Steel Product Producers

GrafTech Swings to a Loss in Q3

November 3, 2023

GrafTech International reported a bumpy third quarter. But despite the challenges, the company said it’s certain improvement is on the horizon.

GrafTech International

Third quarter ended Sept. 30	2023	2022	% Change
Net sales	$159	$304	-47.7%
Net earnings (loss)	($23)	$93	-124.2%
Per diluted share	($0.09)	$0.36	-125%
Nine months ended Sept. 30
Net sales	$483	$1,034	-53.2%
Net earnings (loss)	($38)	$333	-111.4%
Per diluted share	($0.15)	$1.28	-111.7%

(in millions of dollars except per share)

“Third-quarter results fell short of our expectations, primarily as a result of lower industry demand,” said Marcel Kessler, president and CEO of GrafTech, in the earnings release.

The Ohio-based electrode manufacturer reported sales of $159 million, down 48% from $304 million in Q3’22. It swung to a loss of $23 million in Q3 from net income of $93 million during the same quarter one year ago.

Sales volumes of 24,200 thousand metric tons in Q3’23 were down year over year, dropping 32.1% from 35,700 thousand metric tons in Q3’22.

On the Nov. 3 earnings call, Kessler attributed the lower demand to a down steel market.

“The global steel industry remains constrained by geopolitical conflict and economic uncertainty, which has resulted in a persistently soft commercial environment and weak demand, and declining prices for graphite electrodes,” Kessler said on the call.

Tim Flanagan, CFO and treasurer, noted that decarbonization efforts contribute to the sales of graphite electrodes.

“We estimate that planned EAF capacity additions, based on steel producer announcements, along with production increases at existing EAF plants have the potential to bring in incremental 200,000 metric tons of annual graphite electrode demand,” he said.

Kessler will be stepping down as CEO of GrafTech beginning Nov. 15, but will remain on the company’s board of directors. Tim Flanagan, current CFO and treasurer, will serve as interim CEO.

Becca Moczygemba

Becca Moczygemba is a reporter and editor for Steel Market Update. She has been in the steel industry since 2017, specializing in flat-rolled products. Prior to joining SMU, she held positions at Mitsui & Co. and Kloeckner Metals. Becca has a BA in Organizational/Corporate Communication from the University of Houston and an MBA from Norwich University. Contact Becca at becca@steelmarketupdate.com or 724-720-1000.