GrafTech Receives Continued Listing Standards Notice from NYSE

Rhea-AI Summary

GrafTech International (NYSE: EAF) has received a continued listing standards notice from the New York Stock Exchange (NYSE) due to its average closing stock price falling below $1.00 over a 30-day trading period. The company has a six-month cure period to regain compliance by achieving a closing share price and 30-day average closing price of at least $1.00. GrafTech intends to remain listed on the NYSE and is considering options to address the issue, including a potential reverse stock split subject to stockholder approval. The notice does not result in immediate delisting, and GrafTech's stock will continue to trade on the NYSE during the cure period. This development is not expected to impact the company's ongoing business operations or SEC reporting requirements.

Positive

• Company has a six-month cure period to regain compliance
• Stock continues to trade on NYSE during cure period
• No immediate impact on business operations or SEC reporting requirements

Negative

• Average closing stock price below $1.00 for 30 consecutive trading days
• Risk of potential delisting if compliance is not regained
• Possible need for reverse stock split, which may require stockholder approval

Insights

Financial Analyst

GrafTech's receipt of a continued listing standards notice from the NYSE is a significant red flag for investors. The company's average stock price falling below $1.00 over 30 trading days indicates severe market skepticism about its prospects. While delisting isn't immediate, this situation reflects deep-seated financial challenges.

The company's consideration of a reverse stock split is a cosmetic solution that doesn't address underlying issues. Investors should scrutinize GrafTech's financial health, cash flows and industry position. The extended timeframe for compliance, potentially until the next annual meeting, suggests a lack of immediate solutions. This uncertainty could further erode investor confidence and potentially impact the company's ability to raise capital or maintain business relationships.

Market Research Analyst

The NYSE listing notice for GrafTech is a symptom of broader market dynamics. The company, operating in the graphite electrode industry, has likely been impacted by global economic slowdowns and shifts in steel production. With major markets like China experiencing economic headwinds, demand for graphite electrodes used in steel manufacturing may have weakened significantly.

This situation isn't unique to GrafTech; it reflects challenges across the materials sector. Investors should consider the cyclical nature of the industry and assess whether current market conditions represent a temporary downturn or a more permanent shift. The company's ability to navigate these challenges and potentially diversify its product offerings will be important for its long-term viability and stock performance.

BROOKLYN HEIGHTS, Ohio--(BUSINESS WIRE)-- GrafTech International Ltd. (NYSE: EAF) (“GrafTech” or the “Company”) announced today that it received written notice (the “Notice”) from the New York Stock Exchange (the “NYSE”) that it is not in compliance with the NYSE’s continued listing standards because the average closing price of the Company’s common stock per the Notice was less than $1.00 per share over the consecutive 30 trading-day period ended August 5, 2024. The Notice does not result in the immediate delisting of the Company’s common stock from the NYSE.

In accordance with applicable NYSE rules, the Company plans to timely notify the NYSE that it intends to cure the stock price deficiency and return to compliance with the applicable NYSE continued listing standards. The Company can regain compliance at any time within a six-month cure period following its receipt of the Notice if, on the last trading day of any calendar month during such cure period, the Company has both: (i) a closing share price of at least $1.00 and (ii) an average closing share price of at least $1.00 over the 30 trading-day period ending on the last trading day of the applicable calendar month.

The Company intends to remain listed on the NYSE and is considering all available options to regain compliance with the NYSE’s continued listing standards, including, but not limited to, a reverse stock split, subject to stockholder approval. The NYSE rules provide for an extension to the six-month cure period if the action required to cure the price condition requires stockholder approval, in which case, the action needs to be approved by no later than the Company’s next annual stockholder’s meeting and promptly implemented thereafter.

The Notice has no immediate impact on the listing of the Company’s common stock, which will continue to be listed and traded on the NYSE during such cure period, subject to the Company’s compliance with other NYSE continued listing standards. Furthermore, the Notice is not anticipated to impact the ongoing business operations of the Company or its reporting requirements with the U.S. Securities and Exchange Commission (“SEC”).

About GrafTech

GrafTech International Ltd. is a leading manufacturer of high-quality graphite electrode products essential to the production of electric arc furnace steel and other ferrous and non-ferrous metals. The Company has a competitive portfolio of low-cost, ultra-high power graphite electrode manufacturing facilities, with some of the highest capacity facilities in the world. We are the only large-scale graphite electrode producer that is substantially vertically integrated into petroleum needle coke, our key raw material for graphite electrode manufacturing. This unique position provides us with competitive advantages in product quality and cost.

Cautionary Note Regarding Forward-Looking Statements

This press release may contain forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect our current views with respect to, among other things, financial projections, plans and objectives of management for future operations, and future economic performance. Examples of forward-looking statements include, among others, statements we make regarding future estimated volume, pricing and revenue, anticipated levels of capital expenditures and cost of goods sold, anticipated reduction in our costs resulting from our cost rationalization initiatives and one-time costs of implementation and guidance relating to adjusted EBITDA and free cash flow. You can identify these forward-looking statements by the use of forward-looking words such as “will,” “may,” “plan,” “estimate,” “project,” “believe,” “anticipate,” “expect,” “foresee,” “intend,” “should,” “would,” “could,” “target,” “goal,” “continue to,” “positioned to,” “are confident,” or the negative versions of those words or other comparable words. Any forward-looking statements contained in this press release are based upon our historical performance and on our current plans, estimates and expectations considering information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us that the future plans, estimates, or expectations contemplated by us will be achieved. Our expectations and targets are not predictions of actual performance and historically our performance has deviated, often significantly, from our expectations and targets. These forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. We believe that these factors include, but are not limited to: the risk that the Notice and noncompliance with NYSE continued listing standards may impact the Company’s results of operations, business operations and reputation and the trading prices and volatility of the Company’s common stock; risks and uncertainties associated with our ability to access the capital and credit markets could adversely affect our results of operations, cash flows and financial condition; our ability to regain compliance with NYSE continued listing standards within the applicable cure period, including, if necessary, our ability to get stockholder approval to effectuate a reverse stock split or any other action requiring stockholder approval; and our ability to continue to meet NYSE continued listing standards. These factors should not be construed as exhaustive and should be read in conjunction with the Risk Factors and other cautionary statements that are included in our most recent Annual Report on Form 10-K and other filings with the SEC. The forward-looking statements made in this press release relate only to events as of the date on which the statements are made. Except as required by law, we do not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240807936979/en/

Michael Dillon

216-676-2000

investor.relations@graftech.com

Source: GrafTech International Ltd.

FAQ

Why did GrafTech (EAF) receive a continued listing standards notice from NYSE?

GrafTech (EAF) received the notice because its average closing stock price was below $1.00 per share over a consecutive 30 trading-day period ending August 5, 2024, which does not comply with NYSE's continued listing standards.

How long does GrafTech (EAF) have to regain compliance with NYSE listing standards?

GrafTech (EAF) has a six-month cure period to regain compliance by achieving a closing share price and 30-day average closing price of at least $1.00.

What options is GrafTech (EAF) considering to address the NYSE listing issue?

GrafTech (EAF) is considering all available options to regain compliance, including the possibility of a reverse stock split, which would require stockholder approval.

Will GrafTech (EAF) be immediately delisted from the NYSE due to this notice?

No, GrafTech (EAF) will not be immediately delisted. The company's stock will continue to trade on the NYSE during the cure period, subject to compliance with other NYSE continued listing standards.