GrafTech International Lowers EBITDA and Cash Flow Guidance

GrafTech International Ltd. (NYSE:GTI) announced that it now expects its EBITDA and operating cash flow for H1 2015 to be at the low end of the previously announced ranges of $30 to $40 million each. Both could also come in lower than the targeted ranges.

As quoted in the press release:

The Company reported that market conditions remain challenging in both the Industrial Materials segment and Engineered Solutions segment. While pricing in the Industrial Materials segment is generally consistent with expectations, volumes remain under pressure due to weak electric arc furnace steel production in its key North American and European markets driven by high steel import levels. In the Engineered Solution segment, sales are also lower than expected as industrial and oil and gas sector demand continues to be weak. Additionally, lower volumes and pricing pressure have affected product sales into the advanced consumer electronics market. In light of these market conditions, the Company will reduce production rates further to align with current market demand.

The company also announced an update on a convertible preferred investment and tender offer:

As previously announced, GrafTech has agreed to issue $150 million of convertible preferred stock to an affiliate ofBrookfield Asset Management (Brookfield) pursuant to an investment agreement. This transaction will close upon receipt of the required regulatory approvals, which are expected to be received in July or early August.

Also, as previously announced, Brookfield has launched a tender offer to acquire up to all of the outstanding shares ofGrafTech common stock at a purchase price of $5.05 per share. The tender offer will expire at 12:00 midnight, New York City time, on July 7, 2015, unless extended in accordance with the terms of the merger agreement and the applicable rules and regulations of the Securities and Exchange Commission. Closing of the tender offer is subject to receipt of required regulatory approvals.

Click here to read the full GrafTech International Ltd. (NYSE:GTI) press release.