Umicore FIRST LOOK: 1Q qualitative trading update, FY25 guidance reiterated

Umicore issued an unexpected (qualitative) trading update in which it also reiterated its FY25 adjusted EBITDA guidance range of € 720-780m. Given the uncertain economic outlook, we decided to lower our forecast by 3% to € 734m, closer to the bottom end of the guidance range. We remind that Umicore recently organized a CMD, expressing the ambition to try to monetize past investments in Battery Materials, acknowledging that some additional capex and equity investment into the Ionway JV are still necessary to achieve this. The company is actively explore partnerships in Battery Materials. The 2028 adj. EBITDA target of € 1-1.2bn was well above our forecasts at the time of announcement. Whilst the electrification of transportation will eventually put meaningful long term pressure on Catalysis and to a lesser extent potentially also Recycling, given the important weight of PGMs, we considered the strategy update to be comforting. Valuation is attractive and we reiterate our Accumulate rating and € 12 target price.