Ampco-Pittsburgh's Q1 2025: Unpacking Key Contradictions in Operations, Debt, and Segment Performance
Earnings DecryptTuesday, May 20, 2025 11:20 am ET
2min read
UK plant operations and market conditions, debt management and cash flow strategy, asbestos revaluation practices, debt reduction and financial health, and Forged and Engineered Products segment performance are the key contradictions discussed in Ampco-Pittsburgh's latest 2025Q1 earnings call.
Improved Financial Performance:
- Ampco-Pittsburgh Corporation reported earnings per common share of $0.06 for the first quarter of 2025, an improvement of $0.20 compared to the prior year quarter.
- Adjusted EBITDA for the quarter was $8.8 million, compared to $5.1 million in the first quarter of 2024.
- The improvement was driven by record order intake for Air and Liquid, benefits from new equipment in the U.S. forage business, and effective cost management.
Segment Performance and Market Conditions:
- Forged and Cast Engineered Products segment reported a 5% decline in net sales to $72.3 million, primarily due to lower rural volume and unfavorable exchange rates.
- Adjusted EBITDA for the segment improved to $8.27 million, up from $6 million in the prior year.
- Market conditions showed soft but stable global steel demand, while tariffs posed some near-term challenges, which the company aims to manage through customer collaboration.
Tariff Impact and Strategic Positioning:
- The reduction from 125% to 10% tariffs on U.S. produced rolls shipped to China relieved pressure on an upcoming shipment, enabling business continuity.
- The U.S. cast roll market's underserved status maintained European operations' competitiveness despite tariffs.
- Steel tariffs are creating a significant tailwind for the domestic FEP business, with growth opportunities emerging in tool steel, distribution bar, and block products.
Strong Order Intake and Product Mix in Air & Liquid Systems:
- Q1 sales orders were the highest in history for Air and Liquid Systems, driven by record order intake from the nuclear market.
- Revenue was slightly below the prior year, but the product mix improved substantially.
- The first order for a small modular reactor (SMR) project highlighted positive activity in the nuclear market, positioning the company well for growth.
Improved Financial Performance:
- Ampco-Pittsburgh Corporation reported earnings per common share of $0.06 for the first quarter of 2025, an improvement of $0.20 compared to the prior year quarter.
- Adjusted EBITDA for the quarter was $8.8 million, compared to $5.1 million in the first quarter of 2024.
- The improvement was driven by record order intake for Air and Liquid, benefits from new equipment in the U.S. forage business, and effective cost management.
Segment Performance and Market Conditions:
- Forged and Cast Engineered Products segment reported a 5% decline in net sales to $72.3 million, primarily due to lower rural volume and unfavorable exchange rates.
- Adjusted EBITDA for the segment improved to $8.27 million, up from $6 million in the prior year.
- Market conditions showed soft but stable global steel demand, while tariffs posed some near-term challenges, which the company aims to manage through customer collaboration.
Tariff Impact and Strategic Positioning:
- The reduction from 125% to 10% tariffs on U.S. produced rolls shipped to China relieved pressure on an upcoming shipment, enabling business continuity.
- The U.S. cast roll market's underserved status maintained European operations' competitiveness despite tariffs.
- Steel tariffs are creating a significant tailwind for the domestic FEP business, with growth opportunities emerging in tool steel, distribution bar, and block products.
Strong Order Intake and Product Mix in Air & Liquid Systems:
- Q1 sales orders were the highest in history for Air and Liquid Systems, driven by record order intake from the nuclear market.
- Revenue was slightly below the prior year, but the product mix improved substantially.
- The first order for a small modular reactor (SMR) project highlighted positive activity in the nuclear market, positioning the company well for growth.
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