Ferroglobe PLC (NASDAQ: GSM) stock lost over 39.6% in the pre-market session on November 27th, 2018 as the firm posted lower than expected results for the third quarter of 2018. The Company has continued focus on cash generation and deleveraging its balance sheet, and no interim dividend has been declared or is payable in respect of Q3 2018. the Company announced a $20 million programme for the purchase of its ordinary shares. 2,894,049 ordinary shares in the Company have been purchased under the programme, of which 1,152,958 shares have been canceled and 1,741,091 are held in Treasury. The average price paid per share was $6.89. The programme closed on November 7, 2018.
GSM in the third quarter of FY 18 has reported the adjusted earnings per share of 0 cents, missing the analysts’ estimates for the adjusted earnings per share of 15 cents. The company had reported the adjusted revenue growth of 16.7 percent to $526.8 million in the third quarter of FY 18, missing the analysts’ estimates for revenue of $564.01 million. For the third quarter, total shipments were up 14.3% and the average selling price was up 2.1% on Q3 2017. Sales for the nine months ended September 30, 2018 of $1,671 million were up 31.2% when compared to $1,273 million for the nine months ended September 30, 2017. For the nine month period, total shipments were up 16.8% and the average selling price was up 13.2% compared with the same period in 2017. Sales for the quarter and nine month period were aided by the Company’s manganese-based alloy plants in Mo i Rana (Norway) and Dunkirk (France), acquired by the Company on February 1, 2018.
Moreover, during the third quarter 2018, the average selling prices decreased by between 5% and 7% for all of our products quarter-over-quarter, reflecting overall market conditions. However, average selling prices for 2018 are well above 2017 for silicon metal and silicon-based alloys, and at levels that are compatible with historical trends. Manganese-based alloys prices in 2018 have significantly deteriorated, despite persistently high ore prices, a situation that should revert going forward based on historical market precedent. Sales volumes in Q3 also decreased as compared to Q2, primarily as a result of seasonal slowdown in Europe and the impact of changing trade flows. Activity to date in 2018 shows healthy growth, with volume increases over the same period in the prior year of 7% to 8% in silicon metal and silicon-based alloys. A year-to-year comparison of manganese-based alloys volumes is inapt in light of the Company’s acquisition of new manganese-based alloy assets earlier this year.