Aurubis (ETR:NDA) reported what management described as a “sound” start to fiscal year 2025–2026, citing stronger metal prices and resilient demand for copper products as key supports for earnings in the first three months of the year. The company also raised its full-year guidance, while noting that cash flow in the quarter was pressured by higher working capital tied to increased metal prices.
Quarterly results driven by higher metal prices, offset by lower TC/RCs
CEO Toralf Haag said operating earnings before taxes (EBT) came in at €105 million, “in line with market expectations,” supported mainly by higher metal prices and a higher metal result. He added that declining treatment and refining charges (TC/RCs) partly offset the benefit.
Operating EBIT was €101 million and operating EBT of €105 million was 19% below the prior-year quarter’s €130 million. Hoffmann attributed the year-over-year decline to higher personnel expenses (up €12 million) and increased depreciation (up €10 million) tied to strategic projects. EBITDA was €164 million versus €184 million last year, reflecting what management said were anticipated higher costs across the group.
Cash flow declined as inventories and receivables rose at higher metal prices
Net cash flow was -€8 million, a sharp decline from +€178 million in the prior-year quarter. Free cash flow before dividend was -€103 million versus €39 million a year ago. Both Haag and Hoffmann emphasized the quarter-end cash flow should be viewed as a “snapshot,” driven largely by working capital effects at record-high metal prices.
Hoffmann outlined the working capital drivers, including:
- Inventories up €495 million
- Receivables up €176 million
- Factoring €100 million lower than the prior-year quarter
- Liabilities up €404 million, partially offsetting the working capital increase
He also noted a €110 million non-cash effect in the “other” line related to valuation changes for financial instruments used for forward sales. Investment cash outflow was €91 million, mainly linked to the Richmond project and a new precious metals refinery in Hamburg.
Operating return on capital employed (ROCE) on a rolling four-quarter basis declined to 7.8% from 11.7%, reflecting lower trailing earnings and higher capital employed due to growth investments.
Operations: higher concentrate throughput; mixed downstream demand by product
Aurubis reported concentrate throughput rose 5% year-over-year to 630,000 tons, supported by what management described as good operational performance. Copper scrap and blister copper output fell 5% to 115,000 tons, which Haag attributed to the quarter’s input mix. Other recycling materials totaled 125,000 tons, slightly above last year.
On the output side, cathode production was 285,000 tons, supported by stable tank house performance. Sulfuric acid output increased 5% to 583,000 tons. Wire rod output was stable at 201,000 tons, while copper shapes output declined 15% to 34,000 tons, with management pointing to lagging demand, trade barriers, and imports. Flat rolled products increased slightly to 22,000 tons, driven especially by specialty wire.
In the Custom Smelting & Products (CSP) segment, gross margin improved slightly to €369 million from €362 million, as a higher metal result was largely offset by lower concentrate TC/RCs. Operating EBIT declined to €122 million from €125 million, with Hoffmann citing scheduled maintenance in Hamburg (an EBIT impact of -€6 million), cost inflation, and higher spending on strategic projects.
In Multimetal Recycling (MMR), gross margin rose to €177 million from €171 million, but operating EBT declined to €18 million from €28 million as higher expected costs and increased depreciation—among other factors at Aurubis Richmond—outweighed the gross margin uplift.
Market conditions: stable premiums, stronger acid prices, tight concentrate market
Management said European spot copper premiums stayed broadly stable at a high level in the quarter, while sulfuric acid prices increased further, supported by strong demand, especially from overseas markets. On the recycling side, refining charges improved in fiscal Q1 as higher metal prices increased scrap availability, though Aurubis expects the benefit to show with a time lag.
Spot TC/RCs for copper concentrates remained low, reflecting a tight concentrate market. Haag said long-term supply contracts and diversified sourcing help manage the environment, and he noted Aurubis has already secured a “very high share” of supply for calendar year 2026, including additional long-term contracts with new mining projects.
In the Q&A, management said it did not see major changes in contract terms for raw materials due to higher metal prices. Asked about scrap export restrictions from Europe, the company said there was “absolutely no update on the timeline,” but it remains in close contact with political authorities.
Guidance raised; Richmond ramp-up continues; hedging details provided
Aurubis raised full-year operating EBT guidance to €375 million to €475 million from €300 million to €400 million. The company also lifted operating EBITDA guidance by €75 million to €655 million to €755 million and raised its operating ROCE forecast to 9% to 11%. By segment, it expects operating EBT of €320 million to €380 million for CSP and €115 million to €175 million for MMR.
For cash generation, Hoffmann said the company expects net cash flow for the full year to be above last year, meaning it should exceed €677 million, and it expects free cash flow before dividends to be at least break-even.
On Aurubis Richmond, management reiterated expectations for break-even on an EBITDA level for the full year, while noting EBT would remain negative. In a follow-up question, Hoffmann said guidance was adjusted down by roughly €20 million on EBITDA for Richmond due to a ramp-up that is “a few weeks slower” than expected last fall, calling the change “very granular.” Management said weather conditions in the U.S. had no major effect on supply and that the site is currently well supplied with materials for the ramp-up “until summer.”
Haag also updated progress on strategic projects, stating that by Dec. 31 around €1.4 billion—about 80% of the approved strategic investment volume—had been invested. He said commissioning for Complex Recycling Hamburg is planned for the first half of fiscal 2025–2026, Pirdop’s tank house expansion is scheduled for 2025–2026, and Richmond Phase 2 commissioning remains planned for this fiscal year.
On hedging, management said the company is hedged at around 60% for copper and around 70% for gold and silver for the current fiscal year. Separately, management noted Aurubis’ long U.S. dollar position remains around $530 million for the fiscal year, with 54% hedged at 1.125, and around 40% hedged for fiscal years 2026–2027 at 1.188.
About Aurubis (ETR:NDA)
Aurubis AG processes metal concentrates and recycling materials in Germany. The company processes scrap metals, organic and inorganic metalbearing recycling raw materials, and industrial residues. It also offers wire rods and specialty wires, shapes, bars and profiles, industrial rolled products, and architectural rolled products. In addition, the company produces gold, silver, tin, lead, lead-bismuth alloy, lead-antimony litharge, tellurium metals, and tellurium dioxide. Further, the company engages in the recycling of copper, copper scrap, alloy scrap and other recycling materials, precious metals, and other non-ferrous metals.
