Q3_19_Earnings Release

 

 

 

 SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

Pursuant to Rule 13a-16 or 15d-16

under the Securities Exchange Act of 1934

 

For the Month of December, 2019

 

Commission File Number: 001-37668

 

FERROGLOBE PLC

(Name of Registrant)

 

2nd Floor West Wing, Lansdowne House

57 Berkeley Square

London, W1J 6ER

(Address of Principal Executive Office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F 

Form 40-F 

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):     

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):     

 

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

 

Yes 

No  

 

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):  N/A

 


 

 

This Form 6-K consists of the following materials, which appear immediately following this page:

 

·

Press release dated December 2, 2019 announcing results for the quarter ended September 30, 2019

·

Third quarter earnings call presentation

 

Ferroglobe Reports Third Quarter Results of 2019

 

Sales of $381.7 million; Net Loss of $(140.1) million; Adjusted EBITDA of $(7.2) million

 

·

Q3 sales of $381.7 million, compared to $409.5 million in Q2 2019 and $524.4 million in Q3 2018

·

Q3 net loss of $(140.1) million compared to a net loss of $(43.7) million in Q2 2019 and a net loss of $(2.9) million in Q3 2018, with the Q3 2019 net loss including a goodwill impairment charge of $174.0 million

·

Q3 adjusted net loss attributable to Parent of $(16.1) million compared to a net loss of $(22.2) million in Q2 2019 and a net loss of $(0.1) million in Q3 2018

·

Q3 adjusted EBITDA of $(7.2) million compared to $5.0 million in Q2 2019 and $43.9 million in Q3 2018

·

Successful closing of the divestiture of FerroAtlántica, S.A.U. on August 30, 2019, resulting in gross proceeds of $171.2 million and a profit on disposal of $80.7 million

·

Successful closing of a new, five-year $100 million North American asset-based revolving credit facility on October 11, 2019 and repayment of the Company’s previous revolving credit facility

·

Further operational changes announced to the global production platform in an effort to streamline operations, adapting production to reduced demand and decreasing inventory levels

 

LONDON,  December 2, 2019 (GLOBE NEWSWIRE) – Ferroglobe PLC (NASDAQ: GSM) (throughout, “Ferroglobe”, the “Company”, or the “Parent”), the world’s leading producer of silicon metal, and a leading silicon- and manganese-based specialty alloys producer, today announced results for the third quarter of 2019.

 

Earnings Highlights

 

In Q3 2019, Ferroglobe posted a net loss of $(140.1) million, or $(0.83) per share on a fully diluted basis. On an adjusted basis, Q3 2019 net loss was $(16.1) million, or $(0.10) per share on a fully diluted basis.

 

Q3 2019 reported EBITDA was $(183.1) million, down from $(7.1) million in the prior quarter. On an adjusted basis, Q3 2019 EBITDA was $(7.2) million, down from Q2 2019 adjusted EBITDA of $5.0 million. The Company reported an adjusted EBITDA margin of -1.9% for Q3 2019, compared to an adjusted EBITDA margin of 1.2% for Q2 2019.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

Quarter Ended

    

Quarter Ended

 

Quarter Ended

 

Nine Months Ended

    

Nine Months Ended

$,000 (unaudited)

 

September 30, 2019

 

June 30, 2019

 

September 30, 2018 *

 

September 30, 2019

 

September 30, 2018 *

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

381,745

 

$

409,479

 

$

524,407

 

$

1,238,615

 

$

1,650,950

Net (loss) profit

 

$

(140,139)

 

$

(43,658)

 

$

(2,916)

 

$

(212,351)

 

$

98,728

Diluted EPS

 

$

(0.83)

 

$

(0.24)

 

$

(0.01)

 

$

(1.23)

 

$

0.60

Adjusted net (loss) income attributable to the parent

 

$

(16,085)

 

$

(22,221)

 

$

(135)

 

$

(60,200)

 

$

59,189

Adjusted diluted EPS

 

$

(0.10)

 

$

(0.13)

 

$

(0.00)

 

$

(0.36)

 

$

0.34

Adjusted EBITDA

 

$

(7,210)

 

$

5,035

 

$

43,864

 

$

1,152

 

$

206,867

Adjusted EBITDA margin

 

 

-1.9%

 

 

1.2%

 

 

8.4%

 

 

0.1%

 

 

12.5%

 

* The amounts for prior periods have been restated to reflect the impact of the profit / (loss) from discontinued operations associated with the sale of the Company’s Spanish hydroelectric plants

 

Pedro Larrea, Ferroglobe’s Chief Executive Officer commented, “The overall market weakness has adversely impacted our third quarter financials and is expected to linger for the remainder of 2019.” Mr. Larrea continued, “Although we are beginning to see some positive data points across our key products, we continue to right-size our cost structure and production platform in anticipation of demand and pricing uncertainty into 2020. The measures we are now taking are aimed at returning to positive cash-flow, and these operational changes should also help maximize our profitability as soon as the market environment improves.”

 

Cash Flow and Balance Sheet

 

Cash used in operations during Q3 2019 was $82.3 million, including a $66.2 million net movement in respect of securitized accounts receivable and interest and tax paid of $19.6 million.

 

Working capital increased from $410.4 million at June 30, 2019 to $578.7 million at September 30, 2019, driven by an increase in trade receivables of $181.7 million as a result of consolidating trade receivables sold pursuant to the Company’s accounts receivable securitization program.  The securitized trade receivables were consolidated due to an amendment to the program in September 2019. Excluding the consolidation of the securitized trade receivables, working capital decreased from $410.4 million to $397.0 million. 

 

Net debt was $368.3 million as of September 30, 2019, down from $478.3 million as of June 30, 2019.

 

Following a review of the carrying value of the Company’s assets as of September 30, 2019, in the light of prevailing market conditions, the Company has determined that the value of goodwill with respect to the Company’s US and Canadian operations has been impaired. Accordingly, we have recorded total impairment charges of $174.0 million, with $143.2 million allocated  to Ferroglobe’s US operations and $30.8 million allocated to the Canadian operations, resulting in a revised goodwill carrying value of $29.7 million at September 30, 2019. A further review will be undertaken at year end.

 

Beatriz García-Cos, Ferroglobe’s Chief Financial Officer commented, “The entire management team is committed to returning the Company to profitability and delivering a healthier liquidity position and stronger balance sheet. The operational changes support the financial strategy and will help us achieve these goals.”

 

Successful closing of non-core asset divestitures

 

FerroAtlántica, S.A.U.

 

On August 30, 2019, Ferroglobe successfully completed and closed the previously-announced sale of its 100% interest in subsidiary FerroAtlántica, S.A.U. (“FerroAtlántica”), which includes ten hydroelectric power plants and the Cee-Dumbria ferroalloys factory, to affiliates of TPG Sixth Street Partners. The transaction, valued at €170 million ($189.0 million), provided the Company with gross proceeds of €154.0 million ($171.2 million), after closing adjustments.

 

Ultracore Polska ZOO

 

On September 28, 2019, Ferroglobe closed on the sale of its subsidiary Ultracore Polska ZOO, which manufactures cored wire in Poland, for net proceeds of $2.2 million.    

 

Timberlands in South Africa

 

On October 4, 2019, Ferroglobe subsidiary, Silicon Smelters (Pty.) Ltd. completed the sale of its remaining timberlands in South Africa for net proceeds of ZAR 130 million ($8.58 million)

 

Pedro Larrea commented, “Non-core asset divestitures have been an important element of our cash generation initiatives this year.  Of the assets we previously announced for sale, we have now closed on all but one transaction.  The sale process for our French energy assets continues and will likely carry into next year. Additionally, we are reviewing our portfolio for additional assets which could be deemed non-core to the business and will provide an update should we move forward with any other disposals.”

 

Other recent developments

 

Ferroglobe continues to make progress with various initiatives to ‘right-size’ its operational footprint and enhance its financial position. These initiatives are aimed at balancing production with demand, improving the Company’s cost structure and generating cash.

 

On October 4, 2019, Ferroglobe announced further adjustments to its global production platform, to streamline operations, adapt production to reduced demand and release cash through the workdown of inventory. The announced changes reduce the Company’s global production capacity for silicon metal, silicon-based alloys and manganese-based alloys. In France, the

Chateau-Feuillet, Montricher and Laudun facilities will reduce production. In North America, the Bécancour, Quebec and Bridgeport, Alabama facilities will reduce production in the near-term.

 

Most recently the Company has undertaken an extended outage at its Mo I Rana facility in Norway. Both furnaces (producing manganese alloys) were idled on October 28, 2019. Customer orders from this plant have been shifted to the other facilities in order to optimize the Company’s utililization, logistics and overall economics.

 

In the aggregate these measures will reduce the Company’s immediate production capacity across all major product categories. With these operational changes, Ferroglobe’s current silicon metal capacity (annualized run-rate) will decline to 186,000 tons, down 56,000 tons from 242,000 tons at the end of Q3 2019. Silicon-based alloys capacity will decline to 354,000 tons, down 88,000 tons from 442,000 tons at the end of Q3 2019. Lastly, the Company’s manganese-based alloys capacity will decline to 538,000 tons, down 125,000 tons from 663,000 tons at the end of Q3 2019. 

 

On October 11, 2019, Ferroglobe completed the closing of a new five year $100 million North American asset-based revolving credit facility (“ABL”), replacing the Company’s revolving credit facility (“RCF”). The replacement of the RCF marks an important step in the Company’s overall strategy to de-risk the balance sheet. The new ABL has no leverage-based or financial-based covenants and offers reduced liquidity requirements as compared to the prior RCF, thereby enhancing the Company’s flexibility. 

 

Discussion of Third Quarter 2019 Results

 

Sales

 

Sales for Q3 2019 were $381.7 million, a decrease of 6.8% compared to $409.5 million in Q2 2019. For Q3 2019, total shipments were down 3.8% and the average selling price was down 3.5% compared with Q2 2019.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

Quarter Ended

    

Quarter Ended

 

 

    

Quarter Ended

 

 

 

Nine Months Ended

    

Nine Months Ended

 

 

 

 

September 30, 2019

 

June 30, 2019

 

Change

 

September 30, 2018

 

Change

 

September 30, 2019

 

September 30, 2018

 

Change

Shipments in metric tons:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Silicon Metal

 

 

60,225

 

 

54,084

 

11.4%

 

 

81,686

 

-26.3%

 

 

176,578

 

 

259,214

 

-31.9%

Silicon-based Alloys

 

 

69,879

 

 

79,264

 

-11.8%

 

 

75,964

 

-8.0%

 

 

230,944

 

 

230,506

 

0.2%

Manganese-based Alloys

 

 

93,996

 

 

99,555

 

-5.6%

 

 

98,280

 

-4.4%

 

 

297,221

 

 

276,913

 

7.3%

Total shipments*

 

 

224,100

 

 

232,903

 

-3.8%

 

 

255,930

 

-12.4%

 

 

704,743

 

 

766,633

 

-8.1%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average selling price ($/MT):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Silicon Metal

 

$

2,175

 

$

2,320

 

-6.3%

 

$

2,636

 

-17.5%

 

$

2,284

 

$

2,726

 

-16.2%

Silicon-based Alloys

 

$

1,490

 

$

1,572

 

-5.2%

 

$

1,802

 

-17.3%

 

$

1,582

 

$

1,889

 

-16.3%

Manganese-based Alloys

 

$

1,140

 

$

1,188

 

-4.0%

 

$

1,211

 

-5.9%

 

$

1,167

 

$

1,289

 

-9.5%

Total*

 

$

1,527

 

$

1,582

 

-3.5%

 

$

1,841

 

-17.1%

 

$

1,583

 

$

1,955

 

-19.0%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average selling price ($/lb.):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Silicon Metal

 

$

0.99

 

$

1.05

 

-6.3%

 

$

1.20

 

-17.5%

 

$

1.04

 

$

1.24

 

-16.2%

Silicon-based Alloys

 

$

0.68

 

$

0.71

 

-5.2%

 

$

0.82

 

-17.3%

 

$

0.72

 

$

0.86

 

-16.3%

Manganese-based Alloys

 

$

0.52

 

$

0.54

 

-4.0%

 

$

0.55

 

-5.9%

 

$

0.53

 

$

0.58

 

-9.5%

Total*

 

$

0.69

 

$

0.72

 

-3.5%

 

$

0.84

 

-17.1%

 

$

0.72

 

$

0.89

 

-19.0%


* Excludes by-products and other

 

Sales Prices & Volumes By Product

 

During Q3 2019, total product average selling prices decreased by 3.5% versus Q2 2019. Q3 average selling prices of silicon metal decreased 6.3%, silicon-based alloys decreased 5.2%, and manganese-based alloys decreased 4.0%.  Sales volumes in Q3 declined by 3.8% versus the prior quarter.  Q3 sales volumes of silicon metal increased 11.4%, silicon-based alloys decreased 11.8%, and manganese-based alloys decreased 5.6% versus Q2 2019.

 

Cost of Sales

 

Cost of sales was $277.7 million in Q3 2019, a decrease from $292.4 million in the prior quarter. Cost of sales as a percentage of sales increased to 72.8% in Q3 2019 versus 71.4% for Q2 2019.

 

Other Operating Expenses

 

Other operating expenses was $50.1 million in Q3 2019, a decrease from $62.9 million in the prior quarter, primarily due to contract termination costs incurred in Q2 2019 related to the solar joint venture. 

 

Net Loss Attributable to the Parent

 

In Q3 2019, net loss attributable to the Parent was $140.5 million, or $(0.83) per diluted share, compared to a net loss attributable to the Parent of $40.8 million, or $(0.24) per diluted share in Q2 2019.

 

Adjusted EBITDA

 

In Q3 2019, adjusted EBITDA was $(7.2) million, or -1.9% of sales, compared to adjusted EBITDA of $5.0 million, or 1.2% of sales in Q2 2019.

 

Conference Call

 

Ferroglobe management will review the third quarter results of 2019 during a conference call at 9:00 a.m. Eastern Time on December 3, 2019.

 

The dial-in number for participants in the United States is 877‑293‑5491 (conference ID 5768864). International callers should dial +1 914‑495‑8526 (conference ID 5768864). Please dial in at least five minutes prior to the call to register. The call may also be accessed via an audio webcast available at https://edge.media-server.com/mmc/p/8nkuu92x.

 

About Ferroglobe

 

Ferroglobe is one of the world’s leading suppliers of silicon metal, silicon-based and manganese-based specialty alloys and other ferroalloys, serving a customer base across the globe in dynamic and fast-growing end markets, such as solar, automotive, consumer products, construction and energy. The Company is based in London. For more information, visit http://investor.ferroglobe.com.

 

Forward-Looking Statements

 

This release contains “forward-looking statements” within the meaning of U.S. securities laws. Forward-looking statements are not historical facts but are based on certain assumptions of management and describe the Company’s future plans, strategies and expectations. Forward-looking statements often use forward-looking terminology, including words such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “forecast”, “guidance”, “intends”, “likely”, “may”, “plan”, “potential”, “predicts”, “seek”, “target”, “will” and words of similar meaning or the negative thereof.

 

Forward-looking statements contained in this press release are based on information currently available to the Company and assumptions that management believe to be reasonable, but are inherently uncertain. As a result, Ferroglobe’s actual results, performance or achievements may differ materially from those expressed or implied by these forward-looking statements, which are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company’s control.

 

Forward-looking financial information and other metrics presented herein represent the Company’s goals and are not intended as guidance or projections for the periods referenced herein or any future periods.

 

All information in this press release is as of the date of its release. Ferroglobe does not undertake any obligation to update publicly any of the forward-looking statements contained herein to reflect new information, events or circumstances arising after the date of this press release. You should not place undue reliance on any forward-looking statements, which are made only as of the date of this press release.

 

Non-IFRS Measures

 

Adjusted EBITDA, adjusted EBITDA margin, adjusted net profit, adjusted profit per share, working capital and net debt, are non-IFRS financial metrics that, we believe, are pertinent measures of Ferroglobe’s success. Ferroglobe has included these financial metrics to provide supplemental measures of its performance. The Company believes these metrics are important because they eliminate items that have less bearing on the Company’s current and future operating performance and highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures.

 

INVESTOR CONTACT:

Gaurav Mehta
EVP – Investor Relations 
Email:   investor.relations@ferroglobe.com

Ferroglobe PLC and Subsidiaries

Unaudited Condensed Consolidated Income Statement

(in thousands of U.S. dollars, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

    

Quarter Ended

    

Quarter Ended

 

Nine Months Ended

    

Nine Months Ended

 

    

September 30, 2019

 

June 30, 2019

 

September 30, 2018*

 

September 30, 2019

 

September 30, 2018*

Sales

  

$

381,745

 

$

409,479

 

$

524,407

 

$

1,238,615

 

$

1,650,950

Cost of sales

  

 

(277,692)

 

 

(292,432)

 

 

(334,340)

 

 

(899,492)

 

 

(998,629)

Other operating income

  

 

13,215

 

 

14,530

 

 

5,630

 

 

41,766

 

 

20,925

Staff costs

  

 

(72,536)

 

 

(74,852)

 

 

(88,134)

 

 

(221,651)

 

 

(258,206)

Other operating expense

  

 

(50,060)

 

 

(62,924)

 

 

(63,920)

 

 

(166,901)

 

 

(207,223)

Depreciation and amortization charges, operating allowances and write-downs

  

 

(29,591)

 

 

(30,204)

 

 

(29,587)

 

 

(90,165)

 

 

(85,492)

Bargain purchase gain

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

 

44,633

Other (loss) gain

 

 

(3,774)

 

 

275

 

 

221

 

 

(3,896)

 

 

2,936

Operating (loss) profit before impairment losses

 

 

(38,693)

 

 

(36,128)

 

 

14,277

 

 

(101,724)

 

 

169,894

Impairment losses

 

 

(174,018)

 

 

(1,195)

 

 

 —

 

 

(175,353)

 

 

 —

Operating (loss) profit

 

 

(212,711)

 

 

(37,323)

 

 

14,277

 

 

(277,077)

 

 

169,894

Net finance expense

  

 

(16,491)

 

 

(15,047)

 

 

(12,992)

 

 

(45,361)

 

 

(38,292)

Financial derivatives (loss) gain

 

 

2,913

 

 

(295)

 

 

388

 

 

3,882

 

 

1,455

Exchange differences

  

 

(5,083)

 

 

5,080

 

 

(3,071)

 

 

(1,482)

 

 

(11,050)

(Loss) profit before tax

  

 

(231,372)

 

 

(47,585)

 

 

(1,398)

 

 

(320,038)

 

 

122,007

Income tax benefit (expense)

  

 

14,322

 

 

4,890

 

 

(663)

 

 

27,422

 

 

(28,350)

(Loss) profit for the period from continuing operations

 

 

(217,050)

 

 

(42,695)

 

 

(2,061)

 

 

(292,616)

 

 

93,657

Profit (loss) for the period from discontinued operations

 

 

76,911

 

 

(963)

 

 

(855)

 

 

80,265

 

 

5,071

(Loss) profit for the period

 

 

(140,139)

 

 

(43,658)

 

 

(2,916)

 

 

(212,351)

 

 

98,728

Loss attributable to non-controlling interest

  

 

(385)

 

 

2,835

 

 

1,671

 

 

4,174

 

 

4,145

(Loss) profit attributable to the parent

  

$

(140,524)

 

$

(40,823)

 

$

(1,245)

 

$

(208,177)

 

$

102,873

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA

 

$

(183,120)

 

$

(7,119)

 

$

43,864

 

$

(186,912)

 

$

255,386

Adjusted EBITDA

 

$

(7,210)

 

$

5,035

 

$

43,864

 

$

1,152

 

$

206,867

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

169,123

 

 

169,123

 

 

171,935

 

 

169,123

 

 

171,966

Diluted

 

 

169,123

 

 

169,123

 

 

171,935

 

 

169,123

 

 

172,104

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) profit per ordinary share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.83)

 

$

(0.24)

 

$

(0.01)

 

$

(1.23)

 

$

0.60

Diluted

 

$

(0.83)

 

$

(0.24)

 

$

(0.01)

 

$

(1.23)

 

$

0.60

 

* The amounts for prior periods have been restated to reflect the impact of the profit / (loss) from discontinued operations associated with the sale of the Company’s Spanish hydroelectric plants

Ferroglobe PLC and Subsidiaries

Unaudited Condensed Consolidated Statement of Financial Position

(in thousands of U.S. dollars)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

June 30,

 

December 31,

 

    

2019

    

2019

    

2018

ASSETS

Non-current assets

 

 

 

 

 

 

 

 

 

 

Goodwill

 

$

 

29,702

 

$

204,089

 

$

202,848

Other intangible assets

 

 

 

63,980

 

 

62,778

 

 

51,822

Property, plant and equipment

 

 

 

742,752

 

 

784,272

 

 

888,862

Other non-current financial assets

 

 

 

3,381

 

 

20,042

 

 

70,343

Deferred tax assets

 

 

 

50,214

 

 

22,915

 

 

14,589

Non-current receivables from related parties

 

 

 

2,178

 

 

2,276

 

 

2,288

Other non-current assets

 

 

 

1,780

 

 

9,746

 

 

10,486

Non-current restricted cash and cash equivalents

 

 

 

10,889

 

 

 —

 

 

 —

Total non-current assets

 

 

 

904,876

 

 

1,106,118

 

 

1,241,238

Current assets

 

 

 

 

 

 

 

 

 

 

Inventories

 

 

 

479,866

 

 

504,527

 

 

456,970

Trade and other receivables

 

 

 

332,603

 

 

158,252

 

 

155,996

Current receivables from related parties

 

 

 

2,839

 

 

3,000

 

 

14,226

Current income tax assets

 

 

 

41,649

 

 

31,610

 

 

27,404

Other current financial assets

 

 

 

1,660

 

 

7,840

 

 

2,523

Other current assets

 

 

 

12,157

 

 

12,289

 

 

8,813

Cash and cash equivalents *

 

 

 

177,154

 

 

187,673

 

 

216,647

Assets and disposal groups classified as held for sale

 

 

 

8,507

 

 

97,862

 

 

 —

Total current assets

 

 

 

1,056,435

 

 

1,003,053

 

 

882,579

Total assets

 

$

 

1,961,311

 

$

2,109,171

 

$

2,123,817

 

 

 

 

 

 

 

 

 

 

 

EQUITY AND LIABILITIES

Equity

 

$

 

664,300

 

$

816,080

 

$

884,372

Non-current liabilities

 

 

 

 

 

 

 

 

 

 

Deferred income

 

 

 

4,061

 

 

8,108

 

 

1,434

Provisions

 

 

 

78,272

 

 

80,218

 

 

75,787

Bank borrowings

 

 

 

130,622

 

 

 —

 

 

132,821

Lease liabilities

 

 

 

16,417

 

 

18,629

 

 

53,472

Debt instruments

 

 

 

343,400

 

 

342,806

 

 

341,657

Other financial liabilities

 

 

 

10,307

 

 

24,585

 

 

32,788

Other non-current liabilities

 

 

 

29,982

 

 

25,246

 

 

25,030

Deferred tax liabilities

 

 

 

82,192

 

 

64,520

 

 

77,379

Total non-current liabilities

 

 

 

695,253

 

 

564,112

 

 

740,368

Current liabilities

 

 

 

 

 

 

 

 

 

 

Provisions

 

 

 

51,667

 

 

44,007

 

 

40,570

Bank borrowings

 

 

 

130,272

 

 

172,890

 

 

8,191

Lease liabilities

 

 

 

8,218

 

 

8,692

 

 

12,999

Debt instruments

 

 

 

2,734

 

 

10,938

 

 

10,937

Other financial liabilities

 

 

 

49,978

 

 

52,594

 

 

52,524

Payables to related parties

 

 

 

9,160

 

 

9,884

 

 

11,128

Trade and other payables

 

 

 

233,811

 

 

252,372

 

 

256,823

Current income tax liabilities

 

 

 

11,173

 

 

1,766

 

 

2,335

Other current liabilities

 

 

 

104,745

 

 

95,150

 

 

103,570

Liabilities associated with assets classified as held for sale

 

 

 

 —

 

 

80,686

 

 

 —

Total current liabilities

 

 

 

601,758

 

 

728,979

 

 

499,077

Total equity and liabilities

 

$

 

1,961,311

 

$

2,109,171

 

$

2,123,817

 

* Cash and cash equivalents include current restricted cash of $42,834 at September 30, 2019 ($nil at June 30, 2019 and December 31, 2018)

Ferroglobe PLC and Subsidiaries

Unaudited Condensed Consolidated Statement of Cash Flows

(in thousands of U.S. dollars)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

    

Quarter Ended

    

Quarter Ended

 

 

Nine Months Ended

    

Nine Months Ended

 

    

September 30, 2019

 

June 30, 2019

 

September 30, 2018

 

 

September 30, 2019

 

September 30, 2018

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) profit for the period

 

$

(140,139)

 

$

(43,658)

 

$

(2,916)

 

 

$

(212,351)

 

$

98,728

Adjustments to reconcile net (loss) profit
to net cash used by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax (benefit) expense

 

 

(14,489)

 

 

(5,215)

 

 

573

 

 

 

(26,408)

 

 

30,543

Depreciation and amortization charges,
operating allowances and write-downs

 

 

29,591

 

 

31,327

 

 

30,750

 

 

 

92,995

 

 

89,075

Net finance expense

 

 

20,893

 

 

16,145

 

 

13,952

 

 

 

51,794

 

 

41,520

Financial derivatives loss (gain)

 

 

(2,913)

 

 

295

 

 

(388)

 

 

 

(3,882)

 

 

(1,455)

Exchange differences

 

 

5,083

 

 

(5,080)

 

 

3,071

 

 

 

1,482

 

 

11,050

Impairment losses

 

 

174,018

 

 

1,195

 

 

 —

 

 

 

175,353

 

 

 —

Bargain purchase gain

 

 

 —

 

 

 —

 

 

 —

 

 

 

 —

 

 

(44,633)

Gain on disposal of discontinued operation

 

 

(80,729)

 

 

 —

 

 

 —

 

 

 

(80,729)

 

 

 —

Share-based compensation

 

 

1,015

 

 

933

 

 

1,050

 

 

 

3,280

 

 

1,782

Other adjustments

 

 

3,774

 

 

(275)

 

 

(221)

 

 

 

3,896

 

 

(2,936)

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Increase) decrease  in inventories

 

 

5,953

 

 

(46,950)

 

 

(25,666)

 

 

 

(40,962)

 

 

(192,197)

(Increase) decrease in trade receivables

 

 

5,568

 

 

(32,316)

 

 

6,224

 

 

 

1,623

 

 

(13,546)

Increase (decrease) in trade payables

 

 

(10,693)

 

 

21,625

 

 

(21,213)

 

 

 

(12,035)

 

 

49,638

Other

 

 

(59,689)

 

 

28,472

 

 

10,543

 

 

 

(21,430)

 

 

(32,410)

Income taxes paid

 

 

(846)

 

 

(540)

 

 

(5,257)

 

 

 

(3,066)

 

 

(29,425)

Interest paid

 

 

(18,713)

 

 

(3,341)

 

 

(18,400)

 

 

 

(40,562)

 

 

(38,658)

Net cash (used) provided by operating activities

 

 

(82,316)

 

 

(37,383)

 

 

(7,898)

 

 

 

(111,002)

 

 

(32,924)

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and finance income received

 

 

626

 

 

486

 

 

638

 

 

 

1,502

 

 

2,990

Payments due to investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Acquisition of subsidiary

 

 

9,088

 

 

 —

 

 

 —

 

 

 

9,088

 

 

(20,379)

Other intangible assets

 

 

 —

 

 

(50)

 

 

(149)

 

 

 

(184)

 

 

(3,073)

Property, plant and equipment

 

 

(6,269)

 

 

(7,128)

 

 

(25,696)

 

 

 

(26,845)

 

 

(78,005)

Other

 

 

 —

 

 

(627)

 

 

 —

 

 

 

(627)

 

 

(8)

Disposals:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Disposal of subsidiaries

 

 

171,058

 

 

 —

 

 

 —

 

 

 

171,058

 

 

 —

Other non-current assets

 

 

 —

 

 

 —

 

 

 —

 

 

 

 —

 

 

12,734

Other

 

 

19

 

 

1,638

 

 

947

 

 

 

3,416

 

 

6,861

Net cash used by investing activities

 

 

174,522

 

 

(5,681)

 

 

(24,260)

 

 

 

157,408

 

 

(78,880)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends paid

 

 

 —

 

 

 —

 

 

(10,321)

 

 

 

 —

 

 

(20,642)

Payment for debt issuance costs

 

 

(2,093)

 

 

 —

 

 

 —

 

 

 

(2,798)

 

 

(4,476)

Repayment of hydro leases

 

 

(55,352)

 

 

 —

 

 

 —

 

 

 

(55,352)

 

 

 —

Repayment of other financial liabilities

 

 

 —

 

 

 —