Metallus(MTUS) - 2024 Q4 - Annual Results

Financial Performance - Fourth-quarter 2024 net sales were $240.5 million, a 6% increase from$ 227.2 million in the third quarter 2024, but a 27% decrease compared to $328.1 million in the fourth quarter 2023[7][10]. - Full-year 2024 net income was$ 1.3 million, or $0.03 per diluted share, down from$ 69.4 million, or $1.47 per diluted share, in 2023; adjusted net income for 2024 was$ 25.1 million, or $0.57 per diluted share[9][11]. - Adjusted EBITDA for the fourth quarter 2024 was$ 8.3 million, while full-year adjusted EBITDA was $77.7 million, compared to$ 169.0 million in 2023[7][9]. - Net sales for Q4 2024 were $240.5 million, a decrease of 26.6% compared to$ 328.1 million in Q4 2023[25]. - Gross profit for Q4 2024 was $10.9 million, down 73.7% from$ 41.4 million in Q4 2023[25]. - Net loss for Q4 2024 was $21.4 million, compared to a net income of$ 1.3 million in Q4 2023[25]. - Basic earnings per share for Q4 2024 were $(0.50), a decline from$ 0.03 in Q4 2023[25]. - Total net income for the year 2024 was $1.3 million, significantly lower than$ 69.4 million in 2023[25]. - Adjusted net loss for the three months ended December 31, 2024, was $3.3 million, compared to an adjusted net income of$ 16.5 million in the same period of 2023[35]. - Adjusted EBITDA for the year ended December 31, 2024, was $77.7 million, with an adjusted EBITDA margin of 7.2%[49]. Operational Metrics - Ship tons in the fourth quarter 2024 were 130,200, a 9% increase sequentially but a 17% decrease year-over-year; full-year ship tons totaled 555,500, down 19% from 2023[10][11]. - The aerospace & defense segment saw a 17% increase in net sales to$ 134.9 million for the full year 2024, representing 12% of total consolidated net sales[11]. - The company reported a total of 130.2 thousand ship tons for the three months ended December 31, 2024, down from 157.6 thousand ship tons in the same period of 2023, indicating a decrease of about 17.3%[60]. - Base sales for the year ended December 31, 2024, were $864.4 million, compared to$ 1,022.1 million in 2023, reflecting a decline of approximately 15.4%[61]. - The company’s net sales per ton for the year ended December 31, 2024, was $1,951, compared to$ 1,992 in 2023, a decrease of about 2.1%[61]. Costs and Expenses - Manufacturing costs increased by $10.3 million sequentially in the fourth quarter due to lower cost absorption, with melt utilization declining to 56% from 60% in the third quarter[10]. - Selling, general & administrative expenses (SG&A) for Q4 2024 were$ 20.4 million, slightly down from $22.7 million in Q4 2023[25]. - The company reported a loss on extinguishment of debt of$ 9.4 million for the year ended December 31, 2024[25]. - The company incurred a loss on extinguishment of debt amounting to $9.4 million for the three months ended December 31, 2024[49]. - Business transformation costs incurred during the year were associated with strategic evaluations for targeted growth and diversification through acquisitions[36]. - Business transformation costs for 2024 amounted to$ 2.0 million, reflecting the company's focus on strategic growth through acquisitions[43]. - IT transformation costs were reported at $5.1 million for 2024, aimed at modernizing legacy IT systems and reducing operating costs[44]. Liquidity and Capital Expenditures - Cash and cash equivalents at the end of 2024 were$ 240.7 million, with total liquidity of $458.6 million[10][12]. - Planned capital expenditures for 2025 are approximately$ 125 million, including $90 million funded by the U.S. government[16]. - Total liquidity as of December 31, 2024, was$ 458.6 million, down from $539.4 million as of December 31, 2023, a decrease of about 15%[63]. - Capital expenditures for the three months ended December 31, 2024, were$ 15.2 million, slightly lower than $15.4 million in the same period of 2023[29]. Balance Sheet Highlights - Total assets decreased from$ 1,175.3 million in 2023 to $1,116.7 million in 2024, a decline of approximately 5.0%[28]. - Total current assets decreased from$ 656.8 million in 2023 to $587.3 million in 2024, a decline of about 10.6%[28]. - Cash and cash equivalents decreased from$ 280.6 million in 2023 to $240.7 million in 2024, a decline of approximately 14.3%[28]. - Accounts receivable, net of allowances, increased from$ 811.3 million in 2023 to $908.1 million in 2024, an increase of about 11.9%[28]. - Total liabilities increased from$ 1,175.3 million in 2023 to $1,126.2 million in 2024, an increase of approximately 4.3%[28]. - Current liabilities decreased from$ 481.4 million in 2023 to $281.5 million in 2024, a decline of about 41.7%[28]. - Shareholders' equity decreased from$ 690.5 million in 2023 to $675.3 million in 2024, a decline of approximately 2.2%[28]. - Inventories, net decreased from$ 228.0 million in 2023 to $219.8 million in 2024, a decline of about 3.0%[28]. - Operating lease right-of-use assets remained relatively stable, with a slight increase from$ 11.4 million in 2023 to $11.7 million in 2024[28]. - Intangible assets, net increased from$ 2.7 million in 2023 to $3.4 million in 2024, an increase of approximately 25.9%[28]. Future Outlook - The company expects first-quarter 2025 adjusted EBITDA to be higher than in the fourth quarter 2024, with anticipated increases in shipments and improved melt utilization rates[15]. - Future performance may be affected by the company's ability to achieve its sustainability goals and manage risks related to supply chains and labor costs[25]. - The company is undergoing a multi-year IT transformation initiative aimed at reducing operating costs and increasing information security[37]. - The company is undergoing a multi-year IT transformation initiative to enhance information security and capitalize on market opportunities[54]. - The company plans to continue monitoring market conditions and adjust surcharges accordingly to align with cost fluctuations[58].