RHI Magnesita remains focused on fully annualising structural cost savings and synergies from the Resco acquisition, maintaining strong cash generation, continued reduction in net debt and de-leveraging towards approximately 2.6x by year end, and exercising disciplined capital allocation. Through regionalisation, operational efficiency and continued progress in recycling and performance-based solutions, RHI Magnesita is strengthening its position. The Company continues to exercise cost discipline and a cash generative business model. RHI Magnesita retains substantial operating leverage into a potential market recovery.

Stefan Borgas, Chief Executive Officer, commented:

“Our relentless self-help driven turnaround measures delivered a strong and sustainable business performance increase in the second half against a very challenging market backdrop. While management was focused on the business performance turnaround, equally important strategic progress has been made. The Resco integration and synergy realisation are on track, recycling rates are up in almost all regions and our digital transformation is progressing well. Despite not yet foreseeing a major market tailwind yet, we expect our self-help measures and strategic progress to drive business performance and deliver further operational and financial improvements in 2026.

I want to thank all employees, customers, partners, and shareholders for their continued trust. With our enhanced global footprint, rigorous operational discipline, and clear strategic focus, we believe RHI Magnesita is forging a path for continued success despite persistent headwinds.”

The full unaudited results and investor presentation are available on the London Stock Exchange’s Regulatory News Service (RNS) and on our website at: RHI Magnesita | Regulatory News, Reports & Presentations

The post RHI Magnesita 2025 Full Year Results: Disciplined execution and strong H2 performance deliver resilient earnings in challenging market environment appeared first on RHI Magnesita.

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.”

For further enquiries, please contact:

Alexander Ordosch, Head of Investor Relations
Tel +43 699 1870 6162
E‐mail: Alexander.Ordosch@rhimagnesita.com 

Media:
Hudson Sandler
Tel +44 020 7796 4133
E-mail: 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 68 main production sites (including recycling facilities), 12 raw material sites 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

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Alexander has been with RHIM for many years and has already made a strong impact through his roles as Strategy Manager and European Plant Network & Restructuring Project Manager. In these roles, he successfully led major production network optimization initiatives across the European plant network, supported M&A and financial planning, and played a key role in advancing RHIM‘s Decarbonization Strategy.

Before joining RHI Magnesita, Alexander worked as a Commodity Analyst at CRU Group in London, where he focused on the European steel market. He holds a master’s degrees with distinction in Metals & Energy Finance (Imperial College London) and Economic Geology (Montanuniversität Leoben).

With his extensive experience, strong analytical skills, and strategic mindset, Alexander is well positioned to further develop RHI Magnesita’s investor relations activities and strengthen dialogue with stakeholders.

RHI Magnesita looks forward to working with Alexander in his new role and continuing to build strong and transparent relations with the investment community.

The post RHI Magnesita appoints new Head of Investor Relations appeared first on RHI Magnesita.

Steel demand stable, Industrial project deferrals weigh on H1 profitability

RHI Magnesita, the leading global supplier of high-grade refractory products, systems and solutions, today announces its unaudited results for the six months ended 30 June 2025.

Watch the video with CEO Stefan Borgas and CFO Ian Botha talking about the company’s H1 performance:

Financial performance reflects challenging market environment

Revenue declined by 3% to €1,677 million (H1 2024: €1,728 million), with volume and pricing pressure in the base business partly offset by the contribution from the recent Resco acquisition. Adjusted EBITA decreased to €141 million (H1 2024: €190 million), reflecting an 8.4% Adjusted EBITA margin, impacted by a less favourable product mix in Industrial business, reduced demand in the glass sector and postponement of investment decisions by non-ferrous metals customers amid global trade tensions and competitive pressure across key markets.

RHI Magnesita achieved a strong cash conversion despite a build-up of inventory in preparation to meet higher customer demand for the second half of the year. Net debt increased to €1,583 million following the completion of the Resco acquisition, resulting in a leverage ratio of 3.1x. Gearing is expected to reduce to approximately 2.8x by the 2025 year end.

Strategic acquisitions and network optimization

In January 2025, RHI Magnesita completed the €390 million acquisition of Resco, strengthening the company’s position in the North American refractory market. Resco contributed €90 million in revenue and €11 million in Adjusted EBITA during its first five months of consolidation. Integration is progressing well and trading in the US has remained resilient.

In June, RHI Magnesita agreed on a recycling joint venture with BPI, Inc., expanding its circular economy platform across North America. Significant cost and sustainability synergies are anticipated, based on the existing proven business model in Europe. Recycling of raw materials within US borders is expected to have increased relevance in a high tariff environment whilst using reclaimed refractory raw materials is also the fastest route for RHI Magnesita to reduce its CO₂ emissions, when compared to the use of newly mined raw materials. These developments build on RHI Magnesita’s long-term growth strategy, while near-term focus remains on integration, network optimisation, and deleveraging.

Sustainability and Safety

RHI Magnesita remains on track to meet or exceed its 2025 sustainability targets encompassing the areas of health and safety, CO2 emissions intensity, energy consumption and recycling. In parallel, RHI Magnesita has established new targets for 2030 under the CSRD framework. The group’s Ecovadis rating improved to 79 in 2025 (2024: 76), placing it among the top 3% of companies globally.

RHI Magnesita continues to be a leading technology partner for customers developing ‘green steel’ technologies, which have the potential to make a significant contribution to the reduction of CO₂ emissions globally due to the high emissions intensity of steel production.

Commenting on the results, Stefan Borgas, Chief Executive Officer of RHI Magnesita, said: “RHI Magnesita continues to navigate an extremely challenging external market environment with cyclically lower industrial project business, uncertainty caused by tariff negotiations, FX headwinds, aggressive competition and continued weak end market demand all contributing to sharply lower margins in the first half of 2025. Notwithstanding these external factors, we are disappointed with our financial performance and we are determined to take the urgent and necessary steps to deliver improvements. In the second half we expect market share gains in certain jurisdictions and improved margins based on actions we have already taken to secure Industrial project business, increase prices and reduce costs, including two European plant closures already executed. We reduce our outlook for full year Adjusted EBITA to be between €370 and €390 million, to account for the weaker than expected H1 2025 performance and FX. Our active M&A programme has resulted in an elevated gearing level of 3.1x EBITDA but we expect this to reduce over the course of the second half and 2026. We remain confident that our strategy to grow through M&A in the fragmented global refractory market is by far the best route to generate value for shareholders in a low growth environment, building on our existing strengths as an industry leader.”

Outlook for 2025

Market conditions remain challenging with end market demand weakness expected to continue into H2 2025. Steel refractory demand therefore remains low but a modest improvement is assumed in the second half based on the order book and normal seasonality. The highly competitive pricing environment is expected to continue but the group is targeting price increases for H2 on a selective basis.

In the Industrial business, the group now has greater confidence in project deliveries in H2, primarily for Non-ferrous metals customers.

H2 2025 Adjusted EBITA is expected to benefit from management action on price increases and cost reductions including plant closures, SG&A savings and fixed cost initiatives. Full year Adjusted EBITA is now expected to be in the range of €370 to €390 million, at an average margin of approximately 10.5 to 11%. Gearing is forecast to decline from its expected peak of 3.1x to around 2.8x by year end.

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.

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

For further inquiries, please contact: 

Abhijit Borah 
Head of Global Communications & Public Affairs 
Abhijit.borah@rhimagnesita.com
+43 699 1870 6728

The post RHI Magnesita 2025 Half Year Results: Responding to Market Headwinds with focused Strategic Actions appeared first on RHI Magnesita.

The strategic partnership combines RHI Magnesita’s (RHIM) global refractory expertise with BPI, Inc.’s (BPI) robust US infrastructure, local sourcing, and technical processing capabilities. This collaboration is set to create a powerful platform for innovation in circular raw material processing and recycling. It aims to significantly enhance the sustainability of the refractory industry, which is essential to the production processes for cement, steel, aluminum, and many other industrial producers in the North America region.

Key Highlights of the Joint Venture:

• Proximity to customers: with a combined 20 plant locations across PA, OH, MO, NC, AL, CA, IN, and Quebec, RHI Magnesita and BPI are strategically positioned close to customers, allowing for the delivery of locally sourced products and solutions, effectively shortening supply chains as a resilient partner.
• Enhanced portfolio: the combined companies possess technical and analytical services, expanded access to high-quality domestically sourced circular raw materials, and expert sales teams with a solutions-mindset, from raw materials to finished goods.
• Innovation & sustainability:advanced, in-house R&D teams will collaborate to explore and develop state-of-the art solutions that will improve safety, endurance and efficiency, while decreasing the collective carbon footprint.

The newly announced partnership represents an innovative move toward enhancing sustainable refractory while also providing a strategic platform for the sourcing of domestic refractory raw materials in North America.

Stefan Borgas, CEO RHI Magnesita, commented on the joint venture, “At RHI Magnesita, we are committed to leading the way in sustainability and innovation. This partnership with BPI, Inc. is a testament to our dedication to creating a more sustainable future and advancing our circular economy strategy. By joining forces, we strengthen our ability to turn spent materials into future value, setting an example of how innovation and collaboration can drive real progress for our customers, our business, and the planet.”

Joe Quigley, BPI President, also shared, “At BPI, we are committed to providing high-quality mineral products. Partnering with RHIM will expand our portfolio and enhance our efforts to offer circular solutions. We are excited about the progress our combined companies will achieve for a better future.”

The joint venture is subject to customary closing conditions and is expected to be completed in H2 2025.

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.

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

About BPI, Inc.

BPI, Inc. is an U.S.-based leader in mineral processing, including refractory raw materials and specialty mineral products, serving the steel, foundry, aluminum, and cement industries. With advanced processing facilities and a strong focus on sustainability, BPI, Inc. is at the forefront of innovation in material recovery and recycling and is a trusted partner to its customers. BPI operates 7 recycling facilities, 1 office and in-house R&D lab across 4 states, including PA, OH, AL and IN with approximately 100 employees.

The post RHI Magnesita and BPI, Inc. Announce Strategic Joint Venture to Accelerate Circular Economy Initiatives in North America appeared first on RHI Magnesita.

Downside risks to the 2025 trading outlook have increased, driven by a weak outlook for H1 performance and rising global trade tensions, which could negatively affect the Group’s end markets.

Q1 trading

First quarter trading conditions became more challenging, reflecting lower sales volumes, a continued decline in project business in the glass and non-ferrous metals sectors worldwide and lower pricing for cement and steel markets in India and the Middle East.

EBITA margins in the first quarter were lower, as expected, impacted by a combination of lower volumes in high-margin project business, weaker finished goods pricing and higher cost of purchased raw material.

Reflecting the demand backdrop, the Group continues to operate its plants at lower levels of capacity utilisation compared to Q4 2024, with fixed cost under-absorption further weighing on margins. As part of its ongoing Network Optimisation Programme (“NOP”), the Group has announced the closure of its Wetro plant in Germany. Alongside the NOP, management has initiated additional cost saving measures targeting both Cost of Goods Sold and Selling, General & Administration expenses.

In response to higher unit costs, a price increase programme is being implemented to restore margins over the remainder of the year, although securing increases is likely to be more challenging in the current market environment. In particular, India and West Asia markets are experiencing elevated competitive pressure from low-cost imports of refractories from China and overcapacity that has been built in India recently by international and domestic refractory competitors, impacting both margins and sales volumes.

Financial position

As expected, net debt increased to €1.6 billion as at 31 March 2025, primarily due to the completion of the Resco acquisition and the payment of the remaining €346 million of cash proceeds. This was partially funded by a new €200 million syndicated term loan.

Working capital rose modestly, in line with expectations of increased sales in Q2. Guidance for year-end working capital intensity remains at c.24%, excluding any potential impact from global supply chain disruptions stemming from tariff changes.

Following the payment related to the Resco acquisition, gearing – measured as the ratio of net debt to Pro Forma Adjusted EBITDA – is expected to be c.2.9x at the half year, above the Group’s target range of 2.0 to c.2.5x. Gearing is anticipated to reduce through the second half and, based on current earnings and cash flow expectations, would return towards c.2.5x by year end.

Strategic developments

RHI Magnesita pursues a local for local production strategy and benefits from vertical integration in key raw materials. This provides some protection against potential adverse transactional impacts arising from tariffs, compared to other industry participants who rely on imported raw materials from third party producers.

The Group’s growth strategy is primarily focused on M&A. In Q1, the Group completed the planned €391 million acquisition of Resco, marking a significant strategic milestone in strengthening its presence in the North American market. A key benefit of the Resco transaction is the opportunity to increase domestic US production of many products which are currently imported to the US. However, the relocation and ramp-up of production to fully capture these benefits will take approximately 18 months, in line with normal industrial capacity projects.

Outlook

First quarter trading conditions were weaker as expected, with a reduction in both revenues and margins in the period. Performance is expected to improve in the second quarter based on the current order book as cost saving initiatives support profits somewhat. With the benefits of price and cost actions weighted towards the latter part of the year, the first half is now expected to contribute 35-40% of full-year Adjusted EBITA, with 60-65% weighted to the second half, also supported by Non-ferrous Metals project volumes postponed from H1.

Whilst the current order book still could allow delivery of full year guidance for Adjusted EBITA to be modestly ahead of 2024 including Resco, the Group is mindful of the elevated risk posed by current macroeconomic volatility. This could impact end market demand and customer production volumes with the additional possibility of instability in global supply chains. The weaker US dollar will also impact earnings from the North America region in euro terms and if the current exchange rate is maintained for the remainder of 2025 this would represent a c.€15 million incremental headwind to Adjusted EBITA.

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

“RHI Magnesita continues to navigate difficult market conditions as end markets and customer production volumes remain subdued and as industrial projects are being postponed into the second half of the year. New uncertainties surrounding global trade and tariff arrangements are adding complexity to our planning processes and risk of further project postponements. We have implemented measures to support margins by reducing costs and executing price increases as well as progressing more structural drivers including production network optimisation and the realisation of synergies from recent acquisitions. Guidance for 2025 Adjusted EBITA to be modestly ahead of 2024 is maintained, although downside risks have increased and a step up in profitability in the second half will be required to meet expectations.”

Conference call

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

AGM

Further to the Notice of Meeting issued on 27 March 2025, the Company will hold its Annual General Meeting (“AGM”) today at 14:00 CET. Voting results from the AGM will be made available shortly after the meeting.

For further enquiries, please contact:

Chris Bucknall, Head of Investor Relations
Tel +43 699 1870 6490
E‐mail: chris.bucknall@rhimagnesita.com   

Media:

Hudson Sandler
Andrew Hayes
Tel +44 020 7796 4133
E-mail: rhimagnesita@hudsonsandler.com

The post Q1 2025 TRADING UPDATE appeared first on RHI Magnesita.

RHI Magnesita, the leading global supplier of high-grade refractory products, systems and solutions, today announces its final results for the year ended 31 December 2024.

Despite very difficult market conditions, which put pressure on sales volumes (down 1% in the base business), and pricing (down 6%), RHI Magnesita delivered a strong operational and financial performance thanks to its sustained focus on operational efficiency and cost discipline. Despite the falling price environment, the company delivered stable Adjusted EBITA of €407 million (2023: €409 million) and improved its Adjusted EBITA margin to 11.7% (2023: 11.4%). Adjusted EPS increased to €5.32 (2023: €4.98) and strong cash generation of 103% contributed to a €52 million reduction in net debt to €1,251 million. Gearing remained stable at 2.3x (2023: 2.3x), in line with the company’s target range.

Strategic Acquisitions Delivering Value

M&A delivered a strong contribution to overall financial performance in 2024, with the six acquisitions completed in 2023 generating €77 million in Adjusted EBITDA, in line with the company’s guidance of c.€80 million.

In 2024, the company further expanded its recycling capabilities in Europe with the €5 million acquisition of Refrattari Trezzi. The acquired business has been integrated into RHI Magnesita’s MIRECO joint venture, increasing the Group’s share in MIRECO to 55% (2023: 51%).

In January 2025, RHI Magnesita successfully completed the €391 million acquisition of US-based Resco Group, bringing the total value of M&A transactions since December 2021 to €1.2 billion. This acquisition marks a major step in expanding the company’s presence in the high value North American market and advancing its ‘local for local’ production strategy, with significant production now being transferred to the US.

RHI Magnesita remains committed to M&A as a long-term growth driver but in 2025 the Group’s focus will primarily be on integrating the current acquisition and gradually reducing gearing levels.

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

“RHI Magnesita has delivered another resilient financial performance despite very weak market demand in most markets around the world. At €407 million, Adjusted EBITA was within our guidance range of €400-€410 million, reflecting the expected strong performance in the fourth quarter. We continue to prioritise safety above all and this is a core value for us.

We have now completed the Resco transaction, the largest single acquisition we have undertaken since the combination of RHI and Magnesita in 2017. In our US business we can finally fulfil our customers’ requests for significantly higher local production. Investments into the enlarged production network are being prepared in detail by our merged team in the USA. Total restructuring costs of €60 million and capital expenditure of €40 million are planned over the period 2025-27, to deliver €10 million of EBITA benefit in 2025, €20 million in 2026 and €30 million per annum thereafter. Our strategy to grow through acquisition in the fragmented refractory industry, building on our strengths as a technology and sustainability leader, is proving to be the best approach to generating value for shareholders. We will continue to manage the business conservatively throughout the ongoing downturn in demand whilst delivering on our strategic objectives to generate long term value.”

Outlook for 2025

The global refractory industry remains in flux, with no signs of immediate recovery in end markets. China’s economic transition continues to impact supply chains and pricing dynamics. Growth in India and East Asia is healthy, and demand for future-oriented materials like copper, aluminum, and glass remains robust in the long term. At the same time, market reduction in the western economies seems structural and possibly permanent.

RHI Magnesita is expecting another year of decline accentuated by pricing and cost pressure. Despite the challenging macro environment, the company will defend its position as market leader by leveraging its operational efficiency, vertical integration, and expanded customer base. 

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.

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

For further inquiries, please contact: 

Abhijit Borah 
Head of Global Communications & Public Affairs 
Abhijit.borah@rhimagnesita.com
+43 699 1870 6728 

Joseph Waldstein
Global Public Relations
Joseph.waldstein@rhimagnesita.com
+43 699 1870 6106

The post RHI Magnesita 2024 Full Year Results: Strong Margin and Cash Flow Performance in Very Difficult Market Conditions appeared first on RHI Magnesita.

RHI Magnesita is pleased to announce the completion of the acquisition of the US-based Resco Group, from an affiliate of Balmoral Funds LLC, a Los Angeles-based private equity firm, and management. The acquisition, for an enterprise value of $410 million (c.€390 million), is the most significant investment by the Group since the merger of RHI and Magnesita in 2017.

A milestone acquisition in North America

The deal marks a major milestone for RHI Magnesita as it focuses on delivering an exceptional customer experience in the important North American region. RHIM’s refractory products are essential to the production processes for cement, steel, aluminium, and many other industrial producers in the region. The addition of Resco Group to the Company’s North American operations will significantly increase local-for-local production, improving supply chain security for critical industries that underpin the economy of the continent.

Elevating customer experience through an enlarged offering

The acquisition will deliver a broad range of benefits to customers, including:

• A significantly enhanced product portfolio: offering a wider range of basic and non-basic products, with applications across multiple industries. The addition of Resco Group will support RHI Magnesita’s strategic growth trajectory in alumina-based refractories.
• Supply security: an increased focus on local-for-local production will result in a reduced reliance on international imports for US customers.
• Improved responsiveness: the combination of RHI Magnesita’s global manufacturing capabilities and an improved local-for-local production footprint will drive logistical efficiencies and enhanced supply chain agility for shorter lead times.
• Sustainability advancements: Resco customers will benefit from RHI Magnesita’s industry leadership in innovation and sustainability as well as circular economy solutions, to support broader industrial decarbonization efforts. RHI Magnesita’s advanced recycling initiatives in particular will play a key role in reducing waste by converting used refractory materials into reusable raw materials.
• Industry expertise: supported by RHI Magnesita’s global leading expertise, Resco Group and RHIM will continue to pioneer new industry standards for the North American region.

Over the coming weeks and months, RHI Magnesita will focus on integrating teams, processes, technology, and resources to ensure a seamless transition and maintain business continuity for the combined entity’s suppliers, customers and other stakeholders. As part of the integration of the networks, RHI Magnesita will also invest into Resco’s plants to further upgrade them, increase capacities, introduce new product lines and improve overall productivity.

Stefan Borgas, CEO of RHI Magnesita, commented:

“The acquisition of Resco marks a significant milestone for RHI Magnesita as we continue to expand our offering in North America, responding to our customers’ evolving priorities while setting the highest industry standards. This deal will deliver a step change for our North American business as we continue to enhance local-for-local production and expand our product offering. Resco is a profitable and cash flow generative business with a strong customer base in the North American petrochemical, cement, and aluminium industries that will immediately add value to RHI Magnesita.

I would like to extend a warm welcome to our new colleagues from Resco. A business is nothing without its people, and the excellent reputation of Resco and its strong performance to date are testament to the hard work of these expert and dedicated professionals. They will join a collaborative international team, working alongside colleagues across the globe to benefit from a diversity of skills, experience, and exceptional career development opportunities at RHI Magnesita. Together, I am confident that we will continue to set new industry standards.” 

Mark Essig, CEO of Resco from 2022 until the sale, commented:

“This transaction marks an exciting new chapter for Resco and our employees. Over our 78-year history, we have built a strong reputation for delivering high-quality refractory products and technical solutions to our customers. Joining RHI Magnesita will allow us to further enhance our capabilities and expand our reach while maintaining our commitment to excellence in customer service. We are grateful for Balmoral Funds’ support during their ownership, which helped strengthen our market position, and we look forward to continuing our growth trajectory as part of RHI Magnesita’s global platform.”

Media:

Abhijit Borah, Head of Corporate Communications & Public Affairs
Tel +43 699 1870 6728
E-mail: Abhijit.Borah@RHIMagnesita.com

Hudson Sandler
Tel +44 020 7796 4133
E-mail: 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 67 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.

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

About Resco

Resco is a producer of shaped and unshaped refractories, including products for use in the petrochemical, cement, aluminium, and steel-making industries. Resco operates seven plants and two raw material sites in the US and two plants in the UK and Canada. Resco’s Rescobond and Rescocast brands are widely used in refining and petrochemical applications by global customers.

Resco recorded unaudited revenues of $252 million in the year to 31 December 2023, with Profit before Tax of $20 million and had Gross Assets of $191 million at 31 December 2023.

About Balmoral Funds

Balmoral is a Los Angeles, CA based private equity fund that was founded in 2005. Balmoral’s objective is to be the financial partner of choice for entrepreneurial and successful C-suite executives and operating advisors creating transformative outcomes in the businesses they co-invest in together. Balmoral has approximately $1.3 billion of assets under management. Balmoral typically invests in companies that have revenues between $30 to $500 million and require equity investments of $10 to $120 million, with the capability of doing more in particularly compelling opportunities.

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A shared vision for transformation

The partnership aims to enhance efficiency, scalability, and customer focus through an integrated Global Shared Services (GSS) model, leveraging Capgemini’s leading expertise in advanced technology and global process design.

“Our partnership with Capgemini is key for achieving the levels of efficiency, innovation and customer service we aspire to,” said Ian Botha, CFO of RHI Magnesita. “Capgemini brings global expertise in process design and transformation. This will help us streamline our shared services operations, adopt best practices and introduce advanced technology and digital solutions, ensuring consistency and scalability across all operations.”

The partnership makes it possible for RHI Magnesita to focus on its core business functions and supports its culture of innovation. For Capgemini, the collaboration is a testament to its capability to drive transformation in industrial manufacturing, further strengthening its leadership in the sector.

One Team Approach to drive success together

At the heart of this partnership lies a commitment to collaboration and inclusivity. By adopting a One Team approach, this seamless integration ensures continuity and opens new opportunities for learning, innovation, and professional development. Employees will benefit from Capgemini’s cutting-edge technologies, best-in-class tools, and a broader network of expertise. This focus on personal growth ensures that the partnership drives not only organizational success but also individual career advancement. “Capgemini is proud to partner with RHI Magnesita in this strategic transformation,” said Dorota Góral-Abram, Head of Southern and Central Europe, Capgemini’s Business Services. “Together, we will deliver a new level of operational excellence, efficiency, and growth.”

The partnership officially commenced on December 1, 2024, with the transition of RHI Magnesita’s Shared Services Operations in Spain, Mexico, India, and China.This move is the first step in a multi-year journey to fully integrate and optimize the Shared Services model of RHI Magnesita. The partnership is expected to drive significant value for both organizations while setting new benchmarks for excellence in the industrial manufacturing sector.

Hear more about the partnership from CEO Stefan Borgas, CFO Ian Botha, Head of Global Business Services Aneta van den Kieboom and Dorota Góral-Abram,  Head of Southern and Central Europe, Capgemini’s Business Services.

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This year has been dubbed “the year of elections”.  By the end of 2024, 64 countries will have or have had new governments or administrations including the EU, US, Japan, UK, France and India. Businesses worldwide are anticipating what the possible policy changes will be and will mean for them. Especially critical industries could become crucial for an economic recovery.

The world has changed

To fully understand the challenges, we must recognize the geo-political disruptions have changed the world. From our global perspective at RHI Magnesita we clearly see that a series of shocks – including the pandemic, regional wars, the rise of protectionism measures on climate change and immigration – have collectively battered long-established supply chains and global trade networks. The industrial sector, especially heavy and basic industry in most global economies has been in stagnation for more than two years; a recovery is not at sight. Service and IT sectors cannot in the long-term balance out the industrial stagnation or even downturn. A prolonged, much more uncertain environment is testing the way we plan and manage global businesses. The global economy of the past 40 years is no more; industries must be prepared to find new answers and solutions.

The mission-critical refractories industry is feeling this seismic shift keenly. Alarm bells should ring with policymakers and industry leaders around the world, if this industry were to suffer materially. 

Refractories are highly engineered materials designed to withstand very high temperatures well in excess of 1,200° C. They coat the inside of blast furnaces, crucibles and kilns which produce steel, aluminium, cement, glass, chemicals and many other materials that make-up the building blocks of modern societies. They are a very small part of the cost base but completely essential to the industrials sector which is the backbone of economic growth.

The continuing demand downturn and its impact

Another year that started with hopefulness for the refractory industry has taken a turn in recent months. Continuing poor macro-economic conditions, new economic policy measures and trade barriers have resulted in a market downturn in almost every geography due to the downturn of user industries. Even regions such as India, Southeast Asia and the Middle East, which we had anticipated to be “bright spots”, have also shown signs of short-term demand weakness.

Western economies are experiencing an industrial recession due to shrinking demand from the construction, transport and machinery sectors. The structural reduction of the industrial sector in China, the largest consumer and producer of metals, glass and cement, has led to an imbalance in world trade. The country is going through a deep structural shift from a supply-driven economy to a demand driven economy – this is painful, it will take time, and it will cost a lot of money, patience and adjusting – for the Chinese as well as for the entire world. Low domestic consumption has accelerated Chinese steel, metals, glass, and refractory exports, which cannot be easily absorbed due to low demand in destination economies.

Some analysts and commentators do not forecast any improvement in the demand situation for at least the next 12-18 months. This would then result in more than three years of continued downturn or industrial recession. Others are even beginning to question whether demand will ever return to prior levels.

The global demand downturn is further complicated by the recent increase in sea freight costs, transit times and reduced freight reliability arising from the Red Sea crisis, low water levels in the Panama Canal and port congestions. Rising bauxite and alumina prices due to a supply shortage for example, have resulted in cost inflations of alumina-based products, to reflect the higher cost of raw materials. The same is about to happen in magnesite based raw materials too. Developed markets continue to face the incremental challenge of labor cost inflation which is still not being absorbed.

With raw materials making up ca. 70% of total cost of goods, we must pass these inflationary cost increases on to our customers to reasonably protect our already thin margins. Industry-wide, capital expenditure and innovation efforts are already at a dangerous minimum.

The repercussions of a widespread closure of unprofitable refractories plants or production lines could be severe. If, and when, the turning point for an economic recovery comes, world leaders will be bitterly disappointed if steelmakers are hamstrung by shrunken refractories supply capability. So, one would assume that the issues impacting the future of the refractories industry would be high on policymakers’ agendas. Yet still, the refractories industry – the essential ingredient for making our cars, houses, plastics, even paper – does not have the public attention it justifies.

In Europe, Ursula von der Leyen’s new EU Commission announced in September signaled a commitment to reinvigorate Europe’s industrial strategy, but this will be futile if the needs of the refractories industry aren’t taken into account.

For example, RHI Magnesita is calling for a review of the Critical Raw Materials Act to include high-purity magnesia and dolomite, two key refractories precursor minerals, to ensure that refractories production in Europe remains financially viable and innovation continues.

The refractory overcapacity

But as politicians change and policies get modified, I also encourage our industry to help itself:

We today have a self-inflicted overcapacity problem which must no longer go unaddressed. A number of major producers have been progressively building out new greenfield plants in a flat, no-growth industry with pricing challenges. We estimate that excess capacity is running at some 40% above demand and, shockingly, growing. For example, India alone is seeing an addition of almost 300 kt of new greenfield capacity in the next 2-3 years. Reasonable growth of customer demand in India has led to a frensy race for new capacities by many refractory players in India jointly producing very large overcapacity. How rational is this in the context of the macro challenges outside of our industry’s control? RHI Magnesita has been pursuing growth via an M&A strategy while focusing on bringing new innovations and greener production methods to the industry.

Decarbonization needs policy support

Value-add instead of old-style mass production must become a priority. Innovations including refractories recycling or refractory life extension through digital data usage must become more widespread to improve the sustainability of our product and help our customers improve theirs. The opportunity if we focus on innovation is still there.

The Governments and policy makers can help here as well. Within RHI Magnesita’s own sustainability agenda we have ambitions to take a lead on hydrogen adoption and carbon capture and utilization – neither of which will be possible without policy intervention to support new technologies, risk capital to allow first-mover industrial installations, as well as new infrastructure that will benefit a wider industrial decarbonization journey and help the industrial sector to grow again.

Refractories are an overlooked ‘critical’ global industry, a facilitator of the building blocks of modern society. Today, macro crises have led us to a highly challenging juncture. It is essential that we adapt quickly to help power a global economic recovery, and for this we need horizontal and vertical private sector collaboration and public sector recognition, support and engagement.

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