GrafTech lowers FY23 sales volume to 95,000MT-105,000MT

The company said, “While we continue to move past the Monterrey suspension-driven impact on our sales volume, we expect demand for graphite electrodes in the second half of 2023 will be tempered by ongoing softness in the commercial environment. As a result, we now estimate our sales volume for the FY23 will be in the range of 95,000MT-105,000MT, as compared to our previous estimate of 100,000MT-115,000MT. Sales volume in the Q3 is expected to be broadly in line with sales volume for the Q2. We expect our 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. However, for the full year of 2023, we expect a significant year-over-year increase in our cash cost of goods sold per MT as 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 and reflecting the full-year impact of higher raw material costs that increased throughout 2022. We continue to closely manage our operating costs and capital expenditures, as well as our working capital levels. Looking ahead, we remain confident in our ability to overcome near-term challenges and are optimistic about the long-term outlook for our business. We anticipate 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. We also anticipate the demand for petroleum needle coke, the key raw material we use to produce graphite electrodes, to accelerate driven by its utilization in producing synthetic graphite for use in lithium-ion batteries for the growing electric vehicle market. We believe that the actions we are taking, supported by a distinct set of capabilities, including our substantial vertical integration into petroleum needle coke via our Seadrift facility, will optimally position GrafTech to benefit from these sustainable industry tailwinds.”