Befesa Sa · XETR:BFSA
Befesa Sa — 14th ODDO BHF NEXTCAP Forum (2025)
50 slides from Befesa Sa's conference presentation, Sep 18, 2025
Slide 1: Business & strategic update
Business & strategic update 14th ODDO BHF NEXTCAP Forum
Slide 2: Agenda
Agenda Executive Summary Executive Summary Current Trading Resiliency Resiliency USA operations USA operations China operations China operations Business Plan Business Plan Growth Strategy Growth Strategy 2
Slide 3: Key highlights
Key highlights Adjusted EBITDA Q1 2025 at €56m, up 15% YoY Robust Operating Cash Flow in Q1 2025 up 134% YoY driven by solid cash conversion Leverage at Mar25 at x2.8, deleveraging trend continued, improving from Dec24 of x2.9 Net income in Q1 2025 at €18.6m, up 97% vs Q1 2024 Lower utilization leve
Slide 4: Executive Summary 1/2
Executive Summary 1/2 Strong Q1 EBITDA at €56m, expecting FY25 EBITDA in the range of €240m to €265m 2025 ▪ It represents +15% EBITDA growth year on year • Split between segments: 86% Steel Dust & 14% Aluminium • Better hedging price and favourable Zinc TC will have been the main drivers of growth ▪
Slide 5: Executive Summary 2/2
Executive Summary 2/2 China focus on improving existing operations. Expansion plan stop China ▪ Befesa invested in China in 2020 to capture the business opportunity that increased EAF steel and environmental regulation presented • Total capex invested €90m in two EAF dust recycling plants in the pro
Slide 6: Agenda
Agenda Executive Summary Executive Summary Current Trading Resiliency Resiliency USA operations USA operations China operations China operations Business Plan Business Plan Growth Strategy Growth Strategy 6
Slide 7: Strong Q1 EBITDA up 15% YoY, expecting FY25 EBITDA in range
Strong Q1 EBITDA up 15% YoY, expecting FY25 EBITDA in the range of €240m to €265m Q1 2025 Financial Highlights Revenue +3% ▪ Adj. EBITDA Q1 2025 at €56m, up 15% YoY Q1 2025: €308m ▪ Strong Operating Cash Flow in Q1 2025 up 134% YoY driven by solid cash conversion €298m in Q1 2024 ▪ Leverage of x2.8
Slide 8: Q1 2025 Steel Dust business highlights
Q1 2025 Steel Dust business highlights Lower volume in general, driven by scheduled maintenance shutdowns in the period EUROPE USA ASIA Steel production in EU continued low in Lower utilization levels in the recycling Turkey and South Korea operating at Q1 caused by weak end-markets demand bus
Slide 9: Steel Dust Recycling Services Financials
Steel Dust Recycling Services Financials Favourable TC and zinc hedging, partially offset by lower volumes EBITDA Q1’24 to Q1’25 (€m) Q1 2024 Q1 2025 YoY change (%) +13 / +37% 48 Revenue €m 188.0 200.2 +7% 0 Adjusted EBITDA €m 36.0 49.2 +37% 15 Adjusted EBITDA % 19.2% 24.6% +5.4% 36 General inflatio
Slide 10: Q1 2025 Aluminium business highlights
Q1 2025 Aluminium business highlights Weak secondary aluminium metal margin Salt Slags recycling 2nd aluminium Solid performance of the salt slag recycling plants Continued compressed aluminium metal margin Highlights running in line with previous periods utilization driven by weak auto demand c
Slide 11: Aluminium Salt Slags Recycling Services Financials
Aluminium Salt Slags Recycling Services Financials EBITDA impacted by lower 2º alu metal margin and higher energy prices EBITDA Q1’24 to Q1’25 (€m) Q1 2024 Q1 2025 YoY change (%) Revenue¹ 111.5 109.5 -2% -4 / -32% - Salt Slags €m 27.2 27.7 +2% 13 - Secondary Alu 98.3 95.2 -3% 0 EBITDA 12.7 8.6 -32%
Slide 12: Zinc TC settled at $80/t for 2025; zinc price volatility
Zinc TC settled at $80/t for 2025 (vs $165/t in 2024) marking an all- time low; Zinc LME price shows volatility caused by global macro turmoil Peak: $300 (2008 & 2020) Oct 24 3.237 May 24 3.093 FY25 average: $2,838/t TC announcement Contract TCs 2.516 $143 Aug 24 (2018) 2.286 Feb 24 $80 $54 (2025) (
Slide 13: Zinc price hedging extended until Jan 2027
Zinc price hedging extended until Jan 2027 at all-time high level of 1 Befesa’s hedging strategy unchanged €2,655. Next hedging Q1 2027 • 1-3 years forward • Targeting 60% - 75% of zinc equivalent • Befesa provides no collateral Zinc LME1 €2,549 €2,620 €2,425 2 Befesa’s hedging strategy has proven s
Slide 14: Coke price downward trend; gas and electricity prices up
Coke price continues gradual downward trend in Q1’25; Increase in gas and electricity prices in Q1’25 vs FY24 Coke ▪ Coke price at 174€/t in Q1’25, consolidates its stabilization Befesa’s energy price evolution by source compared to previous quarters, with a projected 2019/20 2021 2022 2023 2024 202
Slide 15: EBITDA to Cash Flow
EBITDA to Cash Flow Operating Cash Flow in Q1’25 at €34m. Cash on hand at Mar25 amounted to €105.0m. Adjusted EBITDA to Total cash flow in Q1 2025 (€ million) 56 Total capex = €18m -15 -7 34 -11 -7 -13 2 Adj EBITDA WC Change Taxes Operating CF Maintenance Capex 1 Growth Capex Bank borrowings Total C
Slide 16: Deleveraging trend continued to x2.8
Deleveraging trend continued to x2.8, driven by disciplined capital allocation strategy. TLB repriced reducing 50bps. Capital structure Net Debt / EBITDA • Senior Secured TLB of €650m x3.4 x3.3 • Refinanced in July 2024 • Maturity in July 2029 • Repriced in March to E+225 bps (50 bps saving vs. prev
Slide 17: Befesa expects strong double digit EBITDA growth in 2025
Befesa expects strong double digit EBITDA growth in 2025 Commentary 2025 Outlook Europe: stable/strong volume expected, despite current challenging steel industry Steel dust USA: higher EAF steel dust volume driven by volume from new contracts Neutral to positive volume China/Asia: stable vo
Slide 18: 2025 EBITDA expected between €240m and €265m
2025 EBITDA expected between €240m and €265m Strong Free Cash Flow generation and leverage <x2.5 • Double-digit EBITDA growth driven by overall better TC, FY24A 2025 Guidance hedging, volume and operating cost • Strong cash generation remains EBITDA €213m €240m - €265m a key priority, with continued
Slide 19: Agenda
Agenda Executive Summary Executive Summary Current Trading Current Trading Resiliency USA operations USA operations China operations China operations Business Plan Business Plan Growth Strategy Growth Strategy 19
Slide 20: Unique business model with high barriers to entry
Unique business model with high barriers to entry resulting in high margins over time and strong performance through the cycle ▪ Strategically located plants near customers and long-term service relationships providing high barriers to entry ▪ Proven track record of resilience through cycles and vol
Slide 21: Unique business model with high barriers to entry
Unique business model with high barriers to entry resulting in high margins over time Strategic locations and strong performance through the cycle Locked-in captive demand as Befesa’s plants strategically located in close proximity to client locations Short distance Plants located nearby EAF produce
Slide 22: Befesa's Resilience During Latest Crises
Befesa’s Resilience During Latest Crises Befesa has demonstrated resilient volumes and capacity utilisation levels during the latest crises 2008 / 2009 / 2010 2019 / 2020 / 20213) 600 1000 2019 2020 2021CE 240 >1.1Mt Incl.240US acquisition 550 900 Befesa EAFD 220 500 474 482 220 800 throughput, kt 6
Slide 23: C90 as a solid floor of the zinc price
C90 growing at 6% CAGR over the las 15 years, consistently acting as a solid floor of the zinc price (April ‘22) 4.371 C90 as solid floor for zinc (Feb ‘18) 3.540 ▪ C90 represents the zinc (Dec‘24) 3.043 price level at which 10% of (March ‘08) the most expensive mines 2.496 (May ‘15) break even 2.29
Slide 24: Agenda
Agenda Executive Summary Executive Summary Current Trading Current Trading Resiliency Resiliency USA operations China operations China operations Business Plan Business Plan Growth Strategy Growth Strategy 24
Slide 25: Operational improvement of recycling assets on plan
Operational improvement of recycling assets on plan, ready to capture market growth. Stabilizing refining plant ▪ Steel dust recycling operations increasing efficiency according to initial plan based on operational synergies and best practices – Resulting in an increase of EBITDA/ton of 63%, from €7
Slide 26: US recycling operations improving profitability
US recycling operations improving gradually profitability as planned Steel dust throughput & Plant utilisation 90% 60% 65% 570-590 Gradual recovery of EAF volume since 2021: 450 * 416 Customer 100 ▪ Loss of an EAF steel dust supply contract with a major steelmaker loss before acquisition 350 ▪ Volu
Slide 27: Synergies focused on operational efficiency and coke consumption
Synergies focused on operational efficiency and coke consumption, mostly captured already Coke consumption US plants (Kt) 133 128 113 Coke consumption reduced in Q1 2025 by 8% YoY driven by 105 operational efficiencies. Coke-to-throughput ratio has remained broadly stable YoY (24% in Q1 2024 vs 15%
Slide 28: Palmerton plant refurbishment progressing well
Palmerton plant refurbishment progressing well to seize growth in the US EAF steel dust market Plant overview ▪ 2 kilns with c. 163 kt → 220 kt (post-refurbishment) EAF steel dust recycling capacity Palmerton, Pennsylvania ▪ Producing WOX as a marketable product Indicative timing and status H1 2025
Slide 29: New EAF announcements supported by infrastructure programs
New EAF announcements supported by strong infrastructure programs requiring steel 60kt additional EAF steel dust already contracted Steelmaker Location New capacity, Mt Start up 1 Calvert, Alabama 1.5 H2’24 Arcelor 2 Hamilton, Ontario, Canada 2.4 2026 3 Kingman, Arizona 0.6 Q3’24 4 Lexington, North
Slide 30: Zinc refining asset being turnaround
Zinc refining asset being turnaround to improve profitability Zinc refining plant: Key facts Implementing a 3-phase plan since acquisition ▪ Vertical integration in the US which makes sense as there is Improving the quality of the product to the SHG zinc specification to 1 lack of smelting capacity
Slide 31: Turnaround plan to improve profitability of zinc refining plant
Turnaround plan to improve profitability of zinc refining plant Quality improvement Plant Utilization Cost Reduction % In Spec SHG over total production % Load factor +18% +36% 100% 100% 100% 82% 86% 82% 65% 50% Q4’23 Q1’24 Q2’24 Q3’24 Q4’24 Q4’22 FY23 FY24 ▪ In Spec SHG (Special High Grade) zinc ▪
Slide 32: Agenda
Agenda Executive Summary Executive Summary Current Trading Current Trading Resiliency Resiliency USA operations USA operations China operations Business Plan Business Plan Growth Strategy Growth Strategy 32
Slide 33: China focus on improving existing operations
China focus on improving existing operations. Expansion plan was stopped in 2024 ▪ Befesa invested in China in 2020 to capture the business opportunity that increased EAF steel and environmental regulation presented – Total capex invested €90m in two EAF dust recycling plants in the provinces of Jia
Slide 34: Befesa invested in China in 2020
Befesa invested in China in 2020 to capture the business opportunity that increased EAF steel and environmental regulation presented Total capex invested €90m in two EAF dust recycling plants in the provinces of Jiangsu and Henan 1 Key milestones 2 Environmental Regulation ▪ In 2017, steel mill dust
Slide 35: Real estate crisis driving low utilization of EAF steel makers
The real estate crisis in China is driving low utilization on EAF steel makers, resulting in low EAF dust generation 1 EAF steel output is being impacted by the real estate crisis, with a low utilisation rate 2 2024 represented the fifth year with a double-digit decline 3 Long products production is
Slide 36: Differences between Jiangsu and Henan provinces
Differences in EAF steel production and regulation enforcement between the two provinces drive performance Jiangsu Henan Tier 1 province with strong enforcement of the Tier 2 province, with utilisation rate expected to remain environmental regulation, high plant utilisation rate and subdued for a wh
Slide 37: Investment plan in China stopped until market recovery
Investment plan in China was stopped for the coming years until a clear market recovery Despite de challenging short term, in the medium term the opportunity in China remains very attractive Investment plan stop: Positive trends still in place for the mid-term ▪ The two main drivers for the investme
Slide 38: Agenda
Agenda Executive Summary Executive Summary Current Trading Current Trading Resiliency Resiliency USA operations USA operations China operations China operations Business Plan Growth Strategy Growth Strategy 38
Slide 39: 5-year Business Plan executed keeping leverage below x2.5
5-year Business Plan presented in CMD in November 2022 to be executed keeping leverage below x2.5 ▪ Growth going forward maintaining leverage below x2.5 – Only committed capex is Palmerton and Bernburg expansion, which are ongoing – European projects (expansion of steel dust and new salt slags) to b
Slide 40: What we said at the CMD in November 2022
What we said at the CMD in November 2022 40
Slide 41: Befesa is adjusting its business plan
Befesa is adjusting and adapting its business plan to the temporary macroeconomic challenges CMD Nov 2022 Today Outlook Capex Total capex: €410-450m 20% invested, €87m: US refining and Recytech 30%: Europe steel dust & salt slags, €120-140m 20% being invested, €90m: Palmerton & Bernburg 30
Slide 42: Capex already invested will deliver growth
Capex already invested will deliver 1 Total invested before 5Y Growth Plan €480m growth over the coming years • Today delivering €50m • Potential to deliver €80-90m EBITDA EBITDA Project Capex • >15% ROCE today potential US recycling €390 €47 €70 2 20% of the 5Y Growth Plan invested • €80m invested
Slide 43: Remaining 50% of Recytech acquired
Remaining 50% of Recytech acquired in a highly-accretive deal, advancing strategic global growth plan in Europe Befesa’s EAF steel dust recycling plants in Europe 1 Fouquières-lès-Lens/Recytech Key facts about Recytech: 2 Duisburg 2 1 ▪ Former 50/50 JV between Befesa and Recylex, 3 3 Freiberg 4 Asúa
Slide 44: Bernburg expansion: permits and commercial contracts
Bernburg expansion: Moving forward with permits and commercial contracts Plant overview ▪ Expand alu alloy production capacity at existing Bernburg plant from current 75 kt to 135 kt (+60 kt) • 2 rotary furnaces (and 2 holding furnaces) ▪ Total Befesa 2nd Alu capacity from 205 kt to 265 kt Bernburg,
Slide 45: Agenda
Agenda Executive Summary Executive Summary Current Trading Current Trading Resiliency Resiliency USA operations USA operations China operations China operations Business Plan Business Plan Growth Strategy 45
Slide 46: Growth strategy driven by favourable mega trends
Growth strategy driven by favourable mega trends of decarbonization, energy transition and environmental regulation ▪ The strategy of Befesa remains unchanged, focus on the two-core business – Steel dust and salt slags recycling services to the steel and aluminium industries as well as secondary alu
Slide 47: Industries benefited from decarbonization and energy transition megatrends
Befesa’s industries are benefited from favourable mega trends driven by decarbonization and energy transition FAVOURABLE MEGA TRENDS Rising population Focus on circular economy Increase in middle classes in emerging countries / urbanisation Stricter environmental regulations Resource scarcity STEEL
Slide 48: Decarbonisation megatrends driving EAF steel growth
Decarbonisation megatrends favouring and driving the electric arc furnace (EAF) steel growth Global crude steel production1 Key takeaways million tonnes, 2016—2030e CAGR CAGR 2016—21 2022—30e 2,064 +3.6% +1.0% ▪ Ongoing swift from BOF to 1,951 Total EAF steel — Global EAF crude 1,633 564 steel produ
Slide 49: Energy transition requiring incremental zinc
Energy transition megatrend requiring incremental zinc, in addition to regular GDP related growth Key takeaways Zinc annual demand from wind, solar & batteries 1 thousand tonnes ▪ Global zinc demand grew with GDP at 2-3% CAGR over the L10y ▪ Zinc consumption expected to be supported as governments i
Slide 50: BEFESA
BEFESA