This Annual Report includes statements that are, or may be deemed to be, forward-looking statements within the meaning of the securities laws of certain applicable jurisdictions. These forward-looking statements are made under the “safe harbor” provision under Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, all statements other than statements of historical facts contained in this Annual Report, including, without limitation, those regarding our future financial position and results of operations, our strategy, plans, objectives, goals and targets, future developments in the markets in which we operate or are seeking to operate or anticipated regulatory changes in the markets in which we operate or intend to operate. These statements are often, but not always, made through the use of words or phrases such as “believe,” “anticipate,” “could,” “may,” “would,” “should,” “intend,” “plan,” “potential,” “predict(s),” “will,” “expect(s),” “estimate(s),” “project(s),” “positioned,” “strategy,” “outlook,” “aim,” “assume,” “continue,” “forecast,” “guidance,” “projected,” “risk” and similar expressions.
By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance and are based on numerous assumptions. Our actual results of operations, financial condition and the development of events may differ materially from (and be more negative than) those made in, or suggested by, the forward-looking statements. Investors should read the section entitled “Item 3.D.—Key Information—Risk Factors” and the description of our segments in the section entitled “Item 4.B.—Information on the Company—Business Overview” for a more complete discussion of the factors that could affect us. All such forward-looking statements involve estimates and assumptions that are subject to risks, uncertainties and other factors that could cause actual results to differ materially from the results expressed in, or suggested by, the statements. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking statements are the following:
| ● | the impacts of the Ukraine-Russia conflict; |
| ● | increases in energy prices, disruptions in the supply of power and changes in governmental regulation of the power sector and the effect on costs of production; |
| ● | the outcomes of pending or potential litigation; |
| ● | operating costs, customer losses and business disruptions (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) that may be greater than expected; |
| ● | the retention of certain key employees; |
| ● | the current and anticipated competitive landscape; |
| ● | our ability to adapt products and services to changes in technology or the marketplace; |
| ● | our ability to maintain and grow relationships with customers and clients; |
| ● | the historic cyclicality of the metals industry and the attendant swings in market price and demand; |
| ● | the availability of raw materials and transportation; |
| ● | costs associated with labor disputes and stoppages; |
| ● | our ability to maintain our liquidity and to generate sufficient cash to service indebtedness; |
| ● | the integration and development of prior and future acquisitions; |
| ● | the availability and cost of maintaining adequate levels of insurance; |
| ● | our ability to protect trade secrets, trademarks and other intellectual property; |
| ● | equipment failures, delays in deliveries or catastrophic loss at any of our manufacturing facilities, which may not be covered under any insurance policy; |
| ● | exchange rate fluctuations; |
| ● | changes in laws protecting U.S., Canadian and European Union companies from unfair foreign competition (including antidumping and countervailing duty orders and laws) or the measures currently in place or expected to be imposed under those laws; |
| ● | compliance with, or potential liability under, environmental, health and safety laws and regulations (and changes in such laws and regulations, including in their enforcement or interpretation); |
| ● | risks from international operations, such as foreign exchange fluctuations, tariffs, duties and other taxation, inflation, increased costs, political risks and our ability to maintain and increase business in international markets; |
| ● | risks associated with mining operations, metallurgical smelting and other manufacturing activities; |
| ● | our ability to manage price and operational risks including industrial accidents and natural disasters; |
| ● | our ability to acquire or renew permits and approvals; |
| ● | potential losses due to unanticipated cancellations of service contracts; |
| ● | risks associated with potential unionization of employees or work stoppages that could adversely affect our operations; |
| ● | changes in tax laws (including under applicable tax treaties) and regulations or to the interpretation of such tax laws or regulations by governmental authorities; |
| ● | changes in general economic, business and political conditions, including changes in the financial markets; |
| ● | uncertainties and challenges surrounding the implementation and development of new technologies; |
| ● | risks related to potential cybersecurity breaches; |
| ● | risks related to our capital structure; |
| ● | risks related to our ordinary shares; |
| ● | our foreign private issuer (“FPI”) status, the loss of which would require us to comply with the Exchange Act’s domestic reporting regime, and cause us to incur significant legal, accounting and other expenses; |
| ● | our incorporation in the United Kingdom (“U.K.”), the laws of which govern our corporate affairs and may differ from those applicable to companies incorporated in the U.S.; |
| ● | our failure to maintain an effective system of internal control over financial reporting, given the material weaknesses identified in connection with the audit of our financial statements as of and for the year ended December 31, 2020. The Company continues to have a material weakness as of December 31, 2024; and |
| ● | the other risk factors discussed under “Item 3.D.—Key Information—Risk Factors.” |
These and other factors are more fully discussed in the “Item 3.D.—Key Information—Risk Factors” and “Item 4.B.—Information on the Company—Business Overview” sections and elsewhere in this Annual Report.
The factors described above and set forth in “Item 3.D.—Key Information—Risk Factors” section are not exhaustive. Other sections of this Annual Report describe additional factors that could adversely affect our business, financial condition or results of operations. Moreover, we operate in a very competitive and rapidly changing commercial
environment. New risk factors emerge from time to time and it is not possible for us to predict or list all such risks, nor can we assess the impact of all possible risks on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained, or implied by, in any forward-looking statements.
The forward-looking statements made in this Annual Report relate only to events or information as of the date on which the statements are made in this Annual Report. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. You should read this Annual Report and the documents we reference herein carefully and completely, with the understanding that our actual future results or performance may be materially different from what we anticipate.
CURRENCY PRESENTATION AND DEFINITIONS
In this Annual Report, references to “$,” and “USD” are to the lawful currency of the United States of America, references to “€” and “Euro” are to the single currency adopted by participating member states of the European Union relating to Economic and Monetary Union and references to “£” and “Pound Sterling” are to the lawful currency of the United Kingdom.
Unless otherwise specified or the context requires otherwise, all financial information for the Company provided in this Annual Report is denominated in USD.
Definitions
Unless otherwise specified or the context requires otherwise in this Annual Report:
| ● | the terms (1) “we,” “us,” “our,” “Company,” “Ferroglobe,” and “our business” refer to Ferroglobe PLC and its subsidiaries, including Ferroglobe USA, Inc. and its consolidated subsidiaries and Ferroglobe Spain Metals S.A.U. and its consolidated subsidiaries; |
| ● | “ABL Revolver” refers to the credit agreement, dated as of June 30, 2022, between Ferroglobe subsidiaries Ferroglobe USA, Inc, and QSIP Canada ULC, as borrowers, for a Credit and Security Agreement for a $100 million North American asset-based revolving credit facility, with Bank of Montreal, as lender. |
| ● | “Business Combination” refers to the business combination of Ferroglobe USA, Inc (formerly “Globe”) and Ferroglobe Spain Metals (formerly FerroAtlántica) as wholly-owned subsidiaries of Ferroglobe PLC on December 23, 2015; |
| ● | “Class A Ordinary Shares” refers to share capital issued in connection with the Business Combination, which was subsequently converted into ordinary shares of Ferroglobe PLC as a result of the distribution of beneficial interest units in the Ferroglobe Representation and Warranty Insurance Trust to certain Ferroglobe PLC shareholders on November 18, 2016; |
| ● | “consolidated financial statements” refers to the audited consolidated financial statements of Ferroglobe PLC and its subsidiaries as of December 31, 2024 and December 31, 2023 and for each of the years ended December 31, 2024, 2023 and 2022, including the related notes thereto, prepared in accordance with IFRS (as such terms are defined herein); |
| ● | “EBIT” refers to earnings before interest and taxes; |
| ● | “Gross Debt” is the summation of (i) bank borrowings excluding factoring agreements; (ii) debt instruments; and (iii) other financial liabilities; |
| ● | “IBOR” refers to the basic rate of interest used under some financial instruments. |
| ● | “IFRS” refers to International Financial Reporting Standards as issued by the International Accounting Standards Board; |
| ● | “Reinstated Senior Notes” refer to the 9.375% senior secured notes due 2025 issued in exchange for 98.588% of the 9.375% senior unsecured notes due 2022, in each case issued by Ferroglobe Finance Company PLC and Ferroglobe USA; |
| ● | “ROCE” refers to the return on capital for the relevant fiscal year determined as the result of (EBIT) / (Equity + Gross Debt); |
| ● | “shares” or “ordinary shares” refer to the authorized share capital of Ferroglobe PLC; |
| ● | “tons” refer to metric tons (2,204.6 pounds or 1.1 short tons); |
| ● | “U.S. Exchange Act” refers to the U.S. Securities Exchange Act of 1934, as amended; |
| ● | “U.S. Securities Act” refers to the U.S. Securities Act of 1933, as amended; and |
| ● | “ZAR” refers to the currency abbreviation in forex markets for the South African Rand, the official currency of South Africa. |
PRESENTATION OF FINANCIAL INFORMATION
The selected financial information as of December 31, 2024 and December 31, 2023 and for the years ended December 31, 2024, 2023 and 2022 is derived from our consolidated financial statements, which are included elsewhere in this Annual Report and which are prepared in accordance with IFRS.
Certain numerical figures set out in this Annual Report, including financial data presented in millions or thousands and percentages describing market shares, have been subject to rounding adjustments, and, as a result, the totals of the data in this Annual Report may vary slightly from the actual arithmetic totals of such information. Percentages and amounts reflecting changes over time periods relating to financial and other data set forth in “Item 5.—Operating and Financial Review and Prospects” are calculated using the numerical data in our consolidated financial statements or the tabular presentation of other data (subject to rounding) contained in this Annual Report, as applicable, and not using the numerical data in the narrative description thereof.
