Aperam's Profits Plummet in Fourth Quarter of 2022

Luxembourg [Europe]: Aperam SA, a Luxembourg-based Stainless-Steel producer and recycler, reported higher revenue and shipments in 2022 due to its full-year ownership of scrap subsidiary ELG Metals. The company credits the acquisition for its increased success this year.

Aperam recorded €8.15 billion in sales in 2022, which marked a 37.4% increase from the 2021 figure of €5.1 billion. Despite this rise in revenue, however, the company's earnings before interest, taxes, depreciation and amortization (EBITDA) dropped by 9.3% in 2022, going from €1.186 billion to €1.076 billion between 2021 and 2022 respectively.

Aperam reported a decline in both sales and profits for the fourth quarter of 2022. According to the company, the 11% decrease from the prior quarter was due to "pronounced destocking by customers in Europe."

Good news turned bad in the fourth quarter of 2022 - EBITDA decreased by 41% from 235 million euros ($250.7 million) to 129 million euros ($137.6 million). A hefty decrease for shareholders, employees, and investors alike. Aperam, a global leader in Stainless Steel production, has attributed its recent struggles to "negative inventory valuation, lower volumes, and a price/cost squeeze."

Aperam's full year review of 2022 revealed some significant factors that attributed to their remarkable revenue growth. These included the consolidation of ELG, as well as higher realized prices. In terms of shipment volumes, Aperam managed to increase their overall metric tons from 1.82 million in 2021 to 2.3 million in 2022; an impressive surge of nearly 27%.

The company announced in December of 2022 that changes to the leadership team were made in order to meet their goal of becoming a competitive and diversified player in the circular economy. This decision was based on personnel and corporate strategy plans that were implemented earlier that same year.

Aperam states Bernard Hallemans “took over the current chief technology officer (CTO) organization, with the ESG team and projects at its core [and] Aperam Recycling also being part of his perimeter.” Geert Verbeeck was appointed as the CEO of Stainless Europe by the company. Verbeeck has “extensive experience in leading and transforming large industrial operations at ArcelorMittal, and his recent experience as CTO of Aperam are extremely valuable to further strengthen our European operations,” the company states.

Aperam runs four melt shops: two based in Belgium, one in Brazil and the other in France. This organization's recycling activities span around 50 ELG facilities across Europe, North America and other places, as well as the Recyco furnace dust and slag recycling operations.