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Investing.com -- Befesa SA (ETR:BFSA) on Wednesday reported second-quarter results that were in line with expectations, with sales declining but earnings holding steady due to favorable pricing.
The company’s revenue fell 9% year-over-year to €293 million in the second quarter, primarily due to maintenance shutdowns and volume declines.
However, adjusted EBITDA increased 4% to €56.8 million, matching consensus estimates of €57 million. The EBITDA margin improved to 19.4% from 17.0% in the same period last year and 18.1% in the first quarter of 2025.
In the steel dust segment, revenues decreased 13% year-over-year as electric arc furnace (EAF) volumes fell 11% and waelz oxide (WOX) sold declined 5%.
Despite these volume challenges, the segment’s adjusted EBITDA rose 5% to €47 million, with margins expanding to 25.0% from 20.7% last year, supported by record-low treatment charges and favorable hedging prices.
The salt slag business posted a 10% revenue increase to €30 million, with EBITDA growing 6% to €9 million.
Meanwhile, the secondary aluminum segment continued to face pressure from weak automotive end-markets, with revenue dropping 8% to €86 million and EBITDA falling 45% to €0.6 million.
Befesa’s earnings per share jumped to €0.53 from €0.26 in the prior year. Operating cash flow was €30 million, down 46% year-over-year, while free cash flow improved to €11.7 million compared to negative €4.2 million last year. Net leverage decreased to 2.70x from 2.78x in the first quarter.
Management confirmed its full-year guidance, expecting a significant volume increase in the second half of 2025 as maintenance work completes and higher hedging levels support earnings.
Current market consensus projects 16% sales growth and 21% adjusted EBITDA growth for the second half of the year.
Befesa shares currently trade at €26.09, with Jefferies analysts maintaining a buy rating and a price target of €37.00, suggesting a 42% upside potential.
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