Battery metals company Umicore has slashed its 2024 earnings forecast and said demand for its battery materials has declined steeply in recent weeks.
The 2024 volumes for battery materials could be “equal or slightly lower than last year”, it said. It lowered its full year 2024 guidance for the Battery Materials Business Group on 12 June and now expects adjusted EBITDA for the business to be around break-even. Previously, it expected EBITDA for the unit in the order of €135 million ($144 million).
The overall performance of its foundation businesses (catalysis, recycling and specialty materials) continues to be robust and overall in line with market expectations, it said.
Umicore said it had experienced a reduction in cathode materials sales driven by volumes from legacy contracts coming to an end faster than anticipated and a delay in the anticipated volume ramp-up of new contracts in Europe. Customers are scaling back their electrification ramp-up plans. The volumes for a Chinese battery OEM did not materialise in 2024, it added.
The Belgian company is now reassessing growth projections post 2024 based on the slowdown in investment plans by EV manufacturers. It will also adjust its capex plans to match the growth pace of its customer base. It will adjust its cost structure, but gave no details what this would entail.
Bart Sap, CEO of Umicore, said: “Our short-term outlook in Battery Materials is clearly disappointing. At the same time the electro-mobility trajectory is and will not be linear, like in any other significant industry transformation.
Shares in Umicore, which is listed on the Euronext Brussels stock exchange, fell 8% on the news and have lost 39% of their value over the previous 12 months.
