What happened? Salzgitter this morning reported full 2Q25 results in-line with the company''s pre-release in July, which significantly missed expectations at the time. The guidance is reiterated but we note that FCF generation came above expectations. BNPP Exane View: With the guidance unchanged and Q2 operational results pre-released, the only new development was the divisional breakdown and the FCF performance. Positively, we note that FCF was particularly strong supported by a large working capital release. However, management commentary remains particularly cautious on the near-term outlook. We believe that more tangible support is needed to justify recent share price outperformance. . PandL: Salzgitter had already pre-released Q2 EBITDA of EUR 38m (versus consensus of EUR 119m at the time) and EBT of -EUR 56m (below consensus of EUR 14m). Salzgitter notes that earnings include EUR 80m in ''charges from the reporting date valuation of derivative positions'' as well as a EUR 10m impairment related to the planned portfolio streamlining. . By division: We now learn that the earnings miss largely came from the underperformance of the steel divisions, notably Steel Processing. Technology came in-line. Trading did beat. IP and consolidation missed. . Cash Flow and Balance Sheet: Net debt ended the quarter at EUR 957m, below BNPPe of EUR 1.1b. While capex came above expectations, a larger working capital release drove the beat. . Guidance: The guidance, downgraded a month ago, was reiterated. FY25 EBITDA is expected to reach EUR 300-400m (versus cons. of ~EUR 444m) and EBT EUR -100-0m (versus cons. of -EUR 55m). . Market: Salzgitter expect a delayed recovery in steel demand in H2. RESULTS VS BNPP EXANE and CONSENSUS / Source: Company Data, Bloomberg, DataStream, BNPP Exane estimates