Eramet: 3rd quarter 2021 turnover

Strong growth in Q3 2021 turnover, forecast EBITDA revised upwards close to €1bn over the year.

News
  • Turnover of €1.1bn (+34% vs. Q3 2020), with growth of more than 40% in the Mining and Metals division.
  • Good operating performance in the Mining and Metals division in all entities except New Caledonia:
  • Increase in manganese alloys volumes produced (+11%) with a favourable mix and continued organic growth in manganese ore production in Gabon (+27%).
  • Excellent growth dynamics in Weda Bay nickel ore production with nearly 4 Mwmt over the quarter, representing nearly 11 Mwmt year-on-year at end-September.
  • Increase in mineral sands production in Senegal (+11%).
  • Decrease in ferronickel production in New Caledonia (-19%), notably resulting from the deterioration in the health situation in the territory since early September; cash cost  at $7/lb in Q3 2021, despite the increase in exported nickel ore volumes (+49%).
  • Very favourable price environment in Q3 2021, particularly for manganese alloys; however, the cost of freight largely absorbed the ore price increases. The impact of the increase in energy costs on the Group’s activities remains limited to date.
  • Decline in Aubert & Duval (“A&D”) turnover (-14%) in an aerospace market environment which is still depressed and factoring in the impact of the fire that occurred in a workshop of the Pamiers plant in early September; increase in Erasteel sales (+40%).
  • 2021 Outlook:
  • Favourable market momentum in Q4.
  • Mining production targets confirmed in Gabon and revised upwards for Weda Bay Nickel; nickel ore export target and ferronickel production revised downwards in New Caledonia.
  • Forecast EBITDA revised up over the year: considering the excellent dynamics for manganese alloys and a revised consensus for 2021 of average manganese ore (CIF China 44%) prices at $5.1/dmtu and LME nickel prices at $8.3/lb , forecast EBITDA would be close to €1bn in 2021.

Christel BORIES

Eramet group Chair and Chief Executive Officer

Our organic growth strategy is paying off, with good operating performances in the Mining and Metals division: the very strong increase in the turnover of this division is driven by sustained demand in our main markets and a very favourable price environment, particularly for manganese alloys. 

However, the situation in New Caledonia remains a concern: this is a decisive moment for SLN, which has suffered multiple disruptions since the start of the year and is pending crucial decisions to fully implement its rescue plan. 

Furthermore, we continue to implement our strategic roadmap with the repositioning of our portfolio on Mining and Metals activities, including the development of key metals in the energy transition to strengthen the Group’s growth potential.