SGL Carbon SE (FSE: SGL)

Quick Facts / Company Snapshot

• Company Name: SGL Carbon SE
• Headquarters: Wiesbaden, Germany
• Fiscal Year 2024 Revenue: €1,026.4 million
• Adjusted EBITDA (EBITDApre) 2024: €162.9 million
• Consolidated Net Result 2024: Minus €80.3 million
• Total Assets: €1,336.9 million
• Total Equity: €554.9 million (attributable to shareholders)
• Equity Ratio: 41.5%
• Net Financial Debt: €108.2 million
• Leverage Ratio: 0.7
• Free Cash Flow 2024: €38.7 million
• Capital Expenditure 2024: €97.3 million
• Total Headcount: 4,394 employees (excluding 117 apprentices)
• Number of Production Sites: 29 globally
• Revenue from Outside Germany: 74%
• Largest Business Segment: Graphite Solutions (€539.0 million, 52.5% of total revenue)
• Largest Market Segment: Digitization (€250.6 million, 24.4% of total revenue)
• Chief Executive Officer (CEO): Andreas Klein (effective January 1, 2025)
• Chief Financial Officer (CFO): Thomas Dippold
• Supervisory Board Chairman: Prof. Dr. Frank Richter

Company overview

SGL Carbon SE is a global technology-based company and a leading manufacturer of products and solutions based on specialty graphites, carbon fibers, and composites. Headquartered in Wiesbaden, Germany, the company operates 29 production sites across Europe, North America, and Asia, complemented by a service network spanning more than 80 countries.

The organization focuses heavily on developing cutting-edge, carbon-based products that contribute to a sustainable future and serve industries shaping global megatrends. These future-oriented markets include mobility (particularly electromobility), semiconductor technology, LED, solar and wind energy, and fuel cells. Furthermore, SGL Carbon provides highly customized solutions for the chemical industry and a wide array of industrial applications.

• Total 2024 Revenue: €1,026.4 million.
• Global Headcount: 4,394 employees worldwide.
• Manufacturing Footprint: 29 production sites globally.

The operational business of SGL Carbon is meticulously structured into four primary business units, each holding individual responsibility for its financial results. These units are Graphite Solutions (GS), Process Technology (PT), Carbon Fibers (CF), and Composite Solutions (CS). This decentralized operational structure allows for high flexibility and targeted market approaches, ensuring that customer requirements across diverse high-tech industries are met efficiently.

The corporate strategy is deeply intertwined with sustainability and innovation. The company’s mission revolves around creating superior solutions for its customers while minimizing environmental impact. SGL Carbon’s materials are engineered to enhance the performance, efficiency, and environmental compatibility of its customers’ systems and processes.

Business segments

SGL Carbon’s operations are divided into four main business units, complemented by a Corporate segment that handles central administrative functions and site management.

• Graphite Solutions (GS) Revenue: €539.0 million (52.5% of total revenue).
• Carbon Fibers (CF) Revenue: €209.8 million (20.5% of total revenue).
• Process Technology (PT) Revenue: €138.3 million (13.5% of total revenue).
• Composite Solutions (CS) Revenue: €124.6 million (12.1% of total revenue).
• Corporate Revenue: €14.7 million (1.4% of total revenue).

Graphite Solutions (GS)

The Graphite Solutions business unit is the largest segment within SGL Carbon, contributing €539.0 million to the group’s total revenue, representing 52.5%. This unit focuses on supplying customized solutions utilizing established specialty graphites to both traditional and structurally growing customer industries. Operations are carried out across 14 plants located in Europe, the Americas, and Asia.

The product portfolio within GS is highly differentiated, offering customized graphite components that are crucial for high-temperature processes. The unit produces synthetic fine grain graphite blocks, expanded natural graphite, specialty graphites with high-purity coatings, graphite anode material, and parts for fuel cells.

• Adjusted EBITDA 2024: €131.0 million.
• Adjusted EBITDA Margin: 24.3%.
• Capital Expenditure 2024: €60.5 million.

The primary growth drivers for Graphite Solutions are the semiconductor and LED markets, alongside various industrial applications. In the semiconductor industry, SGL Carbon supplies high-precision graphite components critical for wafer production. The company is notably one of the few global suppliers capable of delivering the high-purity graphite components required for the production of silicon carbide (SiC) semiconductors.

Carbon Fibers (CF)

The Carbon Fibers business unit is SGL Carbon’s second-largest segment, generating €209.8 million in revenue, which equates to 20.5% of the total group revenue. This unit consolidates the manufacturing activities for carbon fibers and carbon fiber semi-finished products. Production is primarily centered at major hubs in Moses Lake (USA) and Muir of Ord (UK), as well as a facility in Lavradio (Portugal) which manufactures precursors.

This segment focuses on the large-volume production of carbon fibers, predominantly serving the wind energy and automotive industries. The business unit controls the entire value chain, starting from the polymerization of the main raw material, acrylonitrile, through the production of carbon fibers, to the manufacture of fabrics.

• Adjusted EBITDA 2024: Minus €11.0 million.
• EBITDA Margin: Minus 5.2%.
• Headcount at Year-End: 937 employees.

The CF unit also encompasses BSCCB, an equity-accounted joint venture dedicated to the production of carbon-ceramic brake discs. This joint venture is strategically linked to Carbon Fibers through both the supply chain and technological synergies.

Process Technology (PT)

Process Technology generated €138.3 million in revenue during 2024, accounting for 13.5% of the total group revenue. This business unit specializes in the construction, maintenance, and repair of plants and equipment specifically designed for the chemicals industry.

The core focus of PT lies in the design and manufacture of high-quality, robust graphite heat exchangers, synthesis units, pumps, quenchers, columns, and ejectors that are routinely exposed to highly corrosive media.

• Adjusted EBITDA 2024: €33.0 million.
• EBITDA Margin Improvement: Reached a record high for the segment since its spin-off.
• Capital Expenditure 2024: €2.3 million.

PT adds significant value through comprehensive service offerings, including installation, commissioning, inspection, and remote maintenance services, ensuring optimal equipment utilization and extended service life for its chemical industry clientele.

Composite Solutions (CS)

Composite Solutions contributed €124.6 million in revenue, representing 12.1% of the total group revenue. This unit focuses on the serial production of customized components and bespoke applications made from composite materials, primarily based on glass and carbon fibers.

The automotive industry is the primary market for CS, where the unit supplies innovative lightweight solutions. Key products include fiber-reinforced composite battery enclosures for electric vehicles, GRP leaf springs, and various types of carbon friction materials utilized in automotive applications.

• Adjusted EBITDA 2024: €18.2 million.
• Adjusted EBITDA Margin: 14.6%.
• Capital Expenditure 2024: €7.5 million.

Manufacturing for the Composite Solutions business unit is strategically localized, with two production sites situated in Austria and two in the United States, allowing for close proximity to major automotive manufacturing hubs.

Corporate

The Corporate segment is a non-operating unit that encompasses central administrative functions and site management. It generated €14.7 million in revenue, making up 1.4% of the total group revenue.

Revenue in this segment primarily stems from the rental of production and administrative buildings, as well as the provision of services to third parties.

• Adjusted EBITDA 2024: Minus €8.3 million.
• Capital Expenditure 2024: €23.9 million (largely driven by joint venture facility expansion).
• Headcount at Year-End: 107 employees.

History and evolution

SGL Carbon’s history is characterized by strategic realignments, technological advancements, and a persistent focus on carbon-based materials. The company’s evolution has been heavily influenced by the necessity to adapt to shifting global markets, transitioning from traditional carbon applications to high-tech, future-oriented material solutions.

A pivotal phase in SGL Carbon’s recent history was the comprehensive transformation and restructuring period spanning from 2020 to 2022. This phase was strategically designed to fundamentally improve the company’s economic performance and establish a robust foundation for sustainable future growth. The core initiatives during this period involved an extensive cost-cutting program and aggressive measures to enhance corporate liquidity.

• Restructuring Phase (2020-2022): Focused on structural simplification and debt reduction.
• Business Unit Realignment: Splitting of heterogeneous divisions into the current four distinct business units.

To better address dynamic customer requirements and eliminate operational inefficiencies, SGL Carbon underwent a significant structural reorganization. Two formerly heterogeneous business units, which possessed vastly different customer structures and minimal synergistic overlaps, were systematically divided into the four specialized, financially responsible business units operating today.

Following the successful stabilization phase, SGL Carbon entered an “acceleration” phase beginning in 2023. This phase shifted the strategic focus toward profitable, organic growth. The company aggressively initiated investments to expand production capacities, specifically targeting products demonstrating exceptional growth and high margin potential.

• Semiconductor Capacity Expansion: Over €75 million invested across 2023 and 2024.
• Joint Venture Consolidation: Strategic expansions in joint ventures like the Brembo partnership for ceramic brakes.

In 2024, facing a deteriorating macroeconomic environment marked by high energy costs and stagnating demand in specific sectors like wind energy and electric vehicles, SGL Carbon temporarily suspended the aggressive acceleration phase. The company pivoted toward consolidating its existing operational business, maintaining strict cost management, and initiating a fundamental restructuring of the underperforming Carbon Fibers business unit to secure long-term profitability.

Products and services

SGL Carbon’s product portfolio is highly specialized, encompassing a wide array of carbon and graphite-based materials, semi-finished goods, and complex composite components.

• Digitization Market Products Revenue: €250.6 million (24.4% of total revenue).
• Mobility Market Products Revenue: €249.7 million (24.3% of total revenue).
• Industrial Applications Products Revenue: €222.5 million (21.7% of total revenue).
• Chemicals Market Products Revenue: €161.9 million (15.8% of total revenue).
• Energy Market Products Revenue: €90.1 million (8.8% of total revenue).
• Textile Fibers Products Revenue: €51.6 million (5.0% of total revenue).

Specialty Graphites for Digitization and Semiconductors

The highest revenue-generating product category falls within the Digitization market segment. This includes high-precision specialty graphite components that are absolutely essential for high-temperature processes in wafer production within the semiconductor and LED industries.

SGL Carbon provides highly purified graphite components with specialized coatings. These products are particularly critical in the manufacturing of silicon carbide (SiC) semiconductors, a next-generation technology vital for electromobility and renewable energy infrastructure due to its extreme efficiency and reduced energy loss.

• Semiconductor segment investment: €40.0 million allocated in 2024 for capacity expansion.
• Product characteristic: High-temperature resistance and extreme purity.

Mobility and Automotive Components

Products serving the Mobility market represent the second-largest revenue stream. This category includes a diverse range of solutions primarily targeting the automotive sector, focusing heavily on lightweight construction and advanced braking systems.

Key products include fiber-reinforced composite battery enclosures specifically designed for electric vehicles, which offer significant weight reductions compared to traditional metal enclosures. Additionally, the company manufactures glass-fiber reinforced plastic (GRP) leaf springs, various types of carbon friction materials, and high-performance carbon-ceramic brake discs through its joint venture.

Industrial Applications and Specialty Materials

This broad category encompasses specialty graphites and carbon materials used across numerous industrial applications. Products include fine grain graphite blocks, expanded natural graphite, and machined graphite components used in mechanical engineering, metallurgy, and high-temperature furnace construction.

These materials are valued for their exceptional thermal and electrical conductivity, chemical resistance, and structural stability under extreme conditions.

Chemical Process Technology Equipment

SGL Carbon designs and manufactures specialized plants and equipment for the chemical industry. The product line includes graphite heat exchangers, synthesis units, columns, pumps, and quenchers.

These products are engineered to withstand highly corrosive media, ensuring safety and longevity in aggressive chemical processing environments. The company also provides comprehensive lifecycle services, including repair and refurbishment of these highly specialized industrial components.

Carbon Fibers and Textile Fibers

This category includes the production of the chemical precursor (polyacrylonitrile or PAN), oxidized fibers, continuous carbon fibers (heavy tow), and chopped carbon fibers. Additionally, the company produces textile acrylic fibers.

These materials serve as the foundational reinforcement elements for composite materials used extensively in the wind energy sector (for rotor blades), aerospace, and industrial applications requiring high tensile strength and low weight.

Brand portfolio

SGL Carbon markets its highly specialized materials and solutions under several established product brands, which are widely recognized in B2B industrial markets for their quality and reliability.

• SIGRAFLEX Revenue: Consolidated under Industrial Applications and Chemical markets.
• SIGRAFINE Revenue: Consolidated predominantly under Industrial Applications.
• SIGRATHERM Revenue: Consolidated under Energy and Industrial markets.
• ECOPHIT Revenue: Consolidated under Industrial markets.

SIGRAFLEX

SIGRAFLEX is SGL Carbon’s premier brand for flexible graphite sealing materials. This brand encompasses a wide range of products including graphite foils, sheets, and customized gaskets.

SIGRAFLEX products are utilized extensively in the chemical, petrochemical, and power generation industries. They are renowned for their exceptional chemical resistance, thermal stability, and reliable sealing performance under extreme pressures and temperatures, providing critical safety in demanding industrial fluid handling systems.

SIGRAFINE

The SIGRAFINE brand represents SGL Carbon’s portfolio of fine-grain specialty graphites. These materials are manufactured using isostatic, vibration-molded, die-molded, and extruded production processes.

SIGRAFINE graphites are heavily utilized in the metallurgical industry, particularly in the gas flushing treatments of aluminum melts, where they extend the service life of components like rotor heads and degassing units. The brand is synonymous with high mechanical strength, purity, and resistance to thermal shock.

SIGRATHERM

SIGRATHERM is the designated brand for SGL Carbon’s thermal management solutions and high-temperature insulation materials.

These products, often based on carbon and graphite felts or rigid insulation boards, are critical for managing heat in industrial furnaces, semiconductor crystal growing facilities, and other extreme high-temperature environments. They offer excellent insulation properties combined with high thermal stability.

ECOPHIT

ECOPHIT represents SGL Carbon’s brand for innovative, graphite-based lightweight construction panels and thermal management solutions utilized primarily in building climatization and industrial applications.

The ECOPHIT products leverage the high thermal conductivity of graphite to create efficient radiant heating and cooling systems, contributing to energy-efficient building technologies and advanced thermal regulation systems.

Geographical presence

SGL Carbon maintains a robust global footprint, strategically positioning its manufacturing facilities, sales offices, and service networks to closely serve its international customer base.

• Germany Revenue: €263.9 million (25.7% of total revenue).
• USA Revenue: €226.5 million (22.1% of total revenue).
• Europe (excluding Germany) Revenue: €208.6 million (20.3% of total revenue).
• Other Asia Revenue: €144.8 million (14.1% of total revenue).
• China (incl. Hong Kong) Revenue: €134.2 million (13.1% of total revenue).
• Rest of World Revenue: €48.4 million (4.7% of total revenue).

Germany

Germany represents SGL Carbon’s most significant single market and operational hub. Generating €263.9 million in revenue, it accounts for 25.7% of the global total.

The country hosts the corporate headquarters in Wiesbaden and several major production sites, including Bonn, Meitingen, Wackersdorf, and Willich. These facilities are critical hubs for Graphite Solutions, Composite Solutions, and central R&D activities. A significant portion of the company’s workforce (1,970 employees) is based in Germany, and the Meitingen site also hosts the major joint venture operations for carbon-ceramic brakes.

United States of America

The USA is SGL Carbon’s second-largest regional market, contributing €226.5 million, or 22.1% of the total revenue.

SGL Carbon operates eight production sites across North America. Key facilities include the major carbon fiber production hub in Moses Lake, Washington, and various manufacturing plants for Composite Solutions and Graphite Solutions. The US market is highly significant for the company’s automotive composite components and aerospace material supplies.

Europe (excluding Germany)

The broader European region (excluding the domestic German market) is a vital operational and sales territory, generating €208.6 million (20.3% of total revenue).

SGL Carbon operates numerous facilities across Europe, including sites in Austria (Ried and Ort im Innkreis for Composite Solutions), France (Chedde and Saint-Martin-d’Hères), the United Kingdom (Muir of Ord and Halifax for Carbon Fibers), Poland (Nowy Sącz and Racibórz), Portugal (Lavradio for precursor manufacturing), Italy, and Spain. This extensive network ensures tight supply chain integration across the European industrial landscape.

Asia (China and Other Asia)

The Asian market is divided into China (including Hong Kong) and Other Asia, which combined represent a massive €279.0 million in revenue, or 27.2% of the global total. China alone accounts for €134.2 million.

SGL Carbon operates five production sites in Asia, strategically located to serve the rapidly expanding local electronics, semiconductor, and renewable energy sectors. The region’s revenue profile shifted in 2024, with a notable decline in Chinese revenue offset by strong growth in other Asian markets, driven by dynamic shifts in the semiconductor supply chain and regional demand fluctuations.

Financial performance analysis

SGL Carbon navigated a highly challenging macroeconomic environment in 2024, characterized by structural headwinds, high energy costs in Europe, and sluggish demand in several key growth markets.

Despite a slight contraction in top-line revenue, the company demonstrated considerable resilience, maintaining robust operating margins through disciplined cost management and strategic product mix optimization. The financial trajectory illustrates a company effectively managing a complex transition, absorbing significant one-off restructuring costs while preserving underlying operational profitability and free cash flow generation.

• Total Assets 2024: €1,336.9 million (Down from €1,472.6 million in 2023).
• Total Equity 2024: €564.6 million (Down from €614.9 million in 2023).
• Net Financial Debt 2024: €108.2 million (Reduced from €115.8 million in 2023).

The multi-year trend showcases a stark recovery and stabilization from previous restructuring phases. The leverage ratio has been remarkably stabilized at 0.7 for two consecutive years, a massive improvement from a ratio of 3.1 recorded at the end of 2020. This indicates a fundamentally strengthened balance sheet capable of withstanding cyclical downturns.

However, the 2024 fiscal year was heavily burdened by non-recurring items and one-off effects. The company recognized significant impairment losses primarily within the Carbon Fibers unit due to structural market overcapacity, which heavily skewed the final consolidated net result into negative territory despite solid adjusted operating metrics.

Profit and loss analysis

The consolidated income statement reflects the dual narrative of resilient core operations masked by heavy one-off non-cash impairment charges.

• Sales Revenue: €1,026.4 million (Decrease of 5.8% year-over-year).
• Cost of Sales: Minus €793.6 million (Decrease of 6.9% year-over-year).
• Gross Profit: €232.8 million (Decrease of 1.7% year-over-year).
• Adjusted EBITDA (EBITDApre): €162.9 million (Decrease of 3.3% year-over-year).
• Consolidated Net Result: Minus €80.3 million.

Revenue and Gross Margin: Sales revenue contracted by 5.8%, primarily driven by volume declines in the Carbon Fibers and Graphite Solutions units, alongside the planned termination of an automotive contract in Composite Solutions. However, the Cost of Sales decreased disproportionately by 6.9%, aided by lower energy and factor costs. Consequently, the Gross Margin actually improved to 22.7% (up from 21.7% in 2023), indicating strong pricing power and operational efficiency in the remaining product mix.

Operating Expenses:

• Selling Expenses: Minus €91.3 million (Down 8.1%).
• Research & Development: Minus €25.7 million (Down 13.5%).
• General & Administrative: Minus €34.7 million (Down 6.5%). Strict cost discipline was evident across all functional areas. The reduction in R&D costs was notably influenced by the cessation of activities in the Battery Solutions (graphite anode material) business line.

Impairments and Net Result: The operating profit (EBIT) plummeted to a loss of €14.3 million. This was entirely driven by staggering non-recurring items totaling minus €118.5 million. These included massive impairment losses of €91.2 million predominantly in the Carbon Fibers unit, alongside €19.0 million in restructuring expenses. Consequently, after a financial result of minus €32.6 million and tax expenses of minus €32.5 million, the consolidated net result settled at a steep loss of €80.3 million.

Balance sheet analysis

SGL Carbon’s balance sheet structure remains solid, characterized by a high equity ratio and strictly managed debt levels, providing stability despite the reported net loss for the year.

• Non-current Assets: €663.0 million.
• Current Assets: €673.9 million.
• Total Equity (attributable to shareholders): €554.9 million.
• Non-current Liabilities: €529.0 million.
• Current Liabilities: €243.3 million.

Assets: Total assets decreased by 9.2% to €1,336.9 million. Non-current assets fell to €663.0 million, severely impacted by €76.5 million in impairment charges recorded in the Carbon Fibers unit and the write-down of €20.0 million in deferred US tax assets. Current assets also declined to €673.9 million, primarily due to targeted reductions in inventories (down to €345.6 million) and lower liquid funds following debt repayment.

Equity and Liabilities: Total equity attributable to shareholders decreased to €554.9 million, directly reflecting the net loss of €80.3 million, partially offset by positive currency translation effects of €23.5 million. Despite this nominal drop, the equity ratio improved slightly to 41.5% due to the parallel contraction of the balance sheet total.

Non-current liabilities shrank significantly to €529.0 million. This was largely driven by the full cash repayment of a €75.0 million term loan facility. Pension provisions also decreased by 5.1% to €195.6 million due to higher discount rates. Current liabilities dropped to €243.3 million, reflecting lower trade payables and decreased provisions.

Cash flow analysis

SGL Carbon maintained robust cash generation capabilities in 2024, successfully funding elevated capital expenditures from its own operational cash flows while continuing to deleverage.

• Cash Flow from Operating Activities: €120.3 million.
• Cash Flow from Investing Activities (excluding time deposits): Minus €81.6 million.
• Cash Flow from Financing Activities: Minus €90.5 million.
• Free Cash Flow: €38.7 million.

Operating Cash Flow: Operating cash flow stood strong at €120.3 million, though lower than the €163.8 million achieved in 2023. This resilient operational cash generation was achieved despite the reported net loss, as the massive impairment charges were non-cash items. Strategic management of net working capital contributed positively, albeit at a lower magnitude than the prior year.

Investing Cash Flow: Cash outflows for capital expenditures in intangible assets, property, and plant equipment increased by 11.7% to €97.3 million. This elevated outflow was heavily directed towards expanding manufacturing capacity for high-margin semiconductor products in the Graphite Solutions segment. The total investing cash flow was partially offset by €15.0 million in dividends received from equity-accounted investments.

Financing Cash Flow: Financing activities resulted in a net outflow of €90.5 million. The primary driver here was the aggressive debt reduction strategy, highlighted by the €79.1 million repayment of financial liabilities, which included the complete retirement of a €75.0 million term loan facility. Interest payments accounted for €21.1 million of the outflow.

Board of directors and leadership team

SGL Carbon operates under a two-tier governance system comprising a Board of Management, which handles operational leadership, and a Supervisory Board, which provides oversight and strategic guidance.

Board of Management:

• Andreas Klein (Chief Executive Officer): Appointed effective January 1, 2025, for a three-year term. He succeeds Dr. Torsten Derr. Klein brings deep internal operational experience, having previously served as the head of SGL’s largest business unit, Graphite Solutions, where he oversaw the critical semiconductor business expansion. He retains operational responsibility for this area to tightly link executive leadership with core market dynamics.
• Thomas Dippold (Chief Financial Officer): Serves as CFO, responsible for financial management, risk management, and reporting. His mandate was extended by the Supervisory Board for an additional five years, providing crucial stability and continuity in financial leadership.
• Dr. Stephan Bühler (Member of the Board of Management): Appointed effective January 1, 2025, for a two-year term. Formerly SGL Carbon’s long-standing general counsel, Dr. Bühler brings extensive transaction experience and is specifically tasked with navigating and executing the strategic restructuring options for the Carbon Fibers business unit.

Supervisory Board: The Supervisory Board consists of eight members—four shareholder representatives and four employee representatives.

• Prof. Dr. Frank Richter (Chairman): Leads the Supervisory Board and represents the interests of the largest shareholder.
• Ingeborg Neumann: Serves as a financial and sustainability expert on the Audit Committee.
• Georg Denoke: Provides extensive financial and compliance expertise.
• Other Members: Include Edwin Eichler, Kathrin Bamberger, Markus Stettberger, Dieter Züllighofen, and Axel Hemleb.

The Supervisory Board operates several specialized committees, including the Audit Committee, Personnel Committee, and Nominating Committee, to ensure rigorous oversight of financial reporting, executive compensation, and succession planning.

Subsidiaries, associates, joint ventures

SGL Carbon operates a complex global network of fully consolidated subsidiaries, alongside strategic joint ventures and associate companies that contribute significantly to specialized product lines.

• SGL Gelter S.A. (Spain): 64.02% ownership. Revenue contribution consolidated.
• SGL Quanhai High-Tech Materials (Shanxi) Co. Ltd. (China): 89.16% ownership. Revenue contribution consolidated.
• Brembo SGL Carbon Ceramic Brakes S.p.A. (Italy): 50.0% ownership. Equity-accounted joint venture.
• MCC-SGL Precursor Co. Ltd. (Japan): 33.3% ownership. Equity-accounted associate.
• Fisigen S.A. (Portugal): 49.0% ownership. Equity-accounted associate.

Brembo SGL Carbon Ceramic Brakes S.p.A. (BSCCB)

This 50:50 joint venture with Italian brake specialist Brembo S.p.A. is a cornerstone of SGL’s automotive strategy. Headquartered in Stezzano, Italy, with major production operations housed within SGL’s Meitingen site in Germany, BSCCB develops and manufactures ultra-high-performance carbon-ceramic brake discs. These advanced braking systems are supplied to manufacturers of premium-class private sports cars and commercial vehicles. Due to surging demand in the premium automotive sector, the joint venture is undergoing a massive capacity expansion, targeting a 70% increase in production capacity by 2027, backed by significant capital expenditures allocated in 2024 for new production halls.

MCC-SGL Precursor Co. Ltd.

This associate company, based in Tokyo, Japan, operates as a strategic partnership. SGL Carbon holds a 33.3% stake. The entity is crucial for securing the upstream supply chain, specifically concerning the procurement of high-quality carbon fiber precursors required for SGL’s downstream manufacturing processes.

Physical properties (offices, plants, factories, etc.)

SGL Carbon operates a highly specialized and capital-intensive physical footprint, comprising 29 manufacturing sites distributed strategically across the globe to optimize supply chains and customer proximity.

• German Hubs: The company’s domestic footprint is anchored by massive industrial complexes in Meitingen and Bonn. The Meitingen site is highly integrated, hosting production lines for Graphite Solutions, Composite Solutions, and the BSCCB joint venture, alongside central R&D facilities. Other key German production sites include Wackersdorf and Willich.
• North American Facilities: The manufacturing presence in the USA is defined by the massive carbon fiber production hub located in Moses Lake, Washington. This facility utilizes state-of-the-art heavy tow carbon fiber technology. Additional critical production sites are located in Charlotte (North Carolina), Valencia (California), Strongsville (Ohio), and St. Marys (Pennsylvania).
• European Network: Beyond Germany, SGL operates critical production infrastructure. The Lavradio plant in Portugal is a foundational asset, dedicated to the continuous, 24/7 production of precursor materials for carbon fibers. The Muir of Ord facility in the UK serves as a highly flexible competence center for carbon fiber processing. Other essential plants are located in Chedde and Saint-Martin-d’Hères (France), Ried and Ort im Innkreis (Austria), Nowy Sącz and Racibórz (Poland), and Verdello (Italy).
• Asian Manufacturing: To serve the dynamic Asian technology markets, SGL operates sophisticated manufacturing facilities in Shanghai and Yangquan (China), and Yamanashi (Japan).

Segment-wise performance

The operational performance across SGL Carbon’s business units exhibited significant divergence in 2024, reflecting complex underlying market dynamics.

• Graphite Solutions (GS) YoY Revenue Movement: Minus 4.7%.
• Graphite Solutions (GS) YoY EBITDA Movement: Minus 2.2%.
• Carbon Fibers (CF) YoY Revenue Movement: Minus 6.7%.
• Carbon Fibers (CF) YoY EBITDA Movement: Fell from €7.2m to minus €11.0m.
• Process Technology (PT) YoY Revenue Movement: Plus 8.1%.
• Process Technology (PT) YoY EBITDA Movement: Plus 47.3%.
• Composite Solutions (CS) YoY Revenue Movement: Minus 19.0%.
• Composite Solutions (CS) YoY EBITDA Movement: Minus 18.0%.

Graphite Solutions Performance: GS experienced a 4.7% revenue decline to €539.0 million. A strong first half, driven by robust semiconductor demand, was negated by a sharp 20.2% drop in semiconductor component sales during the second half as customers aggressively reduced inventories amidst slowing electric vehicle growth. However, strategic pricing and a favorable shift toward high-margin specialty products insulated profitability, resulting in only a marginal 2.2% drop in adjusted EBITDA to €131.0 million, actually expanding the EBITDA margin to 24.3%.

Process Technology Performance: PT delivered exceptional performance, entirely decoupling from broader macroeconomic weakness. Revenue surged by 8.1% to €138.3 million. More impressively, adjusted EBITDA skyrocketed by nearly 50% to €33.0 million. This record-breaking profitability was driven by successful execution of major customer-specific chemical equipment projects, excellent pricing power, and efficient operational execution.

Carbon Fibers Performance: CF remained the most severely challenged unit. Revenue contracted by 6.7% to €209.8 million due to unrelenting weakness in the wind energy sector and intense price pressure from massive global overcapacity. Operational underutilization led to severe idle capacity costs, driving adjusted EBITDA down to a loss of €11.0 million. The structural deterioration triggered massive impairment charges, pushing the unit’s final EBIT to a staggering loss of €117.1 million.

Composite Solutions Performance: CS faced a 19.0% revenue drop to €124.6 million. This sharp decline was predominantly caused by the planned early termination of a major supply contract with a North American automotive customer, compounded by general automotive market softness. Adjusted EBITDA fell to €18.2 million, though the decline was buffered by a €3.0 million contractual compensation payment.

Founders

SGL Carbon SE, in its modern corporate iteration, is the result of complex historical mergers and strategic acquisitions rather than the vision of a single traditional founder. The company’s roots trace back to several historic industrial enterprises specializing in carbon and graphite technologies across Europe and North America. Over decades of industrial consolidation, these disparate entities were unified under the SGL Group umbrella to form a cohesive, global technology leader dedicated exclusively to advancing carbon-based material sciences.

Shareholding pattern

SGL Carbon SE maintains a stable shareholder base characterized by significant anchor investors alongside a substantial free float, ensuring robust market liquidity on the Frankfurt Stock Exchange.

• Total Number of Shares: 122,341,478 shares.
• Free Float: Approximately 46%.

Promoters and Institutional Holdings: The shareholding structure is heavily anchored by strategic institutional investors holding approximately 54% of the total share capital.

• SKion GmbH: Remains the company’s largest single shareholder, maintaining a commanding stake of approximately 28.5%.
• BMW AG: Holds a significant shareholding subject to reporting obligations, reflecting deep historical and ongoing strategic ties, particularly in automotive lightweighting.
• Volkswagen AG: Maintains a significant shareholding subject to reporting obligations, underscoring the automotive industry’s vested interest in SGL’s carbon technologies.

Geographical Distribution of Institutional Investors: Based on the latest shareholder surveys, the institutional free float is geographically distributed as follows:

• Rest of Europe: 56.8%
• Germany: 27.8%
• North America: 14.5%
• Other Regions (Asia, Middle East, South America): 0.9%

Parent

SGL Carbon SE operates as the ultimate parent company and the central management holding entity for the entire SGL Carbon Group. It is an independent, publicly traded European Company (Societas Europaea) listed on the Prime Standard market segment of the Frankfurt Stock Exchange. The operational business is executed entirely through its global network of wholly-owned subsidiaries and strategic joint ventures.

Investments and capital expenditure plans

SGL Carbon executes a highly disciplined, strategically targeted capital expenditure program focused on expanding capacity in high-growth, high-margin sectors while maintaining strict cost control in mature segments.

• Total Capital Expenditure 2024: €97.3 million.
• Total R&D Spending 2024: €25.7 million.

Capex Allocation: Capital investments increased by 11.7% in 2024. The overwhelming majority of these funds were strategically funneled into the Graphite Solutions business unit, which absorbed €60.5 million (over 62% of total CapEx). This aggressive investment was dedicated to expanding global production capacities for specialized graphite components essential for the booming silicon carbide (SiC) semiconductor industry. A significant portion of this expansion risk was mitigated through €86.1 million in long-term customer prepayments designed to secure future production capacity.

The Corporate segment saw a sharp CapEx increase to €23.9 million, primarily financing the €19.1 million construction of new production halls at the Meitingen site to support the aggressive expansion of the BSCCB carbon-ceramic brake joint venture. Conversely, CapEx in the struggling Carbon Fibers unit was severely restricted to a mere €3.1 million, down 74.2% from the prior year.

R&D Spending: Research and development expenditures were tightly managed, decreasing by 13.5% to €25.7 million. This reduction was primarily due to the strategic decision to halt all R&D activities and close laboratory operations related to European graphite anode materials for battery solutions, redirecting focus toward more immediate, profitable technologies like CO2-reduced carbon fibers and recyclable composite systems.

Future strategy

SGL Carbon’s forward-looking strategy represents a deliberate pivot from aggressive capacity expansion to rigorous operational consolidation and structural optimization, reacting dynamically to volatile global market conditions.

• Management-stated Market Focus: The overarching strategic mission remains steadfast: positioning SGL Carbon as the preferred partner for innovative carbon-based solutions in mega-trend markets, specifically digitization, climate-friendly mobility, and renewable energies. The semiconductor and automotive sectors remain the undisputed core focus areas for long-term value generation.
• Consolidation Initiatives (2025 Focus): Facing a slower-than-anticipated recovery in electric vehicle adoption and sustained inventory gluts in the semiconductor supply chain, management has officially suspended the “acceleration” phase. The strategy for 2025 is hyper-focused on consolidating the existing operating business, maximizing cash flow, enforcing strict cost management, and rigorously reviewing all product lines for baseline profitability.
• Carbon Fibers Restructuring: The most critical immediate strategic initiative is the fundamental restructuring of the Carbon Fibers business unit. Driven by insurmountable global overcapacity and relentless price pressure, SGL Carbon is executing a plan to significantly shrink CF operations, potentially including the closure of unprofitable manufacturing sites, to isolate and preserve a smaller, profitable core business.

Key strengths

Based on the disclosed financial and operational data, SGL Carbon possesses several formidable competitive advantages that underpin its market position.

• Technological Monopoly in Niche Markets: SGL Carbon is one of the very few companies globally possessing the technological capability to manufacture the ultra-high-purity specialty graphite components required for silicon carbide (SiC) semiconductor production. This provides immense pricing power and secures long-term, pre-financed customer partnerships.
• De-risked Financial Profile: The successful execution of past transformation programs has resulted in a remarkably resilient balance sheet. With a leverage ratio stabilized at 0.7, an equity ratio of 41.5%, and the complete early repayment of major term loans, the company possesses the financial fortitude to weather severe cyclical market downturns.
• Strategic Joint Venture Success: The BSCCB joint venture with Brembo is a massive strength, successfully capturing the high-margin premium automotive brake market and requiring a 70% capacity expansion to meet surging global demand.
• Operational Agility: The decentralized four-business-unit structure allowed the company to generate record profits in Process Technology and solid margins in Graphite Solutions, effectively cross-subsidizing the severe structural losses incurred in the Carbon Fibers division during 2024.

Key challenges and risks

SGL Carbon’s operational landscape is fraught with significant structural and macroeconomic challenges that actively threaten near-term profitability.

• Semiconductor Inventory Glut: The company is highly exposed to the inventory cycles of the semiconductor industry. Lower-than-expected electric vehicle sales have caused massive inventory buildups at SGL’s customers, severely suppressing demand for GS components throughout late 2024 and extending into 2025.
• Structural Collapse in Carbon Fibers: The Carbon Fibers unit faces an existential crisis driven by massive, permanent global overcapacity (particularly from Asian competitors) and a complete stagnation in European wind energy demand. This has destroyed pricing power, resulting in severe operating losses and triggering massive asset impairments.
• Restructuring Execution Risk: The planned fundamental restructuring of the Carbon Fibers unit carries profound execution risks. The process will incur an estimated €50 million in one-off cash charges over two years, and complexities surrounding site closures and workforce reductions pose significant operational and financial hazards.
• Macroeconomic and Factor Cost Pressures: The company remains highly vulnerable to structurally high energy and labor costs in Europe, which critically undermine its global competitiveness against international rivals. Furthermore, the looming threat of regional trade barriers and tariffs (particularly concerning the US and China) poses severe risks to SGL’s highly internationalized supply chain and sales networks.

Conclusion and strategic outlook

SGL Carbon SE enters 2025 at a critical strategic juncture. The 2024 fiscal year thoroughly tested the resilience of the company’s transformed business model. While the massive impairment losses in the Carbon Fibers segment dominated the headline net result, driving it deeply negative, the underlying operational reality demonstrates significant strength. The company successfully maintained a highly disciplined balance sheet, generated positive free cash flow, and achieved record profitability in its Process Technology unit, proving that its core high-tech material solutions remain highly viable.

Looking forward, the strategic outlook is defined by cautious consolidation. Management officially forecasts that Group sales for 2025 will decline slightly compared to 2024 levels, and adjusted EBITDA is projected to contract to a range of €130 million to €150 million. The immediate future hinges entirely on two critical factors: the successful, rapid execution of the Carbon Fibers restructuring program to stop cash bleed, and the eventual depletion of customer inventories in the semiconductor market to reignite high-margin sales. By pausing aggressive expansion and focusing fiercely on cost control and core profitability, SGL Carbon is defensively positioning itself to weather the current macroeconomic storm, preserving its technological leadership to fully capitalize when the megatrends of electromobility and digitization inevitably re-accelerate.

FAQ section

What are the main business units of SGL Carbon? SGL Carbon operates through four primary business units: Graphite Solutions (GS), Carbon Fibers (CF), Process Technology (PT), and Composite Solutions (CS).

Why did SGL Carbon report a net loss in 2024 despite steady revenue? The consolidated net loss of €80.3 million was entirely driven by massive non-recurring impairment charges and restructuring costs totaling €118.5 million, predominantly related to the structurally underperforming Carbon Fibers business unit and the discontinuation of the Battery Solutions business line.

What is the strategic focus of the Graphite Solutions segment? Graphite Solutions focuses heavily on the semiconductor and LED markets. It is a critical global supplier of the ultra-high-purity graphite components necessary for the production of next-generation silicon carbide (SiC) semiconductors, which are vital for electric vehicles.

How is SGL Carbon addressing the losses in its Carbon Fibers unit? Due to global overcapacity and weak wind industry demand causing severe losses, SGL Carbon announced a fundamental restructuring of the Carbon Fibers unit in early 2025. This involves significantly reducing operations, focusing only on a profitable core, and potentially closing unprofitable manufacturing sites.

What is SGL Carbon’s approach to sustainability and emissions? SGL Carbon has committed to halving its Scope 1 and Scope 2 greenhouse gas emissions by 2025 compared to a 2019 baseline, and aims to achieve net climate neutrality by 2038. Initiatives include transitioning to renewable energy, utilizing biomass plants, and improving overall energy efficiency across its manufacturing footprint.

Official Site: https://www.sglcarbon.com/

Source: Content on FirmsWorld.com is based on publicly available corporate filings, regulatory disclosures, annual reports, SEC 10-K filings, investor relations materials, and, where applicable, direct communications with the company.