#Norway #Oslo #EBITDA #Silicones Division #Elkem

Elkem Reports Third Quarter 2025 Results

Elkem, a major player in silicon-based materials, announced its financial results for the third quarter of 2025, revealing an EBITDA of NOK 829 million. This figure, while down from NOK 1,241 million during the same period last year, reflects a firm operational performance and significant cost enhancements across its divisions.

Overview of Financial Performance

In the face of low sales prices impacting the market, Elkem's strategic focus on rigorous operational efficiency has been a cornerstone of its resilience. The company posted a total operating income of NOK 7,523 million, marking a 7% decrease compared to the previous year's third quarter. As part of this report, Elkem disclosed that its earnings per share (EPS) was NOK 0.05 for the quarter, with a year-to-date EPS of NOK -0.77, heavily influenced by results from its Silicones division.

The Silicones division, currently in a strategic review and classified as discontinued operations, has been under scrutiny as Elkem seeks to streamline its business model. This review is an integral part of a broader strategy aimed at refocusing resources and redirecting capital toward more profitable segments, namely Silicon Products and Carbon Solutions.

Division-Specific Insights

Despite the challenges faced by the Silicon Products division due to declining silicon and ferrosilicon prices, the specialty segments within this division have reported improved results. Total operating income for Silicon Products reached NOK 3,369 million, down 8% year-on-year; however, EBITDA fell significantly by 53% year-over-year.

In contrast, the Carbon Solutions division reported an EBITDA of NOK 231 million, slightly reduced by 14% from the previous year, but maintaining a healthy EBITDA margin of 28%. The decline can largely be attributed to lower sales prices combined with increased raw material costs. Conversely, the Silicones division managed to improve its profitability, posting an EBITDA of NOK 248 million. Though its operating income decreased by 6%, cost management and favorable market positioning led to a notable 23% rise in its EBITDA compared to last year.

Strategic Directions

Elkem's CEO, Helge Aasen, expressed optimism about the ongoing strategic review, stating, "Despite challenging market conditions and pricing pressures, Elkem continues to deliver robust operational performance and cost improvements across our three divisions." The company expects the exclusive sales process related to its Silicones division to conclude in 2026, anticipating this move to bolster its market standing significantly.

Current geopolitical uncertainties and evolving trade dynamics raise questions about future profitability, particularly with EU measures aimed at protecting internal production and possibly increasing prices. Elkem is proactive in addressing these evolving challenges, benefiting from a diversified portfolio and solid customer relationships.

Market Impact and Future Outlook

The financial landscape for Elkem remains complex, with weak demand in both the Silicon Products and Carbon Solutions divisions continuing to exert pressure on overall performance. Nonetheless, Elkem underscores its commitment to strategic advancements that align with market trends, ensuring the company is prepared to adapt swiftly.

Recent developments have brought to light the introduction of safeguard measures within the EU, potentially impacting trade dynamics and pricing structures. Additionally, the US has imposed countervailing duties on silicon imports, which might further affect Elkem's operations. Despite these pressures, Elkem remains confident in its capability to navigate these challenges successfully.

In conclusion, Elkem's third-quarter results depict a company poised for transformation, underpinned by strategic initiatives aimed at improving operational efficacy and positioning it for future growth. As the company looks forward, its focus on innovation and sustainable solutions will likely play a pivotal role in its trajectory within the silicon-based materials industry.