GrafTech sees FY25 CapEx $40M

The company said, “Geopolitical uncertainty, particularly as it relates to global trade and tariffs, continues to have a significant impact on broader steel industry trends. In the U.S., where the steel industry has experienced relative stability, steel production is expected to increase further in the near-term, supported by favorable domestic trade policies. In the European Union, where the steel industry has been relatively challenged, we are beginning to see signs of a potential recovery. These include industry analysts projecting steel demand growth in 2026 within the European Union, with steel production in Europe expected to be further supported by recently announced trade protections. As we closely monitor these developments and assess their potential impact on the commercial environment for graphite electrodes, we continue to expect full-year 2025 demand for graphite electrodes will remain relatively flat in most of the regions in which we operate. For GrafTech (EAF), we now expect to achieve an 8%-10% year-over-year increase in our sales volume for 2025 on a full-year basis, as we continue to gain market share reflecting our compelling customer value proposition and our ongoing focus on delivering on the needs of our customers. The modest change from our previous guidance of a 10% year-over-year increase in sales volume reflects our disciplined approach of foregoing volume opportunities where margins are unacceptably low. As it relates to price, challenging pricing dynamics have persisted in most regions and the pricing environment remains unsustainably low. As a result, we continue to execute actions to accelerate our path to normalized levels of profitability while the market recovers and support our ability to invest in our business. These include initiatives to optimize our order book and actively shift the geographic mix of our sales volume to regions where there is an opportunity to capture higher average selling prices, particularly in the United States. In response to our revised sales volume outlook, we have implemented additional measures to enhance the efficiency of our production schedules and further optimize production costs. As a result, we now expect an approximate 10% year-over-year decline in our cash cost of goods sold per MT for 2025 on a full-year basis, exceeding our previous guidance of a 7-9% decline compared to 2024. Regarding the impact of tariffs, we believe we are well-positioned to minimize the potential impacts imposed by current trade policies, reflecting our integrated and global production network that provides us manufacturing flexibility along with proactive measures we have taken across our supply chain. In addition, we will continue to closely manage our working capital levels and capital expenditures. For 2025, we continue to expect the net impact of working capital will be favorable to our full year cash flow performance. We also continue to anticipate our FY25 capital expenditures will be approximately $40M. Longer term, we remain confident that the steel industry’s 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 near-term actions we are taking, supported by an industry-leading position and our sustainable competitive advantages, including our substantial vertical integration into petroleum needle coke via our Seadrift facility, will optimally position GrafTech to benefit from that long-term growth.”