6 March 2025      

 

THIS ANNOUNCMENT CONTAINS INSIDE INFORMATION

 

Full Year Results for the twelve months ended 31 December 2024

Vesuvius plc, a global leader in molten metal flow engineering and technology, announces its audited results for the twelve months ended 31 December 2024.

 

Financial summary		2024 (£m)	2023 (£m)	Underlying change(1)	Year-on-year change
Headline
Revenue		1,820.1	1,929.8	(1.8%)	(5.7%)
Trading Profit (2) (EBITA)		188.0	200.4	(0.2%)	(6.2%)
Return on Sales (2)		10.3%	10.4%	+10bps	-10bps
Headline basic EPS (2) (pence)		43.3	46.7	+2.1%	(7.2%)
Free cash flow (2)		60.8	128.2	NA	(52.6%)
Net Debt / EBITDA(2)		1.3x	0.9x	NA	+0.4x
Statutory
Operating Profit		153.7	190.1	(13.8%)	(19.1%)
Profit Before Tax		138.6	179.4	(16.3%)	(22.7%)
Statutory basic EPS (pence)		33.5	44.0	(16.0%)	(23.8%)
Cash inflow from operations		216.7	272.0	NA	(20.3%)
Dividend (pence per share)		23.5	23.0	NA	+2.2%

 

 ⁽¹⁾ Underlying basis is at constant currency and excludes separately reported items, and the impact of acquisitions and disposals.

⁽²⁾ For definitions of non-GAAP measures, refer to Note 16 in the Condensed Group Financial Statements.

 

Highlights

·   Robust Group performance with market share gains in Flow Control and Foundry, delivered in challenging market conditions

·    Together with resilient pricing and cost reductions, this partially offset weak end markets experienced in the Foundry Division

·      Group revenue, trading profit and return on sales stable year-on-year on an underlying basis

·      Good performance by our Steel Division despite weaker markets than originally anticipated

·    Positive net pricing across the year

·    Flow Control continues to gain market share

·    RoS improved by 110bps (underlying) to 11.4% driven by cost savings and net positive pricing

·     Challenging year for the Foundry Division as markets outside of India weakened, offsetting strategic progress

·    Good market share gains overall

·    Accelerated delivery of cost-savings

·    Return on sales reduced by 230bps (underlying) to 7.4%, with low activity in EU+UK, North America and North Asia

·     Acceleration of our group-wide cost reduction programme with £13m delivered in-year and exit run-rate of c. £18m

·    New product sales increased further to 19.1%, with 33 new products launched in 2024 and a strong pipeline of new products for the coming years

·     Strategic expansion programme in Asia and Flow Control largely completed

·   Acquired PiroMET, a refractory and robotics business in Turkey, in February 2025, enhancing our position in the strategically important and growing EEMEA market

·     Trade working capital intensity reducing by 50bps to 22.9%  

·     Share buyback programmes successfully implemented in 2024, with 5% of shares in issue bought back during the year. Second programme launched in November 2024, continuing in 2025

·     Strong balance sheet with net debt / EBITDA of 1.3x (31 December 2024)

·     Proposed final dividend of 16.4p, bringing the full year dividend to 23.5p, up 2.2%

·     Strong safety performance with a record Lost time injury frequency rate of 0.52 

·     Reduction of 27% in CO₂e intensity vs. 2019 baseline, exceeding our intermediary target of -20% by 2025

 

Comment from Patrick André, CEO:

"This has been a challenging year for Vesuvius with Foundry markets in Europe, North Asia and the Americas weakening significantly and global Steel production outside China negatively affected by the sharp increase of Chinese steel exports. Despite this, thanks to significant cost cutting, resilient pricing and market share gains, we have delivered a robust performance, maintaining our results at the level of 2023 on an underlying basis, demonstrating again the strength of our technologically differentiated business model.

For the year ahead, while we remain confident in our own performance, we are cautious on market conditions due to the uncertain economic environment arising from the negative impact of trade tariffs which continue to evolve, geopolitical volatility and the continuing structural weakness of Steel and Foundry markets in Europe. We currently anticipate that our trading profit in 2025 will be at a broadly similar level to 2024 on a constant currency basis and including the contribution from the PiroMET acquisition. We expect that cashflow for 2025 will be significantly ahead of 2024, benefiting from our working capital focus and a more normalised level of capex.

Given the near-term uncertain tariff and geopolitical environment and the decline experienced in Foundry end markets over the last 18 months, we are now targeting to achieve our mid-term Return on Sales target of at least 12.5% by 2028 and to deliver our cumulative £400m free cash flow target by 2027. This will be partially dependent on a return to normal conditions in our end-markets and will be supported by an extension of our cost reduction programme which we are increasing from £30m to £45m by 2028."

Presentation of Full Year 2024 Results

Vesuvius management will make a presentation to analysts and investors on 6 March 2025 at 09:00 UK time at the London Stock Exchange, 10 Paternoster Square, London EC4M 7LS. For those unable to attend, the event will be livestreamed and can be accessed by clicking here. Participants can also join via an audio conference call. Please click here to register.  Once registered, you will be provided with the information needed to join the conference, including dial-in numbers and passcodes. Be sure to save this information in your calendar. 

 

For further information, please contact:
Vesuvius plc	Patrick André, Chief Executive	+44 (0) 207 822 0000
	Mark Collis, Chief Financial Officer Rachel Stevens, Group Head of Investor Relations	+44 (0) 207 822 0000 +44 (0) 7387 545 271
MHP Communications	Rachel Farrington/Ollie Hoare	+44 (0) 203 128 8570

 

The person responsible for arranging the release of this announcement on behalf of Vesuvius is Mark Collis, Chief Financial Officer.  

 

About Vesuvius plc

Vesuvius is a global leader in molten metal flow engineering and technology principally serving process industries operating in challenging high‑temperature conditions.

 

We develop innovative and customised solutions, often used in extremely demanding industrial environments, which enable our customers to make their manufacturing processes safer, more efficient and more sustainable. These include flow control solutions, advanced refractories and other consumable products and increasingly, related technical services including data capture.

 

We have a worldwide presence. We serve our customers through a network of cost-efficient manufacturing plants located close to their own facilities, and embed our industry experts within their operations, who are all supported by our global technology centres.

 

Our core competitive strengths are our market and technology leadership, strong customer relationships, well established presence in developing markets and our global reach, all of which facilitate the expansion of our addressable markets.

 

Our ultimate goal is to create value for our customers, and to deliver sustainable, profitable growth for our shareholders giving a superior return on their investment whilst providing each of our employees with a safe workplace where they are recognised, developed and properly rewarded.

 

We think beyond today to create solutions that will shape the future. 

 

Forward looking statements

 

This announcement contains certain forward looking statements which may include reference to one or more of the following: the Group's financial condition, results of operations, cash flows, dividends, financing plans, business strategies, operating efficiencies or synergies, budgets, capital and other expenditures, competitive positions, growth opportunities for existing products, plans and objectives of management and other matters. Forward-looking statements can be identified by the use of terms such as 'intend', 'aim', 'project', 'anticipate', 'estimate', 'plan', 'believe', 'expect', 'forecasts', 'may', 'targets', 'could', 'should', 'will', 'continue' or similar words.

 

Such forward looking statements, including, without limitation, those relating to the future business prospects, revenue, working capital, liquidity, capital needs, interest costs and income, in each case relating to Vesuvius, wherever they occur in this announcement, are necessarily based on assumptions reflecting the views of Vesuvius. Although Vesuvius makes such statements based on assumptions that it believes to be reasonable, by their nature, these forward looking statements are subject to a number of known and unknown risks, uncertainties and other factors beyond Vesuvius' control that could cause actual results, performance or achievements to differ materially from those expressed or implied by the forward looking statements. Such forward looking statements should, therefore, be considered in light of various important factors that could cause actual results to differ materially from estimates or projections contained in the forward looking statements. These include without limitation: economic and business cycles; the terms and conditions of Vesuvius' financing arrangements; foreign currency rate fluctuations; competition in Vesuvius' principal markets; acquisitions or disposals of businesses or assets; and trends in Vesuvius' principal industries.

 

The foregoing list of important factors is not exhaustive. When considering forward looking statements, careful consideration should be given to the foregoing factors and other uncertainties and events, as well as factors described in documents the Company files with the UK regulator from time to time including its annual reports and accounts. In light of these risks, uncertainties and assumptions, the forward looking events discussed in this announcement might not occur and such forward looking statements are not guarantees or predictions of Vesuvius' future performance. You should not place undue reliance on such forward looking statements which speak only as of the date on which they are made. Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser.

 

Neither Vesuvius nor any of its affiliates, associates, employees, directors, officers or advisers assumes any responsibility for the accuracy or completeness or undertakes any obligation, to update or revise any of these forward-looking statements to reflect any new information or any changes in events, conditions or circumstances on which any such forward-looking statement is based save in respect of any requirement under applicable law or regulation.

 

Vesuvius plc, 165 Fleet Street, London EC4A 2AE

Registered in England and Wales No. 8217766

LEI: 213800ORZ521W585SY02

www.vesuvius.com

 

Vesuvius plc

Full Year Results for the twelve months ended 31 December 2024

In 2024, we have shown resilience despite difficult market conditions, thanks to a strong focus on cost reduction and to the continuing benefits of our technology strategy.

 

£m	2024 Reported		2023 Reported	currency	2023 Underlying		Reported Change	Underlying Change
Revenue	1,820.1		1,929.8	(76.0)	1,853.7		(5.7%)	(1.8%)
Trading Profit	188.0		200.4	(11.9)	188.4		(6.2%)	(0.2%)
Return on Sales	10.3%		10.4%		10.2%		-10bps	+10bps

 

Resilient Group trading performance

In 2024, revenue was £1,820.1m, an underlying decrease of 1.8% compared to 2023, and a 5.7% decline on a reported basis, reflecting FX headwinds. The small underlying decrease in revenue was principally due to lower volumes (£30.1m), reflecting a weak market that we partially offset by market share gains, and pricing declines of £3.5m reflecting the lower cost of raw materials. Revenue in our Steel Division was stable on an underlying basis reflecting some market share gains in a market which grew only very moderately, while in Foundry, revenue reduced by 6.3% on an underlying basis, principally reflecting lower market activity, which we partially offset by market share gains.  

 

Trading profit was £188.0m, stable on an underlying basis and a decrease of 6.2% on a reported basis versus the prior year reflecting FX headwinds. The benefits of our £30m cost-saving programme delivered a £13m in-year benefit, well ahead of our previous expectations resulting from the accelerated delivery on specific projects, and a further benefit of £6m from short-term actions. These were mostly offset by the negative profit impact of volume reductions. Net pricing was essentially neutral for the Group with a modest consolidated impact of minus £2m on trading profit.  The Group achieved a return on sales of 10.3% in 2024, 10 basis points ahead of 2023 on an underlying basis. This resilient performance was achieved through the swift implementation of cost reduction actions and market share gains, particularly in Flow Control and in Foundry, supported by the differentiation of our products.

 

Difficult market background in both Steel and Foundry

Global steel production remained subdued in the world excluding China, Russia, Iran and Ukraine with growth limited to 0.8% for the full year (Source: World Steel Association), due to sharply increasing steel exports from China. Steel production in India continued to exhibit strong growth (+6.3% year-on-year), as did South-East Asia (+5.3%) and  EEMEA (EMEA excluding EU+UK, Iran, Russia and Ukraine) (+4.1%). Conversely, Steel production declined in the Americas (-2.9%) and in North Asia (-3.6%).  Europe (EU+UK) only modestly recovered from the very low point of 2023, with growth of +1.2%.

Despite steel production in China contracting by 1.7%, the level of net exports continued to rise during the year, reaching 104 million tonnes, an increase of c. 20 million tonnes versus 2023, due to an even sharper decline in domestic steel consumption. These increasing exports put steel production outside of China under strong pressure and depressed steel prices worldwide.  

Foundry markets, with the exception of India, remained very weak throughout 2024, in particular in Europe, North Asia and in the Americas, as declining industrial activity impacted the end markets of our customers.  All industrial end markets outside of China were affected, including the light vehicle industry which had performed well in 2023. The foundry market decline was particularly severe in EU+UK and in North Asia important regions for our Foundry Division, and we now do not expect them to return to their pre-pandemic levels in the near future.

 

Good performance in our Steel Division

Despite adverse market conditions, the Steel Division performed well in 2024. On an underlying basis, the Steel Division revenue remained broadly stable (-0.1%) while profit grew by 9.9%, resulting in return on sales increasing by 110bps. Revenue growth was driven by market share gains offsetting slightly negative market volumes evolution overall due to our overweight market position in North America, where Steel production declined in 2024.

 

Overall, we gained market share across the Steel Division, with gains across the Flow Control business and in Advanced Refractories in the growing regions of Asia and EEMEA, which more than offset some limited Advanced Refractories market share losses in EU+UK and the Americas.

Headline pricing decreased slightly, reflecting a decline in raw materials costs. Pricing net of cost inflation (raw materials and labour), however, remained positive.

 

Steel Division profits were also supported by the strong cost reduction actions undertaken as part of the group-wide £30m cost-saving programme.

 

Performance of the Foundry Division negatively impacted by the short-term market conditions, despite good underlying progress

Severe market decline, in particular in EU+UK and North Asia which represents c. 40% of the Foundry Division turnover, reduced overall Foundry Division revenue by c. 10%. The division was, however able to mitigate this general market downturn with market share gains of c. 5%.

Headline pricing also decreased during the year, reflecting a decline of raw materials prices. Pricing net of cost inflation (labour and raw materials) was slightly negative as labour inflation was not fully compensated by price increases.

The division reacted strongly to this challenging environment, successfully implementing cost-reduction actions and accelerating production and resources transfers from EU+UK to lower cost and faster growing areas.

We expect this this strong action plan will pave the way for an improvement of the Foundry Division results going forward despite the continuing difficult market conditions in Europe and North Asia.

Capacity-expansion investment programme in Flow Control and in Asia nearing completion

The investment programme to expand capacity and support the growth of Flow Control worldwide and Advanced Refractories and Foundry in Asia, initiated in 2021, is now largely complete and will underpin the progression of our results and profitability in the years to come. The expanded production capacity for VISO, Slide Gate and Mould Flux in Flow Control is now largely operational and will support the business unit's expansion in India, South-East Asia, EEMEA and North America.

In Advanced Refractories, the expansion of our Basic monolithic and AlSi monolithic capacity at our new flagship plant in Vizag is nearing completion and will support profitable growth of the business unit in India going forward.

In Foundry, our non-ferrous flux production line in China is now fully operational and will enable the business unit to accelerate its penetration of the fast-growing aluminium foundry market.

This three-year capex programme of capacity expansion will be mostly completed by the end of H1 2025. Following this, capex is expected to revert towards normalised levels.

Good cash generation and strong balance sheet

The business delivered adjusted operating cashflow of £130.3m in 2024, which represented a 69% cash conversion rate for the year. Free cashflow was £60.8m, after cash capex of £100.8m (2023: £92.6m). We maintained a strict focus on working capital management and were able to reduce our trade working capital intensity further, which was 22.9% at the year end, versus 23.4% last year.

Our balance sheet remained strong with a debt leverage ratio of 1.3x (31 December 2023: 0.9x), at the lower end of our 1.0 - 2.0x range. This reflects the free cashflow described above, £63.4m of payments relating to the share buybacks executed during the year and dividends of £61.1m.

In February 2025 we concluded the refinancing of our RCF facility, extended to £475m, with a syndicate of 10 banks for a term of 4.5 years.

Continued progress in the productivity of R&D and new product development

We increased our investment in research and development in 2024 (on a constant currency basis), spending £36.9m, equating to 2.0% of revenue. This was fully expensed in our income statement. Our two focus areas remain: (1) innovation in materials science, with an objective to continuously improve the performance of our consumables, and (2) the development of mechatronics solutions to enable our customers to substitute the operators who manipulate our consumable refractories with robots and, by doing so, improve their safety, reliability, cost and quality performance.

Our New Product Sales ratio, defined as the percentage of our sales realised from products which didn't exist five years ago, reached 19.1% for the Group in 2024 (and was over 20% in our Flow Control business). This is up from 17.6% in 2023 and well on track towards our group target of over 20% by 2026. We launched 33 new products in 2024 and have an extensive pipeline of products under development which will be progressively introduced in the market over the coming years and will support our ambition to grow our revenue and profitability.

Our robotics business is also accelerating, with orders for robotic systems for Flow Control growing from 5 projects in 2023 up to 9 in 2024. We also saw a considerable increase in robots shipped, up to 6 in the year versus one in 2023, reflecting the significant positive momentum in orders over the last two years.

Cost optimisation programme delivering above expectations

Our cost optimisation programme, launched in late 2023, initially aimed to deliver £30m of annually recurring cash savings by 2026. This program covers all of our worldwide activities and focuses on operational improvement, lean initiatives, automation and digitalisation as well as optimisation of our manufacturing footprint.

In 2024, we delivered cost savings under this programme of £13m with an annualised exit run-rate of £18m. Of the savings delivered in-year, slightly under half were in the Foundry Division, reflecting swift action taken to address costs in a challenging environment. The cost savings achieved to date have been weighted towards headcount reductions. We expect to deliver incremental in-year cost savings of £12m - £14m in 2025.

The one-off costs to deliver these savings are shown as separately reported items, and in FY24 were £14.6m charged to the income statement with a cashflow impact of £7.9m. We anticipate one-off costs in 2025 in the region £7-10m and retain our guidance that the total programme will cost c. £40m, including associated capex costs.

Given this good progress in 2024, we are now raising our cash cost savings objective from £30m of recurring annual savings by 2026 to £45m of recurring annual savings by 2028, with an incremental cost of delivery of c. £20m.

Acquisition in Turkey

Following the agreement reached in November 2024, on 28 February 2025 we completed the acquisition of a 61.65% shareholding in PiroMET, a Turkish refractory company, for €26.2m. The acquisition will strengthen our Advanced Refractory business in the fast-growing region of EEMEA and will also allow us to leverage PiroMET's expertise in robotics and gunning worldwide.

Best ever safety performance

In 2024 we achieved a further improvement in safety, with a Lost Time Injury Frequency Rate (the number of injuries necessitating a lost work-shift, per million hours worked) of 0.52, our best result ever, having achieved 0.60 in 2023. This positions Vesuvius among the best-in-class companies worldwide and is the result of many years of efforts to integrate safety as the number one priority in the company culture.  We remain committed to our goal of zero accidents, and we will strive towards this objective.

Significant progress on our journey to net zero

We continued to implement our action plan to progressively decarbonise our activities. As a result, we have reduced our carbon intensity (CO₂e tonnes per million tonnes product sold) by 27% as compared with our 2019 reference year, on a pro forma basis (-40% on a reported basis), significantly ahead of our 2025 objective of a 20% reduction. This has been achieved through decarbonising our electricity, improving energy efficiency, and moving from higher to lower carbon-emitting energy sources. As part of this initiative, our plant in Rio de Janeiro, Brazil, became our first carbon-free major manufacturing site operating exclusively on renewable electricity and biomethane.

Dividend and share buy-backs

Vesuvius has a progressive dividend policy.  As a minimum we will maintain our dividend per share year-on-year and increase it, through the cycle, in line with earnings per share growth. In addition, where cash is not required for additional investment in the business and while maintaining a strong and prudent balance sheet, we will return cash to shareholders via other means, such as share buy-backs.

The Board has recommended a final dividend of 16.4 pence per share, which together with the interim dividend paid of 7.1 pence per share, brings the total dividend for the year to 23.5 pence per share, which is a 2.2% year on year increase on the total dividend for 2023 of 23.0 pence per share. This represents a dividend cover of 1.8x compared to headline EPS for 2024.

Over 2024 we completed our first £50m share buyback (initiated in December 2023) and started a second £50m tranche in November 2024, resulting in a total cash outflow on share repurchases of £62.4m in FY24 (£63.4m inclusive of costs), with £34.5m remaining under the announced programme. In total 13.8m shares were repurchased during the year, reducing our shares in issue by c. 5%.

Current trading and outlook

This has been a challenging year for Vesuvius with Foundry markets in Europe, North Asia and the Americas weakening significantly and global Steel production outside China negatively affected by the sharp increase in Chinese steel exports during the year. Despite this, thanks to significant cost cutting, resilient pricing and market share gains, we have delivered a robust performance, maintaining our results at the level of 2023 on an underlying basis, demonstrating again the strength of our technologically differentiated business model.

For the year ahead, while we remain confident in our own performance, we are cautious on market conditions due to the uncertain economic environment arising from the negative impact of trade tariffs which continue to evolve, geopolitical volatility and the continuing structural weakness of Steel and Foundry markets in Europe. We currently anticipate that our trading profit in 2025 will be at a broadly similar level to 2024 on a constant currency basis and including the contribution from the PiroMET acquisition. We expect that cashflow for 2025 will be significantly ahead of 2024, benefiting from our working capital focus and a more normalised level of capex.

Medium-term strategic position

In November 2023 we presented our strategy and medium-term targets to investors at a Capital Markets Event.  We highlighted favourable medium-term trends in our end-markets, and, through our market leading investment in research and development, demonstrated our ability to gain both market share while pricing for the value we generate for our customers. We also set out a cost reduction programme to achieve at least £30m of annually recurring costs savings in 2026.

Over the past year, we have implemented our programme and delivered on the cost reduction actions, as set out above. We have also seen the benefit of our technology-led business model, with our differentiation driving market share gains in Flow Control and Foundry. The market backdrop, however, has been challenging, particularly in our Foundry Division where the decline in market activity has been significant, such that the benefit of cost savings in FY24 has largely been offset by this market decline. Despite the short-term uncertainties in our end markets, we remain confident in the mid to long term growth potential of these markets and in particular growth in the steel market outside of China. The strength of our technology-based business model should also enable us to continue outperforming our underlying markets in Flow Control and Foundry.

Given the near-term uncertain tariff and geopolitical environment and the decline experienced in Foundry end markets over the last 18 months, we are now targeting to achieve our mid-term Return on Sales target of at least 12.5% by 2028 and to deliver our cumulative £400m free cash flow target by 2027. This will be partially dependent on a return to normal conditions in our end-markets and will be supported by an extension of our cost reduction programme which we are increasing from £30m to £45m by 2028.

Operational Review

Vesuvius comprises two Divisions, Steel and Foundry. The Steel Division operates as three business lines, Flow Control, Advanced Refractories and Sensors & Probes. Changes described are versus 2023 on an underlying basis, excluding the impact of FX, unless otherwise noted. There were no acquisitions or disposals in 2024 and hence no adjustments were required.

 

Steel Division

 

Steel Division		2024 (£m)	2023 (£m)	Underlying change	Change
Flow Control Revenue		769.0	793.0	1.3%	(3.0%)
Advanced Refractories Revenue		535.6	567.9	(2.6%)	(5.7%)
Steel Sensors & Probes Revenue		39.2	39.1	7.0%	0.4%
Total Steel Revenue		1,343.8	1,400.0	(0.1%)	(4.0%)
Total Steel Trading Profit		153.0	147.6	9.9%	3.7%
Total Steel Return on Sales		11.4%	10.5%	+110bps	+90bps

 

Our Steel Division reported revenues of £1,343.8m in 2024, flat on an underlying basis (-0.1%) and a decrease of 4.0% on a reported basis, reflecting currency headwinds. The flat performance reflects an increase in revenue of 1.3% in Flow Control offset by a 2.6% reduction in Advanced Refractories. Revenue from Sensors and Probes grew 7% due to market share gains. The impact of the underlying steel market performance was negative given our mix of business, as a result of our strong position in the North America market where Steel production declined during the year, which we partially offset by market share gains.

 

Steel Division trading profit grew by 9.9% on an underlying basis to £153.0m. The profit impact from volume declines was greater than usual reflecting some plant underutilisation in recently expanded sites.  The impact of these negative volumes was offset by a combination of modestly positive net pricing and accelerated cost savings, both as part of our group-wide cost-saving programme, and additional one-off benefits. The rise in trading profit on broadly flat revenue has resulted in the divisional return on sales reaching 11.4%, an increase of 110bps.

 

Flow Control

 

Flow Control Revenue		2024 (£m)	2023 (£m)	Underlying change	Change
Americas		297.8	317.8	(1.1%)	(6.3%)
Europe, Middle East & Africa (EMEA)		241.3	252.7	(1.2%)	(4.5%)
Asia-Pacific		230.0	222.4	7.8%	3.4%
Total Flow Control Revenue		769.0	793.0	1.3%	(3.0%)

 

In 2024, revenue in the Group's Flow Control business increased by 1.3% on an underlying basis to £769.0m (a decline of 3.0% on a reported basis after FX headwinds). This performance was driven by positive pricing and overall market share gains, partially offset by market-driven volume declines.

 

In the Americas, overall underlying revenue declined 1.1%, made up of a small out-performance of the market in North America (volumes reducing 3% against a market decline of 4%) but with modestly positive pricing and a slight decline in South America with sales volumes declining moderately while steel production volumes were broadly flat, in part due to a significant destocking effect at our Argentinian customers.  Pricing in South America reduced slightly.

 

In EMEA, revenue declined 1.2% compared to 2023. In EEMEA (excluding Iran, Russia and Ukraine) where steel production grew c. 4%, we gained market share with volume growth significantly ahead of the market. This was offset by moderate volume declines in the EU+UK, slightly behind a flat market, due to a voluntary reduction of our sales to some customers at risk of insolvency. Pricing over the region was broadly flat.

 

In Asia Pacific, revenue grew 7.8%, driven by double-digit sales volume growth in India, well ahead of market volume growth and high-single-digit growth in China despite the steel market contracting in this region.

 

Advanced Refractories

 

Advanced Refractories Revenue		2024 (£m)	2023 (£m)	Underlying change	Change
Americas		188.2	212.1	(7.6%)	(11.2%)
Europe, Middle East & Africa (EMEA)		167.6	191.5	(10.9%)	(12.5%)
Asia-Pacific		179.7	164.3	13.9%	9.4%
Total Advanced Refractories Revenue		535.6	567.9	(2.6%)	(5.7%)

 

Advanced Refractories reported revenue of £535.6m in 2024, a decrease of 2.6%. This was broadly evenly split between pricing declines (partly reflecting input cost decreases) and some volume decline. Sales volume decline was higher than the underlying steel market in both the Americas and the EU+UK region of EMEA, due to market share losses at customers where we had historically given priority to pricing. Market share in these areas has now stabilised. In Asia Pacific, revenue grew 13.9% driven by very significant double-digit volume increases in India and China, materially ahead of the market, reflecting both demand for our high-quality products and the benefit of new capacity coming on stream in these regions.

 

Sensors & Probes

 

Steel Sensors & Probes Revenue		2024 (£m)	2023 (£m)	Underlying change	Change
Americas		28.3	28.2	8.4%	0.2%
Europe, Middle East & Africa (EMEA)		10.5	10.2	5.8%	3.2%
Asia-Pacific		0.4	0.6	(32.2%)	(34.8%)
Total Steel Sensors & Probes Revenue		39.2	39.1	7.0%	0.4%

 

Revenue in Sensors & Probes was £39.2m in 2024, up 7% year-on-year on an underlying basis. Growth has been driven mainly by robust market demand in South America during the first half of the year, increased sales of new high-value products, and by winning new customers in EEMEA.

 

Foundry Division

 

Foundry Revenue		2024 (£m)	2023 (£m)	Underlying change	Change
Americas		119.3	136.4	(7.8%)	(12.6%)
Europe, Middle East & Africa (EMEA)		183.6	215.1	(12.7%)	(14.6%)
Asia-Pacific		173.4	178.3	2.7%	(2.7%)
Total Foundry Revenue		476.3	529.8	(6.3%)	(10.1%)
Total Foundry Trading Profit		35.0	52.8	(28.9%)	(33.6%)
Total Foundry Return on Sales		7.4%	10.0%	-230bps	-260bps

 

Our Foundry Division experienced a difficult trading environment, with reported revenues of £476.3m in 2024, an underlying decrease of 6.3%, reflecting contracting revenues in EMEA (-12.7%) and the Americas (-7.8%), which we partially offset by growth in Asia-Pacific (+2.7%) including India (+12%) and China (+6%). The underlying fall in revenue was largely due to c. 10% market volume declines - partially offset by c. 5% revenue growth from market share gains - and modestly negative sales price. The market contraction described was driven by double-digit declines in our markets in EU+UK and North Asia and a high-single-digit market decline in North America. Against this backdrop, India continued its strong and sustained growth trend. Market share gains were largest in EMEA, India and China, with the latter being supported by our new capacity in the region. Foundry markets have now stabilised at the level of H2 2024.

 

Trading profit and return on sales contracted 28.9% and 230bps respective, both on an underlying basis, reflecting the negative impact of significant volume declines, particularly in our traditionally most profitable regions. This was partially offset by accelerated cost savings as part of the group-wide plan to deliver £30m savings by 2026.

 

Financial Review

 

Basis of Preparation

All references in this financial review are to headline performance unless stated otherwise. See Note 16.1 to the Group Financial Statements for the definition of headline performance.

We also report key metrics on an underlying basis, where we adjust to ensure appropriate comparability between periods, irrespective of currency fluctuations and any business acquisitions and disposals.

This is done by:

·    Restating the previous period's results at the same foreign exchange (FX) rates used in the current period

·    Removing the results of disposed businesses in both the current and prior years

·    Removing the results of acquired businesses in both the current and prior years

 

Therefore, for 2024, we have:

·    Retranslated 2023 results at the FX rates used in calculating the 2024 results

·    No adjustments have been required for acquisitions or disposals

2024 performance overview

Income statement

£m     Revenue	2024		2023				% change
	Reported		Reported	Currency	Underlying		Underlying	Reported
Steel	1,343.8		1,400.0	(54.7)	1,345.2		(0.1%)	(4.0%)
Foundry	476.3		529.8	(21.3)	508.5		(6.3%)	(10.1%)
Total Group	1,820.1		1,929.8	(76.0)	1,853.7		(1.8%)	(5.7%)
Trading profit
Steel	153.0		147.6	(8.4)	139.2		9.9%	3.7%
Foundry	35.0		52.8	(3.5)	49.3		(28.9%)	(33.6%)
Total Group	188.0		200.4	(11.9)	188.4		(0.2%)	(6.2%)
Return on sales
Steel	11.4%		10.5%		10.3%		+110bps	+90bps
Foundry	7.4%		10.0%		9.7%		-230bps	-260bps
Total Group	10.3%		10.4%		10.2%		+10bps	-10bps

 

2024 was a stable year in terms of underlying trading profit and return on sales overall, despite depressed underlying markets in Foundry in particular, and we have continued to generate good free cashflow. This has enabled the Board to recommend an attractive final dividend to our shareholders and commence a second share buy-back, while maintaining investment in strategic areas.

Revenue for the year decreased by 5.7%, of which 3.9% related to FX headwinds and 1.8% underlying performance. Underlying revenue performance was driven by a decline in volume of1.6% and a reduction in pricing of 0.2%. On a reported basis, the Steel and Foundry Division revenue decreased by 4.0% and 10.1%, respectively, in the year.

We achieved a trading profit of £188.0m, down 6.2% on a reported basis of which 0.2% was underlying performance and 6.0% related to FX headwinds. Within the underlying profit changes, there was a £15.1m decline due to the drop-through from volume declines, and a £2.0m decline from net pricing. In addition, there was a further contribution from our ongoing cost-saving programme of £13m plus a £6.0m benefit relating to lower management incentives based on FY24 financial performance, and a net -£2.4m relating to other one-off items. Return on sales of 10.3% was up 10bps on an underlying basis.

The net impact of average 2024 exchange rates compared to 2023 averages has been a headwind of £11.9m at a trading profit level, in particular, due to the depreciation of the Brazilian Real, the US Dollar and the Indian Rupee versus Sterling. Translated at FX rates on 27 February 2025, 2024 revenue would have been c. £1799.9m and trading profit would be c. £185.2m, giving currency headwinds of £20m and £2.8m, respectively.

Investment in R&D is central to our strategy of delivering market-leading product technology and services to customers. In 2024 we spent £36.9m on R&D activities (2023: £37.4m), which represents 2.0% of our revenue (2023: 2.0%, on a constant currency basis) and a small increase in expenditure on a constant currency basis.

Net Interest cost for FY24 increased to £16.2m (2023: £11.6m), principally related to a reduction in finance income from £16.6m to £10.9m due to a reduction in deposits held in Argentina that were accruing a high interest rate. This reduction in deposits arose following the successful repatriation of surplus cash which would have otherwise devalued relative to Sterling.

Profit from joint ventures and associates was broadly flat year on year at £1.1m (2023: £0.9m).

Separately reported items of £34.3m were recognised in FY24 compared to £10.3m in FY23. £10.0m relates to amortisation of acquired intangible assets, which is consistently excluded from our adjusted profit measure (FY23: £10.3m). In addition, one-off costs of £14.6m were incurred relating to our cost saving programme, and in addition a provision for site remediation works was increased by £9.7m, reflecting a reassessment of the duration of the related liability. Due to the one-off nature of both these charges, they are shown as separately reported.

Headline profit before tax ("PBT") was £172.9m, down 8.9% versus last year (£189.7m) on a reported basis. Including separately reported items, PBT of £138.6m was 22.7% lower than last year.

A key measure of tax performance is the Headline Effective Tax Rate ("ETR"), which is calculated on the income tax associated with headline performance, divided by the headline profit before tax and before the Group's share of post-tax profit of joint ventures. The Group's headline ETR, based on the income tax costs associated with headline performance of £47.2m (2023: £51.9m), was 27.5% (2023: 27.5%).

The Group's total income tax costs for the period include a credit within separately reported items of £8.9m (2023: £3.1m) which primarily relates to deferred tax on intangible assets and restructuring costs.

A tax charge reflected in the Group Statement of Comprehensive Income in the year amounted to £0.8m (2023: £2.0m charge) which primarily relates to tax on net actuarial gains and losses on pensions.

We expect the Group's effective tax rate in 2025 on headline profit before tax and before the share of post-tax profits from joint ventures to be in line with that in 2024, dependent on profit mix and any one-off items.  

Non-controlling interests principally comprise the minority holdings in Indian subsidiaries for the Steel and Foundry businesses. This increased to £13.1m in 2024 (2023: £12.1m) reflecting the ongoing strong growth in profit in those subsidiaries.

Headline EPS from continuing operations at 43.3p was 7.2% lower on an underlying basis than 2023 (46.7p), reflecting both the lower earnings and the higher level of non-controlling interests, partially offset by a reduction in average shares in issue from 269.1m to 260.0m (basic), reflecting both the two share buyback programmes undertaken in 2024, and the purchase of shares into the ESOP. Statutory EPS of 33.5p is 23.8% lower than the prior year (2023: 44.0p) reflecting the factors just described and higher separately reported costs.

Dividend

The Board has recommended a final dividend of 16.4 pence per share to be paid, subject to shareholder approval, on 6 June 2025 to shareholders on the register at 25 April 2025. When added to the 2024 interim dividend of 7.1 pence per share paid on 13 September 2024, this represents a full-year dividend of 23.5 pence per share. The last date for receipt of elections from shareholders for the Vesuvius Dividend Reinvestment Plan will be 15 May 2025.

Cost saving programme

At the start of 2024 we initiated an efficiency programme to realise recurring savings of £30m per annum by 2026, of which £13m has been delivered in 2024, significantly ahead of schedule as we accelerated our savings in response to the difficult trading environment. We expect to deliver further cost savings of £12 - 14m in 2025. The programme costs are expected to be c. £40m, including capex and operating expense, of which c. £14.6m of operating expense has been incurred in 2024 with a further £7-10m expected in 2025. As set out above, these restructuring costs are excluded from underlying performance, allowing for a clear measure of our operating performance.

Cash-flow and balance sheet

Our cash management performance was solid, achieving an 69% cash conversion (2023: 93%), reflecting broadly flat trade working capital and continued investment in strategic capacity expansion.

We measure working capital both in terms of actual cash flow movements, and as a percentage of sales revenue. Trade working capital as a percentage of sales in 2024 improved to 22.9% (2023: 23.4%), measured on a 12-month moving average basis. The improvement was principally due to a reduction in debtor days on a 12 -month average basis by 1.3 days, an increase in creditor days by 1.9 days and flat inventory days.

Free cash flow from continuing operations was £60.8m in 2024 (2023: £128.2m).

Capital expenditure

Capital expenditure in 2024 was £100.8m in cash outflow (2023: £92.6m) and £116.1m including capitalised leases (2023: £125.3m) of which £92.2m was in the Steel Division (2023: £93.2m) and £23.9m in the Foundry Division (2023: £32.1m). Capital expenditure on revenue-generating customer installation assets, almost entirely in Steel, was £11.0m (2023: £8.4m) and we spent c. £39m in 2024 on growth capex, also principally in Steel. Total cash capex in 2025 is expected to be c. £80 -85m, reflecting a modest level of growth capex which is being concluded in H1 2025. Capital expenditure will then revert to more normalized levels.

Net debt

Net debt on 31 December 2024 was £329.2m, a £91.7m increase compared to £237.5m on 31 December 2023, due to free cash flow of £60.8m offset principally by dividends of £61.1m, share buybacks of £63.4m and purchases of shares for our ESOP trust of £17.1m.

At the end of 2024, the net debt to EBITDA ratio was 1.3x (2023: 0.9x) and EBITDA to interest was 18.4x (2023: 31.5x). These ratios are monitored regularly to ensure that the Group has sufficient financing available to run the business and fund future growth.

The Group's debt facilities have two financial covenants: the ratios of net debt to EBITDA (maximum 3.25x limit) and EBITDA to interest (minimum 4x limit). Certain adjustments are made to the net debt calculations for bank covenant purposes, the most significant of which is to exclude the impact of IFRS 16.

The Group had committed borrowing facilities of £669.6m as of 31st December 2024 (2023: £685.8m), of which £202.5m was undrawn (2023: £333.4m).

Return on invested capital (ROIC)

Our ROIC for 2024 was 8.4% (2023: 8.9%). Excluding goodwill on our balance sheet from the acquisition of Foseco in 2008, ROIC for 2024 would be 14.3%. ROIC is our key measure of return from the Group's invested capital, calculated as trading profit less amortisation of acquired intangibles plus share of post-tax profit of joint ventures and associates for the previous 12 months after tax, divided by the average (being the average of the opening and closing balance sheet) invested capital (defined as: total assets excluding cash plus non-interest-bearing liabilities), at the average foreign exchange rate for the year).

Pensions

The Group has a limited number of historical defined benefit plans located mainly in the UK, USA, Germany and Belgium. The main plans in the UK and USA are closed to further benefits accrual. All of the liabilities in the UK were insured following a buy-in agreement with Pension Insurance Corporation plc ("PIC") in 2021. This buy-in agreement secured an insurance asset from PIC that matches the remaining pension liabilities of the UK Plan, with the result that the Company no longer bears any investment, longevity, interest rate or inflation risks in respect of the UK Plan.

The Group's net pension liability at 31 December 2024 was £37.4m (2023: £46.3m liability). 

Technical guidance for 2025

Depreciation in 2025 is expected to be in the range £65m - £70m and the net finance charge is expected to be c. £18 - 20m.

 Financial Risk Factors

The Group's approach to risk management, including the mitigations in place for our principal risks, is detailed below.  We consider the main financial risk faced by the Group to be a material business interruption incident leading to reduced revenue and profit.  We also manage broad financial risks such as cost inflation, bank financing and capital market activity and to a lesser extent foreign exchange and interest rate movements (see Note 25 to the Group Financial Statements).  We mitigate liquidity risk by financing using both the bank and private placement debt markets and we mitigate refinancing risk by seeking to avoid a concentration of debt maturities in any one calendar year. 

Principal Risks and Uncertainties

The Board exercises oversight of the Group's Principal Risks and reviews the way in which the Group manages those risks. The Board takes overall responsibility for establishing and maintaining a system of risk management and internal control and for reviewing its effectiveness.

The Board reviewed the Principal Risks and Uncertainties facing the Group during 2024 and considers that they remain unchanged compared with those published in the Annual Report for the year ended 31 December 2023.  The Principal Risks which could have a material impact on the Group's performance are as follows:

 - End market risk

 - Protectionism and globalization

 - Product quality failure

 - Complex and changing regulatory environment

 - Failure to secure innovation

 - Business interruption

 - People, culture and performance

 - Health and safety

 - Environmental, Social and Governance criteria

Risk update

Whilst there are no changes to the Principal Risks and Uncertainties facing the Group, the level geopolitical risk remains elevated, our end markets have been challenging, and global trade dynamics are in flux. In addition, workforce demographics are changing and the potential threat from cyber security attacks continues to evolve. Each of these risks has the potential to impact the Principal Risks facing the Group; specifically End market risk; Protectionism and globalisation; Complex and changing regulatory environment; People, culture and performance; and the risk of Business interruption.

Further information on these Principal Risks and the way in which the Group manages them are detailed in the 2024 Annual Report.

 

6 March 2025      

Group Income Statement For the year ended 31 December 2024			2024					2023
			(1) Headline performance	(1) Separately reported items	Total				(1) Headline performance		(1) Separately reported items		Total
Notes			£m	£m	£m			£m		£m		£m
Revenue	2		1,820.1	-	1,820.1				1,929.8		-		1,929.8
Manufacturing costs			(1,316.4)	-	(1,316.4)				(1,391.9)		-		(1,391.9)
Administration, selling and distribution costs			(315.7)	-	(315.7)				(337.5)		-		(337.5)
Trading profit(2)	2		188.0	-	188.0				200.4		-		200.4
Cost reduction programme expenses	3		-	(14.6)	(14.6)				-		-		-
Provision for future water treatment at disused mine	3		-	(9.7)	(9.7)				-		-		-
Amortisation of acquired intangible assets	2		-	(10.0)	(10.0)				-		(10.3)		(10.3)
Operating profit/(loss)			188.0	(34.3)	153.7				200.4		(10.3)		190.1
Finance expense			(27.1)	-	(27.1)				(28.2)		-		(28.2)
Finance income			10.9	-	10.9				16.6		-		16.6
Net finance costs	4		(16.2)	-	(16.2)				(11.6)		-		(11.6)
Share of post-tax income of joint ventures and associates			1.1	-	1.1				0.9		-		0.9
Profit/(loss) before tax			172.9	(34.3)	138.6				189.7		(10.3)		179.4
Income tax (charge)/credits	5		(47.2)	8.9	(38.3)				(51.9)		3.1		(48.8)
Profit/(loss) after tax			125.7	(25.4)	100.3				137.8		(7.2)		130.6
Profit/(loss) attributable to:
Owners of the parent			112.6	(25.4)	87.2				125.7		(7.2)		118.5
Non-controlling interests			13.1	-	13.1				12.1		-		12.1
Profit/(loss)			125.7	(25.4)	100.3				137.8		(7.2)		130.6
Earnings per share(3)   - pence	6
Continuing and total operations - basic			43.3(1)		33.5			46.7 (1)				44.0
- diluted			42.7(1)		33.1			46.2 (1)				43.6

(1)      Headline performance and separately reported items are non-GAAP measures. Headline performance is defined in Note 16.1 and separately reported items are defined in Note 1.5.

(2)      Trading profit is a non-GAAP measure and is defined in Note 16.4.

(3)   Earnings per share are attributable to the ordinary equity holders of the parent.

 

The above results were derived from continuing operations. Manufacturing costs are costs of goods sold. The pre-tax separately reported items would form part of Administration, selling & distribution costs if classified within headline performance, which including these amounts would total £350.0m (2023: £347.8m