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Item 7. Management’s Discussion and Analysis

2025-02-14 compared with 2024-02-14 · 319 added, 326 removed, 264 unchanged (71% of the section changed)

6 unchanged sentences

Operational and Commercial Update

Sales volume for 2023 was approximately 92 thousand MT, consisting of LTA volume of 29 thousand MT and non-LTA volume of 63 thousand MT, representing a decrease of 39% compared to 149 thousand MT in 2022, consisting of LTA volume of 91 thousand MT and non-LTA volume of 58 thousand MT.

In 2023, our weighted-average realized price from LTAs was approximately $8,800 per MT and our weighted-average realized price for non-LTA business sales of graphite electrodes was approximately $5,400 per MT.

Our weighted-average realized non-LTA price decreased 10% compared to 2022, reflecting the soft commercial environment.

In 2022, our weighted-average realized price from LTAs was approximately $9,500 per MT and our weighted-average realized price for non-LTA business sales of graphite electrodes was approximately $6,000 per MT.

Production volume for 2023 was approximately 88 thousand MT, decreasing 44% compared to 2022, as we proactively reduced our graphite electrode production volume to align with our evolving demand outlook and to manage our working capital levels.

We also temporarily idled needle coke production at our Seadrift facility for a portion of 2023 to align our needle coke inventory with our graphite electrode production needs.

Sales volume for 2024 was approximately 103 thousand MT, consisting of LTA volume of 13 thousand MT and non-LTA volume of 90 thousand MT, representing an increase of 13% compared to 92 thousand MT in 2023, consisting of LTA volume of 29 thousand MT and non-LTA volume of 63 thousand MT.

In 2024, our weighted-average realized price from LTAs was approximately $8,100 per MT and our weighted-average realized price for non-LTA sales of graphite electrodes was approximately $4,200 per MT.

Our weighted-average realized non-LTA price decreased 22% compared to 2023, with the decline reflecting the persistent competitive pressures in the regions in which we operate.

In 2023, our weighted-average realized price from LTAs was approximately $8,800 per MT and our weighted-average realized price for non-LTA sales of graphite electrodes was approximately $5,400 per MT.

Production volume for 2024 was approximately 97 thousand MT, increasing 10% compared to 2023.

We continue to proactively reduced our graphite electrode production volume to align with our evolving demand outlook and to manage our inventory levels to meet our requirements.

Capital Structure and Liquidity

As of December 31, 2023, we had liquidity of $289.3 million, consisting of $112.4 million of availability under our 2018 Revolving Credit Facility and cash and cash equivalents of $176.9 million.

As of December 31, 2023, we had total debt of approximately $950.1 million.

We continue to have adequate liquidity in 2024 to navigate the persistent softness in the commercial environment.

As we enter 2024, we expect demand for graphite electrodes in the near term will remain weak, reflecting persistent softness in the commercial environment as steel industry production remains constrained by global economic uncertainty.

However, we anticipate a modest year-over-year improvement in our sales volume for 2024, most notably in the first quarter of 2024, as the first quarter of 2023 was significantly impacted by the temporary suspension of our Monterrey, Mexico facility in late 2022.

Reflecting industry-wide softness in graphite electrode demand, challenging pricing dynamics have persisted in most regions.

As a result, we are being selective in the commercial opportunities we choose to pursue.

In addition, the Company has announced a set of initiatives designed to reduce our cost structure and optimize our manufacturing footprint while, at the same time, preserving our ability to deliver excellent customer service and to capitalize on long-term growth opportunities for our Company.

Key elements include the following:

• Indefinitely suspending production activities at our St.

Marys, Pennsylvania facility, with the exception of graphite electrode and pin machining, as well as indefinitely idling certain assets within our remaining graphite electrode manufacturing footprint.

• Reducing the Company's overhead structure and expenses.

• Operating our remaining graphite electrode production facilities at reduced levels, as needed, to align production with our view on market demand.

These initiatives, most notably the indefinite suspension of production at St.

Marys and the reduction in Company overhead, are expected to result in annualized cost savings of approximately $25.0 million once fully implemented, excluding the impact of one-time costs.

Of the anticipated cost savings, approximately $15.0 million are expected to be realized in cost of goods sold with the remainder in selling and administrative expenses.

One-time costs are expected to be approximately $5.0 million, of which the majority are cash-related.

These actions, combined with the benefit of reduced market pricing for certain raw materials and energy as well as the anticipated improvement in our sales and production volume levels, are expected to result in a low teen percentage point year-over-year decline in our cash cost of goods sold per MT.

As of December 31, 2023, our stated graphite electrode production capacity was approximately 202 thousand MT.

As a result of indefinitely idling certain assets, beginning in 2024, our stated production capacity will be approximately 178 thousand MT, a reduction of 12%.

Further, during 2024, we will continue to operate these facilities at reduced levels, as needed, to align production with our view on electrode demand.

In addition to being a key component of the incremental actions we are taking in response to weak market conditions, this will also support our efforts to further reduce our inventory levels and manage capital expenditures in 2024.

Specific to capital expenditures, for 2024 we anticipate spending to be in the range of $35.0 million to $40.0 million.

This compares to capital expenditures of $54.0 million for the year ended December 31, 2023.

Longer term, we remain confident that the steel industry’s accelerating efforts to decarbonize will lead to increased adoption of the EAF method of steelmaking, driving long-term demand growth for graphite electrodes.

As of December 31, 2024, we had liquidity of $464.2 million, consisting of $108.0 million of availability under our 2018 Revolving Credit Facility, $100.0 million of availability under our Initial First Lien Term Loan Facility (with respect to the Delayed Draw Commitments thereunder) and cash and cash equivalents of $256.2 million.

As of December 31, 2024, we had total debt of approximately $1.1 billion.

In 2024, steel industry production remained constrained by global economic and geopolitical uncertainty.

As we enter 2025, industry analyst projections indicate a modest recovery in global steel demand is expected for the year.

However, significant geopolitical uncertainty remains, including the potential impact of policymaking on the interest rate environment, global trade and decarbonization policies.

As we closely monitor all of these developments and assess their potential impact on the commercial environment for graphite electrodes, our current outlook is that demand for graphite electrodes in the near term will remain relatively flat in the key regions in which we operate.

For GrafTech, despite the industry-wide headwinds, we anticipate a low double-digit percentage point year-over-year increase in our sales volume for 2025 on a full-year basis as we continue to regain market share.

This reflects our compelling customer value proposition and our ongoing focus on delivering on the needs of our customers.

Of our anticipated 2025 sales volume, to date, we have over 60% committed in our order book following the successful completion of the customer negotiations that occur in the fourth quarter of each year.

As it relates to price, challenging pricing dynamics have persisted in most regions and the pricing environment remains unsustainably low.

As a result, we are taking further actions to accelerate our path to normalized levels of profitability and support our ability to invest in our business.

These include initiatives to optimize our order book and actively shift the geographic mix of our business to regions where there is an opportunity to capture higher average selling prices.

In addition, we have informed our customers of our intention to increase prices by 15% on volume that is not yet committed for 2025.

As it relates to costs, we will continue to execute our initiatives to improve our cost structure.

Reflecting these actions and the benefit of the anticipated increase in our sales and production volume levels, we expect a mid-single digit percentage

point decline in our cash cost of goods sold per MT for 2025 compared to 2024 and is expected to continue to trend toward our long-term expectation of approximately $3,700 per MT.

In addition, we will continue to closely manage our working capital levels and capital expenditures.

For 2025, we expect the net impact of working capital will be favorable to our full year cash flow performance, although to a lesser extent than in each of the previous two years which reflected our efforts to align inventory levels with our view on demand.

We anticipate our full year 2025 capital expenditures will be approximately $40 million.

Longer term, we remain confident that the steel industry’s efforts to decarbonize will lead to increased adoption of the electric arc furnace method of steelmaking, driving long-term demand growth for graphite electrodes.

We also anticipate the demand for petroleum needle coke, the key raw material we use to produce graphite electrodes, to accelerate driven by its utilization in producing synthetic graphite for use in lithium-ion batteries for the growing electric vehicle market.

We believe that the near-term actions we are taking, supported by an industry-leading position and our sustainable competitive advantages, including our substantial vertical integration into petroleum needle coke via our Seadrift facility, will optimally position GrafTech to benefit from that long-term growth.

The table of estimated shipments of graphite electrodes under existing LTAs is as follows, reflecting our current expectations for 2024:

Estimated LTA volume (1)

Estimated LTA revenue (2)

$100-$135 (3)

(1) In thousands of MT

(2) In millions

(3) Includes expected termination fees from a few customers that have failed to meet certain obligations under their LTAs

The majority of the LTAs are defined as pre-determined fixed annual volume contracts while a small portion are defined with a specified volume range.

For 2024, the contractual revenue amounts above are based upon the minimum volume for those contracts with specified ranges.

The actual revenue realized from these contracted volumes may vary in timing and total due to contract non-performance, force majeure notices, arbitrations, credit risk associated with certain customers facing financial challenges and customer demand related to contracted volume ranges.

Key metrics used by management to measure performance

6 unchanged sentences

Net sales $ 538,782 $ 620,500

Net (loss) income (255,250) 382,962

(Loss) earnings per share (1)

Net loss (131,165) (255,250)

Loss per share (1)

(0.51) (0.99)

Adjusted net (loss) income (2)

(11,411) (162,227)

Adjusted (loss) earnings per share (1)(2)

Adjusted EBITDA (2)

Adjusted net loss (2)

(106,144) (100,752)

(1) (Loss) earnings per share represents diluted (loss) earnings per share.

Adjusted (loss) earnings per share represents adjusted diluted (loss) earnings per share.

Adjusted loss (1)(2)

(0.41) (0.39)

Adjusted EBITDA (2)

(1) Loss per share represents diluted loss per share.

Adjusted loss per share represents adjusted diluted loss per share.

(2) Non-GAAP financial measure;

9 unchanged sentences

Production capacity reflects expected maximum production volume during the period depending on product mix and expected maintenance outage.

Actual production may vary.

Actual production

Capacity utilization reflects production volume as a percentage of production capacity.

4 unchanged sentences

Production volume (MT) (1)

Total production capacity(MT) (2)(3)

Total capacity utilization (3)(4)

Production capacity excluding St.

Marys (MT) (2)(5)

Capacity utilization excluding St.

Production capacity(MT) (2)(3)

Capacity utilization (4)

(1) Production volume reflects graphite electrodes we produced during the period.

3 unchanged sentences

Monterrey, Mexico;

Pamplona, Spain;

Marys, Pennsylvania.

During the periods presented in this table, our St.

Marys, Pennsylvania facility graphitized and machined a limited number of electrodes and pins sourced from our Monterrey, Mexico facility.

The remaining production processes at St.

Marys were restarted beginning in the second quarter of 2023.

In the first quarter of 2024, in response to persistent softness in the commercial environment, we announced an indefinite suspension of production activities at St.

Marys, with the exception of graphite electrode and pin machining.

(4) Capacity utilization reflects production volume as a percentage of production capacity.

(5) Includes graphite electrode facilities in Calais, France;

Monterrey, Mexico;

and Pamplona, Spain.

While maintaining the capability to produce up to 28,000 MT of graphite electrodes and pins on an annual basis at our St.

Marys, Pennsylvania facility, most production activities at St.

Marys have been suspended.

The wind down of these production activities was completed during the second quarter of 2024.

Remaining activities at St.

Marys are limited to machining graphite electrodes and pins sourced from our other plants.

(4) Capacity utilization reflects production volume as a percentage of production capacity.

As of December 31, 2023, our stated production capacity was approximately 202 thousand MT through our primary manufacturing facilities in Calais, Pamplona and Monterrey.

On February 14, 2024, the Company announced a cost rationalization and footprint optimization plan, in response to persistent softness in the commercial environment.

This includes an indefinite suspension of production activities at our St.

This included an indefinite suspension of production activities at our St.

Marys facility, with the exception of graphite electrode and pin machining.

We are also indefinitely idling certain assets within our remaining graphite electrode manufacturing

As a result of these initiatives, beginning in 2024, our stated production capacity will be approximately 178 thousand MT.

We also indefinitely idled certain assets within our remaining graphite electrode manufacturing footprint.

As a result of these initiatives, our stated production capacity was reduced from approximately 202 thousand MT in 2023 to approximately 178 thousand MT in 2024.

Non-GAAP financial measures

In addition to providing results that are determined in accordance with GAAP, we have provided certain financial measures that are not in accordance with GAAP.

EBITDA, adjusted EBITDA, adjusted net (loss) income, adjusted (loss) earnings per share, free cash flow, adjusted free cash flow and cash cost of goods sold per MT are non-GAAP financial measures.

We define EBITDA, a non‑GAAP financial measure, as net income or loss plus interest expense, minus interest income, plus income taxes and depreciation and amortization.

We define adjusted EBITDA as EBITDA plus any pension and other post-employment benefit (“OPEB”) plan expenses or benefits, adjustments for public offerings and related expenses, non‑cash gains or losses from foreign currency remeasurement of non‑operating assets and liabilities in our foreign subsidiaries where the functional currency is the U.S.

dollar, stock-based compensation expense, non-cash fixed asset write-offs, related party payable - Tax Receivable Agreement adjustments and goodwill impairment charges.

EBITDA, adjusted EBITDA, adjusted net loss, adjusted loss per share, free cash flow, adjusted free cash flow and cash cost of goods sold per MT are non-GAAP financial measures.

We define EBITDA, a non‑GAAP financial measure, as net loss plus interest expense, minus interest income, plus income taxes and depreciation and amortization.

We define adjusted EBITDA, a non-GAAP financial measure, as EBITDA adjusted by any pension and other post-employment benefit (“OPEB”) expenses, rationalization and rationalization-related expenses, non‑cash gains or losses from foreign currency remeasurement of non‑operating assets and liabilities in our foreign subsidiaries where the functional currency is the U.S.

dollar, stock-based compensation expense, proxy contest expenses, Tax Receivable Agreement adjustments and goodwill impairment charges.

Adjusted EBITDA is the primary metric used by our management and our Board of Directors to establish budgets and operational goals for managing our business and evaluating our performance.

6 unchanged sentences

• adjusted EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our indebtedness;

• adjusted EBITDA does not reflect tax payments that may represent a reduction in cash available to us;

• adjusted EBITDA does not reflect expenses or benefits relating to our pension and OPEB plans;

• adjusted EBITDA does not reflect public offerings and related expenses;

• adjusted EBITDA does not reflect tax payments or the income tax benefit that may represent a reduction in cash available to us;

• adjusted EBITDA does not reflect expenses relating to our pension and OPEB plans;

• adjusted EBITDA does not reflect rationalization or rationalization-related expenses;

• adjusted EBITDA does not reflect the non‑cash gains or losses from foreign currency remeasurement of non‑operating assets and liabilities in our foreign subsidiaries where the functional currency is the U.S.

• adjusted EBITDA does not reflect stock-based compensation expense;

• adjusted EBITDA does not reflect the non‑cash write‑off of fixed assets;

• adjusted EBITDA does not reflect related party payable - Tax Receivable Agreement adjustments;

• adjusted EBITDA does not reflect proxy contest expenses;

• adjusted EBITDA does not reflect Tax Receivable Agreement adjustments;

• adjusted EBITDA does not reflect goodwill impairment charges;

• other companies, including companies in our industry, may calculate EBITDA and adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

We define adjusted net (loss) income, a non‑GAAP financial measure, as net (loss) income, excluding the items used to calculate adjusted EBITDA, less the tax effect of those adjustments.

We define adjusted (loss) earnings per share, a non‑GAAP financial measure, as adjusted net (loss) income divided by the weighted average diluted common shares outstanding during the period.

We believe adjusted net (loss) income and adjusted (loss) earnings per share are useful to present to investors because we believe that they assist investors’ understanding of the underlying operational profitability of the Company.

We define adjusted net loss, a non‑GAAP financial measure, as net loss, excluding the items used to calculate adjusted EBITDA and further excluding debt modification costs, less the tax effect of those adjustments.

We define adjusted loss per share, a non‑GAAP financial measure, as adjusted net loss divided by the weighted average diluted common shares outstanding during the period.

We believe adjusted net loss and adjusted loss per share are useful to present to investors because we believe that they assist investors’ understanding of the underlying operational profitability of the Company.

We define free cash flow, a non-GAAP financial measure, as net cash provided by operating activities less capital expenditures.

We define adjusted free cash flow, a non-GAAP financial measure, as free cash flow adjusted by payments made or received from the settlement of interest rate swap contracts and payments of the Change in Control charges that were triggered as a result of the ownership of our largest stockholder falling below 30% of our total outstanding shares.

We use free cash flow and adjusted free cash flow as critical measures in the evaluation of liquidity in conjunction with related GAAP amounts.

We also use these measures when considering available cash, including for decision-making purposes related to dividends and discretionary investments.

Further, these measures help management, the audit committee, and investors evaluate the Company's ability to generate liquidity from operating activities.

For the purpose of this measure, a Change in Control occurred when Brookfield and any affiliates thereof ceased to own stock of the Company that constitutes at least thirty percent (30%) or thirty-five percent (35%), as applicable, of the total fair market value or total voting power of the stock of the Company (the "Change in Control").

We define cash cost of goods sold per MT, a non-GAAP financial measure, as cost of goods sold less depreciation and amortization and less cost of goods sold associated with the portion of our sales that consists of deliveries of by-products of the manufacturing processes, with this total divided by our sales volume measured in MT.

We also use these measures when considering available cash, including for decision-making purposes related to dividends, debt servicing and discretionary investments.

Further, these measures help management, the Board of Directors, and investors evaluate the Company's ability to generate liquidity from operating activities.

We define cash cost of goods sold per MT, a non-GAAP financial measure, as cost of goods sold less depreciation and amortization less cost of goods sold associated with the portion of our sales that consists of deliveries of by-products of the manufacturing processes and less rationalization-related expenses, with this total divided by our sales volume measured in MT.

We believe this is an important measure as it is used by our management and Board of Directors to evaluate our costs on a per MT basis.

In evaluating EBITDA, adjusted EBITDA, adjusted net (loss) income, adjusted (loss) earnings per share, free cash flow and adjusted free cash flow you should be aware that in the future, we will incur expenses similar to the adjustments in the reconciliations presented below.

Our presentations of EBITDA, adjusted EBITDA, adjusted net (loss) income adjusted (loss) earnings per share, free cash flow and adjusted free cash flow should not be construed as suggesting that our future results will be unaffected by these expenses or any unusual or non‑recurring items.

When evaluating our performance, you should consider EBITDA, adjusted EBITDA, adjusted net (loss) income, adjusted (loss) earnings per share, free cash flow and adjusted free cash flow alongside other measures of financial performance and liquidity, including our net (loss) income, (loss) earnings per share and cash flow from operating activities, respectively, and other GAAP measures.

In evaluating these non-GAAP financial measures, you should be aware that in the future, we may incur expenses similar to the adjustments in the reconciliations presented below.

Our presentations of these non-GAAP financial measures should not be construed as suggesting that our future results will be unaffected by these expenses or any unusual or non‑recurring items.

When evaluating our performance, you should consider these non-GAAP financial measures alongside other measures of financial performance and liquidity, including our net loss, loss per share, cash flow from operating activities, cost of goods sold and other GAAP measures.

The following tables reconcile our non-GAAP key financial measures to the most directly comparable GAAP measures:

Reconciliation of Net (Loss) Income to Adjusted Net (Loss) Income Year Ended December 31,

Reconciliation of Net Loss to Adjusted Net Loss Year Ended December 31,

(Dollars in thousands, except per share data)

Net (loss) income $ (255,250) $ 382,962

Diluted (loss) income per common share:

Net (loss) income per share $ (0.99) $ 1.48

Net loss $ (131,165) $ (255,250)

Diluted loss per common share:

Net loss per share $ (0.51) $ (0.99)

Weighted average common shares outstanding 257,667,125 257,042,843

Net (loss) income $ (255,250) $ 382,962

Net loss $ (131,165) $ (255,250)

Adjustments, pre-tax:

Pension and OPEB plan expenses (benefits) (1)

6,309 (7,355)

Public offerings and related expenses (2)

Non‑cash losses on foreign currency remeasurement (3)

Pension and OPEB expenses (1)

Rationalization expenses (2)

Rationalization-related expenses (3)

Non‑cash (gains) losses on foreign currency remeasurement (4)

Stock-based compensation expense (5)

Non‑cash fixed asset write‑off (5)

Related party Tax Receivable Agreement adjustment (6)

Proxy contest expenses (6)

Tax Receivable Agreement adjustment (7)

Debt modification costs (8)

Goodwill impairment charges (9)

1 unchanged sentence

Income tax impact on non-GAAP adjustments (10)

Adjusted net (loss) income $ (100,752) $ 379,666

(1) Net periodic benefit cost (credit) for our pension and OPEB plans, including a mark-to-market loss (gain), representing actuarial gains and losses that result from the remeasurement of plan assets and obligations due to changes in assumptions or experience.

Adjusted net loss $ (106,144) $ (100,752)

(1) Net periodic benefit cost for our pension and OPEB plans, including a mark-to-market adjustment, representing actuarial gains and losses that result from the remeasurement of plan assets and obligations due to changes in assumptions or experience.

We recognize the actuarial gains and losses in connection with the annual remeasurement in earnings in the fourth quarter of each year.

(2) Legal, accounting, printing and registration fees associated with the public offerings and related expenses.

(3) Non-cash losses from foreign currency remeasurement of non-operating assets and liabilities of our non-U.S.

(2) Severance and contract termination costs associated with the cost rationalization and footprint optimization plan announced in February 2024.

(3) Other non-cash costs, primarily inventory and fixed asset write-offs, associated with the cost rationalization and footprint optimization plan announced in February 2024.

(4) Non-cash (gains) losses from foreign currency remeasurement of non-operating assets and liabilities of our non-U.S.

subsidiaries where the functional currency is the U.S.

(4) Non-cash expense for stock-based compensation grants.

(5) Non-cash fixed asset write-off recorded for obsolete assets.

(6) Non-cash expense adjustment for future payment to our sole pre-IPO stockholder for tax assets that are expected to be utilized.

(5) Non-cash expense for stock-based compensation awards.

(6) Expenses associated with our proxy contest.

(7) Non-cash expense adjustment for future payment to our sole pre-IPO stockholder for tax assets that have been utilized.

(8) Debt modification costs related to the December 2024 debt transactions, which are recognized in interest expense on the Consolidated Statements of Operations.

(9) Non-cash goodwill impairment charges.

(10) The tax impact on the non-GAAP adjustments is affected by their tax deductibility and the applicable jurisdictional tax rates.

Reconciliation of (Loss) Earnings Per Share to Adjusted (Loss) Earnings Per Share

Reconciliation of Loss Per Share to Adjusted Loss Per Share

Year Ended December 31,

(Loss) Earnings per share $ (0.99) $ 1.48

Loss per share $ (0.51) $ (0.99)

Adjustments per share:

Pension and OPEB plan expenses (benefits) (1)

Public offerings and related expenses (2)

Non‑cash losses on foreign currency remeasurement (3)

Pension and OPEB expenses (1)

Rationalization expenses (2)

Rationalization-related expenses (3)

Non‑cash (gains) losses on foreign currency remeasurement (4)

Stock-based compensation expense (5)

Non‑cash fixed asset write‑off (5)

Related party Tax Receivable Agreement adjustment (6)

Proxy contest expenses (6)

Tax Receivable Agreement adjustment (7)

Debt modification costs (8)

Goodwill impairment charges (9)

1 unchanged sentence

Income tax impact on non-GAAP adjustments per share (10)

Adjusted (Loss) Earnings per share $ (0.39) $ 1.47

Adjusted Loss per share $ (0.41) $ (0.39)

We recognize the actuarial gains and losses in connection with the annual remeasurement in earnings in the fourth quarter of each year.

(2) Legal, accounting, printing and registration fees associated with the public offerings and related expenses.

(3) Non-cash losses from foreign currency remeasurement of non-operating assets and liabilities of our non-U.S.

(2) Severance and contract termination costs associated with the cost rationalization and footprint optimization plan announced in February 2024.

(3) Other non-cash costs, primarily inventory and fixed asset write-offs, associated with the cost rationalization and footprint optimization plan announced in February 2024.

(4) Non-cash (gains) losses from foreign currency remeasurement of non-operating assets and liabilities of our non-U.S.

subsidiaries where the functional currency is the U.S.

(4) Non-cash expense for stock-based compensation grants.

(5) Non-cash fixed asset write-off recorded for obsolete assets.

(6) Non-cash expense adjustment for future payment to our sole pre-IPO stockholder for tax assets that are expected to be utilized.

(5) Non-cash expense for stock-based compensation awards.

(6) Expenses associated with our proxy contest.

(7) Non-cash expense adjustment for future payment to our sole pre-IPO stockholder for tax assets that have been utilized.

(8) Debt modification costs related to the December 2024 debt transactions, which are recognized in interest expense on the Consolidated Statements of Operations.

(9) Non-cash goodwill impairment charges.

(10) The tax impact on the non-GAAP adjustments is affected by their tax deductibility and the applicable jurisdictional tax rates.

Reconciliation of Net (Loss) Income to Adjusted EBITDA Year Ended December 31,

Reconciliation of Net Loss to Adjusted EBITDA Year Ended December 31,

(Dollars in thousands)

Net (loss) income $ (255,250) $ 382,962

Net loss $ (131,165) $ (255,250)

Depreciation and amortization 62,245 56,889

3 unchanged sentences

EBITDA (11,411) (162,227)

Pension and OPEB plan expenses (benefits) (1)

6,309 (7,355)

Public offerings and related expenses (2)

Non‑cash losses on foreign currency remeasurement (3)

Pension and OPEB expenses (1)

Rationalization expenses (2)

Rationalization-related expenses (3)

Non‑cash (gains) losses on foreign currency remeasurement (4)

Stock-based compensation expense (5)

Non‑cash fixed asset write‑off (5)

Related party Tax Receivable Agreement adjustment (6)

Proxy contest expenses (6)

Tax Receivable Agreement adjustment (7)

Goodwill impairment charges (8)

Adjusted EBITDA $ 1,632 $ 20,484

We recognize the actuarial gains and losses in connection with the annual remeasurement in earnings in the fourth quarter of each year.

(2) Legal, accounting, printing and registration fees associated with the public offerings and related expenses.

(3) Non-cash losses from foreign currency remeasurement of non-operating assets and liabilities of our non-U.S.

(2) Severance and contract termination costs associated with the cost rationalization and footprint optimization plan announced in February 2024.

(3) Other non-cash costs, primarily inventory and fixed asset write-offs, associated with the cost rationalization and footprint optimization plan announced in February 2024.

(4) Non-cash (gains) losses from foreign currency remeasurement of non-operating assets and liabilities of our non-U.S.

subsidiaries where the functional currency is the U.S.

(4) Non-cash expense for stock-based compensation grants.

(5) Non-cash fixed asset write-off recorded for obsolete assets.

(6) Non-cash expense adjustment for future payment to our sole pre-IPO stockholder for tax assets that are expected to be utilized.

(5) Non-cash expense for stock-based compensation awards.

(6) Expenses associated with our proxy contest.

(7) Non-cash expense adjustment for future payment to our sole pre-IPO stockholder for tax assets that have been utilized.

(8) Non-cash goodwill impairment charges.

Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow and Adjusted Free Cash Flow

Reconciliation of Net Cash (Used in) Provided by Operating Activities to Free Cash Flow and Adjusted Free Cash Flow

Year Ended December 31,

(Dollars in thousands)

Net cash provided by operating activities $ 76,561 $ 324,628

Net cash (used in) provided by operating activities $ (40,093) $ 76,561

Capital expenditures (34,309) (54,040)

Free cash flow (74,402) 22,521

Debt modification costs (1)

Interest rate swap settlements (2)

Change in Control payment (3)

Adjusted free cash flow $ (56,153) $ 49,974

(1) Receipt of cash related to the monthly settlement of our outstanding interest rate swap contracts.

(2) The year ended December 31, 2023 includes cash received from the termination of our interest rate swap contracts.

(3) In the second quarter of 2021, we incurred pre-tax Change in Control charges of $88 million as a result of the ownership of our largest stockholder, Brookfield, moving below 30% of our total shares outstanding.

Of the $88 million in pre-tax Change in Control charges, $73 million were cash and $15 million were non-cash.

An aggregate of $72 million of the cash charges have been paid through the fourth quarter of 2023 and an additional $1 million will be paid in subsequent quarters, as a result of the timing of related payroll tax payments.

(1) Cash payments of debt modification costs related to the December 2024 debt transactions, which are recognized in interest expense on the Consolidated Statements of Operations and recognized in net cash (used in) provided by operating activities on the Consolidated Statements of Cash Flows.

(2) Receipt of cash related to the monthly settlement of our interest rate swap contracts prior to their termination in the second quarter of 2023, as well as receipt of cash related to the termination of the interest rate swap contracts.

Reconciliation of Cost of Goods Sold to Cash Cost of Goods Sold per MT

6 unchanged sentences

32,801 14,500

Rationalization-related expenses (3)

Cash cost of goods sold 442,699 507,233

3 unchanged sentences

(2) Primarily reflects cost of goods sold associated with the portion of our sales that consists of deliveries of by-products of the manufacturing processes.

(3) Other non-cash costs, primarily inventory and fixed asset write-offs, associated with the cost rationalization and footprint optimization plan announced in February 2024.

Results of Operations

6 unchanged sentences

Cost of goods sold 533,757 571,857 (38,100) (7) %

Lower of cost or market inventory valuation adjustment 12,431 — 12,431 NM

Gross profit 36,212 554,877 (518,665) (93) %

Lower of cost or market inventory valuation adjustment 24,878 12,431 12,447 100 %

Gross (loss) profit (19,853) 36,212 (56,065) (155) %

Research and development 5,706 5,520 186 3 %

Selling and administrative expenses 46,510 74,012 (27,502) (37) %

Rationalization expenses 3,156 — 3,156 NM

Goodwill impairment charges — 171,117 (171,117) NM

Operating (loss) income (214,437) 474,259 (688,696) (145) %

Other expense (income), net 4,679 (10,147) (14,826) (146) %

Operating loss (75,225) (214,437) 139,212 (65) %

Other (income) expense, net (1,569) 4,679 (6,248) (134) %

Interest expense 85,313 58,087 27,226 47 %

Interest income (5,701) (3,439) (2,262) (66) %

(Loss) income before (benefit) provision for income taxes (273,764) 452,318 (726,082) (161) %

(Benefit) provision for income taxes (18,514) 69,356 (87,870) (127) %

Net (loss) income $ (255,250) $ 382,962 $ (638,212) (167) %

Loss before income taxes (153,268) (273,764) 120,496 (44) %

Income tax benefit (22,103) (18,514) (3,589) 19 %

Net loss $ (131,165) $ (255,250) $ 124,085 (49) %

NM = Not Meaningful.

Net sales decreased $660.8 million, or 52%, compared to the prior year, primarily reflecting lower sales volume driven by the residual impact of the temporary suspension of our operations in Monterrey, Mexico in late 2022 and industry-wide softness in graphite electrode demand.

A shift in the mix of our business from LTA volume to non-LTA volume and lower weighted-average realized prices also contributed to the decline in net sales.

Cost of goods sold decreased $154.5 million, or 21%, in 2023 compared to 2022, primarily reflecting lower sales volume.

Reduced sales volume was partially offset by an increase in our costs on a per MT basis as higher priced inventory was sold during 2023, reflecting the full-year impact of raw material, energy and freight cost increases that occurred throughout

In addition, due to reduced production levels, we recorded fixed manufacturing costs of $62.4 million and $16.0 million that would have otherwise been inventoried for years ended December 31, 2023 and 2022, respectively.

Lower of cost or market (“LCM”) inventory valuation adjustment represents a write-down of inventory recorded in 2023.

The net realizable value of certain of our inventories fell below their carrying amounts as of December 31, 2023, and as a result, we recorded a LCM inventory valuation adjustment of $12.4 million in order to state our inventories at market.

Selling and administrative expenses decreased $3.0 million, or 4%, in 2023 compared to 2022, primarily due to reduced selling expenses driven by reduced sales volumes.

Net sales decreased $81.7 million, or 13%, compared to 2023.

The decline primarily reflected a decrease in the weighted-average realized price for volume derived from non-LTAs and a shift in the mix of our business from volume derived

from LTAs to volume derived from non-LTAs.

These factors were partially offset by a 13% increase in total sales volume in 2024, compared to 2023.

Cost of goods sold decreased $38.1 million, or 7%, in 2024 compared to 2023, primarily due to decreased costs as a result of our cost rationalization and footprint optimization plan announced in February 2024.

In addition, we experienced a $40.3 million reduction of fixed manufacturing costs recorded in 2024, compared to 2023, that would have otherwise been inventoried.

Also, the lower of cost or market (“LCM”) inventory valuation adjustments recorded in 2024 and 2023 generated a $19.7 million favorable impact to cost of goods sold in 2024.

These decreases were partially offset by the impact of increased volume.

LCM inventory valuation adjustment represents a write-down of inventory recorded in 2024 and 2023.

The net realizable value of certain of our inventories fell below their carrying amounts as of December 31, 2024 and 2023, and as a result, we recorded LCM inventory valuation adjustments of $24.9 million and $12.4 million, respectively, in order to state our inventories at market.

Selling and administrative expenses decreased $27.5 million, or 37%, in 2024 compared to 2023, primarily due to the $9.2 million reimbursement of legal fees in connection with the favorable outcome of an arbitration (See Note 12, “Commitments and Contingencies” in the Notes to the Consolidated Financial Statements for further discussion), decreased employee-related expenses driven by our cost rationalization and footprint optimization plan announced in February 2024, as well as decreased variable compensation expenses.

Rationalization expenses represent severance and contract termination costs related to the cost rationalization and footprint optimization plan announced in February 2024.

See Note 17, “Rationalization Expenses” in the Notes to the Consolidated Financial Statements for further discussion.

Goodwill impairment charges includes non-recurring charges relating to goodwill.

Refer to Note 6, “Goodwill and Other Intangible Assets,” to the Consolidated Financial Statements for additional discussion.

Other expense (income), net was expense of $4.7 million in 2023, compared to income of $10.1 million in 2022.

2023 included mark-to-market losses on our pension and OPEB plans of $3.0 million, while 2022 included mark-to-market gains of $9.6 million.

Interest expense increased $21.5 million, or 59%, in 2023 compared to 2022 primarily due to higher interest incurred on debt associated with our 2023 Senior Secured Notes that carry a fixed interest rate of 9.875%.

In addition, there was a $6.4 million reduction of net gains recognized on our interest rate swaps in 2023, compared to 2022.

Refer to Note 6, “Other Intangible Assets and Goodwill,” to the Consolidated Financial Statements for additional discussion.

Other (income) expense, net was income of $1.6 million in 2024, compared to expense of $4.7 million in 2023.

2024 included $1.9 million of foreign currency remeasurement gains, while $0.7 million of foreign currency remeasurement losses were recognized in 2023.

In addition, in 2024, we recognized mark-to-market losses of $0.7 million on our pension and OPEB plans compared to $3.0 million in 2023.

Interest expense increased $27.2 million, or 47%, in 2024 compared to 2023.

The increase was due to $18.4 million of debt modification costs recognized in 2024 related to our financing transactions completed in 2024, as well as the effect of full year interest incurred in 2024 on debt associated with our Existing 9.875% Notes issued in June 2023.

See Note 7, "Interest Expense," to the Consolidated Financial Statements for additional details.

(Benefit) provision for income taxes .

The following table summarizes the (benefit) provision for income taxes in 2023 and 2022:

Income Tax Benefit .

The following table summarizes the income tax benefit in 2024 and 2023:

Year Ended December 31, 2024 Year Ended December 31, 2023

(Benefit) provision for income taxes $ (18,514) $ 69,356

(Loss) income before (benefit) provision for income taxes $ (273,764) $ 452,318

Income tax benefit $ (22,103) $ (18,514)

Loss before income taxes $ (153,268) $ (273,764)

Effective income tax rate 14.4 % 6.8 %

The provision for income taxes represented a benefit for the year ended December 31, 2023 compared to an expense for the year ended December 31, 2022.

Total pre-tax earnings shifted from a profit position to a loss position and the Company recorded a goodwill impairment charge that is not tax deductible.

The difference in effective income tax rate from 2024 to 2023 is primarily due to the jurisdictional mix of worldwide earnings taxed at different rates and the impact of a 2023 goodwill impairment charge that was not-tax deductible.

Currency Translation and Transactions

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dollars for consolidation and reporting purposes in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 830 , Foreign Currency Matters .

Foreign currency translation adjustments are generally recorded as part of stockholders’ equity and identified as part of accumulated other comprehensive loss on the Consolidated Balance Sheets until such time as their operations are sold or substantially or completely liquidated.

Foreign currency translation adjustments are generally recorded as part of stockholders’ (deficit) equity and identified as part of accumulated other comprehensive loss on the Consolidated Balance Sheets until such time as their operations are sold or substantially or completely liquidated.

We account for our Russian, Swiss, Luxembourg, United Kingdom and Mexican subsidiaries using the U.S.

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Our remaining subsidiaries use their local currency as their functional currency.

We also record foreign currency transaction gains and losses from non‑permanent intercompany balances as part of cost of goods sold and other expense (income), net.

We also record foreign currency transaction gains and losses from non‑permanent intercompany loan balances as part of cost of goods sold.

Significant changes in currency exchange rates impacting us are described under “—Effects of Changes in Currency Exchange Rates” and “—Results of Operations” in this section.

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dollar equivalent cost of goods sold and other expenses with respect to those facilities.

In certain countries in which we have manufacturing facilities, and in certain export

markets, we sell in currencies other than the U.S.

In certain countries in which we have manufacturing facilities, and in certain export markets, we sell in currencies other than the U.S.

Accordingly, when these currencies increase (or decline) in value relative to the U.S.

dollar, this has the effect of increasing (or reducing) net sales.

The result of these effects is to increase (or decrease) operating and net (loss) income.

The result of these effects is to increase (or decrease) operating and net loss.

Many of the non-U.S.

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The impact of these changes in the average exchange rates of other currencies against the U.S.

dollar on our net sales was an increase of $1.5 million in 2023, a decrease of $11.7 million in 2022 and an increase of $5.5 million in 2021.

dollar on our net sales was a decrease of $1.1 million in 2024, an increase of $1.5 million in 2023 and a decrease of $11.7 million in 2022.

The impact of these changes in the average exchange rates of other currencies against the U.S.

dollar on our cost of goods sold was an increase of $12.4 million in 2023, a decrease of $20.6 million in 2022 and an increase of $10.1 million in 2021.

dollar on our cost of goods sold was a decrease of $8.5 million in 2024, an increase of $12.4 million in 2023 and a decrease of $20.6 million in 2022.

As part of our cash management, we also have intercompany loans between our subsidiaries.

These loans are deemed to be temporary and, as a result, remeasurement gains and losses on these loans are recorded as currency gains or losses in other expense (income), net on the Consolidated Statements of Operations.

These loans are deemed to be temporary and, as a result, remeasurement gains and losses on these loans are recorded as currency gains or losses in cost of goods sold on the Consolidated Statements of Operations.

We have in the past and may in the future use various financial instruments to manage certain exposures to risks caused by currency exchange rate changes, as described under “Quantitative and Qualitative Disclosures about Market Risk."

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Our sources of funds have consisted principally of cash flow from oper ations and debt, including our credit facilities (subject to continued compliance with the financial covenants and representations).

Our uses of those funds (other than for operations) have consisted principally of dividends, capital expenditures, scheduled debt repayments, optional debt repayments, stock repurchases and general purposes.

Our uses of those funds (other than for operations) have consisted principally of capital expenditure s, debt repayment, dividends, share repurchases and other general purposes.

On an ongoing basis, we expect to evaluate and consider strategic transactions, including acquisitions, divestitures, joint ventures, equity investments, debt issuances, refinancing of our existing debt or repurchases of our outstanding debt obligations in open market or privately negotiated transactions, as well as other strategic transactions.

These transactions may require cash expenditures, which may be funded through a combination of cash on hand, proceeds from the issuance of debt or from equity offerings.

Disruptions in the U.S.

and international financial markets could adversely affect our liquidity and the cost and availability of financing to us in the future.

We believe that we have adequate liquidity to meet our needs for at least the next twelve months and for the foreseeable future thereafter.

As of December 31, 2023, we had liquidity of $289.3 million, consisting of $112.4 million of availability under our 2018 Revolving Credit Facility, after giving effect to $3.1 million of letters of credit, and cash and cash equivalents of $176.9 million.

As any borrowings under the 2018 Revolving Credit Facility remain subject to compliance with the financial covenant thereunder (see below and Note 5, “Debt and Liquidity”), our operating performance as of December 31, 2023 resulted in a reduction of the availability under the facility.

We do not anticipate the need to borrow against our 2018 Revolving Credit Facility.

We had gross long-term debt of $950.0 million and short-term debt of $0.1 million as of December 31, 2023.

We believe that we have adequate liquidity to meet our needs for at least the next twelve months.

As of December 31, 2024, we had liquidity of $464.2 million, consisting of $108.0 million of availability under our 2018 Revolving Credit Facility (after giving effect to $7.4 million of letters of credit), $100.0 million of availability under our Initial First Lien Term Loan Facility (with respect to the Delayed Draw Commitments thereunder) and cash and cash equivalents of $256.2 million.

As any borrowings under the 2018 Revolving Credit Facility remain subject to compliance with the financial covenant thereunder (see below and Note 5, “Debt and Liquidity”), our operating performance as of December 31, 2024 and 2023 resulted in a reduction of the availability under the facility.

We had gross long-term debt of $1.1 billion as of December 31, 2024.

As of December 31, 2023, we had liquidity of $289.3 million, consisting of $112.4 million available under our 2018 Revolving Credit Facility, after giving effect to $3.1 million of letters of credit, and cash and cash equivalents of $176.9 million.

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As of December 31, 2024 and 2023, $60.0 million and $77.6 million, respectively, of our cash and cash equivalents were located outside of the U.S.

We repatriate funds from our foreign subsidiaries through dividends.

All of our subsidiaries face the customary statutory limitation that distributed dividends do not exceed the amount of retained and current earnings.

We repatriate funds from our foreign subsidiaries through intercompany dividends.

subsidiaries face the customary statutory limitation that distributed dividends may not exceed the amount of accumulated earnings.

Upon repatriation to the United States, the foreign source portion of dividends we receive from our foreign subsidiaries is not subject to U.S.

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These factors include customer order patterns, fluctuations in working capital requirements, timing of tax and interest payments and other factors.

During the second quarter of 2023, GrafTech Global Enterprises Inc.

issued $450 million of 2023 Senior Secured Notes.

This transaction extended our debt maturities to 2028 as the net proceeds from this offering were used to repay the debt outstanding under the 2018 Term Loan Facility that was scheduled to mature in 2025 under our credit agreement.

We had positive cash flow from operating activities during each of the last three years.

During the fourth quarter of 2024, the Company consummated a series of financing transactions to extend the maturities on its outstanding debt and help to manage its liquidity.

These transactions are described under “--Financing transactions” in this section.

Uses of Liquidity

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We may purchase shares from time to time on the open market, including under Rule 10b5-1 and/or Rule 10b-18 plans.

The amount and timing of repurchases are subject to a variety of factors including liquidity, stock

price, applicable legal requirements, other business objectives and market conditions.

The amount and timing of repurchases are subject to a variety of factors including liquidity, stock price, applicable legal requirements, other business objectives and market conditions.

In 2024, we did not repurchase any shares of our common stock.

As of December 31, 2024, we had $99.0 million remaining under our stock repurchase authorization.

Throughout 2022 and through the second quarter of 2023, we paid a quarterly dividend of $0.01 per share.

Our ability to repurchase shares is restricted by certain covenants in our debt instruments.

In the first and second quarters of 2023 , we paid a quarterly dividend of $0.01 per share.

On August 2, 2023, the Company’s Board of Directors elected to suspend the quarterly cash dividend of $0.01 per share.

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Potential uses of our liquidity (other than operations) include capital expenditures, debt repayments, dividends, share repurchases and other general purposes.

Any such potential uses of our liquidity may be funded by existing available liquidity, the incurrence of new secured or unsecured loans or capital market issuances.

Any such potential uses of our liquidity may be funded by existing available liquidity, the incurrence of new secured or unsecured loans, capital market issuances, divestitures, joint ventures or equity investments.

An improving economy, while resulting in improved results of operations, could increase our cash requirements to purchase inventories, make capital expenditures and fund payables and other obligations until increased accounts receivable are converted into cash.

A downturn, including any recession or potential resurgence of a global pandemic, could significantly and negatively impact our results of operations and cash flows, which, coupled with increased borrowings, could negatively impact our credit ratings, our ability to comply with debt covenants, our ability to secure additional financing and the cost and availability of such financing.

In order to seek to reduce our credit risks, we may reduce our sales of, or refuse to sell (except for prepayment, cash on delivery or under letters of credit or parent guarantees), our products to some customers and potential customers.

A downturn, including any recession, could significantly and negatively impact our results of operations and cash flows, which, coupled with increased borrowings, could negatively impact our credit ratings, our ability to comply with debt covenants, our ability to secure additional financing and the cost and availability of such financing.

In order to seek to minimize our credit risks, we may reduce our sales of, or refuse to sell (except for prepayment, cash on delivery or under letters of credit or parent guarantees), our products to some customers and potential customers.

Our unrecovered trade receivables worldwide have not been material during the last two years individually or in the aggregate.

We manage our capital expenditures by taking into account quality, plant reliability, safety, environmental and regulatory requirements, prudent or essential maintenance requirements, global economic conditions, available capital resources, liquidity, long‑term business strategy and return on invested capital for the relevant expenditures, cost of capital and return on invested capital of the Company as a whole among other factors.

Capital expenditures totaled $54.0 million in 2023.

We anticipate capital expenditures between $35.0 million and $40.0 million in 2024.

In the event that operating cash flows fail to provide sufficient liquidity to meet our business needs, including capital expenditures, any such shortfall would be expected to be made up by borrowings under our 2018 Revolving Credit Facility, to the extent available.

In the event that operating cash flows fail to provide sufficient liquidity to meet our business needs, including capital expenditures, any such shortfall would be expected to be made up by borrowings under our delayed draw term loan and 2018 Revolving Credit Facility, to the extent available, or other liquidity options described above.

The Company also maintains access to credit and capital markets and may incur additional debt or issue equity securities from time to time, which may provide an additional source of liquidity.

However, there can be no guarantee that we would be able to access the credit or capital markets on commercially satisfactory terms or at all.

Related Party Transactions

We have engaged in transactions with affiliates or related parties during 2023 and 2022 and we expect to continue to do so in the future.

These transactions include ongoing obligations under the Tax Receivable Agreement, stockholders rights agreement, as amended, and registration rights agreement, each with Brookfield.

The following table summarizes our cash flow activities:

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(Dollars in thousands)

Cash flow provided by (used in):

Cash flow (used in) provided by:

Operating activities $ (40,093) $ 76,561

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Net change in cash and cash equivalents $ 81,416 $ 41,454

Operating activities

Cash provided by operating activities totaled $76.6 million in 2023 versus $324.6 million in the prior-year period.

The decrease in operating cash flow was primarily due to a $638.2 million decrease in net income, which included a non-cash goodwill impairment charge of $171.1 million in 2023.

Partially offsetting reduced net income was an increase in cash provided

by working capital of $207.1 million.

Cash flow provided by inventories increased $261.4 million, compared to 2022, primarily driven by reduced quantities on hand.

Cash flow provided by accounts receivable decreased $14.8 million, compared to 2022, primarily due to reduced sales volume.

Cash flow used for accounts payable and accruals was $23.9 million in 2023 compared to a source of cash of $7.7 million in 2022 primarily due to a reduced amount of purchases in 2023 versus 2022.

Investing activities

Net cash used in investing activities was $53.8 million in the year ended December 31, 2023 compared to $72.0 million in the year ended December 31, 2022 primarily driven by decreased capital expenditures.

Financing activities

Net cash provided by financing activities was $18.7 million in 2023 compared to $176.3 million of net cash used in financing activities in 2022.

The change was primarily due to the issuance of $450.0 million of 2023 Senior Secured Notes net of an $11.4 million original issue discount, the absence of $60.0 million of stock repurchases in 2023 compared to 2022 and $21.0 million of increased cash received from the settlement of interest rate swaps, partially offset by a $323.7 million increase in cash used to repay the 2018 Term Loan Facility.

Net cash (used in) provided by operating activities represented a $40.1 million use of cash in 2024 versus a $76.6 million source of cash in the prior year.

The decrease in operating cash flow was primarily due to reduced cash provided by working capital $67.3 million in 2024 compared to 2023.

Cash flow provided by inventories decreased $39.0 million, compared to 2023, primarily driven by actively managing our inventory levels to meet demand.

Cash flow provided by accounts receivable decreased $41.2 million, compared to 2023, primarily due to reduced sales in the fourth quarter of 2024 compared to the fourth quarter of 2023.

Cash flow used for income taxes decreased $25.6 million in 2024 compared to 2023 due to reduced federal income tax payments made in 2024.

Cash flow used for accounts payable and accruals increased $15.6 million in 2024 compared to 2023 primarily due to the timing of payments.

Net cash used in investing activities was $34.2 million for the year ended December 31, 2024 compared to $53.8 million for the year ended December 31, 2023 primarily driven by reduced capital expenditures.

Net cash provided by financing activities was $155.7 million in 2024 compared to $18.7 million in 2023.

The increase was primarily due to the issuance of $175.0 million of our First Lien Term Loans and the absence of $5.1 million of dividend payments in 2024, partially offset by $27.5 million of cash received from interest rate swaps in 2023, as well as a $10.8 million increase in deferred financing fees, in 2024 compared to 2023, related to debt issuance.

Financing transactions

On December 23, 2024 (the “Settlement Date”), the Company consummated offers by GrafTech Finance Inc.

(“GrafTech Finance”) and GrafTech Global Enterprises Inc.

(“GrafTech Global” and, together with GrafTech Finance, the “Issuers”), each a subsidiary of the Company, to exchange (each an “Exchange Offer” and, together, the “Exchange Offers”) any and all of (i) GrafTech Finance’s 4.625% senior secured notes due 2028 (the “Existing 4.625% Notes”) and (ii) GrafTech Global’s 9.875% senior secured notes due 2028 (the “Existing 9.875% Notes” and, together with the Existing 4.625% Notes, the “Existing Notes”), for the New 4.625% Notes and the New 9.875% Notes, respectively.

The Company and the Issuers also consummated the solicitation of consents (with respect to each series of Existing Notes, a “Consent Solicitation” and, collectively, the “Consent Solicitations”), on the terms and subject to the conditions set forth in a confidential exchange offer memorandum and consent solicitation statement (the “Offering Memorandum”) from certain eligible holders of each series of the Existing Notes (the “Existing Noteholders”) (with respect to each series of Existing Notes, a “Consent” and, collectively, the “Consents”) pursuant to which amendments were entered into to the indenture governing the Existing 4.625% Notes (as amended, the “Existing 4.625% Notes Indenture”), and the indenture governing the Existing 9.875% Notes (as amended, the “Existing 9.875% Notes Indenture” and, together with the Existing 4.625% Notes Indenture, the “Existing Notes Indentures”), that (i) eliminated substantially all of the restrictive covenants as well as certain events of default and related provisions and definitions in the Existing Notes Indentures and (ii) released all of the collateral securing the Existing Notes.

Issuance of New Notes due 2029

On December 23, 2024, GrafTech Finance issued New 4.625% Notes in an aggregate principal amount of $498.2 million and GrafTech Global issued New 9.875% Notes in an aggregate principal amount of $446.2 million in exchange for $498.2 million of GrafTech Finance’s Existing 4.625% Notes and $446.2 million of GrafTech Global’s Existing 9.875% Notes, respectively, validly tendered and accepted in connection with the Exchange Offers.

The New Notes are the Issuers’ second lien obligations.

The New 4.625% Notes were issued pursuant to an indenture, dated as of the Settlement Date (the “New 4.625% Notes Indenture”), by and among GrafTech Finance, the Company, each subsidiary guarantor from time to time party thereto

(collectively, the “Subsidiary Guarantors,” and, together with the Company, the “Guarantors”), and U.S.

Bank Trust Company, National Association, as trustee (the “New Trustee”) and collateral agent (the “New Notes Collateral Agent”).

The New 4.625% Notes will pay interest of 4.625% semiannually per annum.

The New 9.875% Notes were issued pursuant to an indenture, dated as of the Settlement Date (the “New 9.875% Notes Indenture” and, together with the New 4.625% Notes Indenture, the “New Notes Indentures”), by and among GrafTech Global, the Guarantors, GrafTech Finance, the New Trustee and the New Notes Collateral Agent.

The New 9.875% Notes will pay interest of 9.875% semiannually per annum.

GrafTech Finance may redeem some or all of the New 4.625% Notes at the redemption prices and on the terms specified in the New 4.625% Notes Indenture.

If, at any time prior to December 23, 2026, all or a portion of the outstanding principal amount of the New 4.625% Notes are prepaid, repaid, redeemed or accelerated (or deemed accelerated), including as a result of GrafTech Finance filing for bankruptcy or becoming subject to any other insolvency proceeding, GrafTech Finance will be required to pay the applicable New 4.625% Notes Redemption Price (as defined in the New 4.625% Notes Indenture).

If the Company or GrafTech Finance experiences specific kinds of changes in control or the Company or any of the restricted subsidiaries sells certain of its assets, then GrafTech Finance must offer to repurchase the New 4.625% Notes on the terms set forth in the New 4.625% Notes Indenture.

On and after December 23, 2026, GrafTech Global may redeem some or all of the New 9.875% Notes at the redemption prices and on the terms specified in the New 9.875% Notes Indenture.

At any time prior to December 23, 2026, GrafTech Global may also at its option and on one or more occasions redeem up to 40% of the aggregate principal amount of the notes issued with the proceeds from certain equity offerings, at a redemption price of 109.875% of the aggregate principal amount of the notes, together with accrued and unpaid interest, if any, to, but not including, the date of redemption.

In addition, at any time prior to December 23, 2026, GrafTech Global may at its option on one or more occasions redeem all or a part of the notes, at a redemption price equal to 100% of the principal amount of the notes redeemed, plus a “make-whole” premium, together with accrued and unpaid interest, if any, to, but not including, the date of redemption.

If, at any time prior to December 23, 2028, all or a portion of the outstanding principal amount of the New 9.875% Notes are prepaid, repaid, redeemed or accelerated (or deemed accelerated), including as a result of GrafTech Global filing for bankruptcy or becoming subject to any other insolvency proceeding, GrafTech Global will be required to pay the applicable New 9.875% Notes Redemption Price or the Applicable Premium (each as defined in the New 9.875% Notes Indenture), as applicable.

If the Company or GrafTech Global experiences specific kinds of changes in control or the Company or any of the restricted subsidiaries sells certain of its assets, then GrafTech Global must offer to repurchase the New 9.875% Notes on the terms set forth in the New 9.875% Notes Indenture.

The New Notes Indentures contain certain covenants that, among other things, limit the Company’s ability, and the ability of certain of its subsidiaries, to incur or guarantee additional indebtedness or issue preferred stock, pay distributions on, redeem or repurchase capital stock or redeem or repurchase subordinated debt, incur or suffer to exist liens securing indebtedness, make certain investments, engage in certain transactions with affiliates, consummate certain asset sales and effect a consolidation or merger, or sell, transfer, lease or otherwise dispose of all or substantially all assets.

Pursuant to the New Notes Indentures, if our pro forma consolidated total net leverage ratio is no greater than 2.50 to 1.00, we can make restricted payments so long as no default or event of default has occurred and is continuing.

If our pro forma consolidated total net leverage ratio is greater than 2.50 to 1.00, we can make restricted payments pursuant to certain baskets.

We were in compliance with all of our debt covenants in the New Notes Indentures as of December 31, 2024.

The New 4.625% Notes are guaranteed, jointly and severally, on a senior secured second-priority basis by the domestic Guarantors (the “U.S.

Guarantors”) that guarantee the Existing 4.625% Notes and certain other foreign subsidiary Guarantors of the Company (the “Foreign Guarantors”).

The New 9.875% Notes are guaranteed, jointly and severally, on a senior secured second-priority basis by the U.S.

Guarantors that guarantee the Existing 9.875% Notes and the Foreign Guarantors.

In accordance with the terms of the New Notes Indentures, the New Trustee is obligated to first enforce the guarantees of the U.S.

Guarantors prior to any guarantees of the Foreign Guarantors, subject to certain terms described therein.

The New Notes are secured by a perfected second-priority security interest in all of the assets and property of the Issuers and the Guarantors that currently secure the Existing Notes, and certain other assets and property of the Foreign Guarantors as set forth in the New Notes Indentures (the “Collateral”).

The New Notes and each guarantee constitute:

senior obligations that rank pari passu in right of payment with all of our and the Guarantors’ existing and future senior indebtedness, including the First Lien Term Loans (as defined below) and the 2018 Revolving Credit Facility;

provided, that the First Lien Term Loans and the 2018 Revolving Credit Facility are senior in right of payment to the New Notes with respect to proceeds of the Foreign Guarantor facility located in Calais, France (the “Calais Facility”) solely to the extent that such facility does not constitute Collateral;

secured on a second-priority basis, subject to certain exceptions and permitted liens, on the Collateral that secures the First Lien Term Loans and the 2018 Revolving Credit Facility on a first-priority basis;

effectively junior to all of our and the Guarantors’ obligations under the First Lien Term

Loans and the 2018 Revolving Credit Facility (and other indebtedness secured on a first-priority basis on the Collateral pari passu with the liens securing the First Lien Term Loans and the 2018 Revolving Credit Facility) to the extent of the value of the Collateral securing the First Lien Term Loans and the 2018 Revolving Credit Facility (and such other indebtedness secured on a first-priority basis on the Collateral);

effectively senior to all of our and the Guarantors’ future debt that is secured by liens on the Collateral securing the New Notes that are junior to those securing the New Notes and to any of our and the Guarantors’ unsecured indebtedness, in each case, to the extent of the value of the Collateral securing the New Notes and the guarantees;

and structurally subordinated to all of our existing and future indebtedness and other liabilities, including trade payables, of each of our subsidiaries that do not issue or guarantee the New Notes.

Existing 4.625% Notes due 2028

In December 2020, GrafTech Finance issued $500.0 million aggregate principal amount of Existing 4.625% Notes in a private offering.

All of the net proceeds from the Existing 4.625% Notes were used to partially repay borrowings under our 2018 Term Loan Facility.

GrafTech Finance may redeem some or all of the Existing 4.625% Notes at the redemption prices and on the terms specified in the Existing 4.625% Notes Indenture.

Prior to the Settlement Date, if the Company or GrafTech Finance experienced specific kinds of changes in control or the Company or any of its restricted subsidiaries sold certain of its assets, then GrafTech Finance was required to offer to repurchase the Existing 4.625% Notes on the terms set forth in the Existing 4.625% Notes Indenture.

Prior to the Settlement Date, the Existing 4.625% Notes Indenture contained certain covenants that, among other things, limited the Company’s ability, and the ability of certain of its subsidiaries, to incur or guarantee additional indebtedness or issue preferred stock, pay distributions on, redeem or repurchase capital stock or redeem or repurchase subordinated debt, incur or suffer to exist liens securing indebtedness, make certain investments, engage in certain transactions with affiliates, consummate certain asset sales and effect a consolidation or merger, or sell, transfer, lease or otherwise dispose of all or substantially all assets.

Pursuant to the Existing 4.625% Notes Indenture, prior to the Settlement Date, if our pro forma consolidated first lien net leverage ratio was no greater than 2.00 to 1.00, we could make restricted payments so long as no default or event of default had occurred and was continuing.

Prior to the Settlement Date, if our pro forma consolidated first lien net leverage ratio was greater than 2.00 to 1.00, we could make restricted payments pursuant to certain baskets.

In connection with the consummation of the Consent Solicitations, substantially all of the restrictive covenants and related provisions and definitions in the Existing 4.625% Notes Indenture were removed, effective as the Settlement Date.

The Existing 4.625% Notes Indenture contains certain events of default customary for agreements of its type (with customary grace periods, as applicable) and provides that, upon the occurrence of an event of default arising from certain events of bankruptcy or insolvency with respect to the Company or GrafTech Finance, all outstanding Existing 4.625% Notes will become due and payable immediately without further action or notice.

If any other type of event of default occurs and is continuing, then the trustee or the holders of at least 30% in principal amount of the then outstanding Existing 4.625% Notes may declare all of the Existing 4.625% Senior Notes to be due and payable immediately.

We were in compliance with all of our debt covenants as of December 31, 2024 and 2023.

Following the Exchange Offer, approximately $1.8 million aggregate principal amount of Existing 4.625% Notes remain outstanding.

Existing 9.875% Notes due 2028

In June 2023, GrafTech Global issued $450 million aggregate principal amount of Existing 9.875% Notes, including $11.4 million of original issue discount.

The Existing 9.875% Notes were issued at an issue price of 97.456% of the principal amount thereof in a private offering.

The net proceeds from the Existing 9.875% Notes were used to repay borrowings under our 2018 Term Loan Facility.

GrafTech Global may redeem some or all of the Existing 9.875% Notes at the redemption prices and on the terms specified in the Existing 9.875% Notes Indenture.

Prior to the Settlement Date, if the Company or GrafTech Global experienced specific kinds of changes in control or the Company or any of its restricted subsidiaries sold certain of its assets, then GrafTech Global was required to offer to repurchase the Existing 9.875% Notes on the terms set forth in the Existing 9.875% Notes Indenture.

Prior to the Settlement Date, the Existing 9.875% Notes Indenture contained certain covenants that, among other things, limited the Company’s ability, and the ability of certain of its subsidiaries, to incur or guarantee additional indebtedness or issue preferred stock, pay distributions on, redeem or repurchase capital stock or redeem or repurchase subordinated debt, incur or suffer to exist liens securing indebtedness, make certain investments, engage in certain transactions with affiliates, consummate certain asset sales and effect a consolidation or merger, or sell, transfer, lease or otherwise dispose of all or substantially all assets.

Pursuant to the Existing 9.875% Notes Indenture, prior to the Settlement Date, if our pro forma

consolidated first lien net leverage ratio was no greater than 2.00 to 1.00, we could make restricted payments so long as no default or event of default had occurred and was continuing.

Prior to the Settlement Date, if our pro forma consolidated first lien net leverage ratio was greater than 2.00 to 1.00, we could make restricted payments pursuant to certain baskets.

In connection with the consummation of the Consent Solicitations, substantially all of the restrictive covenants and related provisions and definitions in the Existing 9.875% Notes Indenture were removed, effective as the Settlement Date.

The Existing 9.875% Notes Indenture contains certain events of default customary for agreements of its type (with customary grace periods, as applicable) and provides that, upon the occurrence of an event of default arising from certain events of bankruptcy or insolvency with respect to the Company or GrafTech Global, all outstanding Existing 9.875% Notes will become due and payable immediately without further action or notice.

If any other type of event of default occurs and is continuing, then the trustee or the holders of at least 30% in principal amount of the then outstanding Existing 9.875% Notes may declare all of the Existing 9.875% Notes to be due and payable immediately.

We were in compliance with all of our debt covenants as of December 31, 2024 and 2023.

Following the Exchange Offer, approximately $3.8 million aggregate principal amount of Existing 9.875% Notes remains outstanding.

Initial First Lien Term Loan Facility;

Delayed Draw First Lien Term Loan Facility

Concurrent with the settlement of the Exchange Offers, on the Settlement Date, Barclays Bank plc (the “Fronting Lender”), agreed to provide GrafTech Global $175 million of new senior secured first lien term loans (the “Initial First Lien Term Loans”) and provided commitments (the “Delayed Draw Commitments”) with respect to $100 million of new senior secured first lien delayed draw term loans (together with the Initial First Lien Term Loans, the “First Lien Term Loans”).

The First Lien Term Loans are governed by a new credit agreement, dated as of the Settlement Date, by and among GrafTech, as holdings, GrafTech Global, as borrower, GLAS USA LLC, as administrative agent, GLAS Americas LLC, as collateral agent, and the lenders from time to time party thereto (the “First Lien Term Loan Credit Agreement”).

The Initial First Lien Term Loans were drawn in a single drawing on the Settlement Date.

The Delayed Draw Commitments are available to the Company until July 23, 2026, subject to the satisfaction of customary conditions precedent thereto.

The First Lien Term Loans will mature on December 23, 2029, and are guaranteed by the Guarantors.

The First Lien Term Loans are pari passu in right of payment with the 2018 Revolving Credit Facility and the New Notes, but the First Lien Term Loans and the 2018 Revolving Credit Facility are senior in right of payment to the New Notes with respect to the proceeds of the Calais Facility.

The First Lien Term Loans and the 2018 Revolving Credit Facility are secured on a pari passu basis by perfected first-priority security interests in the Collateral.

The First Lien Term Loans bear interest at the option of GrafTech Global, at a rate equal to (i) Term SOFR (as defined in the First Lien Term Loan Credit Agreement) (subject to a 2.00% floor) plus 6.00% per annum or (ii) the ABR (as defined in the First Lien Term Loan Credit Agreement) plus 5.00% per annum.

The Company will pay a ticking fee with respect to undrawn Delayed Draw Commitments in an amount equal to 3.75% per annum of the amount of such undrawn and outstanding commitments.

The First Lien Term Loans are prepayable in whole or in part at the option of the Company (i) prior to the 24-month anniversary of the Settlement Date, subject to payment of a customary “make-whole” premium (which includes a 2.00% prepayment premium), (ii) on or after the 24-month anniversary of the Settlement Date through, but excluding, the 36-month anniversary of the Settlement Date, subject to a 2.00% prepayment premium, and (iii) on or after the 36-month anniversary of the Settlement Date, without a prepayment premium.

If the Company sells certain of its assets, then GrafTech Global may be required to offer to prepay the First Lien Term Loans and/or other indebtedness of GrafTech Global and/or its subsidiaries.

The First Lien Term Credit Agreement contains certain covenants that, among other things, limit the Company’s ability to incur or guarantee additional indebtedness or issue preferred stock, pay distributions on, redeem or repurchase capital stock or redeem or repurchase certain debt, incur or suffer to exist certain liens, make certain investments, engage in certain transactions with affiliates, consummate certain asset sales and effect certain fundamental changes.

The First Lien Term Loan Credit Agreement also contains certain events of default (with grace periods, as applicable) that permit the agent to accelerate the First Lien Term Loans, and provide that, upon the occurrence of certain events of default arising from bankruptcy or insolvency, all First Lien Term Loans will become due and payable immediately without further action or notice.

2018 Term Loan and 2018 Revolving Credit Facility

In February 2018, the Company entered into a credit agreement (as amended, the "2018 Credit Agreement"), which provided for (i) a $2,250 million senior secured term facility (the "2018 Term Loan Facility") after giving effect to the June 2018 amendment (the “First Amendment”) that increased the aggregate principal amount of the 2018 Term Loan Facility from $1,500 million to $2,250 million and (ii) a $330 million senior secured revolving credit facility after giving effect to the Third Amendment that increased the revolving commitments under the 2018 Credit Agreement by $80 million from $250 million (the "2018 Revolving Credit Facility").

In February 2018, the Company entered into a credit agreement (as amended, the “2018 Credit Agreement”), which provided for (i) a $2,250 million senior secured term facility (the “2018 Term Loan Facility”) after giving effect to the June 2018 amendment (the “First Amendment”) that increased the aggregate principal amount of the 2018 Term Loan Facility from

$1,500 million to $2,250 million and (ii) a $330 million senior secured revolving credit facility after giving effect to the May 2022 amendment that increased the revolving commitments under the 2018 Credit Agreement by $80 million from $250 million (the “2018 Revolving Credit Facility”).

GrafTech Finance Inc.

(“GrafTech Finance”) was the sole borrower under the 2018 Term Loan Facility while GrafTech Finance, GrafTech Switzerland SA (“Swissco”) and GrafTech Luxembourg II S.à.r.l.

(“Luxembourg Holdco” and, together with GrafTech Finance and Swissco, the “Co-Borrowers”) are co-borrowers under the 2018 Revolving Credit Facility.

The 2018 Revolving Credit Facility matures on May 31, 2027.

The net proceeds from the 2023 Senior Secured Notes (as defined below) were used to repay outstanding borrowings under our 2018 Term Loan Facility.

(“Luxembourg Holdco” and, together with GrafTech Finance and Swissco, the “Co-Borrowers”) were co-borrowers under the 2018 Revolving Credit Facility.

In December 2024, the 2018 Credit Agreement was further amended to provide for a $225 million senior secured first lien revolving credit facility, reducing the revolving commitments under the 2018 Credit Agreement by $105 million.

On June 26, 2023, GrafTech repaid the term loans under the 2018 Term Loan Facility with proceeds from the Existing 9.875% Notes issuance.

As of December 31, 2024, there are no outstanding term loans under the 2018 Term Loan Facility.

Until at least $275 million of First Lien Term Loans have been borrowed by the Company, the Company is not permitted to have more than $15 million in aggregate principal amount of revolving loans outstanding at any time under the 2018 Revolving Credit Facility.

The Company’s ability to borrow under the 2018 Revolving Credit Facility is subject to certain customary conditions precedent, including that the Company must not have more than $100 million of unrestricted cash and cash equivalents after giving effect to the applicable borrowing.

The 2018 Revolving Credit Facility matures on November 30, 2028, subject to a springing maturity date 91 days prior to the maturity date of certain other reference indebtedness.

As of December 31, 2024 and 2023, the availability under our 2018 Revolving Credit Facility was $108.0 million and $112.4 million, respectively.

As any borrowings under the 2018 Revolving Credit Facility remain subject to compliance with the financial covenant thereunder, our operating performance as of December 31, 2023 resulted in a reduction of the availability under the facility.

As of December 31, 2023 and December 31, 2022, there were no borrowings outstanding on the 2018 Revolving Credit Facility and there was $3.1 million and $3.0 million of letters of credit drawn against the 2018 Revolving Credit Facility as of each date, respectively.

The 2018 Revolving Credit Facility bears interest, at our option, at a rate equal to either (i) the Adjusted Term SOFR Rate, and Adjusted EURIBOR Rate (each, as defined in the 2018 Credit Agreement), plus an applicable margin initially equal to 3.00% per annum or (ii) the ABR Rate, plus an applicable margin initially equal to 2.00% per annum, in each case with two 25 basis point step downs based on achievement of certain senior secured first lien net leverage ratios.

In addition, we are required to pay a quarterly commitment fee on the unused commitments under the 2018 Revolving Credit Facility in an amount equal to 0.25% per annum.

The 2018 Revolving Credit Facility is guaranteed by each of our domestic subsidiaries, subject to certain customary exceptions, and by GrafTech Luxembourg I S.à.r.l., a Luxembourg société à responsabilité limitée and an indirect wholly owned subsidiary of GrafTech, Luxembourg HoldCo, and Swissco (collectively, the “Guarantors”) with respect to all obligations under the 2018 Revolving Credit Facility of each of our foreign subsidiaries that is a Controlled Foreign Corporation (within the meaning of Section 956 of the Internal Revenue Code of 1986, as amended from time to time (the “Code”)).

All obligations under the 2018 Revolving Credit Facility are secured, subject to certain exceptions, by:

(i) a pledge of all of the equity securities of each domestic Guarantor and of each other direct, wholly owned domestic subsidiary of GrafTech and any Guarantor, (ii) a pledge on no more than 65% of the equity interests of each subsidiary that is a Controlled Foreign Corporation (within the meaning of Section 956 of the Code), and (iii) security interests in, and mortgages on, personal property and material real property of each domestic Guarantor, subject to permitted liens and certain exceptions specified in the 2018 Revolving Credit Facility.

The obligations of each foreign subsidiary of GrafTech that is a Controlled Foreign Corporation under the 2018 Revolving Credit Facility are secured by (i) a pledge of all of the equity securities of each Guarantor that is a Controlled Foreign Corporation and of each direct, wholly owned subsidiary of any Guarantor that is a Controlled Foreign

Corporation, and (ii) security interests in certain receivables and personal property of each Guarantor that is a Controlled Foreign Corporation, subject to permitted liens and certain exceptions specified in the 2018 Revolving Credit Facility.

The 2018 Revolving Credit Facility contains customary representations and warranties and customary affirmative and negative covenants applicable to GrafTech and restricted subsidiaries, including, among other things, restrictions on indebtedness, liens, investments, fundamental changes, dispositions, and dividends and other distributions.

The 2018 Revolving Credit Facility contains a financial covenant that requires GrafTech to maintain a senior secured first lien net leverage ratio not greater than 4.00:1.00 when the aggregate principal amount of borrowings under the 2018 Revolving Credit Facility and outstanding letters of credit issued under the 2018 Revolving Credit Facility (except for undrawn letters of credit in an aggregate amount equal to or less than $35 million), taken together, exceed 35% of the total amount of commitments under the 2018 Revolving Credit Facility.

The 2018 Revolving Credit Facility also contains customary events of default.

We were in compliance with all of our debt covenants as of December 31, 2023 and 2022.

2020 Senior Secured Notes

In December 2020, GrafTech Finance issued $500.0 million aggregate principal amount of the 2020 Senior Secured Notes at an issue price of 100% of the principal amount thereof in a private offering to qualified institutional buyers in accordance with Rule 144A under the Securities Act of 1933 (the "Securities Act") and to non-U.S.

persons outside the United States under Regulation S under the Securities Act.

The 2020 Senior Secured Notes are guaranteed on a senior secured basis by the Company and all of its existing and future direct and indirect U.S.

subsidiaries that guarantee, or borrow under, the 2018 Revolving Credit Facility, other than GrafTech Finance.

The 2020 Senior Secured Notes are secured on a pari passu basis by the collateral securing the debt under the 2018 Revolving Credit Facility and the 2023 Senior Secured Notes.

GrafTech Finance, the Company and the other guarantors granted a security interest in such collateral, consisting of substantially all of their respective assets, as security for the obligations of GrafTech Finance, the Company and the other guarantors under the 2020 Senior Secured Notes and the indenture governing the 2020 Senior Secured Notes (the “2020 Indenture”) pursuant to a collateral agreement, dated as of December 22, 2020 (the “Collateral Agreement”), among GrafTech Finance, the Company, the other subsidiaries of the Company named therein as grantors and U.S.

Bank National Association, as collateral agent.

The 2020 Senior Secured Notes bear interest at the rate of 4.625% per annum, which accrues from December 22, 2020 and is payable in arrears on June 15 and December 15 of each year, commencing on June 15, 2021.

The 2020 Senior Secured Notes will mature on December 15, 2028, unless earlier redeemed or repurchased, and are subject to the terms and conditions set forth in the 2020 Indenture.

GrafTech Finance may redeem some or all of the 2020 Senior Secured Notes at the redemption prices and on the terms specified in the 2020 Indenture.

If the Company or GrafTech Finance experiences specific kinds of changes in control or the Company or any of its restricted subsidiaries sells certain of its assets, then GrafTech Finance must offer to repurchase the 2020 Senior Secured Notes on the terms set forth in the 2020 Indenture.

The 2020 Indenture contains certain covenants that, among other things, limit the Company’s ability, and the ability of certain of its subsidiaries, to incur or guarantee additional indebtedness or issue preferred stock, pay distributions on, redeem or repurchase capital stock or redeem or repurchase subordinated debt, incur or suffer to exist liens securing indebtedness, make certain investments, engage in certain transactions with affiliates, consummate certain asset sales and effect a consolidation or merger, or sell, transfer, lease or otherwise dispose of all or substantially all assets.

The 2020 Indenture contains events of default customary for agreements of its type (with customary grace periods, as applicable) and provides that, upon the occurrence of an event of default arising from certain events of bankruptcy or insolvency with respect to the Company or GrafTech Finance, all outstanding 2020 Senior Secured Notes will become due and payable immediately without further action or notice.

If any other type of event of default occurs and is continuing, then the trustee or the holders of at least 30% in principal amount of the then outstanding 2020 Senior Secured Notes may declare all of the 2020 Senior Secured Notes to be due and payable immediately.

As any borrowings under the 2018 Revolving Credit Facility remain subject to compliance with the financial covenant thereunder, our operating performance as of December 31, 2024 and 2023 resulted in our inability to access the full amount of commitments under the facility.

As of December 31, 2024 and 2023, there were no borrowings outstanding on the 2018 Revolving Credit Facility and there was $7.4 million and $3.1 million of letters of credit drawn against the 2018 Revolving Credit Facility as of each date, respectively.

Borrowings under the 2018 Revolving Credit Facility bear interest (i) with respect to new revolving loans denominated in U.S.

dollars, at the option of GrafTech Finance, Adjusted Term SOFR plus 3.50% per annum or ABR (as defined in the 2018 Revolving Credit Agreement) plus 2.50% per annum and (ii) with respect to new revolving loans denominated in euros, the Adjusted EURIBOR Rate (as defined in the 2018 Revolving Credit Agreement) plus 3.50% per annum.

Undrawn commitments under the New Revolving Credit Facility bear a commitment fee of 0.25% per annum.

Lenders holding all of the Company’s existing revolving commitments who agreed to provide commitments under the 2018 Revolving Credit Facility were paid a customary extension fee, in connection with the December 2024 amendment.

The 2018 Revolving Credit Facility has customary negative covenants and events of default and is required to be prepaid in the case of certain mandatory prepayments of the First Lien Term Loans.

The 2018 Revolving Credit Facility also includes a financial covenant requiring that the Company have a Senior Secured First Lien Net Leverage Ratio of no more than 4.00 to 1.00, tested quarterly, to the extent outstanding revolving loans and letters of credit (subject to certain exclusions) exceed 51.3% of the amount of commitments then-existing under the 2018 Revolving Credit Facility.

We were in compliance with all of our debt covenants as of December 31, 2024 and 2023.

2023 Senior Secured Notes

In June 2023, GrafTech Global Enterprises Inc.

issued $450.0 million aggregate principal amount of 2023 Senior Secured Notes, including $11.4 million of original issue discount.

The 2023 Senior Secured Notes were issued at an issue price of 97.456% of the principal amount thereof in a private offering to qualified institutional buyers in accordance with Rule 144A under the Securities Act and to non-U.S.

persons outside the United States under Regulation S under the Securities Act.

The 2023 Senior Secured Notes are or will be, as applicable, guaranteed on a senior secured basis by (i) GrafTech Finance, (ii) the Company and all of its direct and indirect U.S.

subsidiaries that, as of the date of the 2023 Senior Secured

Notes, guarantee (or are borrowers of) the debt under the 2018 Revolving Credit Facility, other than GrafTech Global Enterprises Inc., and (iii) all of the Company’s future direct and indirect subsidiaries that guarantee (or are borrowers of) debt under the 2018 Revolving Credit Facility, the 2020 Senior Secured Notes and certain other future indebtedness, in each case, other than certain excluded foreign subsidiaries and GrafTech Global Enterprises Inc.

The 2023 Senior Secured Notes and the note guarantees are secured on a first-priority basis by liens on the collateral of GrafTech Global Enterprises Inc.

guarantors securing the debt under the 2018 Revolving Credit Facility and the 2020 Senior Secured Notes, on an equal and ratable basis with the debt under the 2018 Revolving Credit Facility and 2020 Senior Secured Notes, in each case subject to permitted liens and certain exceptions, pursuant to a collateral agreement, dated as of June 26, 2023 among GrafTech Global Enterprises Inc., the Company, the other subsidiaries of the Company named therein as grantors and U.S.

Bank Trust Company, National Association, as collateral agent.

The 2023 Senior Secured Notes bear interest at a rate of 9.875% per annum which accrued from June 26, 2023 and is payable in arrears on June 15 and December 15 of each year, commencing on December 15, 2023.

The 2023 Senior Secured Notes will mature on December 15, 2028, unless earlier redeemed or repurchased, and are subject to the terms of the indenture governing the 2023 Senior Secured Notes (the “2023 Indenture”).

GrafTech Global Enterprises Inc.

may redeem some or all of the 2023 Senior Secured Notes at the redemption prices and on the terms specified in the 2023 Indenture.

If the Company or GrafTech Global Enterprises experiences specific kinds of changes in control or the Company or any of its restricted subsidiaries sells certain of its assets, then GrafTech Global Enterprises Inc.

must offer to repurchase the 2023 Senior Secured Notes on the terms set forth in the 2023 Indenture.

The 2023 Indenture contains certain covenants that, among other things, limit the Company’s ability, and the ability of certain of its subsidiaries, to incur or guarantee additional indebtedness or issue preferred stock, pay distributions on, redeem or repurchase capital stock or redeem or repurchase subordinated debt, incur or suffer to exist liens securing indebtedness, make certain investments, engage in certain transactions with affiliates, consummate certain asset sales and effect a consolidation or merger, or sell, transfer, lease or otherwise dispose of all or substantially all assets.

The 2023 Indenture contains events of default customary for agreements of its type (with customary grace periods, as applicable) and provides that, upon the occurrence of an event of default arising from certain events of bankruptcy or insolvency with respect to the Company or GrafTech Global Enterprises Inc., all outstanding 2023 Senior Secured Notes will become due and payable immediately without further action or notice.

If any other type of event of default occurs and is continuing, then the trustee or the holders of at least 30% in principal amount of the then outstanding 2023 Senior Secured Notes may declare all of the 2023 Senior Secured Notes to be due and payable immediately.

We were in compliance with all of our debt covenants as of December 31, 2023.

Material Cash Requirements.

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Total contractual and other obligations (f) $ 1,577,791 $ 104,324 $ 173,668 $ 1,299,799 $ —

(a) Represents our total debt from our 2020 Senior Secured Notes with an outstanding balance of $500.0 million due in 2028 and our 2023 Senior Secured Notes with an outstanding balance of $450.0 million due 2028 (see "Financing transactions" in this section for full details of these obligations).

(b) Represents estimated interest payments on the 2020 and 2023 Senior Secured Notes through December 15, 2028.

(a) Represents our total debt from our New and Existing 9.875% Notes, our New and Existing 4.625% Notes and our Initial First Lien Term Loans (see "--Financing transactions" in this section for full details of these obligations).

(b) Represents estimated interest payments on the Existing 9.875% Notes and the Existing 4.625% Notes through December 15, 2028, interest payments on the New 9.875% Notes and the New 4.625% Notes through December 23, 2029, as well as estimated interest payments on our Initial First Lien and Delayed Draw Term Loans through 2029.

Contributions in future periods will be dependent upon regulatory requirements, the plans' funded ratios, plan investment performance, discount rates, actuarial assumptions, plan amendments, our contribution objectives and other factors.

Contributions in future periods will be depend ent upon regulatory requirements, the plans' funded ratios, plan investment performance, discount rates, actuarial assumptions, plan amendments, our contribution objectives and other factors.

We anticipate funding those contributions with cash on hand or cash generated from operations.

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federal income tax and Swiss tax that we and our subsidiaries realize as a result of the utilization of certain tax assets attributable to periods prior to our IPO, including certain federal NOLs, previously taxed income under Section 959 of the Code, foreign tax credits, and certain NOLs in Swissco.

In addition, we will pay interest on the payments we will make to Brookfield with respect to the amount of these cash savings from the due date (without extensions) of our tax return where we realize these savings to the payment date at a rate equal to the one-month period secured overnight financing rate administered by the Federal Reserve Bank of New York plus 1.10% per annum.

The term of the Tax Receivable Agreement commenced on April 23, 2018 and will continue until there is no potential for any future tax benefit payments.

(f) In addition, letters of credit of $7.4 million were issued under the 2018 Revolving Credit Facility as of December 31, 2024.

Costs Relating to Protection of the Environment

We have been and are subject to stringent environmental protection laws and regulations.

In addition, we have an on‑going commitment to rigorous internal environmental protection standards.

Environmental considerations are part of all significant operating and capital expenditure decisions.

The following table sets forth certain information regarding environmental expenses and capital expenditures.

Year Ended December 31,

2023 2022 2021

(Dollars in thousands)

Expenses relating to environmental protection $ 12,085 $ 22,395 $ 16,914

Capital expenditures related to environmental protection 7,588 6,012 7,014

Critical accounting policies

Critical accounting policies are those that require difficult, subjective or complex judgments by management, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods.

We use and rely on estimates in determining the economic useful lives of our assets, obligations under our employee benefit plans, provisions for doubtful accounts, provisions for restructuring charges and contingencies, tax valuation allowances, evaluation of goodwill, other intangible assets, pension and OPEB and various other recorded or disclosed amounts, including inventory valuations.

We use and rely on estimates in determining the economic useful lives of our assets, obligations under our employee benefit plans, provisions for doubtful accounts, provisions for restructuring charges and contingencies, tax valuation allowances, evaluation of other intangible assets, pension and OPEB and various other recorded or disclosed amounts, including inventory valuations.

Estimates require us to use our judgment.

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The following accounting policies are deemed to be critical.

Goodwill arises from the purchase price for acquired businesses exceeding the fair value of tangible and intangible assets acquired less assumed liabilities.

The Company has two reporting units, Graphite Electrodes and Needle Coke.

The acquisition of the Company by Brookfield in 2015 generated a goodwill amount of $171.1 million, which was allocated entirely to the Graphite Electrode reporting unit.

Goodwill is tested for impairment annually as of December 31 and between annual tests whenever events or circumstances indicate that the carrying value of a reporting unit may exceed its fair value.

When reviewing goodwill for impairment, we first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value.

In performing a qualitative assessment, we consider business conditions and other factors including, but not limited to (i) adverse industry or economic trends, (ii) lower projections that may impact future operating results, (iii) sustained decline in our share price and (iv) overall financial performance and other events affecting the reporting units.

If we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then a quantitative impairment test is performed by estimating the fair value of the reporting unit and comparing it to its carrying value.

If the carrying value of a reporting unit exceeds its fair value, we would record an impairment charge equal to the excess of the carrying value of the reporting unit over its fair value.

Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units and determination of the fair value of each reporting unit.

We estimate the fair value of each reporting unit using a discounted cash flow methodology under the income approach.

This requires us to use significant judgment including estimation of future cash flows, which is based

upon relevant market data, internal forecasts, estimation of the long‑term growth for our business and determination of the weighted average cost of capital for purposes of establishing a discount rate.

For the 2023 annual impairment testing, the Company performed a quantitative assessment of the fair value of the reporting unit, using a combination of the income approach and the market approach (Level 3 in the fair value hierarchy) from a market participant’s perspective.

The valuation of the Graphite Electrode reporting unit is performed with cash flows that are adjusted to present this reporting unit as purchasing petroleum needle coke entirely from third parties at anticipated market prices.

The income approach was based on discounted projected debt-free cash flows for the graphite electrode reporting unit.

The forecast of cash flows included several assumptions regarding future sales growth, revenues, earnings before interest, taxes, depreciation and amortization (“EBITDA”), capital expenditures and working capital changes.

In addition to the estimates of future cash flows, the income approach involves the determination of the discount rate based upon market participant’s assumptions.

The market approach fair value was based on valuation multiples that were applied to the graphite electrode reporting unit’s actual and projected EBITDA.

The multiples were derived under the guideline public company method from analyzing market multiples of EBITDA for a group of comparable public companies.

The techniques used in the Company’s assessment incorporate a number of assumptions that the Company believes to be reasonable and to reflect known market conditions at the measurement date.

Key assumptions relate to customer demand and sales growth, graphite electrode and needle coke pricing trends, operating costs and capital expenditures.

Assumptions in estimating future cash flows are subject to a degree of judgement.

The testing determined that the fair value of the Graphite Electrode reporting unit was less than its carrying amount by more than the amount of goodwill.

As a result, we recorded a full impairment charge of $171.1 million, which was recorded in Goodwill impairment charges in the Consolidated Statements of Income.

The goodwill impairment was caused primarily by reduced sales of graphite electrodes due to softening demand and the deterioration of the electrode spot pricing.

For the 2022 and 2021 annual goodwill impairment testing, the Company performed a qualitative assessment first to determine whether it was more likely than not that the fair value of the Graphite Electrode reporting unit was less than its carrying amount.

We assessed relevant events and circumstances, including industry, market and macroeconomic conditions, as well as Company and reporting unit-specific factors.

Based on this review, we determined that it was not more likely than not that the fair value of the Graphite Electrode reporting unit was less than its carrying amount and concluded that the quantitative goodwill impairment test was not required.

No impairment of goodwill resulted from our annual impairment tests in 2022 and 2021.

Refer to Note 1, "Business and Summary of Significant Accounting Policies" and Note 6, "Goodwill and Other Intangible Assets" to the Consolidated Financial Statements for information regarding our goodwill impairment testing.

Employee benefit plans.

We sponsor various retirement and pension plans, including defined benefit and defined contribution plans and post-employment benefit plans that cover most employees worldwide.

Excluding the defined contribution plans, accounting for these plans requires assumptions as to the discount rate, expected return on plan assets, expected salary increases and health care cost trend rate.

See Note 11, "Retirement Plans and Post-employment Benefits," to the Consolidated Financial Statements for further details.

Impairments of long‑lived assets.

Impairment of long‑lived assets.

We may record impairment losses on long‑lived assets used in operations when events and circumstances indicate that the assets might be impaired and the future undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets.

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Accounting for income taxes.

We are required to estimate our income taxes in each of the jurisdictions in which we operate.

We are required to estimate our income taxes in each of the jurisdictions in which we are subject to taxation.

This process requires us to make the following assessments:

• estimate our actual current tax liability in each jurisdiction;

• estimate our temporary differences resulting from differing treatment of items for tax and accounting purposes (which result in deferred tax assets and liabilities that we include within the Consolidated Balance Sheets);

• assess the likelihood that our deferred tax assets will be recovered from future taxable income and, if we believe that recovery is not more likely than not, a valuation allowance is established.

If our estimates are incorrect, our deferred tax assets or liabilities may be overstated or understated.

As of December 31, 2023, we had a valuation allowance of $9.0 million against certain deferred tax assets.

• estimate our temporary differences resulting from differing treatment of items for tax and accounting purposes (which result in deferred tax assets (“DTAs”) and deferred tax liabilities (“DTLs”) that we include within the Consolidated Balance Sheets);

• assess the likelihood that our DTAs will be recovered from future taxable income and, if we believe that recovery is not more likely than not, a valuation allowance is established.

If our estimates are incorrect, our DTAs or DTLs may be overstated or understated.

As of December 31, 2024, we had a valuation allowance of $19.3 million against certain DTAs.

Our losses in certain tax jurisdictions in recent periods represented sufficient negative evidence to require a full valuation allowance.

We also have a partial valuation allowance related to certain U.S.

state net operating losses where realizability is unlikely due to discontinued operations in these states.

Until we determine that we will generate sufficient jurisdictional taxable income to realize our net operating losses and deferred tax assets, we continue to maintain a valuation allowance.

state net operating losses where realizability is unlikely due to discontinued operations or the ability of our U.S.

subsidiaries to generate capital gains to utilize capital loss carryforwards in these states.

Until we determine that we will generate sufficient jurisdictional taxable income to realize our net operating losses and DTAs, we continue to maintain a valuation allowance.

As of December 31, 2024, we had DTAs of $52.4 milllion in the U.S.

These DTAs consist of the previously mentioned state items with a valuation allowance and approximately $34.2 million in additional net DTAs recognized in 2024.

These additional DTAs include approximately $30.0 million related to interest limitations and U.S.

federal net operating loss carryforwards that do not expire, and which may be used to offset taxable income in future periods to reduce our income taxes payable in these future periods.

However, our U.S.

losses in recent periods and the potential for U.S.

losses in 2025 may lead to a cumulative U.S.

loss and may represent sufficient negative evidence to require a full valuation allowance on U.S.

DTAs, which would materially increase our expenses in the period the allowance is recognized and materially adversely affect our financial condition and results of operations.

If cumulative losses are realized, we will evaluate additional evidence such as our projections for growth and market recovery to determine if a valuation allowance is required, as well as other sources of future taxable income.

Related-party Tax Receivable Agreement.

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federal income tax and Swiss tax that we and our subsidiaries realize as a result of the utilization of certain tax assets attributable to periods prior to our IPO, including the pre-IPO Tax Assets.

The term of the Tax Receivable Agreement commenced on April 23, 2018 and will continue until there is no potential for any future tax benefit payments.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis