Salzgitter shares drop 17% after cutting 2025 outlook, posting Q2 miss

Published 18/07/2025, 11:16
© Reuters.

Investing.com -- Salzgitter AG (ETR:SZGG) shares fell more than 17% on Friday after the German steelmaker issued a profit warning and lowered its full-year guidance, citing a lack of recovery in the second half of 2025.

The company reported preliminary second-quarter EBITDA of €38 million, well below Visible Alpha consensus and Morgan Stanley (NYSE:MS) estimates of €115 million to €116 million. 

Excluding a €23.5 million contribution from Aurubis, underlying EBITDA for the period was approximately €14 million. On a like-for-like basis, Morgan Stanley had estimated €99 million.

Salzgitter revised its 2025 EBITDA forecast to a range of €300 million to €400 million, down from its earlier range of €350 million to €550 million. 

The midpoint of the new guidance, €350 million, is 28% below consensus expectations of €484 million from Visible Alpha and €469 million from Morgan Stanley.

The guidance implies a near doubling of EBITDA in the second half of the year, which comes amid declining hot-rolled coil prices in Europe and seasonal weakness in the third quarter.

The company also narrowed its forecast for earnings before tax to between €-100 million and €0. 

This compares with its previous range of €-100 million to €+100 million. Morgan Stanley had projected €3 million, while the consensus estimate stood at €18 million.

Total (EPA:TTEF) cash needs for 2025 are estimated at approximately €1 billion, including €900 million in capital expenditures and €100 million in financing charges, according to Morgan Stanley. 

Based on the midpoint of Salzgitter’s guidance, the projected free cash flow to equity deficit exceeds €650 million for the year.

The company had forecast net debt of about €900 million for the second quarter, implying a net debt-to-EBITDA ratio of approximately 3 using the updated full-year guidance.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.