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Refractory products provider RHI Magnesita warned it could miss its annual earnings guidance after cost pressures and the temporary closure of an Austrian facility weighed on its third-quarter performance.
Achieving full-year guidance for earnings before interest, tax and amortisation of €310 million would require a strong performance in the fourth quarter, the company said.
It noted that the fourth quarter was supported by a normal seasonal uplift in cement, but was also subject to the agreement of further price increases currently being negotiated with customers.
'Full year EBITA could therefore be between €280 million and €310 million, depending on the successful realization within the fourth quarter of the latest round of price increases and any further increases in costs,' RHI Magnesita said.
Third-quarter profitability was weaker than forecast but momentum improved in September as the benefits of price increases took effect.
Sales volumes for high-margin refractories mainly for use in non-ferrous metals projects were impacted by lower output from the Radenthein plant in Austria.
The temporary closure of one tunnel kiln there for unscheduled maintenance would adversely impact second-half EBITA by around €8 million.
On costs, RHI Magnesita said the supply chain position remained challenging, with it seeing further increases in the cost of sea freight and demurrage, together with rising energy and consumables costs.
'Supply chain delays caused by low freight reliability impacted production schedules and deliveries and there was continued use of air freight when necessary to ensure customer supply,' it said.