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Investing.com -- German wafer manufacturer Siltronic AG (ETR:WAFGn) (XETRA:WAF) on Tuesday reported better-than-expected second quarter results but cut its full-year sales guidance due to currency headwinds.
The company posted second quarter sales of €329.1 million, down 6.3% year-over-year and 4.8% from the first quarter, but 2% above company consensus of €322 million.
EBITDA came in at €86.4 million, down 4.6% from the same period last year but up 10.3% sequentially, beating consensus by 25%.
The earnings beat was primarily attributed to a later-than-anticipated activation of depreciation and amortization expenses, which will now occur in late summer rather than early summer.
Siltronic’s gross margin improved to 18.3% from 15.9% in the first quarter, driven by more favorable cost of goods sold and higher volumes of wafer area sold, which partially offset negative impacts from foreign exchange and price.
The company refined its full-year 2025 guidance, now expecting sales to be mid-single-digit below the previous year, compared to its earlier forecast of sales "in the region of the previous year."
This reduction is mainly due to foreign exchange assumptions, with the EUR/USD rate now projected at 1.15 for the second half of 2025 versus 1.08 previously.
Despite the sales guidance cut, Siltronic maintained its EBITDA margin forecast of 21-25%, while lowering its depreciation and amortization outlook to €340-400 million from €380-440 million previously.
The company reported that demand for wafers remains subdued with elevated customer inventories and some volume postponements from the third to fourth quarter.
Siltronic expects lower sequential revenues in the third quarter followed by a recovery in the fourth quarter.
Cash flow remained negative at -€83.4 million, resulting in net debt increasing to €902.8 million, approximately 2.6 times EBITDA, compared to €733.5 million at the end of 2024.
Siltronic’s equity ratio stood at 43.3%, slightly down from 43.6% at the end of 2024, while capital expenditure guidance was set at €350-400 million for the year.
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