German firm SGL Carbon’s sales at $1.16 bn in FY23

March 27, 2024 - Germany

Germany’s SGL Carbon, a leading manufacturer of carbon and graphite products, has reported a slight decrease in group sales in fiscal 2023 (FY23), dropping 4.1 per cent to €1.08 billion (approximately $1.16 billion) from €1.135 billion in the previous year. Despite the downturn, the company's performance was within the anticipated forecast range of €160 to €180 million, showcasing resilience in challenging market conditions.

The adjusted EBITDA for the group also saw a modest decline of 2.5 per cent, falling to €168.4 million compared to €172.8 million in the preceding year. However, the adjusted EBITDA margin saw an improvement, inching up from 15.2 per cent to 15.5 per cent, attributed to the strong performance across other business units, the company said in a press release.

Notably, the graphite solutions (GS) business unit emerged as the largest contributor to the company's consolidated sales, accounting for 51.9 per cent or €565.7 million, an increase from 45.1 per cent or €512.2 million in the previous year. The adjusted EBITDA margin in this segment also improved, moving from 23.1 per cent to 23.7 per cent.

On the other hand, the carbon fibres (CF) business unit experienced a significant decline, with sales dropping 35.2 per cent to €224.9 million from €347.2 million. The adjusted EBITDA in this segment plummeted by 83.3 per cent to €7.2 million.

The composite solutions (CS) business unit, however, maintained a stable performance, with sales nearly unchanged at €153.9 million compared to €153.1 million in the prior year. This stability contributed to an 11 per cent increase in adjusted EBITDA to €22.2 million, improving the adjusted EBITDA margin from 13.1 per cent to 14.4 per cent.

"Demand for carbon fibres for the wind industry fell dramatically at the beginning of 2023. Construction activities for offshore wind turbines, in which our carbon fibres are needed, almost came to a standstill. High raw material costs and interest rates as well as low acceptance prices and high regulatory barriers are currently making the construction of new wind parks almost unprofitable, particularly in Europe. This has also hit our business unit carbon fibres (CF) hard. Accordingly, CF's sales and earnings declined significantly. Nevertheless, the record results of the three other SGL business units almost completely compensated for this downturn, meaning that we still achieved our targets for 2023," said CEO Dr Torsten Derr.