Earnings call transcript: AMG’s Q1 2025 earnings beat expectations, stock surges

AMG Advanced Metallurgical Group NV, with a market capitalization of $5 billion and trading at a P/E ratio of 10.56, reported a strong performance for Q1 2025, with earnings per share (EPS) of 0.15 USD, surpassing market expectations. The company’s revenue reached 388.08 million USD. Following the announcement, AMG’s stock price surged by 14.64%, closing at 19.11 USD, reflecting investor optimism about the company’s future prospects and strategic initiatives. According to InvestingPro, the company shows several promising indicators, with 5+ additional exclusive insights available to subscribers.

Key Takeaways

• AMG’s Q1 2025 EPS of 0.15 USD exceeded expectations.
• Revenue for the quarter was 388.08 million USD.
• The stock price increased by 14.64% in the aftermath of the earnings release.
• The company raised its adjusted EBITDA outlook for 2025 to 170 million USD or more.
• AMG continues to expand its lithium and chrome metal operations.

Company Performance

AMG demonstrated robust growth in Q1 2025, with its EBITDA nearly doubling from the previous year to 58 million EUR, contributing to a substantial trailing twelve-month EBITDA of $708.8 million. The company reported positive cash flow from operating activities amounting to 9 million EUR. Analyst targets suggest potential upside, with price targets ranging from $168 to $200. AMG’s strategic focus on critical materials such as lithium and vanadium has positioned it as a key player in the market, particularly with the completion of its lithium operation expansion in Brazil and the approval of a new chrome metal production facility in the United States.

Financial Highlights

• Revenue: 388.08 million USD
• Earnings per share: 0.15 USD
• EBITDA: 58 million EUR, nearly doubled from the previous year
• Net debt: 476 million USD
• Total liquidity: 486 million USD

Earnings vs. Forecast

AMG’s EPS of 0.15 USD exceeded market expectations. The company’s revenue of 388.08 million USD also reflected strong operational performance. The surprise in earnings is significant, given the challenging market conditions for lithium and vanadium.

Market Reaction

Following the earnings announcement, AMG’s stock price rose by 14.64%, closing at 19.11 USD. This sharp increase is notable against its 52-week range, where the stock’s low was 11.30 USD and the high was 23.82 USD. The positive market reaction highlights investor confidence in AMG’s strategic direction and financial health. InvestingPro analysis indicates the stock is currently undervalued, with a strong price momentum score of 3.33 out of 5. Discover more undervalued opportunities at Most Undervalued Stocks.

Outlook & Guidance

AMG revised its adjusted EBITDA outlook for 2025 from 150 million USD to 170 million USD or more. The company anticipates a price correction in the lithium market but remains optimistic about its long-term growth prospects. Capital expenditures for 2025 are expected to range between 75 million USD and 100 million USD, focusing on small, accretive investments.

Executive Commentary

CEO Dr. Heinz Schimmelbusch stated, "Despite exceptionally low lithium and vanadium prices, we had a very strong start in ’twenty five." This sentiment underscores AMG’s resilience in navigating market volatility. Michael Conner, Chief Corporate Development Officer, emphasized the importance of critical materials, saying, "Critical materials such as lithium, vanadium, and antimony have become essential to the technologies that power modern life."

Risks and Challenges

• Lithium market volatility: Prices are subject to significant fluctuations, which could impact margins.
• Supply chain disruptions: Potential challenges in sourcing materials could affect production.
• Economic conditions: Broader macroeconomic pressures may influence demand for critical materials.
• Regulatory changes: Shifts in environmental policies could impact operations.
• Competition: Increasing competition in the critical materials sector poses a risk to market share.

Q&A

During the earnings call, analysts inquired about the high margins in the antimony business and the timeline for the lithium hydroxide qualification process. The company expects the qualification process to take a few months, indicating a focus on ensuring product quality and market readiness. Additionally, AMG discussed its flexibility in sourcing lithium feed, which could provide strategic advantages in managing supply chain challenges.

Full transcript - AMG Advanced Metallurgical Group NV (AMG) Q1 2025:

Conference Operator: Good day, everyone, and welcome to today’s AMG Q1 twenty twenty five Earnings Conference Call. At this time, all participants are in a listen only mode. Later, you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing the star and one on your telephone keypad. Please note this call is being recorded, and I will be standing by should you need any assistance.

It is now my pleasure to turn the conference over to Michelle Fisher. Please go ahead.

Michelle Fisher, Earnings Call Host/Moderator, AMG: Welcome to AMG’s first quarter twenty twenty five earnings call. Joining me on this call are Doctor. Heinz Schimmelbusch, the Chairman of the Management Board and Chief Executive Officer Mr. Jackson Dunkel, the Chief Financial Officer Mr. Eric Jackson, the Chief Operating Officer and Mr.

Michael Conner, the Chief Corporate Development Officer. AMG’s first quarter twenty twenty five earnings press release issued yesterday is on AMG’s website. Today’s call will begin with a review of the first quarter twenty twenty five business highlights by Doctor. Schimmelbusch. Mr.

Karnhoff will comment on strategy. Mr. Dunkel will comment on AMG’s financial results and Mr. Jackson will discuss operations. At the completion of Mr.

Jackson’s remarks, Doctor. Schimmelbusch will comment on outlook. We will then open the line to take your questions. Before I pass the call to Doctor. Schimmelbusch, I would like to expressly refer you to our statement on forward looking statements and the meaning thereof as we have used at all previous occasions and we will use at this earnings call, and which explanatory statement has been published as part of our financial presentation and on our website all in connection with this earnings call.

I will now pass the floor to Doctor. Schimmelbusch, AMG’s Chairman of the Management Board and Chief Executive Officer.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Thank you, Michel. We are obviously pleased to have achieved such a strong EBITDA in the first quarter, almost doubled compared to the first quarter last year. We achieved an EBITDA of €58,000,000 for the first three months in 2025 despite the absence of any correction in the lithium or vanadium prices upward. This indicates the power of AMG’s Critical Materials portfolio and demonstrates the significant upside potential should commodity prices normalize. AMG had positive cash from operating activities of 9,000,000 during q one twenty five compared to 15,000,000 of cash used in operating activities during the first three months of last year.

Our technologies segment also had an extremely strong performance with its highest order backlog in AMG’s history of $460,000,000 at the end of the first quarter. Looking forward, while the indirect effects of increased tariffs and trade barriers are difficult to assess, there are no material effects of the tariff on AMG businesses based on our present analysis. In the current volatile environment, our businesses benefit from their production of materials, which are critical to our customers and to a large extent, we operate within domestic value chains. As we enter into a period of uncertainty, it should be noted that AMG is at the end of its heavy capital expansion phase. Going forward, we will be focused on small, highly accretive investments, which preserve our growth options.

The recently announced investments in U. S. Chrome, in Lagora and Flatside demonstrate how we will continue to invest and support growth while maintaining the strength of our balance sheet. As an important example that demonstrates the end of our heavy investment phase, I am very pleased to report that the Bisophel refinery has successfully produced lithium hydroxide at battery grade specifications and will be shipping the first commercial qualification batches to our customers promptly. I will now hand over to Mike.

Mike?

Michael Conner, Chief Corporate Development Officer, AMG: Thank you, Heinz. In today’s rapidly evolving global economy, critical materials such as lithium, vanadium and antimony have become essential to the technologies that power modern life. From renewable energy systems and electric vehicles to advanced defense applications and digital infrastructure. As nations accelerate their transition to cleaner energy and latent technological competitiveness, access to and control over these strategic resources are increasingly shaping economic policy, national security strategies and global supply chain dynamics. As a result of our portfolio of critical materials and our globally diverse footprint, AMG is uniquely positioned to capitalize on these accelerating macro trends.

We continue to focus on these dynamics in our strategic decision making and our expansion activities. Regarding our major current lithium growth projects, the ramp up at Bitterfeld, as Heinz just said, is proceeding as expected and has produced battery grade lithium for qualification by our customers. Additionally, the expansion of our lithium operation in Brazil is complete, solidifying our position as one of the lowest cost lithium concentrate producers globally. AMG is the largest shareholder of Savannah Resources, the sole owner of the Barroso lithium project in Portugal. Savannah has continued to build strong positive momentum, recently achieving a major milestone with the European Commission designating Barocco as a strategic project under the Critical Raw Materials Act, highlighting its integral role in Europe’s battery and electric vehicle sectors.

In April, AMG signed an exclusive agreement with Grupo Lagoa with the goal of becoming the first producer of lithium concentrate in Portugal. Both the initial capital requirement as well as the risk profile of this investment are low. With this agreement, AMG is establishing its foothold within one of the most attractive lithium resources in Europe. In terms of our vanadium segment, we approved a capital investment of $15,000,000 in April to establish an aluminothermic production facility to manufacture chrome metal in The United States. Chrome metal is classified as a critical material in The U.

S. Due to its importance in various industrial particularly those within the aerospace sector. The project benefits are evident and substantial. The necessary capital investment is minimal. The payback period will be short.

And the facility is anticipated to commence operations in the first quarter of twenty twenty six. Phase one of our supercenter project in Saudi Arabia is currently in the detailed engineering phase. In April, we successfully obtained the required environmental permit to construct through the proper channels in Saudi Arabia. We are now in the process of selecting an EPC contractor. In March, AMG successfully repurchased 40% ownership in graphite crop mule from Alterna Capital Partners.

The acquisition was facilitated with very flexible payment options. This transaction simplifies our capital structure and gives us strategic flexibility as we now have complete control over the asset. We continue to operate as a low cost producer, and the success of our diversified portfolio is allowing us to continue with highly accretive, low risk strategic investments despite market downturns in some of our major products. I will now pass the floor to Jackson Dunkel, AMG’s Chief Financial Officer. Jackson?

Thank you, Mike. I will be referring to the first quarter twenty twenty five investor presentation posted yesterday on the website. Starting on Page five of the presentation, I’d like to underscore Heinz’s comments about the strength of the EBITDA performance this quarter given the low lithium prices. Despite these low prices, AMG delivered the highest quarterly EBITDA since the fourth quarter of twenty twenty three. On Page six, you can see the price and volume movements for our key products represented by arrows, which underscore our segmental results.

On Page seven, you’ll see our return on capital and valuation metrics year over year. It’s important to note that we’ve invested over $650,000,000 over the last four years for our lithium and vanadium expansion projects, which has impacted the return on capital metrics. AMG Lithium is shown on Page eight. On the top left, you can see that Q1 twenty twenty five revenues decreased 23% versus the prior year. This decrease was driven mainly by the 27% decline in lithium prices and the 22% decrease in lithium concentrate sales volumes.

Those were partially offset by higher tantalum sales prices. Despite the decrease in lithium market prices, adjusted EBITDA for the segment in Q1 ’twenty five was down only 6% from Q1 last year. AMG Vanadium is shown on Page nine. Revenue for the quarter decreased 7% compared to Q1 ’twenty four due mainly to lower volumes of ferrovanadium and titanium alloys, partially offset by increased sales prices in ferrovanadium and chrome metal. Q1 twenty five adjusted vanadium EBITDA of $13,000,000 decreased 10% compared to Q1 twenty four.

This was primarily due to the lower sales volumes, partially offset by higher profitability in chrome and the ongoing benefit of 45x. AMG Technologies is shown on Page 10. The Q1 ’twenty five revenue increased by $51,000,000 or 34% versus Q1 ’twenty four. This improvement was driven mainly by steadily increasing sales prices of antimony in the current quarter. Adjusted EBITDA of $39,000,000 during the first quarter was more than triple the same period in 2024.

This increase was primarily due to higher profitability in AMG Antimony. Page 11 of the presentation shows our main income statement items. The key change on this page is regarding our tax expense, which was $1,000,000 in the current quarter compared to $3,000,000 during Q1 ’twenty four. The Q1 ’twenty five expense is largely due to $6,000,000 of Brazilian deferred tax expense related to the appreciation of the Brazilian real, offset by $5,000,000 of unobserved losses. Page 12 of the presentation shows our cash flow metrics.

The key item on the page is our Q1 twenty twenty five cash from operating activities, which is notably strong versus the same period last year and was driven by high advanced payments in our engineering business and strong cash flows from our antimony business. I’d also like to point out that our return on capital employed of 13.4% in the current period was higher than in any quarter of 2024. A and G ended the quarter with $476,000,000 of net debt. And as of 03/31/2025, we had $286,000,000 in unrestricted cash and $200,000,000 available on our revolving credit facility. The resulting $486,000,000 of total liquidity at the end of the quarter demonstrates our ability to fully fund all approved capital expansion projects.

One note on net debt. We are carrying our vendor note to Alterna and other liabilities. The rationale for this treatment is there are no interest payments associated with the note, and we intend to utilize our shares to settle the liability. We continue to expect capital expenditures to be 75,000,000 to $100,000,000 for 2025. That concludes my remarks.

Eric? Thank you, Jackson. AMG Technologies reported exceptional results, driven by our market leading position in our engineering business and very strong results in our diversified mineral operations. AMG Engineering signed $107,000,000 in new orders during the first quarter. The order intake was driven by strong orders for turbine blade coatings.

And as mentioned, this resulted in a record breaking order backlog of $416,000,000 as of the end of the quarter. Our other operating units under the AMG Technologies umbrella, especially AMG Antimony, also performed extremely well in the quarter and made a significant contribution to the $29,000,000 quarter over quarter increase in AMG Technologies EBITDA. After temporarily halting our silicon metal production in the first quarter, we have restarted and will operate one of our four furnaces in the second quarter. The profitability of AMG’s silicon business is presently not material and is excluded from adjusted EBITDA during this period of abnormal operations. Our Brazil lithium operation delivered 12,167 metric tons CIF China of lithium concentrate in the first quarter.

Volumes were low due to shipment schedules and the decision to use this period of low prices to perform significant testing on our lithium concentrate production lines to increase both reliability and performance. We plan to ramp up to full capacity again during the second quarter. The average realized sales price was $640 per metric ton and the average cost of production was $572 per metric ton against Fifth China. This higher than run rate cost per ton was driven by the lower vanadium concentrate and tantalum concentrate production in the current quarter. It’s important to note that the fourth quarter twenty twenty four cost per ton of $290 was, as we mentioned, after that quarter, especially low given the high tantalum sales volumes during that period.

In our vanadium segment, AMG titanium experienced weakened market demand during the first quarter of twenty twenty five, particularly titanium aluminides. The segment’s profitability was also negatively impacted by startup costs of our new vanadium electrolyte plant in Germany, which is now fully operational. AMG Vanadium’s Zanesville and Cambridge spent catalyst processing facilities lead the industry in terms of cost structure and environmental performance. AMG Vanadium’s results were, however, negatively impacted by lower volumes during the first quarter. The increase the small increase in sales prices in ferrovanadium helped to offset the impact of lower volumes.

We believe that as the only producer of ferrovanadium in The United States, our vanadium operations are well positioned in this uncertain tariff environment. Our overriding operating objectives are to be the lowest cost, highest quality and most environmentally responsible producer of all of our products. This enables us to deliver strong financial performance even as many of our direct competitors report significant losses. I’ll now pass the floor to Doctor. Schimmelbusch.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Thank you, Jack. Despite exceptionally low lithium and vanadium prices, we had a very strong start in ’twenty five. The AMG Technologies segment performed particularly well. Based on that and considering uncertain economic and market conditions globally, we increased our adjusted EBITDA outlook from 150,000,000 or more in ’twenty five to $170,000,000 or more in ’twenty five. Regarding AMG’s five year guidance, the key pillars, which represent significant investments are now complete.

The Bitterfeld battery grade lithium hydroxide facility, our lithium concentrate expansion, the establishment of AMG battery strategy lever for energy acquisition, the doubling of spent catalyst processing capacity in AMG vanadium and AMG Engineering’s highest ever backlog. These projects deliver the volume growth, which underpin the long term guidance of an EBITDA of hundred million dollars or more in five years or earlier at normalized market prices. Operator, we would now like to open the line for questions.

Conference Operator: Thank you. At this time, we will open the question and answer session. Star and one on your telephone keypad, and you’ll be placed into the queue in the order received. You may remove yourself from the queue at any time by pressing pound and one. Once again, to ask a question, press And we’ll take our first question from Frank Claussen with Degroof Petercam.

Jackson Dunkel, Chief Financial Officer, AMG: Good morning all. Two questions, please. First of all, on the antimony business, given that it is a conversion business, how long can you still benefit from the current rally in the antimony prices? Could you elaborate on that? That is my first question.

And then secondly, on the Bitterfeld refinery, you’re now shipping the first commercial batches. Does that also mean that you expect already a positive EBITDA contribution for ’25? Or is that too early? Thank you.

Michael Conner, Chief Corporate Development Officer, AMG: On antimony, it is a conversion business. And as you know, we would normally expect constant margins despite high prices. However, in today’s very short market, we’re able to command significantly higher margins. That being said, we have no indication that prices are going to change in the near term. We have no indication that China is going to suddenly start to ship antimony metal overseas.

But predicting what that looks like out more than a quarter or two is very difficult.

Jackson Dunkel, Chief Financial Officer, AMG: Okay.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: That’s Basically Just because

Jackson Dunkel, Chief Financial Officer, AMG: So, basically, the high margins can this high margin can be sustainable at least in the foreseeable future. Is that the line of thinking?

Michael Conner, Chief Corporate Development Officer, AMG: Correct.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: K. So now let me go to your second question. The lithium battery grade hydroxide qualification process is going through a standard pattern. The first step is achieved. The first step is the production of battery grade lithium hydroxide in specification.

That happened last week. So now the second step is that we ship batches, what is the so called qualification batches to the customer customers. They do analytical reconfirmation analytical reconfirmation. Then we are shipping the batches for the performance test to the customer. Then they send us a letter that we are free to ship consecutive production.

So we are extremely pleased, and we actually celebrated this first achievement, the first step of this also the most important step, namely that we have demonstrated the production of in spec materials that will create hydroxide in our plant. So now second step batches, etcetera, as I have said. Given the the the logical uncertainties, this hypothesis, we have no reason to change whatever we said about the start up of of the the timing of the start up steps in that refinery.

Jackson Dunkel, Chief Financial Officer, AMG: But does that mean that this year, there will already be a positive without contribution, or will that be more for next year?

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Well, it will be next week, but when you ask me, I might be more optimistic.

Jackson Dunkel, Chief Financial Officer, AMG: Okay. Alright. Okay.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Thank you. Look at my colleagues here, you know. I’m I’m I’m I have to be under total discipline here and then stop them.

Jackson Dunkel, Chief Financial Officer, AMG: I see. Okay. K. Thank you very much for the for the comments. Helpful.

Thank you.

Conference Operator: And our next question will come from Stain Demester with ING.

Michael Conner, Chief Corporate Development Officer, AMG: Yes. Yes. Good morning. Thanks for your opportunity to ask questions. Three, if I may.

The first one is on the long term guidance. Since you mentioned the end of the phase of large CapEx items, are you actually moving away from building further modules in Bitterfelt? And doesn’t the long term guidance assume at least one more module to be built? So can you comment maybe on that on that question?

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Well, we are not moving away, and we expect the second model to be built. But but that only affects the last the last year of that five year guidance. I’ll do your question? Yes. That’s clear.

The second one is also on

Michael Conner, Chief Corporate Development Officer, AMG: the guidance, unfortunately, because you mentioned normalized prices. Now I don’t I know you don’t provide guidance on prices, but could you maybe elaborate a bit where we situate normalized prices versus current prices, notably for lithium? Because, obviously, over the last couple couple of years, you’ve seen a lot of extremes both on the up and down side. So, yeah, any any color here would help.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Lithium project for resource project and updating project is dependent on financeability. Most of these projects are project finance. Project financing is not available unless you have a a stable forecast north of $20,000 of assumed carbonate equivalent. So at present, this is far from it. There are no there are new projects or value there projects under development with project financing.

So there will be a correction. It’s very difficult to comment intelligently on this on the size of correction, but let me make three remarks on this. The first is corrections never come or rarely come gradually. Corrections and then suddenly, corrections come suddenly. And mostly when nobody expects from.

It’s typically demonstrated by antimony prices. The external shocks possible in this in this anyhow very tight structure. And and and that, I think, will happen because it always starts. The second is that when you look at benchmark, they have a have a long term very steady increase, and we have built that into our assumptions of the lithium price first and and this is correction, and then it stays very steady. That’s absolutely not gonna happen.

Volatility in this, you will stay with us. Every commodity industry, which was in the same position, and and I have a real experience on that, where it goes through the same initial volatility until the industry reaches a certain degree of maturity. And that’s far from it. So there will be a correction, and then there will be a massive correction, then will be that will be again the fall off and etcetera etcetera. It will be high volatility.

And the third one is that there is a big uncertainty when when the feed in China of low quality raw materials such as the lipidolite, when that use, intensive use of the lipidolite in China ends? That’s a complicated question, which we, of course, analyze, and that is there are different theories about that because it is a difficult material and it’s expensive still, and it might be used more or less also for national strategic reasons in China.

Michael Conner, Chief Corporate Development Officer, AMG: Thank you. Thank you. This is very helpful. If I may elaborate on this because in bitterfrost, will not produce lithium carbonate, obviously. You will produce lithium hydroxide, which is an entirely different chemical.

Are you still confident that material could command a premium versus what is currently a shift in the market? And then could you also comment maybe on how many customers are currently qualifying on the channel?

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Well, we it’s quite a number, and we are not we are not naming the number. But but we are totally confident on on the premium.

Michael Conner, Chief Corporate Development Officer, AMG: Okay. Okay. This is very helpful. Maybe final one for me on vanadium. Despite the IRA tax credits in q one, which was not yet recorded in q one twenty four and somewhat lower prices, I think the result is somewhat weaker than what I maybe the market was expecting in Canadian.

So can you comment maybe if there is some volume shortfall in in q one that explains this? Yeah. There was no real effect from 45 x in q one. We did have shipping issues moving spent catalyst into our facility, which caused the the volume shortfall. Okay.

Are those the results in Q2?

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Yeah. They should be.

Michael Conner, Chief Corporate Development Officer, AMG: Okay. Thank you. This is for me. And congrats on the very strong results.

Jackson Dunkel, Chief Financial Officer, AMG: Thank you.

Conference Operator: Our next question will come from Martin Bindrevier with ABN AMRO.

Michael Conner, Chief Corporate Development Officer, AMG: Yes. Good morning, gentlemen. Thanks for taking my questions. My first one is going back to the battery grade lithium hydroxide. The qualification test batches and the subsequent performance test.

Can can you perhaps elaborate on how long that process will take? Are we talking two quarters, three quarters? Any color would help. That’s question one.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: It it takes a few months.

Michael Conner, Chief Corporate Development Officer, AMG: A few months. Okay. Clear. And then my second question goes back to to antimony. Normally, I assume that you have two, three quarters of of of inventory to run a processing business.

So I was assuming that eventually you would have to start buying at market price, therefore, the positive impact on profitability would eventually fade. Now you’re saying that that may continue going forward. Does that also imply that you found alternative sources of antimony perhaps at a advantageous prices or what else sustains that that profitability?

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: That’s a complicated question, but can you handle it?

Michael Conner, Chief Corporate Development Officer, AMG: Yeah. Well, I I think that at higher prices, obviously, we our margins increase. We did have some inventory as a producer, but we don’t see the prices changing dramatically. And we expect our margins to be to continue to be substantially above our historical margins.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: I understand that. But you

Michael Conner, Chief Corporate Development Officer, AMG: have to buy it somewhere. You have to source it somewhere. Right? And

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: That’s true. Because if you don’t source somewhere, you can’t produce.

Michael Conner, Chief Corporate Development Officer, AMG: Exactly. So if you have to source at market prices, logically, that that profitability will not be as high as you have during the ramp up. No. No. I mean, what I’m

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: what I’m saying is is, of course, we’re we source in many, many places. What what what just was said is that the margins at higher price levels are higher. Do we buy a high price? Of course. When you I mean, of course, when you buy at higher prices, you need much higher prices in order to a higher market.

But but but that’s the topology. You know? I mean, I don’t I don’t understand your question.

Michael Conner, Chief Corporate Development Officer, AMG: Have no pricing. We have no advantageous sourcing of cheap insulin. We’re buying at market prices. Alright. Thank you.

That’s that’s clear. And then my final question is on on on the lithium operations in Brazil, the the optimization. Why is it necessary to do optimization so shortly after the the the full ramp up and the the commissioning? And more importantly, when will this facility go back to what we perhaps see as normal nameplate capacity?

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: We have a particular problem in a particular equipment, more or less, in a in a particular section of the of the proceeds, and we are fixing it, and that’s it.

Michael Conner, Chief Corporate Development Officer, AMG: K. So back to normal operations in q two or

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: may may take a little bit longer? And and the expansion of a complex facility of of that type of complexity. Within the existing plant, within without it’s not an expansion next door. So it’s it’s within the existing plant, a reach from the a reconfiguration of the whole flow sheet has, of course, its complexities and its demands. And we we decided to do it that way because it’s the most economic way to do it.

However, there is a particular equipment is still not functioning, and we are we are fixing it. That’s it. I mean Yeah.

Michael Conner, Chief Corporate Development Officer, AMG: Yeah. We we I I think I stated in our script, we are moving back towards full capacity in the second quarter. It’s it’s it’s a a issue that we’re confident we will solve. Great. That’s it.

Thank you very much, gentlemen.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: That wasn’t special, by the way. That was early. Yeah.

Conference Operator: And we’ll move next to Krishan Agarwal with Citibank.

Michael Conner, Chief Corporate Development Officer, AMG: I have three, if I may. The first is on the vanadium plant. Can you comment on how the the ramp up is progressing or what are the the the capacity utilization rates are there in the q one for the expansion of the vanadium? And do we expect some kind of a positive benefit from higher output going forward in q two and then picking up? Which which vanadium plant?

Are you lithium or vanadium? The vanadium. In

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: vanadium, we are in the the the big vanadium project has been completed in full in its full production. Yeah.

Michael Conner, Chief Corporate Development Officer, AMG: So this is this is the context where there was a comment that you haven’t been able to source the same catalyst. So I’ve assumed that the the operating rates are also lower in that context.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: No. There were issues shipping issues. It’s a raw material. It’s a raw material. It’s a logistics issue.

But but that’s that’s that’s so there’s no this is it happened from time to time because of quarterly quarterly this is a quarterly problem, you know. It’s it’s just the volatility occurs sometimes in the quarter. It will be will be corrected in the second quarter.

Michael Conner, Chief Corporate Development Officer, AMG: Understand. Understand. Okay. And the second question is on the Bitterfield plant. Can you help understand the the material flow?

I mean, in the sense that the feed is coming from your own polyline operation, or is it the third party base for now?

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: The fees? Are you talking about lithium? Seed for lithium as

Michael Conner, Chief Corporate Development Officer, AMG: well. Yes.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Well, we we we take the opportunity to to buy in the spot market off trade off trade material, which is very advantageous as regard to prices. And that is reducing the material which we take from from our own sources by the by the way of conversion agreements.

Michael Conner, Chief Corporate Development Officer, AMG: Okay. But the longer term plan is to have full integration with your own fleet?

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: Yeah. You know, there there are there are this this appearance of spot opportunities is the result of sort of start up problems in other areas of the of the digital market. And today, and and those spot occurrences, we, of course, want to capitalize on. And how that is being going in the future, we don’t know. But but we we don’t care.

We have flexibility here.

Michael Conner, Chief Corporate Development Officer, AMG: Yes. Understood. And and then finally, I mean, the guidance of grade for 01/2025, obviously, you would have factored the continuing better results from antimony. How much of the weakness do you think is already into the price for the lithium business? Do you see more pricing weakness coming through to the Q2?

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: No. Let me again say the $500,000,000 guidance is the result of a myriad of model runs, this variety of scenarios and those scenarios then stabilize around a certain number, and then we make a conservative discount on that number, and then that’s the prior year guidance. So it’s a very solid state of many scenario plans.

Michael Conner, Chief Corporate Development Officer, AMG: Yeah. And then the question was more regarding the guidance for 2025. What? Can you repeat the could you repeat the question? So for the 2025 guidance of one seventy or more, how much of this no pricing weakness you have factored for lithium business in the q two?

We assume, as always, that current lithium prices will remain for the entire year. So we have no projected lithium price increases in the 01/07. Okay. Okay. That that that’s what I wanted to know.

Okay. Thanks a lot. Yeah.

Conference Operator: Next question comes from Martin Verbique with The Idea.

Michael Conner, Chief Corporate Development Officer, AMG: Good morning. It’s Martin Verbique of The Idea. Firstly, on the the acquisition of the remaining 40 stake in the Graftwert Cooking Oil. The change in other liabilities, is that a reflection of the future price for this these shares? Or otherwise, could you share how much that will be in future?

The change in liabilities reflects, yes, that approximate purchase price, but we don’t we don’t wanna put a number on it right now. Okay. We’re under NDA with alternate. But the price is fixed because you you handed over to Shandler? Exactly.

The price is fixed. Quantity of shares that we provide is obviously to be determined.

Conference Operator: Exactly.

Dr. Heinz Schimmelbusch, Chairman of Management Board and CEO, AMG: So we the option we have the option to buy that for cash or for cash? Yeah. Okay.

Michael Conner, Chief Corporate Development Officer, AMG: Thanks. And then secondly, concerning the antimony business impact. If you look at the technologies business and you can more or less work your way what engineering has has done, is it fair to assume that the change of the technology business excluding engineering and that comes down to roughly a change of $70,000,000 and a change in in in in gross and EBITDA of 30,000,000? Is that truly contributable for this antimony business? Yes.

It’s mainly it’s mainly antimony. Not to say that, you know, our engineering and graphite business in any way shape or form underperform. They perform very well. And

Conference Operator: there are no further questions at this time. Thank you, everyone, for joining AMG’s first quarter twenty twenty five earnings call. Good day.

Michael Conner, Chief Corporate Development Officer, AMG: The host has ended this call. Goodbye.

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