Nickel Industries Limited

Nickel Industries reported revenue of $1.65 billion and adjusted EBITDA of $282.8 million for FY2025. Management said LME nickel prices were down 9.8% versus 2024 and NPI prices were down 2.8%, while RKAB-related standby costs of $21.5 million in Q4 cut quarterly EBITDA to $37.5 million versus $87 million in Q3. Record operating metrics included NPI production of 1,055,658 tonnes, mine production of 19.2 million wet metric tons, and sales of 9.9 million wet metric tons. On the balance sheet, cash was $357 million, debt was $1.2 billion, and net debt was $866 million. For 2026, management said the new RKAB quota should allow full ore requirements for ENC and the same saprolite supply level for the RKEF business, while ENC commissioning is expected in the first half and first sales around July. Management also pointed to January EBITDA of $50 million and said full-year 2026 EBITDA could be well above broker consensus of about $500 million, though no formal company guidance was given.

Justin Werner’s tone was confident and upbeat despite calling 2025 a challenging year. He emphasized that the company’s model proved resilient through the cycle, highlighting safety, ESG recognition, record production, and the ability to keep generating EBITDA even with nickel prices near cyclical lows. His strategic focus was on growth through the cycle: ENC commissioning, higher quota access, and Sampala development, all of which he said should lift 2026 and 2027 results.

Christopher Shepherd focused on balance-sheet management and financing structure. He said cash was $357 million at year-end, debt was $1.2 billion, and net debt was $866 million; he also noted an $8.1 million impairment tied to limonite inventory sterilized for ENC tailings construction. On capital structure, he highlighted the $800 million refinancing of senior unsecured notes, lowering the coupon to 9% and removing amortization, and explained that a $22 million financing expense reflected the early takeout of the October 2028 bonds with a make-whole payment. He also said the Sphere transaction released more than $200 million of near-term commitments, which he framed as prudent balance-sheet management.

Analysts focused on the RKAB quota, ore sourcing, ENC ramp-up, and capital allocation. Management said the Hengjaya mine quota increase would allow 100% of ENC ore needs in 2026 and continued saprolite supply for the RKEF business, while the quota cut at third-party mines should not disrupt operations because the company is increasingly self-sufficient and can source ore from others. On capital allocation, management said it will review the dividend, share buybacks, and debt repayment mid-year, while continuing to optimize the debt stack. Questions on ENC timing and offtake were answered with first sales targeted around July, Sphere’s 10% offtake beginning when product ships, and discussions continuing with other potential off-takers.