GrafTech's Q4 2024: Contradictions in Pricing Strategies, Inventory Management, and Market Share Recovery

These are the key contradictions discussed in GrafTech's latest 2024Q4 earnings call, specifically including: Pricing Expectations and Strategy, Inventory Management, and Market Share Recovery:



Sales Growth and Market Share Recovery:
- GrafTech International's sales volume grew by 13% year-over-year in 2024 despite flat global steel production and graphite electrode demand outside of China.
- This growth was driven by increased customer engagement, improving the customer value proposition, and the introduction of the 800-millimeter product offering.

Cost Reduction Initiatives:
- The company achieved a 23% year-over-year reduction in cash COGS per metric ton in 2024, surpassing their projected goal of a 20% decline.
- This was due to a cost rationalization plan, which included idling facilities and reducing overhead structures.

Working Capital Improvements:
- GrafTech reduced working capital levels by $40 million in 2024, adding to the $108 million reduction in 2023.
- These improvements were part of efforts to align inventory levels with demand views and enhance liquidity.

Price Increase Strategy:
- GrafTech announced a 15% price increase for uncommitted 2025 volume, to be implemented in the second quarter of 2025.
- This step is essential for returning the business to profitability, as current pricing levels are not sustainable.