724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 724500UWG6A61XNA3Y36 2024-12-31 724500UWG6A61XNA3Y36 2023-12-31 724500UWG6A61XNA3Y36 2022-12-31 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:IssuedCapitalMember 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:TreasurySharesMember 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:SharePremiumMember 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:OtherReservesMember iso4217:EUR iso4217:EUR xbrli:shares 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:RetainedEarningsMember 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:ReserveOfRemeasurementsOfDefinedBenefitPlansMember 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 724500UWG6A61XNA3Y36 2023-12-31 ifrs-full:NoncontrollingInterestsMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:IssuedCapitalMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:TreasurySharesMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:SharePremiumMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:OtherReservesMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:RetainedEarningsMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:ReserveOfRemeasurementsOfDefinedBenefitPlansMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 724500UWG6A61XNA3Y36 2024-01-01 2024-12-31 ifrs-full:NoncontrollingInterestsMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:IssuedCapitalMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:TreasurySharesMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:SharePremiumMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:OtherReservesMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:RetainedEarningsMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:ReserveOfRemeasurementsOfDefinedBenefitPlansMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 724500UWG6A61XNA3Y36 2024-12-31 ifrs-full:NoncontrollingInterestsMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:IssuedCapitalMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:TreasurySharesMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:SharePremiumMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:OtherReservesMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:RetainedEarningsMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:ReserveOfRemeasurementsOfDefinedBenefitPlansMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 724500UWG6A61XNA3Y36 2022-12-31 ifrs-full:NoncontrollingInterestsMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:IssuedCapitalMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:TreasurySharesMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:SharePremiumMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:OtherReservesMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:RetainedEarningsMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:ReserveOfCashFlowHedgesMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:ReserveOfRemeasurementsOfDefinedBenefitPlansMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 724500UWG6A61XNA3Y36 2023-01-01 2023-12-31 ifrs-full:NoncontrollingInterestsMember
Annual Report and Accounts 2024
Safety,
resilience
and progress
Page 5
Integrating
knowledge
through M&A
Page 6
Our new
4PRO
offering
Page 10
Global
leader
in heat
management
CONTENTS
STRATEGIC REPORT
IFC Highlights
01 We are RHI Magnesita
02 Chair’s statement
05 CEO review
08 Our business model and value chain
12 Our strategic framework
22 Key performance indicators
26 Our stakeholders
32 Operational review
39 Financial review
46 Sustainability
48 Our risk management approach
48 Effective risk management
51 Our internal control system
53 Viability statement
54 Principal risks
64 Sustainability Statement
GOVERNANCE
173 Governance at a glance
174 Chair’s introduction to corporate governance
176 Board of Directors
180 Board composition
182 Executive Management Team
183 Corporate Governance report
200 Nomination & Governance Committee report
204 Corporate Sustainability Committee report
206 Audit & Compliance Committee report
212 Remuneration Committee report
218 Directors’ Remuneration Policy
220 Annual Report on Remuneration
FINANCIAL STATEMENTS
232 Consolidated Statement of Profit or Loss
233 Consolidated Statement
of Comprehensive Income
234 Consolidated Statement of Financial Position
235 Consolidated Statement of Cash Flows
236 Consolidated Statement of Changes in Equity
238 Notes to the Consolidated Financial
Statements 2024
300 Company Financial Statements
of RHI Magnesita N.V.
302 Notes to the Company Financial
Statements 2024
OTHER INFORMATION
312 Independent Auditor’s report
322 Limited assurance report of
the independent auditor on the
consolidated sustainability statement
325 Alternative performance measures (“APMs”)
327 Glossary
329 Shareholder information
Our purpose is to master heat, enabling global industries
to build sustainable modern life. We offer refractory
products and services that shape tomorrow’s world. Our
advanced products are essential for our customers in the
steel, cement, metals, glass and chemicals industries.
HIGHLIGHTS
Revenue
€3.5bn
2023: €.3.6bn
Adjusted EBITA
€407m
2023: €409m
Adjusted profit after
tax
€263m
2023: €241m
Adjusted earnings
per share
€5.32
2023: €4.98
Net debt: Pro Forma
Adjusted EBITDA
2.3x
2023: 2.3x
Dividend per share
€1.80
2023: €1.80
per share
Adjusted operating
cash flow
€419m
2023: €418m
ROIC
9.8%
2023: 10.7%
C0 emissions
1.57t CO/t
2023: 1.62t CO/t
Recycling rate
14.2%
2023: 12.6%
Lost time injury
frequency
0.11
2023: 0.16
Global leader
in heat
management
Integrity, honesty, reliability
and respectful collaboration
Adjusted EBITA margin
(2023: 11.4%)
Green steel project
contract awards in 2024
robotic and
machinery solution
systems sales
contracts awarded
in 2024
11.7%
5
18
WE ARE RHI MAGNESITA
1RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CHAIR’S STATEMENT
As the global leader in the
critical refractory industry we
have a responsibility to lead the
way in sustainability and ethical
business practices.
Dear Shareholders,
I am pleased to present the achievements
and performance of RHI Magnesita in
2024, which was another year of difficult
conditions in the refractory market. We
have demonstrated our resilience and the
continuing validity of our strategy despite
facing many challenges.
Our successful M&A programme continues
with the €391 million acquisition of Resco
in the US, alongside the ongoing integration
of the businesses we acquired in 2022
and 2023. Our strategy to grow through
acquisition in the refractory industry
remains intact and is already generating
value despite weak demand conditions.
Refractories are essential for modern life;
without them it is not possible to
manufacture steel, glass, cement,
non-ferrous metals and petrochemical
products. RHI Magnesita is the global
leader in this highly specialised and vital
industry and we have a responsibility to
lead the market in sustainability and ethical
business practices, as well as delivering
value for shareholders.
Health and safety
I am saddened to report that the Group
experienced a fatality in June 2024 at
its Dalian plant in China, in addition to the
previously reported fatal incident in Austria
that occurred in February 2024. No serious
injury or fatality in the workplace can ever
be acceptable and the Board is fully focused
on supporting management to bringing
about the necessary changes to prevent
them. I am satisfied that appropriate,
far-reaching measures are being taken
to improve performance and that the
issue is being given the priority it deserves.
Your Board will continue to monitor the
situation closely.
Strategic priorities
Despite significant volatility in end markets,
supply chains and global trade we remain
confident that our strategy is the best
approach to generating value in our industry.
During periods of disruption we must
remain focused on our long-term goals
if we are to succeed.
One of the key strengths of RHI Magnesita
is the ability to generate stable earnings
and cash flow with consistent margins
and return on invested capital throughout
business cycles. This enables us to
consistently allocate capital to growth,
which at present we believe is best delivered
through an active M&A programme that
continues to gather momentum, alongside
delivering a regular dividend to shareholders.
We are proud to deliver
a wider benefit to society
through our leadership
of the refractory industry.
€396m
Capital allocated
to M&A in 2024,
including Resco
Herbert Cordt
Chair
Essential for
modern life
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 20242
CHAIR’S STATEMENT CONTINUED
Leaders
in innovation
and sustainability
Pioneering new technologies
We are developing new technologies
to reduce emissions in the refractory
production process
Recycling
Recycling has been the main
contributor to the Group’s CO
emissions reductions to date.
There are also significant
waste management and
circular economy benefits
for our customers.
1.6t
of CO can be
saved per tonne
of recycled raw
material used
Green steel opportunity
Steel producers launching
green steel projects are turning
to RHI Magnesita for refractory
solutions. Five contract awards
were made in 2024.
€50m
Investment
over four years
Sustainability R&D
RHI Magnesita committed to an
investment of €50 million over the
period from 2021-25 into the research
and development of new technologies
to avoid or capture CO emissions.
8%
The steel industry
accounts for around
8% of global
CO emissions
We are committed to
decarbonising our industry
1. Avoid new
CO emissions,
for example
through the
use of recycling
2. Carbon capture
and storage
or utilisation at
our raw material
production sites
3. Transition to
clean energy
sources such
as renewable
electricity and
green hydrogen
4. Decarbonise
our supply chain
using techniques
proven in our
own operations
3RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Our capital allocation priorities seek to
balance growth with providing a reliable
return for shareholders, supported by
long-term resilience and sustainability.
Sustainability is integrated into our strategy
and is not treated as a separate topic. This
means any investments we make into new
ventures with a sustainability related goal
need to meet the same investment return
criteria as any other M&A transaction or
organic investment project that competes
for capital. Sustainability goals are also
embedded into our other strategic
priorities, for example we are building up
recycling capacity through acquisition and
increasing our market share in non-basic
refractories, which will be important for
certain customers as they undergo their
own decarbonisation processes.
External market conditions
Each year there are new uncertainties,
economic and political developments to
which we must adapt. In 2024, elections in
key geographies have resulted in a change
in priorities for new governments with
important consequences for our customer
industries and end markets.
A key driver of market conditions for RHI
Magnesita is the transition of the Chinese
economy away from steel intensive growth
based on infrastructure and real estate
development towards a consumption based
economy with changing demand patterns
for raw materials. Steel production in
China has peaked and is forecast to reduce
in coming years. This is a major change for
industry and commodity markets for whom
strong growth in Chinese demand over the
last 25 years has been a strong driving force.
New growth in East Asia, the Middle East
and India is encouraging but at a smaller
scale and is not yet enough to compensate
for the decline in Chinese demand.
Due to the weaker demand environment for
refractories, input costs in many categories
reduced in 2024, resulting in pricing
pressure as competitors reduce prices in
line with lower costs. This represents the
end of the recent cycle of cost and price
inflation which necessitated action on our
part to defend margins.
People and culture
In uncertain times it is important to be able
to unite behind a consistent purpose, goals
and corporate culture. By living our values
we can react to challenges, gauge our
performance and set an example to the
many new colleagues who have joined
the Group in recent years.
One of our key priorities is to encourage
greater gender diversity. We have a target
of 33% female representation in the Board
of Directors which is currently met and a
longer-term aspiration to increase this to
45%. In senior management we are aiming
to hit the 33% target for EMT and direct
reports in 2025 and this ratio was
26% at the end of 2024. We have many
initiatives in process to achieve the target
and I am confident we are making the
necessary progress.
Dividend
The Board has recommended a final
dividend of €1.20 per share in respect
of the financial year ending 31 December
2024, bringing the total dividend for the
year to €1.80 per share. This level of
dividend is aligned with our policy to
maintain dividend cover of below three
times adjusted earnings and is balanced
against the other funding requirements
of the business as we manage capital
expenditures, M&A spend and gearing
levels through this important period
in our strategic development.
Summary
We are the global leader of a critical
industry that is essential for modern life.
We are seeking to build on this leadership
by executing our strategy to grow via
M&A in this fragmented market. We can
be proud of what we have built up to this
point and enthusiastic for our future
prospects together.
CHAIR’S STATEMENT CONTINUED
RHI Magnesita is
the global leader in
this highly specialised
and vital industry.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 20244
Weak end markets continued to
impact the business in 2024. The
contribution from M&A, operational
excellence and network efficiencies
supported relatively stable
revenues, margins and profitability.
We continue to execute on our
three strategic pillars of reducing
costs, expanding our business
model and growing in markets
where we are underrepresented.
Health and safety is our absolute priority
and I am saddened to report that two fatal
incidents occurred at our production sites
in H1 2024. Health and safety improvements
have been prioritised at all levels of
management; together we are undertaking
a complete review of our safety standards,
culture, leadership and key serious injury
and fatality risks.
During the year we established the
RHI Magnesita HELP fund, a registered
association in Austria focused on providing
immediate financial assistance to individuals
and families affected by workplace safety
incidents across our global network. I am
proud to say that the HELP fund has been
funded primarily through voluntary
contributions from RHI Magnesita staff,
with a matching contribution from the
Company. From these sources the HELP
fund raised over €800,000 in its first year
and payments to qualifying recipients have
already commenced.
Operational excellence underpins our
customer offering, our industrial operations
and financial performance. The work to drive
improvements is translating into tangible
benefits in both of these areas. Our main KPIs
in 2024 were PIFOT (“Process In Full On
Time”) and net promoter scores in customer
surveys. Both of these achieved record
highs in 2024. Other operational indicators
and inventory management metrics also
showed improvements, contributing to a
reduction in working capital and strong
cash flow conversion this year.
Our digital transformation is well
underway, consisting of a group-wide
replacement of the core operating systems
(including ERP) alongside a redesign of
our core business processes, all focused
on improving customer experience.
In Q4 we entered into a business process
outsourcing agreement with Capgemini
which will result in broader career
opportunities for our shared service centre
colleagues, deliver cost savings and, most
importantly, lead to sharper execution of the
critical processes which are the foundation
of our ability to deliver for our customers
more reliably. We will be investing over
€100 million into this platform to deliver
greater value to customers and more
effective integration of acquisitions.
R&D and the new ‘4PRO’ service offering
are critical to deliver improvements to our
customers. Constantly improving world-
leading refractory performance is reliant
upon continuous adaptation of existing
solutions according to customer needs and
the development of new technologies that
will deliver the next iteration of product
performance improvements, and efficiency
gains in our own manufacturing processes.
I am pleased to report strong growth in
sales of robotics solutions for automated
lining repairs in 2024 and exciting new
developments in production techniques
with high potential for sustainability, cost
and performance improvements. Our
offering in this area has been consolidated
under a central function offering Advanced
Technologies to ensure that we can move
our customers up the margin curve to
higher value added products and services.
During 2024 we expanded our solutions
contract offering under the 4PRO brand.
4PRO represents a holistic approach to
high-performance refractory applications,
based on closer collaboration with
customers seeking continuous
Safety, resilience
and progress
Stefan Borgas
Chief Executive Officer
CEO REVIEW
Scan the QR code to read
Stefan’s review of 2024
5RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CEO REVIEW CONTINUED
Integrating
knowledge
through M&A
S
h
a
r
e
b
u
y
b
a
c
k
M
&
A
O
r
g
a
n
i
c
i
n
v
e
s
t
m
e
n
t
€77m
2024 EBITDA
contribution from
2023 M&A
2
Acquisitions
agreed in
2024
€396m
Capital allocated
to M&A in 2024,
including Resco
Since 2017 we have pursued
a proactive and selective
M&A growth strategy,
establishing RHI Magnesita
as the leading consolidator
in the industry.
Given the relatively mature global refractory
market with low growth expectations, our
strategy focuses on growth through an
active M&A programme rather than
investing in new production capacity.
With each acquisition we integrate into
our network, we gain valuable insights
into market opportunities and diverse
business models.
We build momentum by responsibly
integrating the businesses we acquire,
offering exciting career development
opportunities for individuals and global
growth potential for product specialists
or regional champions looking to
expand globally.
Simon Kuchelbacher
Head of M&A
Capital allocation and M&A strategy
Balanced approach
to capital allocation
RHI Magnesita maintains a
purposeful approach to capital
allocation which seeks to
balance shareholder returns,
acquisitions and organic
investments that will deliver
long-term growth and
productivity gains. After
maintenance capital
expenditures and the ordinary
dividend, M&A, organic
investments and share buybacks
compete for capital. We target
gearing of 1.0-2.0x EBITDA
with the flexibility to increase
to c.2.5x for compelling
M&A opportunities.
2.3X
31 Dec 2024 gearing
Our resilient margins, stable
profitability throughout
macroeconomic cycles and
high levels of cash conversion
support the targeted gearing
range of up to c.2.5x for M&A.
Capital Allocation
2018 to 2024 (%)
Organic investments 29%
M&A 27%
Maintenance 22%
Dividend 18%
Share buyback 4%
Dividend
Maintenance
capex
Net
operating
cash flow
Gearing
1.0-2.0x
C.2.5x for M&A
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 20246
CEO REVIEW CONTINUED
improvement in production techniques
as well as the pursuit of sustainability
objectives and circular economy initiatives.
Our M&A-led growth strategy delivered
strong results despite headwinds from weak
market conditions. The six acquisitions
completed in 2023 contributed Adjusted
EBITDA of €77 million, in line with
guidance of c.€80 million. During 2024
we completed the acquisition of Refrattari
Trezzi, expanding our recycling activities
in Europe.
In the US, we reached agreement on the
acquisition of Resco Group in April 2024
and successfully completed the transaction
on 28 January 2025, for a final deal value of
€391 million. This acquisition is a major step
forward for our North American business.
Resco’s strengths in the petrochemical,
cement and aluminium industries are
complementary to our existing business
and will provide opportunities in these
market segment worldwide by leveraging
RHI Magnesita’s global footprint. The much
larger US plant footprint will allow us to
accelerate our ‘local for local’ production
strategy, onshoring significant manufacturing
activity into the US and shortening supply
chains. Resco is the largest acquisition we
have undertaken since the combination of
RHI and Magnesita in 2017 and I am excited
about the prospects for our future growth in
this dynamic and valuable refractory market.
The new team is fired-up!
We remain committed to our strategy to
allocate capital to growth via M&A. We note
that there have been other transactions
in the sector in 2024, with Shinagawa’s
acquisition of Gouda Refractories Group
and Vesuvius PLC’s purchase of Piromet
in Türkiye. During 2025 our focus will
be primarily on network optimisation,
the integration of recent acquisitions and
reducing net debt, with any additional
M&A likely to be limited in scope.
We expect to incur network optimisation
expenses in Europe and Brazil as a result
of plant footprint adjustments following
the Resco acquisition and other M&A
transactions completed in 2022 and 2023.
Total restructuring costs in the base
business of €60 million and associated
capital expenditure of €40 million are
planned over the period 2025-27, to deliver
€10 million of EBITA benefit in 2025,
€20 million in 2026 and €30 million
per annum thereafter.
Our greatest strength lies in our people.
Every contribution matters and strengthens
our collective success, increasingly also
from colleagues joining RHI Magnesita
as a result of M&A. We continue to learn
more about our industry, identifying new
opportunities and benefitting from the
expertise of talented teams and individuals
as we integrate acquired businesses.
Sustainability means the protection
and preservation of resources for future
generations. Our Company traces its
origins back to 1834. Today, as the leading
global supplier of refractories, which are
essential for the creation of basic building
materials for modern life, we can be certain
that our industry will remain essential for
many years to come. Refractory production
is CO intensive and RHI Magnesita has
pioneered new technologies for reducing
CO emissions. Our journey to recycle
secondary raw materials increasingly
requires the development of cutting edge
technologies, which are now in industrial
testing. In 2025 we will be piloting a CO
re-mineralisation technology together
with MCi Carbon. Further progress requires
engagement with suppliers to adopt
low-carbon energy sources.
Our customers are amongst the
highest emitters of CO globally and
are undergoing their own transformation
to decarbonise. When developing new
production technologies they are
increasingly turning to RHI Magnesita
as their preferred partner for refractory
solutions. We have now won five major
contract awards for green steel projects;
this will be an important source of high
value-add business going forwards.
RHI Magnesita has produced a
Sustainability Statement according to
ESRS for the 2024 financial year. Having
completed a lengthy double materiality
assessment and complied in full with the
disclosure requirements, the Group is
of the view that the outcome of the ESRS
process is not beneficial to stakeholders.
ESRS places an unreasonable burden in
terms of financial cost and other corporate
resources which cannot be deployed
to actual sustainability improvements.
RHI Magnesita urges relevant regulators
and legislators to look again at the way that
ESRS has been implemented in practice to
allow companies to redirect resources from
reporting to action. We note that the
European Commission has proposed
a revision to ESRS through its Omnibus
Directive and we hope for improvement.
Our financial performance was resilient
considering the challenging end market
conditions, which saw a decrease in sales
volumes of 1% in the base business and
6% lower pricing. The contribution from
M&A and operational efficiency delivered
stable revenues and Adjusted EBITA of
€407 million (2023: €409 million) with
margin increasing to 11.7% (2023: 11.4%).
It is a sign of our strong operational
performance that we were able to maintain
margin in a falling price environment, despite
lower vertical integration contribution and
the additional burden from high fixed cost
under-absorption due to shrinking volumes.
Adjusted EPS increased to €5.32 (2023:
€4.98) and cash generation was strong
at 103%, contributing to a reduction in net
debt of €53 million to €1,251 million and
gearing of 2.3x (2023: 2.3x), in line with
our target range.
The short-term outlook for our industry
remains weak and we must be ready
to respond with fast decision making.
China’s necessary and clearly
communicated economic transition is the
most significant factor affecting industrial
markets worldwide including refractory
markets. The long term outlook for
future-oriented commodities and materials
such as copper, aluminium and glass
remains strong. However, project demand
in the industrial segment is expected to
decline in the near term.
Should any recovery in refractory demand
occur, RHI Magnesita is well positioned to
benefit due to its high levels of operational
gearing and vertical integration capability.
During this extended downturn, we have
greatly increased our customer base
through the acquisition of 12 businesses with
a total deal value of €1.2 billion and we are
seeing real benefits from synergies as these
acquisitions are integrated into our network.
Against this backdrop, we continue to
believe that adaptability, discipline and
innovation will deliver long-term success.
7RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Raw materials
Recycle
Removal
Maintenance
Optimisation
Design
Installation
Monitoring
Logistics
Refractory
production
R&D
Purpose,
values and
culture
OUR BUSINESS MODEL
Our business model
We are masters of heat, the leading global supplier of high-grade refractory products,
systems and solutions. We have a vertically integrated value chain ranging from raw
material sourcing to refractory production and performance-based solutions.
We apply our strengths…
Our people
and culture
The expertise and
dedication of our
people underpins
our success.
Our technology
High-performance,
customised
refractory products
and services create
value for our
customers.
Vertical
integration
In 2024 we sourced
internally 67% of
our magnesite and
dolomite raw
material needs.
Local-for-local
operations
We seek to produce
refractories close
to our customers
to shorten supply
chains and
reduce costs.
Capital allocation
Balanced approach
with M&A, organic
investments and
buyback competing
for capital after
maintenance capex
and dividends.
Sustainability
leadership
We lead the industry
in recycling and we
are developing new
technologies to
reduce CO.
…to create stakeholder value.
Shareholders
ROIC in excess
of WACC
consistently
creates value.
Reliable core
dividend, 3x
covered by EPS.
Debt holders
and lenders
€1.8 billion of
gross borrowings
with closely
managed
maturity profile
and long-term
banking
relationships.
Customers
The primary
focus of our
efforts. Creating
value for
customers is
the source of
value creation
for all others.
Communities
Our social
licence to
operate relies
on close ties with
communities
who jointly
benefit from
our stakeholder
activities.
Employees
Our people
determine our
success and
share in the
benefits.
Governments
Partnering in the
development
of industrial
projects and
natural
resources.
Suppliers
Long-term
relationships
with suppliers
who share
our values.
R
e
f
r
a
c
t
o
r
y
p
r
o
d
u
c
t
i
o
n
a
n
d
d
i
s
t
r
i
b
u
t
i
o
n
S
e
r
v
i
c
e
s
a
n
d
s
o
l
u
t
i
o
n
s
…across our value chain…
Read more about what we do across
our value chain on the next page
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 20248
Raw materials Refractory production Logistics
RHI Magnesita operates raw
material sites in Austria, Brazil,
China, Czechia, Türkiye and
USA. 67% of magnesite and
dolomite raw material usage
by volume was source internally
in 2024, contributing 0.8% to
Group Adjusted EBITA margin.
The Group operates
53 refractory production
plants in Europe, Türkiye,
India, China and the Americas.
Smaller markets in East Asia,
the Middle East, Africa and
Australasia are supplied from
regional hubs.
Timely raw material and finished
goods deliveries with effective
inventory management
strategies are crucial to ensure
customer delivery reliability
whilst minimising working
capital and operating costs.
Research &
Development
Design Installation
Development of new products,
customisation and improved
production techniques are
essential to maintaining our
position as market leader.
R&D is also required to
achieve our longer-term
sustainability objectives.
The capability to design
refractory solutions for new
projects or new customers
locks in future recurring
revenues from refractory sales.
New contract wins in green
steel projects demonstrate
the Group’s success in 2024.
Customers often outsource the
highly technical task of lining
installation to RHI Magnesita.
Refractory performance is
dependent on correct
installation, with high quality
control requirements.
Monitoring Maintenance Optimisation
We offer digital sensors
to monitor refractory usage,
depletion or slag levels in real
time. Kiln surveys can identify
hot spots or deformities. Such
services are often carried out
within a solutions contract
framework.
Refractory maintenance can
include gunning or other repairs
to extend the useful life of
refractory linings. Efficient use
of refractory linings can have
meaningful benefits for other
operating costs at customer sites,
such as energy consumption.
Maximise customer plant
utilisation and minimise
operating costs associated with
energy usage or maintenance
downtime. Post mortem
analyses of used refractories are
carried out to optimise product
formulations over time.
Removal Recycle
Plan and execute the removal
of linings after maximum safe
usage has been achieved. Sort
refractory waste to optimise
recycling recovery yields.
Reclaim valuable refractory
material for reuse, with
significant circular economy
benefits. Our proprietary
technology ensures high
performance with significant
CO emissions reduction
potential.
OUR BUSINESS MODEL CONTINUED
Our value chain
We design, produce, deliver, install, monitor, maintain,
remove and recycle optimised refractory solutions for
our global customer base.
9RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
4PRO
A comprehensive offering that
reflects our expanded capabilities
For many years RHI Magnesita has been at
the forefront of the industry in its ability to
offer a complete refractory solution to its
customers, charged per unit of customer
output and not based on refractory
consumption. This arrangement has
enabled us to build many long-term
relationships and to improve the efficiency
of customer plants by employing the best
available technology and working practices.
Our offering is now much broader and we
have launched the 4PRO initiative to achieve
another step-change in the relationship
we have with our customers.
Sustainable products
RHI Magnesita prioritises sustainability
by developing low-carbon and
emission-free refractory products.
Our commitment to a circular economy
drives us to incorporate recycling into
our production processes, significantly
reducing our environmental impact while
delivering high-performance solutions.
Robotics
We leverage advanced robotics to enhance
the precision and safety of our manufacturing
processes. By automating hazardous tasks,
we not only improve operational efficiency
but also protect our workforce from certain
dangerous conditions.
OUR BUSINESS MODEL CONTINUED
Systems
Our cutting-edge refractory systems are
designed to meet the unique demands of
high-temperature industries. These systems
optimise performance and reduce energy
consumption, reflecting our dedication
to innovation and sustainability.
Sensors
We utilise state-of-the-art sensor
technology for real-time monitoring and
control. These sensors provide critical data
that allows us to maintain safety, optimise
processes, and ensure the highest levels
of operational efficiency.
Digital solutions
Our digital platforms empower us to
optimise key industrial processes like slag
foaming and mass balance. By leveraging
data-driven insights, we enhance both
efficiency and sustainability in our operations.
Highly specialised engineering
Our team of specialised engineers is
dedicated to creating bespoke solutions
that address complex industrial challenges.
We ensure that our products and systems
meet the highest standards of performance,
safety, and efficiency.
Decarbonisation solutions
We are pioneering technologies
to significantly reduce CO emissions
through initiatives like carbon capture pilots
and the development of low-carbon
footprint products.
Clean and green steel solutions
We support the steel industry’s transition
to sustainability by providing innovative
refractory solutions that enhance energy
efficiency and reduce emissions. Our
products are integral to achieving cleaner
and greener steel production.
Evolving our customer
relationships is not an
option, it is a necessity.
Over the years our business
model has evolved and
today we are able to offer
our customers a new level
of interaction.
More than
products
& services
Gustavo Franco
Chief Customer Officer
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202410
P
a
r
t
n
e
r
s
h
i
p
s
Long Term
Agreements
Refractory
Material
Social
Responsibility
Connectivity
Automation
Robotics
Data Access
Connectivity
Sensors
Joint
Development
Digital
Solutions
CO
2
FootprintOn site services
& Supply Chain
Circular EconomySupervision
Local for LocalProcess
Consulting
P
l
a
n
e
t
P
e
o
p
l
e
P
e
r
f
o
r
m
a
n
c
e
OUR BUSINESS MODEL CONTINUED
A new interaction
4PRO is a new form of
interaction with our customers
offering innovative solutions
to the contemporary challenges
of industry and society.
RHI Magnesita’s offering extends far
beyond refractory products and basic
services. Our portfolio includes recycled
products, robotics, systems, sensors,
digital solutions, decarbonisation solutions
and green steel solutions.
4PRO recognises the need to take a
holistic approach covering ‘Planet, People,
Partnership and Performance’.
80%
of customers are interested
in the 4PRO offering when
made aware of it
Scan the QR code
to discover 4PRO
Customer service support
11RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR STRATEGIC FRAMEWORK
Our strategic
framework
RHI Magnesita’s
strategic pillars:
• To improve Competitiveness through
cost control, production network
efficiencies, streamlined process
execution, automation and digitalisation.
• To grow revenues and margins by
enhancing our Business model.
• Drive Market leadership through M&A
and organic growth to strategically
increase market share in geographies
and applications where the Group
is underrepresented.
The three pillars of our strategy are
underpinned by a focus on people,
corporate culture and our commitment
to sustainability leadership in the
refractory industry.
Each strategic pillar represents an
opportunity to deliver significant long-term
value for shareholders as a highly
competitive global leader in refractories
with breadth and scale.
The Group’s long-term strategy is aligned
to its purpose of mastering heat to enable
global industries to build sustainable,
modern life. The Board reviews the strategy
annually to dynamically respond to
changing market conditions, industry
developments and stakeholder priorities.
The Board believes that the Group’s
strategy is the optimum route for
delivering long-term value creation for
all stakeholders. More information on how
the Group interacts with its stakeholders
to ensure that strategic priorities are
aligned can be found on page 26.
Competitiveness Business model Markets People and culture Sustainability
Reduce operating costs
Cost-saving initiatives include reducing
SG&A, plant footprint optimisation,
automation and digitalisation, supply
chain management and selected capital
expenditure projects to reduce raw material
and conversion costs.
Expand the business model
We seek to maximise value for our
customers and increase margins through
the offering of a broad range of products
and services, growing the proportion of
revenue derived from solutions contracts
and expanding our recycling activities.
Grow market share in geographies and
products where we are under-represented
The Group aims to grow its share of the
global refractories market via a consolidation
strategy targeting businesses in high-growth
markets or market segments where the
Group is currently underrepresented.
Enablers of our strategy
RHI Magnesita fosters a culture of
innovation, openness, pragmatism and
high performance to support the delivery
of its strategy. Hiring and retaining talented
teams and individuals is essential for the
Group to grow and maintain
its leadership position.
Sustainability leadership
RHI Magnesita seeks to maintain its
leadership position in sustainability in
the refractory industry to gain cost, pricing
and market share advantages over the long
term. We are committed to reducing
emissions from our activities and to assisting
our customers with their own transitions.
Progress
Adjusted EBITA margin increased to 11.7%
(2023: 11.4%) and gross margin improved
to 24.3% (2023: 24.0%), supported
by FX movements.
Decreases in input costs were broadly
offset by lower pricing, whilst SG&A
discipline, improved fixed costs absorption
and strong sales in higher margin
non-ferrous metals and glass projects
supported higher margins.
Progress
The scope of the existing solutions
contract offering was broadened and
relaunched under the brand 4PRO during
2024, to include the full range of the
Group’s capabilities.
Recycling volumes continued to increase,
with 14.2% of raw materials now sourced
from reclaimed material. The acquisition
of Refrattari Trezzi develops the Group’s
European recycling activities.
Progress
The €391 million acquisition of Resco Group
was agreed in April 2024 and completed
in January 2025. Resco’s strengths in the
petrochemical, cement and aluminium
industries are complementary to the Group’s
existing business and will accelerate the
‘local for local’ production strategy,
reducing network costs and shortening
supply chains.
One other acquisition was made in 2024
in the recycling sector, Refrattari Trezzi.
Progress
The highest priority cultural initiative
during 2024 has been to develop the
Group’s health and safety culture in light
of recent incidents. A multi-year initiative
supported by dss+ is underway.
Diversity, equity and inclusion initiatives
undertaken included EmpowHer workshops,
a global mentoring programme for female
staff, a hiring partnership with Female
Factor, unconscious bias training and
focus on gender diversity in the Global
Trainee Programme.
Progress
The Group made strong progress towards
achieving its 2025 sustainability targets
and established new medium-term targets
for 2030.
The 2024 Annual Report contains
the Group’s first CSRD-compliant
sustainability statement.
Priority areas addressed in 2024 were
health and safety, supply chain diligence
and R&D for CO emissions reduction.
Outlook
The Group is targeting structural cost
savings in both raw material and refractory
production in 2025. The ramp up of the
Brumado kiln in Brazil is expected to
result in improved raw material margins.
Refractory margins are intended to be
increased through the realisation of
M&A synergies and possible network
optimisation, which may include site
closures. The Group has also entered into
an outsourcing agreement with Capgemini
expected to result in SG&A savings.
Outlook
Rollout of 4PRO concept is intended to
increase the breadth of customer offering.
Plan flexibility to be increased to react
to changes in demand patterns.
Recycling rate target for 2025 is 15%
and 2030 target has been set at 20%.
M&A (e.g. Resco) will continue to add to
the Group’s capabilities across geographies
and product segments.
Outlook
The near-term priority is to fully integrate
recently acquired businesses and realise
value from synergies.
The Group is likely to prioritise cash
generation and the paying down of net debt
in 2025. However, it maintains an active
M&A pipeline and will remain flexible in
assessing any new opportunities which
may arise.
Outlook
Continued focus on health and safety
performance improvements.
Short-term Board gender diversity is at
target (33%) but senior leadership (EMT-1)
representation is 26% and requires further
action to meet the 2025 target of 33%.
Outlook
The Group is focused on achieving its
2025 sustainability targets, which requires
further progress on recycling, CO emissions
intensity and gender diversity.
Occupational health and safety will remain
the highest priority with ongoing investment
to improve performance.
Read more about this strategic pillar
Pages 14 & 15
Read more about this strategic pillar
Pages 16 & 17
Read more about this strategic pillar
Pages 18 & 19
Read more about this strategic pillar
Pages 20 & 21
Read more about this strategic pillar
Pages 46 & 47
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202412
OUR STRATEGIC FRAMEWORK CONTINUED
Competitiveness Business model Markets People and culture Sustainability
Reduce operating costs
Cost-saving initiatives include reducing
SG&A, plant footprint optimisation,
automation and digitalisation, supply
chain management and selected capital
expenditure projects to reduce raw material
and conversion costs.
Expand the business model
We seek to maximise value for our
customers and increase margins through
the offering of a broad range of products
and services, growing the proportion of
revenue derived from solutions contracts
and expanding our recycling activities.
Grow market share in geographies and
products where we are under-represented
The Group aims to grow its share of the
global refractories market via a consolidation
strategy targeting businesses in high-growth
markets or market segments where the
Group is currently underrepresented.
Enablers of our strategy
RHI Magnesita fosters a culture of
innovation, openness, pragmatism and
high performance to support the delivery
of its strategy. Hiring and retaining talented
teams and individuals is essential for the
Group to grow and maintain
its leadership position.
Sustainability leadership
RHI Magnesita seeks to maintain its
leadership position in sustainability in
the refractory industry to gain cost, pricing
and market share advantages over the long
term. We are committed to reducing
emissions from our activities and to assisting
our customers with their own transitions.
Progress
Adjusted EBITA margin increased to 11.7%
(2023: 11.4%) and gross margin improved
to 24.3% (2023: 24.0%), supported
by FX movements.
Decreases in input costs were broadly
offset by lower pricing, whilst SG&A
discipline, improved fixed costs absorption
and strong sales in higher margin
non-ferrous metals and glass projects
supported higher margins.
Progress
The scope of the existing solutions
contract offering was broadened and
relaunched under the brand 4PRO during
2024, to include the full range of the
Group’s capabilities.
Recycling volumes continued to increase,
with 14.2% of raw materials now sourced
from reclaimed material. The acquisition
of Refrattari Trezzi develops the Group’s
European recycling activities.
Progress
The €391 million acquisition of Resco Group
was agreed in April 2024 and completed
in January 2025. Resco’s strengths in the
petrochemical, cement and aluminium
industries are complementary to the Group’s
existing business and will accelerate the
‘local for local’ production strategy,
reducing network costs and shortening
supply chains.
One other acquisition was made in 2024
in the recycling sector, Refrattari Trezzi.
Progress
The highest priority cultural initiative
during 2024 has been to develop the
Group’s health and safety culture in light
of recent incidents. A multi-year initiative
supported by dss+ is underway.
Diversity, equity and inclusion initiatives
undertaken included EmpowHer workshops,
a global mentoring programme for female
staff, a hiring partnership with Female
Factor, unconscious bias training and
focus on gender diversity in the Global
Trainee Programme.
Progress
The Group made strong progress towards
achieving its 2025 sustainability targets
and established new medium-term targets
for 2030.
The 2024 Annual Report contains
the Group’s first CSRD-compliant
sustainability statement.
Priority areas addressed in 2024 were
health and safety, supply chain diligence
and R&D for CO emissions reduction.
Outlook
The Group is targeting structural cost
savings in both raw material and refractory
production in 2025. The ramp up of the
Brumado kiln in Brazil is expected to
result in improved raw material margins.
Refractory margins are intended to be
increased through the realisation of
M&A synergies and possible network
optimisation, which may include site
closures. The Group has also entered into
an outsourcing agreement with Capgemini
expected to result in SG&A savings.
Outlook
Rollout of 4PRO concept is intended to
increase the breadth of customer offering.
Plan flexibility to be increased to react
to changes in demand patterns.
Recycling rate target for 2025 is 15%
and 2030 target has been set at 20%.
M&A (e.g. Resco) will continue to add to
the Group’s capabilities across geographies
and product segments.
Outlook
The near-term priority is to fully integrate
recently acquired businesses and realise
value from synergies.
The Group is likely to prioritise cash
generation and the paying down of net debt
in 2025. However, it maintains an active
M&A pipeline and will remain flexible in
assessing any new opportunities which
may arise.
Outlook
Continued focus on health and safety
performance improvements.
Short-term Board gender diversity is at
target (33%) but senior leadership (EMT-1)
representation is 26% and requires further
action to meet the 2025 target of 33%.
Outlook
The Group is focused on achieving its
2025 sustainability targets, which requires
further progress on recycling, CO emissions
intensity and gender diversity.
Occupational health and safety will remain
the highest priority with ongoing investment
to improve performance.
Read more about this strategic pillar
Pages 14 & 15
Read more about this strategic pillar
Pages 16 & 17
Read more about this strategic pillar
Pages 18 & 19
Read more about this strategic pillar
Pages 20 & 21
Read more about this strategic pillar
Pages 46 & 47
13RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR STRATEGIC FRAMEWORK CONTINUED
Competitiveness
Reducing the
cost base
We seek to maintain and
improve our cost position
through adapting and
investing in our production
network, managing SG&A,
streamlining process
execution and using
automation and
digitalisation to modernise
manufacturing processes.
Cost efficiency drives margins
and returns
The global refractory market is competitive
with many of the Group’s peers operating
on a ‘cost-plus’ pricing model. RHI Magnesita
offers high-performance products and
value added services, for which our
customers are prepared to pay a premium,
but is still exposed to broader pricing trends
in the market.
To retain market share, our pricing must
therefore reduce if industry input costs
come down, as they did in 2024. Average
pricing per tonne reduced by 7% in 2024
exactly for this reason, but margins still
increased. In this competitive environment,
the best way to expand margins is by
reducing our cost base, without impacting
product quality or customer experience.
If costs can be sustainably reduced and the
benefits of these efficiency gains are retained
within the business by holding pricing
constant, profitability can be sustainably
improved over the medium and long term.
ROIC performance is more sensitive
to improved profit margins than reducing
invested capital. A €14 million improvement
in SG&A (as was delivered in 2024)
delivers an increase in ROIC equivalent
to a reduction of c.€140 million in invested
capital. Cost savings of this magnitude
can be easier to achieve than structural
reductions in capital employed.
How we will maintain and
improve our cost position
Our plants have been operating at
significantly below full capacity for two
years and there is significant operational
gearing opportunity. If refractory demand
recovers and sales volumes can be
increased we stand to benefit as the fixed
cost underabsorption which is currently
weighing on margins will be reduced. We
are deliberately maintaining the flexibility
to increase production into a recovery,
although we are also evaluating whether
it is necessary to retain all of this surplus
capacity as we progress our M&A strategy.
Whilst there are strong potential benefits
from any future recovery in volumes,
we do not rely only on external market
developments and we are continuing to
work on structurally improving our cost
base. The main focus of our efforts in
2024 was the rollout of our Operations
Excellence System (“OES”). OES will bring
uniformity in processes, standards and
parameters to allow comparability,
accurate financial analysis and business
steering, standardised production and
consistent delivery of operational KPIs.
Vertical integration
RHI Magnesita is partially vertically
integrated in the production of magnesite
and dolomite based refractory raw
materials. In 2024, we produced 67% by
volume of the total amount of these raw
materials and 64% by value. Magnesite
and dolomite based raw materials
accounted for 54% by value of all raw
materials consumed by RHI Magnesita in
2024, and 34% of all externally purchased
raw materials. The most important grouping
of raw materials besides magnesite and
dolomite which we purchase externally are
alumina-based materials, which increased
in price significantly in the second half
of 2024.
The Group owns and operates a highly
cost competitive portfolio of magnesite
and dolomite raw material assets, such that
it is consistently able to produce these raw
materials at a lower cost than would be
incurred if we purchased them externally.
We calculate the contribution to Group
Adjusted EBITA margins for the raw
material assets and refractory plants
separately based on the market prices
for the raw materials on the open market.
In 2024, our raw material assets
contributed 0.8% of margin points to the
Group EBITA margin of 11.7%. Whilst this
is a record low for vertical integration
contribution, it is still a positive number and
validates our low cost position. Raw material
prices are at historically low levels and
€14m
SG&A reduction 2023-24
24.3%
Gross margin 2024
(2023: 24.0%)
11.7%
Adjusted EBITA margin 2024
(2023: 11.4%)
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202414
OUR STRATEGIC FRAMEWORK CONTINUED
loss-making marginal producers in China
are coming under pressure to withdraw
supply from the market.
Owning and operating low cost raw
material assets remains part of our
long-term strategy and whilst ROIC from
vertical integration is below the Group’s
cost of capital of 8.2% in 2024 and
therefore not generating an economic
profit, this is the first time that ROIC in raw
materials has been lower than refractory
ROIC in over ten years. We are confident
that this short-term trend can quickly
reverse if demand recovers and raw
material prices increase.
CO emissions
Our production process is CO intensive
and plants located in Europe are required
to purchase CO certificates for all emissions
above our free allocation. The cost of
purchasing the required CO certificates
in 2024 was €6 million (2023: €2 million).
CO costs are expected to increase in the
future as free allocations are withdrawn and
with the transition to CBAM. RHI Magnesita
operates a hedging strategy in regard to
future CO costs to improve cost visibility.
The average price per tonne paid in 2024
was €59.30. The most impactful way
to reduce CO costs is to reduce Scope 1
emissions from our European plants and
we have a number of initiatives underway
to achieve this. We have increased the
use of waste and biofuels in our kilns,
implemented energy efficiency projects
and trialled the use of recycled materials
within raw material plants, displacing
geogenic process emissions.
Shared services outsourcing
RHI Magnesita launched a long-term
strategic partnership in December 2024
which transferred shared services centre
staff in Spain, Mexico, India and China
to Capgemini. Under the terms of the
partnership we expect to generate cost
savings and process efficiencies, as well
as delivering exciting new career
developments for our colleagues who
have transferred to Capgemini. We are
simultaneously redesigning our business
processes and upgrading our digital
architecture and together these initiatives
offer the potential for significant efficiency
gains, resulting in lower costs and improved
customer experience.
Network optimisation
The success of our M&A programme means
that our production and distribution network
is expanding. In the same way as we adapted
the network after the combination of RHI
and Magnesita in 2017 we are reassessing
our production and logistics needs following
acquisitions in 2022 and 2023 and the
addition of Resco in 2025. It is possible that
we will need to make adjustments such as
the closure or downsizing of plants in
regions which are currently net exporters
to improve competitiveness through
local-for-local production, where beneficial.
This may incur restructuring costs in the
short-term in order to realise longer-term
efficiency gains. This year we have taken
the decision to write down €29 million of
expenditure that was previously invested to
increase output in Brazil for export to North
America. We will now seek to increase
domestic US production, following the
acquisition of Resco. We continue to assess
the optimum structure for our plant network
and this is likely to be an ongoing task as
a natural consequence of M&A. This is the
right strategy to pursue in our low growth
market, where scale and cost efficiency
will ultimately determine our success.
“ We are deliberately
maintaining the flexibility
to increase production into
a recovery. Scale and cost
efficiency will ultimately
determine our success.”
Rajah Jayendran
Chief Technology Officer
15RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Business model
Enhancing
the business
model
Key strengths of our business model
RHI Magnesita is a leading global supplier of
high-grade refractory products, systems and
solutions with a vertically integrated value
chain. We are able to offer complete solutions
to our customers due to our broad range of
refractory products, global manufacturing
footprint and expertise in the management
of heat in modern industrial processes.
Our service offering has evolved to include
digital, sustainability and circular economy
focused products and services and was
relaunched in 2024 under the 4PRO brand
to reflect the full range of our capabilities.
Refractories are an essential part of our
customers’ manufacturing processes with the
potential to influence costs and performance
in areas that extend far beyond the refractory
contract. As a large scale, global player we
are able to meet our customers’ critical needs
to maintain a consistent supply of high-
quality refractory products and services,
without which they would not be able to
operate. Reliability and quality control are
essential foundations of our success.
Enhancing our customer offering
We are continually seeking to develop
our business model by:
1. Moving customers up the margin
curve, encouraging the use of higher
value-added products and services;
2. Increasing the proportion of revenue
derived from the 4PRO offering;
3. Increasing the use of recycled raw
materials, which has significant
environmental benefits for all parties
and the potential to support a new
business line in the provision of ‘green’
refractory raw materials;
4. Offering more sustainable or more efficient
refractory products with a lower product
carbon footprint to support our customers
in reducing their Scope 3 emissions;
5. Reducing product complexity;
6. Making supply chain and logistics
planning improvements;
7. Digitalising our customer-facing tools
and seeking to capture data to deliver
process efficiencies; and
8. Funding R&D of new robotics or other
automation technologies with potential
for efficiency and health and safety
improvements.
4PRO
4PRO recognises the need to take a
holistic approach covering ‘Planet, People,
Partnership and Performance’. Our portfolio
now includes recycled products, robotics,
systems, sensors, digital solutions,
decarbonisation solutions and green
steel solutions.
Due to the potential benefits that can
be captured by improving refractory
performance, we are now able to
approach customers with a much higher
level of strategic engagement and not
only as a supplier of commoditised
or consumable items.
Circular economy vision
RHI Magnesita initially invested into
recycling of raw materials as a sustainability
initiative to reduce CO emissions in its own
activities. After proving the technology and
the equivalent performance of products
containing higher levels of recycled raw
materials, the bottleneck for expansion
became the ability to source and sort
residual refractory waste at customer sites.
Through acquisitions of specialist waste
collectors and by entering into partnerships
with customers to improve waste collection
and the sorting process at sites, we have
been able to significantly increase the
tonnage of waste material obtained and
increase the yield of useful material from
waste. The best result for recycling of
refractory waste can be obtained if the
material is sorted immediately when broken
out, protected when stored and shipped
to a recycling facility in as short a time
as possible after breakout. As we have
approached customers to develop these
techniques we have been able to offer
a waste processing solution. This utilises
material which would otherwise be sent
to landfill, with associated costs.
RHI Magnesita supplies
a broad range of refractory
products and services to
its global customer base.
4PRO expands the
refractory solutions we
can offer, reflecting our
broader capabilities.
20%
Market share in refractories
excluding China
25%
Global market share in
cement kiln refractories
OUR STRATEGIC FRAMEWORK CONTINUED
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202416
Our capabilities took a major step forward in
2024 with the launch of the new ‘RAPTOR’
waste sorting unit, This scalable solution
utilises automated sorting technologies
based on laser spectrometry and
hyperspectral imaging cameras to
significantly speed up and improve
accuracy in the waste sourcing process.
RHI Magnesita’s rapidly developing
practices in the effective sourcing of
reusable refractory waste may result in
greater quantities of recycled raw materials
being reclaimed than can be utilised within
the Group’s own network. Surplus material,
with a low or zero carbon footprint, will
then become available for sale to other
refractory producers. Such material is likely
to become significantly more valuable as
carbon costs increase, for example with the
implementation of the EU Carbon Border
Adjustment Mechanism, which will greatly
increase the cost of high CO footprint raw
material sourced from China.
Complexity reduction
RHI Magnesita offers highly customised
products to its customers, with bespoke
specifications developed over many years
of iterative improvement. This leads to
increasing product complexity and a
proliferation of product SKUs over time.
This process is accelerated by M&A, since
with the acquisition of new businesses the
Group acquires new product specifications
which may be similar to existing products
already offered. Complexity can result
in small batch sizes with lower margins
or plant inflexibility if products are
not interchangeable.
The complexity reduction programme
(CoRe) was launched to meet this challenge
and has become increasingly important as
the Group’s M&A activities have increased.
CoRe encourages customers and sales
teams to migrate to a core portfolio of
products where this will not impact
product performance.
Digital transformation
Harnessing the potential future benefits of
artificial intelligence requires foundational
investment today in technology and data
management. RHI Magnesita is investing
approximately €35 million per year over
the period 2024-2026 to modernise its
technology platform, including a global
ERP upgrade and updates to planning and
logistics systems. With fully standardised
and interchangeable data we will be able
to serve our customers in increasingly
sophisticated ways and deliver
improvements to the speed and reliability
of our supply chain and distribution network.
Automation and robotic solutions
Sales of robotic and machinery solutions
grew significantly in 2024, with 18 new
contracts awarded. The Group has been
investing in the development of such
systems for a number of years to deliver
productivity and safety improvements
for customers and to lock-in long-term
refractory supply agreements. RHI
Magnesita will continue to develop
automation solutions to maintain its
leadership position in lining installation
repair and monitoring.
Green steel projects
RHI Magnesita has now secured contracts
for refractory design and supply for five
green steel projects worldwide. Such
contracts represent material new project
revenue and validation of the Group’s
strategy to position itself as the leading
supplier of refractory linings and services
for Direct Reduction, Open Bath, Electric
Arc and Basic Oxygen furnaces, which are
expected to be essential for the large-scale
adoption of green steel production globally.
OUR STRATEGIC FRAMEWORK CONTINUED
17RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Markets
Driving market
leadership
OUR STRATEGIC FRAMEWORK CONTINUED
We see a major opportunity
to generate value through
consolidation of the global
refractory industry,
targeting businesses in
high-growth geographies
or product segments where
the Group is currently
underrepresented.
Growth through consolidation
in a fragmented industry
RHI Magnesita has completed 11 acquisitions
since December 2021 with a total deal value
of €1.2 billion. The Group is continuing
to execute its strategy to grow through
acquisition in the global refractory industry,
which remains fragmented creating the
opportunity to grow in product segments
or geographic markets where the Group
is underrepresented.
Resco
RHI Magnesita agreed to acquire Resco
Group in April 2024 and completed the
transaction on 28 January 2025, for an
enterprise value of €391 million. The
acquisition is a major step forward for the
North America region. Resco’s strengths in
the petrochemical, cement and aluminium
industries are complementary to the Group’s
existing business and will accelerate the
strategy for local production, on-shoring
significant manufacturing activity into the
US, reducing network costs and shortening
supply chains. Resco is the largest acquisition
the Group has undertaken since the
combination of RHI and Magnesita in 2017.
Trezzi
The €5 million acquisition of Refrattari
Trezzi was completed in June 2024,
expanding recycling activities in Europe.
Acquiring recycling specialists enables
RHI Magnesita to source increased
quantities of reclaimed refractory material
to supply its growing recycling business.
Integrating knowledge
Each business we acquire brings talented
new individuals into the Group. We seek
to retain the expertise of teams joining the
RHI Magnesita network and in many cases
to roll out innovative products and business
models on a global scale which may
previously have been limited to specific
product segments or geographies.
Buy, don’t build
The global refractory market has low growth
expectations and the Group’s strategy
is to grow primarily through acquisition
rather than the construction of greenfield
facilities. Investing in new capacity is
unlikely to lead to acceptable financial
returns in a market which is already
adequately supplied. Significant synergies
can be realised through M&A, based on
revenue synergies, procurement and other
cost savings and network efficiencies.
10%
Revenue growth in India,
China and Türkiye
16%
of revenue generated
by flow control
€77m
Adjusted EBITDA contribution
from businesses acquired in 2023
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202418
Industry consolidation opportunity
RHI Magnesita is building on its global leadership position in the refractory industry
Growth in underrepresented geographies
Network or logistics synergies
Flow control growth
Alumina-based refractories (non-basic)
Complementary product offering
Sustainability leadership
Resco Group
Sörmaş
Mireco
Seven
Dalmia GSB
P-D Refractories
Refrattari Trezzi
DBRL
Hi-Tech
Chongqing
Jinan New Emei
USA India ChinaEurope
OUR STRATEGIC FRAMEWORK CONTINUED
“ Our M&A strategy
has gathered momentum
and we are now well
established as the leading
consolidator in the sector.”
Date Consideration
Regional
markets
Product
markets
Chongqing December 21 €5 million China & East Asia Industrial
Mireco March 22 €13 million Europe, CIS, Türkiye Recycling
Sörmaş October 22 €46 million Europe, CIS, Türkiye Industrial, Steel
DBRL January 23 27 million shares
in RHI Magnesita
India Ltd.
India, West Asia &
Africa
Industrial, Steel
Hi-Tech January 23 €86 million India, West Asia &
Africa
Steel Flow Control
Dalmia GSB April 23 €13 million Europe, CIS, Türkiye Steel lances and precast
products
Jinan New Emei May 23 €40 million China & East Asia Steel Flow Control
Seven
Refractories
July 23 €84 million Europe, CIS, Türkiye
and North America
Alumina-based mixes
P-D Refractories October 23 €45 million Europe, CIS, Türkiye Alumina refractories for
Industrial customers
Refrattari Trezzi June 24 €5 million Europe, CIS, Türkiye Recycling
Resco Group January 25 €391 million North America, UK Industrial, Steel
Stefan Borgas
Chief Executive Officer
19RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR STRATEGIC FRAMEWORK CONTINUED
People and culture
Our greatest
strength
The successful
implementation of our
strategy relies on a talented
and incentivised workforce
with a customer-focused
culture.
Our purpose and culture
RHI Magnesita’s culture is built upon our
corporate purpose: to master heat, enabling
global industries to build sustainable
modern life. Delivering for our customers is
at the centre of everything we do, supported
by four values of innovation, openness,
pragmatism and performance.
The EMT dedicates a full day each year
to discuss culture and performance of
senior managers in the Group. The inputs
to this include the outcomes of surveys of
employees across a broad range of topics
such as the transformational ERP project
and outsourcing project, new joiners, H&S
surveys, the detail of compliance reports
and reports of misconduct, integration
surveys, which cover both those in new
assets and in the existing Group footprint,
and external employer rating websites.
Where benchmarks are available, these
help to contextualise the outputs for the
EMT in a more quantitative way.
The headline cultural values remain the
same as in 2019 and with the assistance
of cultural champions in all our regions,
we instill these values upon joining the
RHI Magnesita Group with a dedicated
workshop led by our Culture team, which
welcomes new colleagues and sets them
up for success with a clear briefing on the
values, and engages them to consider what
these values mean in practice and what
inappropriate behaviours in the cultural
framework would look like.
In 2024, the EMT launched a programme
to validate the cultural values and refresh
the Company’s purpose, vision and mission.
As part of this, the EMT considered
themes arising from the feedback on
leadership in the organisation, recognition
of achievements and psychological safety,
which is critical to an open and
transparent culture.
In early 2025, the EMT considered inputs
from over 3,000 colleagues across varying
levels and all regions and resolved to
refresh the values with updated detail and
relaunch the Group’s customer focused
culture in the course of 2025.
Diversity, Equity and Inclusion
RHI Magnesita’s workforce comprises
employees from over 90 countries, bringing
together a rich diversity of experiences,
backgrounds, and perspectives that drive
innovation and resilience within our
business model. This diversity aligns with
our strategic goals, enabling us to adapt to
the dynamic global markets we operate in.
We truly believe it is a strength of our
multi-national company. Leveraging the
diversity we enjoy across our regions brings
different viewpoints, ways of approaching
and solving problems, and generates
learnings about how we can all succeed
together. We are committed to fostering a
culture of lifelong learning and supporting
both personal and professional growth,
ensuring that our employees are equipped
to meet evolving business needs while
contributing to our organisation’s
long-term success.
RHI Magnesita shows its commitment to
diversity in a myriad of ways, including in
our day to day decisions as an EMT and are
supported by the Global Gender Equality
Policy and Diversity Charter which is
endorsed by the most senior managers
in RHI Magnesita. Alongside our Code of
Conduct and other relevant policies and
guiding principles, these statements set
out clearly for our employees, including
contract workers and those who join us
through acquisition, how we expect to
behave with each other. They support our
business with compliance and management
of risks. You can find these policies here.
5.21%
Voluntary employee turnover
(2023: 6.50%)
26%
Gender diversity in leadership
(2023: 28%)
33%
Gender diversity of our Board
(2023: 29%)
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202420
OUR STRATEGIC FRAMEWORK CONTINUED
Simone Oremovic
EVP, People, Projects,
Integrations & Recycling
“ People are our core asset
and securing our people
and culture advantage is
critical to our continued
success. A highly motivated
and engaged team is more
likely to deliver superior
operational outcomes.”
These policies are established to ensure
that our employees are treated equally
in the workplace irrespective of age,
gender, marital or civil partnership status,
pregnancy, maternity, family responsibilities,
political beliefs, colour, nationality and
ethnic or national origins, religion,
disability, sexual orientation, and gender
identity. In this approach we seek to foster
business growth boosts business success,
drive innovation, and elevate our brand
in the competitive marketing landscape.
You can read about the initiatives that the
management have taken to improve our
leadership gender diversity level to try to
meet our 2025 target on page 23. We will
continue to work to support and develop
female talent in our organisation, whilst
recognising the structural and historic factors
which influence our ability to do so.
21RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
KEY PERFORMANCE INDICATORS
Key performance
indicators
The Board and management
have identified the
following KPIs which they
believe reflect the key
indicators of financial and
non-financial performance.
The non-financial information, as presented
within the Director’s Report, which in this
document, comprises the Strategic report
and Governance section of this Annual
Report, complies with the Dutch Disclosure
of Non-Financial Information.
Read more on risk management
Page 48
Safety: LTIF Relative CO emissions
(t CO/t)
Use of secondary
raw materials
Voluntary employee
turnover
Gender diversity
in leadership
2024
2023
2022
2021
2020
0.11
0.16
0.20
0.19
0.13
2024
2023
2022
2021
2020
1.57
1.62
1.71
1.76
1.86
2024
2023
2022
2021
2020
14.2%
12.6%
10.5%
6.8%
5.0%
2024
2023
2022
2021
2020
5.21%
6.50%
6.50%
6.80%
5.10%
2024
2023
2022
2021
2020
26%
28%
21%
22%
25%
Link to strategy Link to strategy
Link to strategy
Link to strategy Link to strategy
KPI relevance
Safety is paramount to the successful
running of our business. Lost Time Injury
Frequency (LTIF) is the main indicator used
to measure safety performance. The Group’s
goal is zero accidents.
KPI relevance
Climate change poses strategic and
operational risks to our business, as well
as opportunities. The Group’s target is
to reduce Scope 1, 2 and 3 (raw materials)
by 15% per tonne of product by 2025
(versus 2018 baseline).
KPI relevance
Recycling plays a critical role in achieving
our 2025 emissions reduction target
while also developing the circularity of
our business. Our target is to reach 15%
secondary raw material (SRM) content
in refractories by 2025.
KPI relevance
Voluntary turnover is one way of
measuring the Group’s success in retaining
its employees.
KPI relevance
Diversity is important in terms of
maintaining our competitiveness and
economic success, and gender diversity
is our first priority. Our target is to increase
female representation in senior leadership
to 33% by 2025.
How it is measured
The number of accidents resulting in
lost time of more than eight hours, per
200,000 working hours, determined
on a monthly basis.
How it is measured
Tonnes of total Scope 1, 2 and 3 (raw
materials) carbon emissions per tonne of
product. Scope 1 emissions consist of onsite
emissions, Scope 2 comprise purchased
electricity, and Scope 3 are measured from
raw materials production.
How it is measured
Share of SRM content as a percentage
of total raw materials.
How it is measured
The percentage of employees who
voluntarily left the Company during the
year and were replaced by new employees.
How it is measured
Number of women as a percentage of all
those in leadership positions (EMT and EMT
direct reports).
2024 performance
LTIF reached 0.11 in 2024, representing
a 31% reduction compared to 2023.
Total Recordable Injury Frequency (TRIF)
decreased to 0.41 from 0.46 in 2023.
Two fatalities occurred in our operations in
2024 - one at the Breitenau plant in Austria
and a second at the Dalian plant in China.
2024 performance
In 2024, total CO emissions (Scope 1, 2
and 3 - raw materials) were 4,4 million
tonnes and our emissions intensity has
reduced by 14%. Since the baseline year
of 2018, the Group has exceeded its initial
targets in recycling, offset by delayed
progress in switching to alternative fuels.
A new target has been adopted to reduce
CO emissions intensity by a further 10%
by 2030, compared to the 2024 baseline.
2024 performance
Use of SRM was at 14.2% in 2024,
compared with 12.6% in 2023. The speed
with which we can continue to increase
overall Group recycling rates from this
point may moderate due to dilution impact
from new acquisitions.
2024 performance
Voluntary turnover decreased in 2024
to 5.2%. The rate remains relatively low,
reflecting uncertainty in the global
economic environment.
2024 performance
Despite our numerous internal and external
initiatives (trainee programme, female
mentoring programme, EmpowHer
programme and others), we continue
to face challenges in attracting female
candidates. This may be due to the nature
of our industry, which is traditionally
male-dominated. While we remain
committed to maintaining 33% female
representation in senior leadership roles,
we recognise that achieving this must be
done sustainably and without compromising
fairness in the selection process.
Non-financial
Link to strategy
Competitiveness
Business model
Markets
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202422
KEY PERFORMANCE INDICATORS CONTINUED
Safety: LTIF Relative CO emissions
(t CO/t)
Use of secondary
raw materials
Voluntary employee
turnover
Gender diversity
in leadership
2024
2023
2022
2021
2020
0.11
0.16
0.20
0.19
0.13
2024
2023
2022
2021
2020
1.57
1.62
1.71
1.76
1.86
2024
2023
2022
2021
2020
14.2%
12.6%
10.5%
6.8%
5.0%
2024
2023
2022
2021
2020
5.21%
6.50%
6.50%
6.80%
5.10%
2024
2023
2022
2021
2020
26%
28%
21%
22%
25%
Link to strategy Link to strategy
Link to strategy
Link to strategy Link to strategy
KPI relevance
Safety is paramount to the successful
running of our business. Lost Time Injury
Frequency (LTIF) is the main indicator used
to measure safety performance. The Group’s
goal is zero accidents.
KPI relevance
Climate change poses strategic and
operational risks to our business, as well
as opportunities. The Group’s target is
to reduce Scope 1, 2 and 3 (raw materials)
by 15% per tonne of product by 2025
(versus 2018 baseline).
KPI relevance
Recycling plays a critical role in achieving
our 2025 emissions reduction target
while also developing the circularity of
our business. Our target is to reach 15%
secondary raw material (SRM) content
in refractories by 2025.
KPI relevance
Voluntary turnover is one way of
measuring the Group’s success in retaining
its employees.
KPI relevance
Diversity is important in terms of
maintaining our competitiveness and
economic success, and gender diversity
is our first priority. Our target is to increase
female representation in senior leadership
to 33% by 2025.
How it is measured
The number of accidents resulting in
lost time of more than eight hours, per
200,000 working hours, determined
on a monthly basis.
How it is measured
Tonnes of total Scope 1, 2 and 3 (raw
materials) carbon emissions per tonne of
product. Scope 1 emissions consist of onsite
emissions, Scope 2 comprise purchased
electricity, and Scope 3 are measured from
raw materials production.
How it is measured
Share of SRM content as a percentage
of total raw materials.
How it is measured
The percentage of employees who
voluntarily left the Company during the
year and were replaced by new employees.
How it is measured
Number of women as a percentage of all
those in leadership positions (EMT and EMT
direct reports).
2024 performance
LTIF reached 0.11 in 2024, representing
a 31% reduction compared to 2023.
Total Recordable Injury Frequency (TRIF)
decreased to 0.41 from 0.46 in 2023.
Two fatalities occurred in our operations in
2024 - one at the Breitenau plant in Austria
and a second at the Dalian plant in China.
2024 performance
In 2024, total CO emissions (Scope 1, 2
and 3 - raw materials) were 4,4 million
tonnes and our emissions intensity has
reduced by 14%. Since the baseline year
of 2018, the Group has exceeded its initial
targets in recycling, offset by delayed
progress in switching to alternative fuels.
A new target has been adopted to reduce
CO emissions intensity by a further 10%
by 2030, compared to the 2024 baseline.
2024 performance
Use of SRM was at 14.2% in 2024,
compared with 12.6% in 2023. The speed
with which we can continue to increase
overall Group recycling rates from this
point may moderate due to dilution impact
from new acquisitions.
2024 performance
Voluntary turnover decreased in 2024
to 5.2%. The rate remains relatively low,
reflecting uncertainty in the global
economic environment.
2024 performance
Despite our numerous internal and external
initiatives (trainee programme, female
mentoring programme, EmpowHer
programme and others), we continue
to face challenges in attracting female
candidates. This may be due to the nature
of our industry, which is traditionally
male-dominated. While we remain
committed to maintaining 33% female
representation in senior leadership roles,
we recognise that achieving this must be
done sustainably and without compromising
fairness in the selection process.
Non-financial
Link to strategy
Competitiveness
Business model
Markets
23RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
KEY PERFORMANCE INDICATORS CONTINUED
Revenue Adjusted EBITA margin Adjusted EPS Leverage ROIC R&D and Technical
Marketing spend
2024
2023
2022
2021
2020
€3,487m
€3,572m
€3,317m
€2,551m
€2,259m
2024
2023
2022
2021
2020
11.7%
11.4%
11.6%
11.0%
11.5%
2024
2023
2022
2021
2020
€5.32
€4.98
€4.82
€4.52
€3.28
2024
2023
2022
2021
2020
2.3x
2.3x
2.3x
2.6x
1.5x
2024
2023
2022
2021
2020
9.8%
10.7%
12.3%
10.8%
10.5%
2024
2023
2022
2021
2020
€83m
€83m
€79m
€63m
€62m
Link to strategy Link to strategy
Link to strategy
Link to strategy
Link to strategy
Link to strategy
KPI relevance
This demonstrates the growth of
the business. By increasing our global
refractory market share, continually
enhancing our product and service
offering, the Company is focused on
achieving revenue growth and aims
to outperform the refractories market
on an annual basis.
KPI relevance
Adjusted EBITA margin provides a measure of
profitability and demonstrates the successful
execution of the Company’s strategy.
KPI relevance
Reflecting the income statement in a clear
way and taking the equity structure into
account, the Board believes Adjusted EPS
to be one of the indicators that demonstrates
shareholder value.
KPI relevance
Appropriate leverage provides the business
with headroom for compelling investment
opportunities, but also enables shareholder
distribution.
The Board has defined a long-term
leverage target range of 1.0 to 2.0x
(c.2.5x for M&A).
KPI relevance
Return on invested capital (“ROIC”) is
used to assess the Group’s efficiency in
executing its capital allocation strategy,
which is aimed at enabling organic growth,
disciplined M&A and shareholder returns.
KPI relevance
Excellence in R&D and strong technical
marketing capabilities are key contributors
to our competitiveness. This demonstrates
our commitment to driving innovation and
to being the leading provider of services
and solutions within the refractories
industries. The Company aims to invest at
least 2.2% of revenue per annum in R&D
and technical marketing.
How it is measured
Total Group revenue, as reported in the
financial statements.
How it is measured
Adjusted EBITA divided by revenue,
as reported in the financial statements.
Adjusted EBITA is an APM and more
information can be found on page 325.
How it is measured
Earnings per share, excluding other
financial income and expenses.
Adjusted EPS is an APM and more
information can be found on page 325.
How it is measured
Net debt to Pro Forma Adjusted EBITDA.
Leverage is Net debt divided by Pro Forma
Adjusted EBITDA which are APMs. More
information can be found on page 325
and 326.
How it is measured
Calculated as net operating profit after tax,
divided by average invested capital for the
year. ROIC is an APM and more information
can be found on page 326.
How it is measured
Annual spend on research and
development, before subsidies and
including opex and capex.
2024 performance
Revenue for 2024 amounted to
€3,487 million, 2% lower than 2023,
mostly due to a weak market environment.
2024 performance
The Group recorded an EBITA margin of
11.7% in 2024, and 30bps higher than 2023.
This was due to stringent cost management.
2024 performance
Adjusted EPS of €5.32 per share was
higher than the €4.98 per share recorded
at 2023 largely given the substantial
FX tailwind.
2024 performance
Leverage remained flat at 2.3x at the end
of 2024.
2024 performance
ROIC decreased in 2024 to 9.8%,
mostly driven by an increase in average
invested capital.
2024 performance
€83 million was committed to R&D and
technical marketing in 2024, equating to
2.4% of revenues, exceeding the Group’s
annual commitment of 2.2%.
Financial
Link to strategy
Competitiveness
Business model
Markets
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202424
KEY PERFORMANCE INDICATORS CONTINUED
Revenue Adjusted EBITA margin Adjusted EPS Leverage ROIC R&D and Technical
Marketing spend
2024
2023
2022
2021
2020
€3,487m
€3,572m
€3,317m
€2,551m
€2,259m
2024
2023
2022
2021
2020
11.7%
11.4%
11.6%
11.0%
11.5%
2024
2023
2022
2021
2020
€5.32
€4.98
€4.82
€4.52
€3.28
2024
2023
2022
2021
2020
2.3x
2.3x
2.3x
2.6x
1.5x
2024
2023
2022
2021
2020
9.8%
10.7%
12.3%
10.8%
10.5%
2024
2023
2022
2021
2020
€83m
€83m
€79m
€63m
€62m
Link to strategy Link to strategy
Link to strategy
Link to strategy
Link to strategy
Link to strategy
KPI relevance
This demonstrates the growth of
the business. By increasing our global
refractory market share, continually
enhancing our product and service
offering, the Company is focused on
achieving revenue growth and aims
to outperform the refractories market
on an annual basis.
KPI relevance
Adjusted EBITA margin provides a measure of
profitability and demonstrates the successful
execution of the Company’s strategy.
KPI relevance
Reflecting the income statement in a clear
way and taking the equity structure into
account, the Board believes Adjusted EPS
to be one of the indicators that demonstrates
shareholder value.
KPI relevance
Appropriate leverage provides the business
with headroom for compelling investment
opportunities, but also enables shareholder
distribution.
The Board has defined a long-term
leverage target range of 1.0 to 2.0x
(c.2.5x for M&A).
KPI relevance
Return on invested capital (“ROIC”) is
used to assess the Group’s efficiency in
executing its capital allocation strategy,
which is aimed at enabling organic growth,
disciplined M&A and shareholder returns.
KPI relevance
Excellence in R&D and strong technical
marketing capabilities are key contributors
to our competitiveness. This demonstrates
our commitment to driving innovation and
to being the leading provider of services
and solutions within the refractories
industries. The Company aims to invest at
least 2.2% of revenue per annum in R&D
and technical marketing.
How it is measured
Total Group revenue, as reported in the
financial statements.
How it is measured
Adjusted EBITA divided by revenue,
as reported in the financial statements.
Adjusted EBITA is an APM and more
information can be found on page 325.
How it is measured
Earnings per share, excluding other
financial income and expenses.
Adjusted EPS is an APM and more
information can be found on page 325.
How it is measured
Net debt to Pro Forma Adjusted EBITDA.
Leverage is Net debt divided by Pro Forma
Adjusted EBITDA which are APMs. More
information can be found on page 325
and 326.
How it is measured
Calculated as net operating profit after tax,
divided by average invested capital for the
year. ROIC is an APM and more information
can be found on page 326.
How it is measured
Annual spend on research and
development, before subsidies and
including opex and capex.
2024 performance
Revenue for 2024 amounted to
€3,487 million, 2% lower than 2023,
mostly due to a weak market environment.
2024 performance
The Group recorded an EBITA margin of
11.7% in 2024, and 30bps higher than 2023.
This was due to stringent cost management.
2024 performance
Adjusted EPS of €5.32 per share was
higher than the €4.98 per share recorded
at 2023 largely given the substantial
FX tailwind.
2024 performance
Leverage remained flat at 2.3x at the end
of 2024.
2024 performance
ROIC decreased in 2024 to 9.8%,
mostly driven by an increase in average
invested capital.
2024 performance
€83 million was committed to R&D and
technical marketing in 2024, equating to
2.4% of revenues, exceeding the Group’s
annual commitment of 2.2%.
Financial
Link to strategy
Competitiveness
Business model
Markets
25RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR STAKEHOLDERS
Engaging for
mutual success
RHI Magnesita cannot operate in a vacuum. We can
only succeed if we conduct ourselves responsibly and
have positive relationships with our stakeholders.
Shareholders
Why they are important
As providers of capital and owners of the
business, our shareholders play a central
role in the Company’s growth and
development. By fostering and maintaining
their support, we are able to implement our
strategy and objectives.
How the Company engages
The Company is listed on the London
and Vienna Stock Exchanges, with London
as its primary listing location.
The Company issues consistent, fair,
balanced and understandable information to
these stock exchanges to ensure efficient and
fair functioning of financial markets. Care
is taken to ensure messaging is consistent
and publications are compliant with the EU
and UK Market Abuse Regime, UK Listing
Rules, Austrian Stock Exchange Act, and
Corporate Governance Codes and guidance.
The Investor Relations department
maintains an ongoing dialogue with
shareholders and analysts which is fed
back to senior management.
Regular engagement is facilitated via
one-on-one meetings, investor presentations
and webcasts, the AGM, industry
conferences and events and site visits.
How the Board engages
The Executive Directors meet regularly
with investors and analysts (both in person
and via digital channels). On request,
the SID and Deputy Chair meets with
shareholders to discuss governance
matters. In 2024 this covered the Board’s
oversight of strategy and risk, Board skills,
diversity and composition, and
sustainability metrics.
The Investor Relations team regularly
provides analyst coverage of the market
and shareholder sentiment to the Board.
This includes shareholder commentary,
and comparison of the Company’s
performance against its peers. The
Company’s brokers also provide valuable
and pertinent perspectives from their wider
experience base, which gives context to
the Board for regulatory news publications.
The Chair and SID and Deputy Chair also
engaged with larger shareholders to hear
about their priorities and answer questions
around both tactical and strategic delivery.
As part of the process to consult on the
Remuneration Policy in 2024, the Chair
of the Remuneration Committee engaged
with shareholders holding over 80% of
the rights in the Company on the proposed
policy adopted at the 2024 AGM,
The changes in late 2024 in remuneration
principles and guidelines from various
proxy agencies representing the investment
community, were briefed to the
Remuneration Committee.
The Board benefits from long-term
shareholder representative Directors,
who share their perspective and priorities
to guide management and reflect the
shareholder experience, whilst also taking
care to recognise minority shareholder
interests and priorities.
Priority topics raised by stakeholders
• Company strategy and implementation,
particularly regarding M&A and capital
allocation.
• Operational and financial performance
including cash generation, sales volumes,
pricing considering raw material costs,
and trading outlook.
• Geopolitical outlook and associated
changes to global economic factors.
• Sustainability agenda and activities,
such as contract wins in green steel,
sustainability targets.
• Climate strategy and associated
capex investment.
• Incentives linked to reduction of CO
emissions and other ESG matters.
• Company’s preparedness to comply
with CSRD.
• Board composition including gender
diversity and the skills and experience
represented.
Outcomes
Shareholder perspectives were
fundamental considerations in Board
discussions on a wide range of topics,
including the implementation of
remuneration policy, accounting
judgements, capital allocation decisions,
gearing and leverage, and ESG strategy.
Feedback about the Group’s acquisition
strategy from shareholders informs the
strategy and planning for the future in
terms of liquidity and business capacity.
A number of acquisitions have been
made since 2022 and the priorities of
shareholders will continue to be a driving
factor in the future acquisition approach.
Two dividends, final and interim, were paid
in 2024, in line with the dividend policy
and shareholder expectations.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202426
OUR STAKEHOLDERS CONTINUED
Debt holders and lenders
Why they are important
Our lenders and debt holders are an
important source of the financial liquidity
that the Group requires to operate. They
are integral to the long-term sustainable
success and growth initiatives of the business.
How the Company engages
The Group CFO and Group Treasurer
execute strategies approved by the Board
by regularly engaging with debt holders
and lenders to secure favourable terms,
mitigate risks, and ensure sustainable
and solid relationships.
Regular engagement with these
stakeholders is facilitated via one-on-one
and Group meetings and presentations.
How the Board engages
The Treasury department maintains an
ongoing, transparent dialogue with its debt
holders and lenders, and reports regularly
to the Audit & Compliance Committee
and Board.
The Board has a clearly defined approval
and delegation of authorities matrix for
the contracting of debt instruments,
and actively contributes and engages
in discussions with the Group CFO and
Group Treasurer.
Priority topics raised by stakeholders
• Company strategy and implementation.
• Operational and financial performance
and outlook.
• Capital structure and liquidity.
• Sustainability initiatives.
• Risk management.
Outcomes
In 2024, the Group successfully raised
a €200 million syndicated term loan with
a tenor of five years. Loan proceeds have
been used to acquire Resco Group in early
2025. Furthermore, the Group prepaid
€100 million from a €150 million bilateral
term loan, which matures in April 2026,
to optimise the Group’s capital structure
and reduce excess cash.
As a result of the Group’s strong EcoVadis
ESG rating upgrade in June 2024, with
an improvement by four points to 76, the
margin payable on the Group’s ESG-linked
financings amounting to €1,983 million
(including the fully undrawn €600 million
revolving credit facility) per December
2024 was reduced by 3bps, leading
to €0.5 million savings in interest cost
on an annualised basis.
Customers and
innovation partners
Why they are important
Our customers are at the heart of our
business model and fundamental to the
sustainable future of the Group.
We collaborate across the refractory
industry, and more broadly, with external
partners such as accelerators, start-ups,
open innovation platforms, companies and
institutions to foster innovation and drive
developments in R&D.
How the Company engages
The Company connects with partners from
the private and public sector, innovators
and academia to exchange ideas and more
concretely, tackle challenges through
problem-solving approaches. Our R&D
teams, amongst others, collaborate and
engage with innovation partners on an
ongoing basis. Annually, the Company
hosts a technical advisory committee
attended by external parties to bring
together advanced perspectives from
industry, academia, and startups to
consider a variety of topics such as Artificial
Intelligence in R&D, Refractory Recycling,
and use of Hydrogen.
Our specialists are invited to present at expert
symposiums and technical conferences,
typically focusing on sustainability
innovations and refractory technology.
The business is well represented at trade
fairs across different industries, such as
steel and cement, and geographies across
the world.
We work closely with our customers to
ensure we are aware of their needs through
day-to-day contact fact-finding, technical
consulting, installation and operations
supervision and site visits.
The Company runs Customer Satisfaction
surveys to regularly assess our Net
Promoter Score. It is used as a key metric
for customer-facing teams, to ensure focus
on providing a positive customer experience
in every interaction.
How the Board engages
Customers continue to be at the heart
of the Company’s values and culture, and
as such form a central part of every Board
decision. Directors meet customers
wherever possible and as part of the Board
site visit in April, the Board was delighted to
have the chance to visit Tata Steel’s plant in
Jamshedpur, India, and see first-hand how
RHI Magnesita works side by side to support
and deliver successful outcomes. A session
with the management of Tata Steel enabled
Directors to hear their priorities and to
discuss best practice H&S procedures
adhered to by Tata Steel, as well as wider
economic factors and developments.
The Executive Directors meet regularly
with customers to discuss joint strategies,
at industry congresses, seminars and
webinars, and at technology events
and fairs.
The CSC hears from senior management
on their work with innovation partners
on the development of the Company’s
sustainability strategy, and feedback
to the Board.
27RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Priority topics raised by stakeholders
• Price increases in response to widespread
inflationary costs and low demand in
some regions.
• Service levels and lead times.
• Response to climate change and
opportunities in green transformation.
• Health & Safety.
Outcomes
Increased investment in production sites to
strengthen supply and quality of products
for customers and restructured teams and
processes to deliver better customer
service. The Group’s Net Promoter Score
continued to reach new highs in 2024,
showing the benefits of focus on areas such
as customer service delivery performance
and technical support.
Management’s work to improve operational
processes and to partner with logistics
providers who can support flexible and
cost-efficient solutions is resulting in
improved customer outcomes.
The ongoing Safety Culture Transformation
covers our own employees at customers’
sites as well as at our own plants,
laboratories and offices.
The Group’s regional structure continues
to deliver strong customer experience
through direct engagement and alignment
between local teams.
Reports from customer relationship teams
informed the Board’s strategic decisions
to develop the service offering and product
portfolios available to them, particularly with
regard to sustainable products and location
of supply. The Group is increasingly the
partner of choice in the green transition
of steel and cement in Europe.
The esteemed scientific trade journal,
Bulletin, published by RHI Magnesita,
shares the latest research on refractory
innovations as well as showcasing the
successful delivery of innovation through
the implementation of new products,
technologies and services at our
customers’ sites. Bulletin is available on the
Company website and demonstrates the
Company’s continued development and
coordination with innovation partners.
Partnerships were established with MCi
Carbon and Compact Membrane Systems
to embark on pilot schemes to develop
technology to eventually bring benefits
in carbon capture and utilisation (CCU).
Other co-operation includes initiatives
with ResourceFull, a recycling company
for waste materials, and ReSoURCE, an EU
initiative creating partnerships to develop
and fund refractory recycling equipment.
Communities
Why they are important
Wherever we operate, our business
depends on maintaining the trust of local
communities. In return for this social licence
to operate, we must conduct our business
ethically and responsibly. We must also strive
towards sustainability, not only in our own
operations but also to support socioeconomic
development and environmental protection.
How the Company engages
As a member of the UN Global Compact,
we support the UN SDGs and implement the
Global Compact principles (anti-corruption,
human rights, labour rights and environment).
These commitments drive our engagement
with policymakers, non-governmental
organisations (NGOs), and others at
a national and international level.
At a local level, each operation engages with
local communities and other stakeholders
to understand their concerns and how we
can support them.
In 2024, we specifically focused on
education and youth development, health
and medical care, and environment across
the communities in which we operate.
These three community investment pillars
align with a number of the UN SDGs,
How the Board engages
The CSC considered, and reported back
to the Board, on community engagement,
including charitable fundraising for local
communities and received updates from
management on projects in communities
in India and Brazil.
The CSC gave feedback on where Directors
felt focus should be directed and noted the
relevant legal requirements.
Priority topics raised by stakeholders
• Health and wellbeing.
• Climate change.
• Education, youth development and
employment programmes.
Outcomes
The employee volunteering programme,
established in 2022, continued in 2024
through which we are partnering with
six non-profit organisations.
We once again increased our spend on
community programmes in 2024 across our
regions, resulting in construction of libraries,
building up the skills and knowledge of
children from challenging backgrounds,
and facilitating primary healthcare and
assistance for disabled individuals in the
communities we operate in.
We made further progress on our
decarbonisation plan to help improve the
world we live in for future generations and
were pleased to see an increase in our use
of SRM to 14.2% in 2024.
RHI Magnesita was the sponsor of
the St Gallen MBA Challenge, in which
young minds considered how to build
a Circular Raw Material Business model
in different regions helping to develop
the next generation and build a more
sustainable future.
Employees
Why they are important
Attracting, retaining and developing talent
is central to the success of the Company.
Our people are crucial in the delivery of
our strategic goals. We aim to cultivate
an engaged, innovative and collaborative
workforce, with a strong focus on diversity.
OUR STAKEHOLDERS CONTINUED
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202428
How the Company engages
Communication channels include townhall
meetings, conferences for different functions
and seniority levels, and our corporate
communications mobile application
(Workvivo) which allows colleagues from
all levels and locations to be connected
and to hear consistently from senior leaders,
as well as express themselves, and highlight
their own concerns and achievements.
Colleagues throughout the Company,
who are designated as Culture Champions,
engage with the workforce on an ongoing
basis to embed our culture and values.
Regional leadership teams hold townhalls
to address regional specific issues,
e.g., local supply chain issues, employee
health and wellbeing, and site changes.
How the Board engages
Three ERDs sit on the Board, feeding
in on a range of workforce issues such as
remuneration, feedback on executives, the
operational footprint, and Health & Safety.
The Board meets with plant employees
and management, as well as holding direct
conversations with senior management on
detailed topics outside of Board meetings.
They also had a dedicated session with
trainees in late 2024 to gain more of an
understanding of the priorities of the next
generation. More details can be found
on page 216.
Local and global townhalls and Q&A
sessions are run both virtually and in person,
at both regular intervals and when there
are specific communications to be delivered,
such as the full and half year financial
results. On the Board’s visit to the Bhiwadi,
Jameshedpur and Rajgangpur plants,
as well as the regional headquarters,
all Directors attended the townhalls, sitting
amongst local employees, and the Chair of
the Board addressed colleagues, alongside
the CEO and Regional President. In one
plant, re-emphasising the tone from the
top on safety, the Chair of the CSC also
addressed those working in the plant,
reiterating her expectations about safe
working practices.
The CSC considers employee safety KPIs
at each meeting, including a root cause
analysis of any major accidents. The Board
also receives a report of Health & Safety
statistics from the CEO at each meeting.
The CSC, as well as the broader Board,
focused on the fatalities, lessons learned,
as well as receiving briefings on the
business’s response and the support
for affected colleagues at the plants.
Guidance and encouragement were given
by Board members to improve processes
and approach based in their own
experiences elsewhere.
Board Directors participated in the
mentoring programme for female talents,
sharing their own experiences as women in
the workplace, and supported the delivery
of the scheme through advising other
mentors in the Company on how to
establish a good mentoring relationship.
Priority topics raised by stakeholders
• Operational performance improvement
programmes including process and
controls improvement.
• Health & Safety and cultural changes
to foster greater transparency to build
safer working environments.
• Business restructuring and job security,
within the wider macroeconomic
backdrop (specific to certain regions).
• Regional investment and the impact
of new assets and additional colleagues.
• Responding to green steel
transformation and delivering
environment related solutions.
• Salary/wage growth.
• Recruitment, talent development
and retention.
• Work/life balance.
• Leadership behaviours and
communication, e.g., cultural role
modelling and leading by example.
• Change resilience, psychological safety,
and employee wellbeing.
Outcomes
The Company initiated a full-scale review
of safety in the organisation, supported by
dss+, a leading safety consultancy. This
involved detailed surveys and engagement
with colleagues from the shop floor through
to management to understand perceptions
and prioritisation of safety worldwide across
our regions. The Board and management
received oversight of the detailed responses
which informed the action plan.
Several initiatives and events were
implemented to strengthen our Diversity,
Equity and Inclusion (“DEI”) efforts:
• ‘EmpowHer’ workshops,
• a partnership with Female Factor
to improve hiring practices for
minority groups
• the Global Female Mentoring
Programme to promote professional
development through mentoring
of c.50 female talents; and
• a Global Trainee Programme, across all
five regions and varying functions, which
delivers gender diversity, cross-cultural
collaboration, and inclusion of new
generations. In 2024, we received
5,000 applications for this programme,
Additionally, we held quarterly global
webinars on unconscious bias training
for all employees. Over 1,000 employees
joined the global DEI seminars in 2024.
Our global Employee Engagement
team implements digital tools to develop
management skills and the Company
culture, which should lead to improved
retention.
A new regional office has been established
in Gurugram, India, as well as other recently
commissioned regional headquarters
in Tampa, USA and Contagem, Brazil.
These upgraded working environments
show investment in the local operations,
providing employees with a better
workplace environment.
Workvivo provides tips and
recommendations for health and
wellbeing, and hosts sessions to boost
wellbeing and improve work/life balance.
In certain locations there are employee
assistance programmes providing free
therapy, counselling and coaching sessions
to support colleagues.
Overall average remuneration increased,
taking into account inflation, and collective
and union agreements. A strata approach
to pay increases was taken to support lower
paid employees and in various locations
there have been detailed discussions
between trade unions and works councils
and management in a structured and
transparent manner to deliver a fair
outcome for employees.
OUR STAKEHOLDERS CONTINUED
29RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Post-acquisition, there is a consistent
and agreed process to integrate new assets
as quickly as possible which is led by the
regions together with the global
department, in order to support and retain
employees following completion of M&A
transactions. The global function ensures
consistency of approach and delivers a
coordinated and comprehensive overview
to the executive management and senior
leaders, whilst ensuring the new assets
are supported effectively by the corporate
functions, seeking regular feedback as part
of the process. The focus on retention
delivers combined leadership to leverage
synergies of best practice to set the new
structure up for success across a wide
range of metrics. The lead of integrations
by the regional teams enables a tailored
and detailed integration designed to
be sustainable and effective.
Governments
and authorities
Why they are important
Governments and authorities set the
regulatory framework within which we
operate. They also set out national and
international strategies wherein
RHI Magnesita plays a part. There is vital
interplay between industry and political
stakeholders and this relationship is the
linchpin that propels us towards a cleaner,
more sustainable future.
How the Company engages
We engage on multiple levels with
authorities in our regions. We list a few
examples from 2024 here.
Relationships with EU institutions were
strengthened through various initiatives
and personal meetings. In March, former
Energy Commissioner Kadri Simson visited
the CCU pilot plant of MCi Carbon in
Australia to investigate CCU for the
European refractory industry.
Director General Kerstin Jorna of the
EU Commission’s Directorate-General for
Internal Market, Industry, Entrepreneurship
and SMEs visited our mine in Breitenau
in May 2024. This visit was particularly
important for us in highlighting the
significance of magnesite/magnesia,
as we aim to have it listed as a ‘strategic’ raw
material in the EU.
Furthermore, in December, RHI Magnesita
hosted its first of a kind ‘Magnesia Cocktail’
networking event in Brussels, uniting the
European magnesite and magnesia
industries to advocate for the strategic
importance of magnesite and magnesia
for the European industry.
Key discussions were held with government
and party representatives from China and
East Asia on different topics such as raw
materials, mining, R&D investments, and
green energy.
In India we have ongoing dialogue with key
government agencies such as Invest India,
the nodal investment facilitation agency
of the Government of India, and Industrial
Promotion & Investment Corporation of
Odisha. In July, the Group was represented
at a high-level business meeting with
Indian Prime Minister Narendra Modi in
Vienna. This meeting provided a crucial
platform to present RHI Magnesita’s raw
material strategy and led to valuable
connections with senior officials in Prime
Minister Modi’s cabinet.
In South America, our advocacy efforts
focused on maintaining and improving
infrastructure, notably rail transport.
The Company engages promptly and
transparently as required with regulators
and governance bodies across the world,
including anti-trust authorities, SEBI (India),
AFM and SER (the Netherlands), FMA
(Austria) and the FCA and FRC (UK).
We are part of a number of industry
associations, such as the World Refractories
Association, which help us to communicate
our viewpoints as part of a wider industry
to global authorities.
How the Board engages
The Board considers responses to
authorities and encourages management
to research and consider the consultations
which are issued.
The Board receives briefings on changes
in legislation and the extent of their impact
on the Company, such as the changes to
the UK Listing Rules in 2024. The CSC also
considers changes in regulation within its
scope, such as the recent German Supply
Chain Due Diligence Act.
The Board sets an averse risk appetite
in respect of non-compliance with
regulations (see page 49), establishing
how the Directors expects the organisation
to engage with authorities and regulations.
The Board approves the Code of Conduct
which has a zero-tolerance approach to
any illegality.
Priority topics raised by stakeholders
• Raw Materials.
• Infrastructure.
• Alternative energies, sustainability,
climate change, and decarbonisation.
• Company preparedness to report
against EU’s Corporate Sustainability
reporting directive.
Outcomes
The Board endorsed management’s
approach to public affairs and political
engagement, and guided attention to the
new assets, asking management to ensure
Group standards were implemented
and maintained.
The Company has provided information
on request to governments and agencies,
actively engaging in open dialogue.
By actively engaging in regional
discussions and initiatives with political
bodies and governmental agencies, we
address unique challenges and contribute
to environmentally responsible industrial
practices on a global scale. Transparent
communication and open information
sharing progresses our goal of securing
a sustainable infrastructure for a clean
and efficient industry to secure refractory
production in Europe. In India the Group
has communicated its dedication to
aligning business objectives with national
policies and has leveraged opportunities
to show the important role the Company
plays in a fast-growing economy.
OUR STAKEHOLDERS CONTINUED
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202430
Suppliers
Why they are important
Strong relationships with our suppliers
are vital to ensure our end-to-end supply
chain. We rely on our suppliers to deliver
services and materials, and we recognise
that the availability of these goods impacts
how we execute our services to customers.
We are embracing strategic alliances and
long-term partnerships mainly for raw
materials and logistics.
How the Company engages
All suppliers are requested to confirm the
Supplier Code of Conduct. Our Sustainable
Supply Chain & Procurement Guideline
and Supplier On-Site Assessment
Guidelines are implemented consistently
across our operations.
The Company evaluates its suppliers
through a sustainability risk matrix that
assesses suppliers according to country
risk and a goal-based framework to
evaluate the majority of RHI Magnesita’s
purchase spend by supplier under its
sustainability criteria.
On-site assessments are undertaken
at suppliers to ensure compliance with
our standards. In higher-risk areas expert
external parties undertake these
assessments on behalf of the Company.
Internal on-site supplier assessments have
been completed across all five of the
Group’s regions.
The Company has focused on building
longer-term partnerships with certain
strategic suppliers to establish more stable
and reliable supply chains.
The Company operates fair payment terms
for suppliers, whilst leveraging benefits for
its own financial health.
How the Board engages
The CSC received reports from
management on supplier on-site
assessments and engagement, and
considered progress on the Company’s
sustainable procurement initiatives.
The Board receives regular updates
on the business’s work to future-proof our
supply chain and the work undertaken to
adapt our processes to an increasingly
volatile environment.
In 2024, the Board considered and
approved the Modern Slavery Act
Statement for publication. The statement
can be found on the Company’s website.
Priority topics raised by stakeholders
• Inventory levels.
• Supply chain resiliency & black swan
event playbook.
• Climate action.
• Safety.
• Raw material pricing and rising risk
of trade restrictions.
• Sustainable procurement.
Outcomes
The efforts to improve tactical and strategic
supply chain management continued in
2024 and the next steps will be to upgrade
the systems and tools for use in the teams’
work driving efficiencies and improving
supplier and employee experience.
The Group engaged in a partnership
with o9 Solutions to deliver an advanced
end-to-end integrated standard supply
chain planning tool that will enable us
to optimise our supply chain processes.
In Europe we initiated a new railway line
and eTruck solutions in partnership with
MSC Mediterranean Shipping Company
to further ensure the supply of refractory
products to international customers
quickly, reliably and sustainably.
Furthermore, the global roll-out of our
Oracle Transportation Management system
for finished goods ocean freight in 2024
increases our visibility and enhances the
ease of doing business. This journey will be
continued in 2025 focusing on land freight
and raw material shipments.
Greater numbers of suppliers are signed
up to the Supplier Code of Conduct and are
increasingly more aware of the Company’s
expectations on product carbon footprint
data and about the on-site assessment
process. This has led to greater adoption
across associated industries and, it is
hoped, will have driven improvements
in ESG matters.
The insights from on-site assessments in
2024 have led to improvements in quality,
transparency and supplier relationships.
Tools used to increase supply chain
transparency have identified labour
practices which were not aligned with
RHI Magnesita’s Code of Conduct and
relationships were suspended and then
discontinued with the relevant supplier.
OUR STAKEHOLDERS CONTINUED
31RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OPERATIONAL REVIEW
We think global
and act local
RHI Magnesita owns and
operates a global network
of 65 refractory production
sites and is capable of
supplying a full range
of high-quality refractory
products and services
across the globe.
Following the merger of RHI and Magnesita
in 2017, the production network was
restructured and optimised through the
closure of high-cost sites and consolidation
of production into modernised low-cost
locations. The Group follows a local-for-
local strategy with production facilities
located as close as possible to its customers,
to deliver an optimal customer experience,
reduce freight and customs duties and
minimise working capital requirements
associated with international shipments.
% of production in region
Key raw material freight routes:
Internal raw materials
External raw materials
South America
88%
North America
57%
Europe & Türkiye
92%
Africa
0%
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202432
OPERATIONAL REVIEW CONTINUED
Our acquisition strategy seeks to fill regional
product gaps or add plant locations to
improve logistics or position for growth.
Changes in global refractory usage, foreign
exchange rates, freight and energy costs can
impact the competitiveness of our production
network. An agile and forward looking
approach is required to ensure that we
are fully optimised for changing market
conditions from time to time.
In 2022 RHI Magnesita established an
operational governance structure consisting
of five regional business units. Managing
the business through a regional structure
enables the Group to serve its customers
better through faster local decision making
and improved accountability.
Vertical integration in refractory
raw materials
RHI Magnesita’s low-cost raw material
production represents a significant
advantage versus refractory producers
who purchase raw materials on the open
market at higher prices.
The Group consumes 81% of its own raw
material production internally, with minimal
external sales and guaranteed security of
supply. The contribution of vertical
integration to the Group’s margins has
been consistently positive over many years,
demonstrating the structural cost advantage.
The benefit is maximised during periods
of high market prices for raw materials and
the current contribution from raw material
production to Group’s Adjusted EBITA
margin of 11.7% is therefore lower than
historical levels at 0.8% (2023: 1.7%).
India
72%
China
83%
NME
0%
Asia &
Australasia
0%
33RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Steel overview
Supplying refractory products and services
to the steel industry accounted for 68% of
RHI Magnesita’s revenues in 2024 and the
Group retained its leading position globally
with a c.13% market share, or c.20%
excluding China and East Asia. Refractory
products are required to protect steel
making equipment from extremely high
temperatures of up to 1,800°C, chemical
corrosion and abrasion. Refractory product
applications include iron making (blast
furnace or direct reduction), primary
steel-making (basic oxygen furnace or
electric arc furnace) as well as ingot and
continuous casting. New applications are
under development for production of green
steel and the Group was awarded five
contracts for such projects in 2024.
RHI Magnesita offers a complete range of
products and solutions for the steel making
process. The lifespan of refractory products
in the steel making process can range
from hours to months depending on the
application, for example a slide gate is
a consumable item that may need to be
replaced every four hours whilst the lining
of a primary steel making furnace could
require re-lining at six month intervals.
Refractory consumption in steel making
is therefore classified as an operating
expense by steel producers and usually
accounts for around 2-3% of operating
costs, on average.
Steel segment revenues decreased by 4%
to €2,373 million (2023: €2,461 million)
and by 3% in constant currency terms
(2023: €2,434 million) as a 3% increase
in sales volumes supported by M&A was
offset by 6% lower pricing. Excluding M&A,
the base business increased shipped
volumes by 1%, a strong performance
compared to World Steel Association data
which indicates a decrease of 0.9% in
global steel output in 2024.
Steel 2024
2023
reported
2023
(constant
currency) Change
Change
(constant
currency)
Revenue (€m) 2,373 2,461 2,434 (4)% (3)%
Gross profit (€m) 551 550 576 0% (4)%
Gross margin 23.2% 22.3% 23.7% 90bps (50)bps
Industrial 2024
2023
reported
2023
(constant
currency) Change
Change
(constant
currency)
Revenue (€m) 1,114 1,111 1,094 0% 2%
Gross profit (€m) 297 307 305 (3)% (3)%
Gross margin 26.6% 27.7% 27.9% (110)bps (130)bps
Global steel demand decreased in the
key markets of China and North America
in 2024 but grew in India, West Asia
& Africa, Europe and South America.
Domestic production in some markets was
displaced by exports from China where
domestic consumption of steel reduced
by approximately 6% and production
by approximately 3%. The approximate
3% gap represents the increase in exports,
which increased from approximately
90 million tons in 2023 to approximately
120 million tons in 2024.
Industrial overview
RHI Magnesita is a leading supplier
of refractory products and services
to customers in the cement and lime,
non-ferrous metals, glass, energy,
environmental and chemicals industries.
These Industrial customers accounted for
32% of Group revenues in 2024 and have
longer replacement cycles compared to
Steel customers, ranging from one to
20 years. Refractories are classified as
capital expenditure by Industrial customers
and represent between 0.2% and 1.5% of
total costs over the life cycle of a facility.
RHI Magnesita has a c.25% market share
globally in cement refractories, c.20%
market share in non-ferrous metals
applications, c.19% in the glass industry
and c.5% in other industrial applications
such as energy, environment, chemicals
and foundry.
Industrial revenues were stable at
€1,114 million (2023: €1,111 million) and
increased by 2% in constant currency
terms, with shipped volumes increasing
by 11%, supported by M&A, whilst average
pricing reduced by 9%.
Steel revenue
€2,373m
2023: €2,461m
Steel revenue by region
North America 27%
Europe, CIS & Türkiye 24%
India, West Asia & Africa 23%
South America 15%
China & East Asia 11%
Industrial revenue
€1,114m
2023: €1,111m
Industrial revenue by region
North America 18%
Europe, CIS & Türkiye 33%
India, West Asia & Africa 18%
South America 10%
China & East Asia 15%
Minerals 6%
OPERATIONAL REVIEW CONTINUED
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202434
Cement & Lime revenues reduced by
12% to €376 million (2023: €424 million),
representing 11% of Group revenues in 2024
as pricing reduced by 7% and sales volumes
reduced by 4%. Strong growth in sales
volumes in Process Industries of 101% and
Glass of 19%, mainly resulting from M&A,
were offset by the 4% decline in the larger
Cement & Lime segment and 9% lower
Non-ferrous metals sales. The Non-ferrous
metal business remained the highest margin
segment for the Group, with a gross margin
of 44% in 2024 (2023: 42%).
Minerals
The Group sourced 42% of its raw material
needs by value, in line with its vertical
integration strategy. Raw materials not
utilised internally are sold in the open
market and reported under Minerals within
the Industrial segment, generating revenues
of €65 million in 2024 (2023: €80 million).
Mineral sales volumes declined by 11%,
coupled with lower market prices for raw
materials, leading to a reduction in revenue.
Regional business units
In 2023 RHI Magnesita established an
operational governance structure consisting
of five regional business units, which
continued in 2024. Managing the business
through a regional structure enables the
Group to serve its customers better through
faster local decision making and improved
accountability, supporting our local for
local production strategy.
Europe, CIS & Türkiye
Europe, CIS & Türkiye revenues increased
by 3% to €926 million (2023: €894 million),
or by 5% in constant currency terms.
Average price per tonne declined by 11%
due to end market weakness in construction
and automotive and a changing product
mix, but this was more than offset by a 17%
increase in shipped volumes due to the full
year contribution from M&A completed in
2023. Excluding M&A, base business sales
volumes reduced by 2% and price per
tonne was 14% lower, with revenues
reducing by 15%.
Europe, CIS & Türkiye
Pricing reduced by 11%, offset by the
contribution from 2023 M&A. Industrial
sales volumes increased by 40% driven
by a full year contribution from P-D.
North America
Sales volumes reduced by 1% and
overall pricing by 3%. Gross profit margin
increased to 30.9% (2023: 27.9%) due
to effective cost management and
resilient Industrial pricing.
India, West Asia & Africa
A 4% increase in sales volumes was
offset by a 6% decline in pricing due
to increased competition and product
mix changes.
South America
Volumes declined by 3% and pricing
by 7% mainly due to weakness in the
Industrial business. Brumado rotary kiln
project was completed and ramped up.
China & East Asia
Steel refractory sales volumes excluding
M&A increased by 5%.
40%
increase in Industrial
sales volumes in Europe,
CIS & Türkiye due to M&A
5%
increase in base business
steel sales volumes in China
& East Asia
OPERATIONAL REVIEW CONTINUED
35RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Gross profit increased by 10% to €195 million
(2023: €177 million), as higher gross margins
of 21.1% (2023: 19.8%) were supported
by the contribution from higher margin
businesses acquired in 2023 and a
reduction in the key input costs of energy
and purchased raw materials. In the second
half of the year, a significant increase in
alumina prices drove up costs for acquiring
alumina based refractory raw materials and
disruption in the global graphite supply
chain also resulted in cost increases.
Steel revenues decreased by 1% in
constant currency terms on 7% higher
shipped volumes, as M&A delivered
volume growth despite subdued customer
demand. Steel production in the European
Union increased by 2.6% and in Türkiye
by 9.4% according to WSA data, reflecting
recovery from a low base in Europe and
strong growth and relative stability in
Türkiye compared to the surrounding
region. Whilst steel output in the European
Union increased year on year, producers
continue to face a combination of
deteriorating prices, rising costs and low
demand relative to historic levels. These
factors led some customers to reduce
capital expenditure in favour of running
repairs and to increase sourcing of cheaper
imported refractories. The challenging
market conditions for steel customers also
resulted in the delay of some green steel
projects, but these were temporary
postponements and not cancellations.
Industrial segment sales volumes increased
by 40% and revenues by 15% in constant
currency terms, supported by a full year
contribution from process industries
focused P-D Refractories. Whilst volumes
in Cement & Lime and Non-ferrous metals
reduced by 15% and 23% respectively, this
was more than offset by a 49% increase in
Glass sales volumes and 216% increase in
Industrial applications, mainly due to M&A.
Waste to energy is a strategic growth focus
within Industrial applications where the
Group was able to increase market share
in both maintenance and greenfield project
support. Sales of digital products
increased, including laser technologies
for refractory evaluation at customer sites.
Such products are already widely in use in
the Cement & Lime segment and are now
gaining traction with Non-ferrous metals
and Industrial applications customers.
The Europe and Türkiye region has
benefited from significant inorganic
growth in recent years with the addition
of MIRECO, Sörmaş, Dalmia GSB, Seven
Refractories and P-D Refractories in 2022
and 2023. Regional leadership have been
focused on the integration of each of these
businesses and the achievement of synergy
targets. MIRECO delivered strong growth
in recycling rates, Sörmaş prepared for the
initial adoption of the Group’s new ERP
system and the Bochum plant previously
owned by Dalmia GSB completed
necessary legal, financial and operational
integration processes during the year.
Certain Seven Refractories businesses
now form RHI Magnesita’s new Alumina
Monolithics business unit and synergy
realisation is on track, despite low demand
conditions. Network optimisation in Europe
is expected to be required to fully realise
the synergy benefits of M&A completed
in the last three years.
The Mainzlar plant in Germany will
be closed in 2025 and the Group may
consider further plant footprint optimisation
in Europe following recent M&A.
North America
Revenues in North America decreased by
5% to €852 million (2023: €894 million)
or by 4% in constant currency terms, due
to a 1% reduction in sales volumes and
3% lower average pricing.
Despite lower revenues, the region grew
Gross profit by 5% to €263million (2023:
€250 million) as margins were successfully
increased to 30.9% (2023: 27.9%) due
to effective cost management and
resilient pricing in Cement & Lime
and Non-ferrous metals.
Steel volumes reduced 2% and pricing by
3% resulting in 4% lower revenues, whilst
gross margin expanded to 30.7% (2023:
28.3%). Utilisation rates in US steel mills
remained low, at approximately 76%in
2024 and reducing below this level at the
end of the year following the US election
in November. North America steel output
according to WSA data declined by 4.2%
in 2024 whilst RHI Magnesita estimates
that output from its customers in the region
reduced by 6%, compared to the 2%
decline in sales volumes. The Group
continues to build out its product offering
and secured agreements with three
additional tap hole clay customers during
the year. In the electric arc furnace
segment, a contract for refractory supply
including an automated robotic solution
for gunning repair was awarded in Canada,
by a large customer converting to EAF
from BOF steel production. Other robotics
contracts were awarded in the US, including
multiple new tundish cage solutions.
OPERATIONAL REVIEW CONTINUED
Revenue 2024
2023
reported
2023
(constant
currency) Change
Change
(constant
currency)
Europe, CIS & Türkiye 926 894 884 3% 5%
Steel 558 574 565 (3)% (1)%
Industrial 368 320 319 15% 15%
North America 852 894 889 (5)% (4)%
Steel 648 673 670 (4)% (3)%
Industrial 204 221 220 (8)% (7)%
India, West Asia & Africa 744 762 757 (2)% (2)%
Steel 541 582 577 (7)% (6)%
Industrial 203 180 180 13% 13%
South America 473 522 504 (9)% (6)%
Steel 362 393 386 (8)% (6)%
Industrial 112 129 118 (13)% (6)%
China & East Asia 426 418 416 2% 3%
Steel 264 239 237 10% 11%
Industrial 163 179 178 (9)% (9)%
Minerals 65 80 78 (19)% (17)%
Total 3,487 3,572 3,529 (2)% (1)%
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202436
Industrial sales volumes saw greater
variation across segments with a weak
Cement & Lime result more than offset
by strong trading in Glass and Industrial
applications, resulting in an overall
increase in sales volumes of 1%. Higher
pricing in Non-ferrous metals and reduced
input costs were the key drivers of the
increase in Industrial Gross margin to
31.7% (2023: 27.0%). Cement and concrete
production in the US reduced by 8% and
was the main driver of a 13% reduction in
Cement & Lime refractory sales volumes.
The Group continued to expand its offering
to a broader range of customers and was
awarded a contract for aluminium furnace
design and refractory supply, the first of
its kind in the region.
Inventory management was a key focus
to minimise working capital and finished
goods inventories were successfully
reduced despite falling customer demand
over the year. PIFOT and net promoter
scores in customer surveys remained close
to all-time highs.
The integration of Seven Refractories’
US sites is largely complete, with a new tap
hole clay line now commissioned at the
plant in Huron, US. RHI Magnesita agreed
to acquire US based Resco in April 2024
and the acquisition completed in January
2025. The integration of Resco into the
Group’s North American business and the
realisation of planned synergies will now
be the primary focus for regional leadership.
The US increased its recycling rate to a new
high of 14.2% (2023: 8.3%). New health
and safety reporting structures and a ‘stop
work’ system were implemented at the
Pevely and York plants.
India, West Asia & Africa
Revenues in the India, West Asia & Africa
region decreased by 2% to €744 million
(2023: €762 million) or by 2% in constant
currency, as a 4% increase in sales volumes
was offset by a 6% decline in average
pricing due to increased competition and
product mix changes. Base business sales
volumes, excluding the full year
contribution from 2023 M&A, increased
by 2% with similar pricing pressure and
mix impacts.
Gross profit reduced by 17% to €155 million
(2023: €187 million) as gross margins
reduced to 20.8% (2023: 24.5%), caused
by the 6% reduction in average pricing
on relatively stable unit costs.
Steel revenues decreased by 7% to
€541 million (2023: €582 million) with a
1% increase in sales volumes offset by an
8% decrease in prices, as the full effect of
pricing pressure fell on the Steel segment
whilst Industrial pricing was stable. The
main cause of pricing pressure in Steel was
the impact of surplus low-priced imports
from China entering the Indian market due
to weakening demand in China. Steel gross
margins compressed to 19.2% from 22.8%
in 2023, mostly as a result of competitive
pricing pressure, which outweighed the
benefit of a 4% improvement in unit costs.
OPERATIONAL REVIEW CONTINUED
37RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Domestic steel production in India grew
by 6% in 2024 according to WSA data,
however imports from China and Vietnam
increased to partially satisfy growth in local
demand. In India the Group remains well
positioned to benefit from new DRI, blast
furnace and coke oven projects under
construction and customers have reacted
positively to the growth strategy in iron
making, DRI furnace refractories and pellet
production. In the Middle East some new
steel projects were postponed due
to current unfavourable market conditions
but this was offset by new business growth
in induction and reheating furnaces in Iraq,
Saudi Arabia, Libya and Africa. The Group
secured three new solutions contracts in
India and three in the Middle East, alongside
two contract renewals outside India.
Industrial revenues increased by 13%
to €203 million (2023: €180 million)
reflecting a 13% increase in sales volumes
on stable pricing. The main driver of the
increase in revenues was the Cement
& Lime segment, where sales volumes
increased by 15% and revenue by 17%,
with new demand coming from greenfield
and brownfield cement projects in India
and North Africa. Non-ferrous metals,
the second largest segment in the region
by revenue and gross profits, saw a 22%
decrease in sales volumes offset by 18%
higher pricing, translating to an overall 9%
decrease in revenues.
Industrial gross margin decreased to 24.9%
(2023: 30.3%) as costs increased by 7%,
mainly due to high prices for alumina-based
raw materials and a change in product mix
towards alumina-based refractory sales.
Margins improved in Non-ferrous metals
and Glass but declined in Cement & Lime
and Industrial Applications.
Capacity utilisation remained at a low level,
with space to grow in line with forecast
customer demand increases. One plant
at Bhilai was closed and production
transferred to Rajgangpur, in line with the
M&A integration strategy. Supply chain
reliability and efficiency was good
throughout the year.
South America
Revenues in South America decreased
by 9% to €473 million (2023: €522 million)
or by 6% in constant currency terms, as
shipped volumes reduced by 3% and
pricing declined by 7%. Gross profit
reduced by 3% to €142 million (2023:
€146 million) supported by an increase
in Gross margin to 30.0% (2023: 28.0%),
driven by lower input costs.
Steel revenues decreased by 8% to
€362 million (2023: €393 million) driven
by a 1% decline in shipped volumes and
7% lower average pricing. The decline
in sales volumes was slightly below the
movement in steel production for the
region, which increased by 0.6% in 2024
according to WSA data. Steel gross margin
increased to 28.5% (2023: 24.5%) as the
impact from lower pricing was more than
offset by an 11% improvement in unit costs.
New long-term contracts were signed with
key customers and revenue derived from
long-term contracts increased to 70%
of the total for the region in 2024.
Industrial revenues decreased by 13%
to €112 million, with a 6% decline in sales
volumes and 7% lower average price per
tonne. Volume decline was most
pronounced in the Non-ferrous metals
segment, with no new greenfield projects
occurring during 2024 against a strong
comparative in 2023. Pricing weakness
was most evident in Cement & Lime.
Industrial segment Gross margins reduced
to 35.2% (2023: 38.7%) as the 7% decline
in average pricing was only partially offset
by 2% lower costs.
During the year the Brumado rotary kiln
project was completed and ramped up
production. The project will reduce costs
and increase operational flexibility
considerably at this strategically important
and globally significant raw material site.
A write-down of assets in Brazil of
€29 million connected to the completion of
the Resco transaction has been recognised
in the 2024 financial results, reflecting the
network optimisation which will result in
transfer of production capacity into the US.
China & East Asia
Revenues in China & East Asia increased
by 2% to €426 million (2023: €418 million)
as strong sales volumes in Steel offset volume
decline and lower pricing in the Industrial
segment. Excluding the contribution from
M&A, revenues in the base business
declined by 8%, mainly due to lower
pricing and 2% lower shipped volumes.
Gross margins were stable at 21.0%
(2023: 21.0%) as pricing pressure was
matched by reduced input costs. Gross
profit increased slightly to €89 million
(2023: €88 million) reflecting the revenue
increase and stable margins.
Steel refractory sales volumes excluding
M&A increased by 5%, representing a
strong relative performance compared to
WSA data for China which indicates a 1.7%
decline in steel output in 2024. Shipped
volumes of refractories in East Asia
excluding M&A increased by 6%, also
outpacing overall steel output growth
in the region although this was largely due
to the restart of a key customer site that had
been suspended in 2023.
Industrial sales volumes decreased
by 5% driven by weaker demand in
construction and reduced consumption of
glass refractories, partially offset by robust
Non-ferrous metal demand in China.
Lower pricing resulted in Industrial revenue
decline of 9%, as weak Cement & Lime
results were offset by strong demand for
Non-ferrous metals refractories in China.
Industrial gross margin in the region reduced
to 27.3% (2023: 28.0%) as price weakness
outpaced the reduction in input costs.
The Group’s priority in its China & East Asia
business continues to be a sustainable
increase in margins to levels that are closer
to the average for the Group worldwide.
The Group’s strategy is to focus on higher
value-added products and services to
differentiate against lower quality
competing suppliers.
OPERATIONAL REVIEW CONTINUED
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202438
FINANCIAL REVIEW
Resilience
Efficiency
Sustainability
Ian Botha
Chief Financial Officer
“ We delivered a robust
financial performance in
spite of the challenging
macro environment.”
Reporting approach
The Company uses a number of alternative
performance measures (“APMs”) in addition
to measures reported in accordance with
IFRS Accounting Standards as adopted
by the European Union (“IFRS”), which
reflect the way in which the Board and
the Executive Management Team assesses
the underlying performance of the
business. The Group’s results are presented
on an ‘adjusted’ basis, using APMs that are
not defined or specified under the
requirements of IFRS, but are derived from
the IFRS financial statements. The APMs
are used to improve the comparability of
information between reporting periods
and to address investors’ requirements for
clarity and transparency of the Group’s
underlying financial performance.
The APMs are used internally in the
management of our business performance,
budgeting and forecasting. A reconciliation
of key metrics to the reported financials is
presented in the section titled APMs.
All references to comparative 2023
numbers in this review are on a reported
basis, unless stated otherwise. Figures
presented at constant currency represent
2023 translated numbers against average
2024 exchange rates as disclosed in Note 3
to the Consolidated Financial Statements.
All reported volume changes year-on-year
are excluding mineral sales.
Read more on APMs on
Pages 325 & 326
€3,487m
Group revenue, broadly
in line with 2023
Revenue
The Group recorded revenues of €3,487
million, a 1% decrease from 2023 revenues
of €3,529 million on a constant currency
basis. This was primarily driven by 6%
lower average pricing and a 1% decline in
base business sales volumes, offset by 6%
growth in revenues from acquisitions
completed in 2023.
On a reported basis, the decrease in
revenue was 2% (2023: €3,572 million),
reflecting the depreciation of certain
currencies against the euro (Chinese yuan,
Indian rupee, Brazilian real, Turkish lira,
Canadian dollar) which reduced revenue
generated from those geographies in euro
terms. The foreign exchange impact on
revenues was €43 million.
Against a backdrop of weakness in the
key end markets of construction and
automotive, steel revenues decreased to
€2,373 million, representing a 4% decline
on a reported basis (2023: €2,461 million)
and a 3% decline in constant currency
terms (2023: €2,434 million), accounting
for 68% of Group revenue in 2024.
The primary driver behind the decrease in
steel revenues for the financial year 2024
was pricing. Soft end market demand also
impacted sales volumes in North and
South America. Exports of surplus steel
from China negatively affected pricing
39RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
FINANCIAL REVIEW CONTINUED
and refractory demand from domestic
steel producers in most geographies,
in particular in India.
Industrial revenues were stable at €1,114
million (2023: €1,111 million) and increased
by 2% in constant currency terms (2023:
€1,094 million), outperforming steel
revenue growth, supported by M&A.
Cement & Lime revenues decreased by
12% to €376 million (2023: €424 million),
while Non-ferrous metal revenues declined
by 12% to €247 million (2023: €281 million).
The primary factors contributing to the
decline in cement, lime, and Non-ferrous
metals were weaker end markets in China
and South America. Revenues in the glass
business increased by 19% to €217 million
(2023: €182 million), mainly driven by
a strong contribution from 2023 M&A.
Revenues from industrial applications
increased by 46% to €210 million
(2023: €143 million), also due to M&A.
During 2024 the Group re-assessed its
criteria for the timing of revenue recognition
for shipments delivered by sea freight with
third-party carriers. From 2024, control
of refractory products is determined to
transfer when the carrier issues shipping
documents that allows the customer to
redirect or otherwise control the shipped
refractory products. Group revenue in
2024 increased by €42 million (and gross
profit by €10 million) as a result of this
revised accounting policy. For further details
refer to Note 3 of the Financial Statements,
‘Significant Accounting Policies,
Judgements and Estimates’.
Cost of goods sold
Cost of goods sold decreased by 3%
to €2,639 million from €2,715 million in
2023, primarily due to a reduction in raw
material costs. The cost of purchased raw
materials fell by 7% to €1,058 million
(2023: €1,139 million). Plant-related labour
costs increased by 16% in 2024, rising from
€452 million to €523 million, mainly due
to acquisitions and salary increases to offset
inflation. After a period of disruption and
high inflation in 2023, freight and energy
costs decreased by 11% and 10%,
respectively, in 2024 as both markets
stabilised. Spending on general supplies,
including pallets, packaging, and spare
parts were broadly flat at €169 million
(2023: €170 million).
During 2024 the Group re-assessed its
criteria for inventory provisioning in light
of sustained improvements in its inventory
management. Re-valuation of stock
previously written off, which is now deemed
to be saleable at market price, resulted in
an €11 million reduction in cost of goods
sold. For further details refer to Note 3
of the Financial Statements, ‘Significant
Accounting Policies, Judgements
and Estimates’.
Raw material prices
Refractory raw material prices decreased in
2024 compared to 2023, with the price of
high-grade dead burned magnesia (“DBM”)
from China decreasing by 6% and by 1%
on average for medium-grade DBM from
China. Lower raw material prices usually
result in lower finished goods pricing for
refractories worldwide, as production costs
for non-vertically integrated competitors
are reduced. The main driver for the
decrease in DBM pricing was oversupply,
combined with lower customer demand for
refractories globally. Fused alumina, a raw
material that the Group does not produce
and which constitutes only a small portion
of the Group’s overall raw material
requirements, experienced a significant
price increase towards the end of 2024,
in line with the increase in alumina prices
in the fourth quarter.
Gross profit
The Group recorded gross profit of €848
million (2023: €857 million), a decrease of
1% on a reported basis and 4% in constant
currency terms. Gross margins increased
by 30bps to 24.3% (2023: 24.0%).
Although refractory pricing in the base
business reduced by 8%, input costs
reduced further, primarily due to lower
prices for externally purchased raw
materials as well as lower energy and
freight costs.
SG&A
Selling, general and administrative
expenses (“SG&A”), were €435 million,
a 3% decrease compared to the previous
reporting period (2023: €449 million),
attributable to stringent cost management,
lower personnel expenses and reduced
hiring levels.
Depreciation and amortisation
Depreciation increased by 2% to €136
million (2023: €134 million) and in 2025
is expected to be around €150 million
including Resco.
Amortisation of intangible assets amounted
to €39 million in 2024 (2023: €44 million)
and is expected to be approximately
€35 million in 2025, subject to the purchase
price allocation exercise relating to the
acquisition of Resco Group.
Adjusted EBITDA
The Group recorded Adjusted EBITDA of
€543 million, flat compared to the prior year
(2023: €543 million). Adjusted EBITDA
margin increased to 15.6% (2023: 15.2%)
an increase of 40bps, reflecting higher gross
margins and a decrease in SG&A expenses.
Adjusted EBITDA margin decreased by
60bps on a constant currency basis.
Adjusted EBITA
Adjusted EBITA remained broadly flat at
€407 million, compared to €409 million in
2023 on a reported basis, as the contribution
from M&A and lower input costs offset
weaker pricing and mix effects. Adjusted
EBITA from businesses acquired in 2023
was €65 million (or €77 million of Adjusted
EBITDA), broadly in line with guidance.
Adjusted EBITA margin increased to
11.7% (2023: 11.4%) as M&A contributions,
supported by lower input costs and
SG&A reduction.
Steel 2024 2023 Change
Revenue (€m) 2,373 2,461 (4)%
Gross profit (€m) 551 550 0%
Gross margin 23.2% 22.3% 90bps
Adjusted EBITA (€m) 255 240 7%
Adjusted EBITA margin 10.8% 9.7% 110bps
Industrial 2024 2023 Change
Revenue (€m) 1,114 1,111 0%
Gross profit (€m) 297 307 (3)%
Gross margin 26.6% 27.7% (110)bps
Adjusted EBITA (€m) 151 169 (11)%
Adjusted EBITA margin 13.6% 15.2% (160)bps
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202440
Vertical integration contributed a record
low 0.8ppts of the Group’s overall Adjusted
EBITA margin of 11.7%. Whilst this
contribution is lower than the 1.7ppts
contribution in 2023, primarily due to the
decline in the market prices for refractory
raw materials, the contribution was still
positive meaning that the Group is able to
source its own raw materials more cheaply
than buying in the market. Lower raw
material prices negatively impact the
calculation of the contribution from the
Group’s raw material assets, which is based
on the theoretical cost of acquiring those
raw materials in the open market.
The Group’s refractory business contributed
a historic high of 10.9 ppts towards the total
Adjusted EBITA margin of 11.7%, an increase
of 120 bps compared to the 9.7 ppts
contribution in 2023. Refractory margin
was supported by lower input costs, the
benefits of M&A synergies and structural
cost reductions resulting from the Group’s
strategic cost-saving initiatives.
Adjusted EBITA and Adjusted EBITDA both
exclude €125 million of net expenses from
adjusted performance (2023: €31 million),
including Software as a Service costs
(largely on new SAP ERP), Mainzlar Plant
closure costs and impairment of Hexa
Contagem Project, consequent on Resco
acquisition as set out in ‘Items excluded
from adjusted performance’ below.
The Adjusted EBITA performance in 2025 is
expected to be modestly above 2024 levels
including the acquisition of Resco.
Net finance expenses
Net finance expenses, which includes
interest payable on borrowings net of
interest income on cash balances, gains and
losses relating to foreign exchange, pension
expenses, present value adjustments,
factoring costs and non-controlling interest
expenses, decreased to €42 million
(2023: €100 million).
Net interest expenses remained stable
at €39 million (2023: €38 million)
comprising interest expenses on borrowings
of €61 million (2023: €58 million) and
€22 million of interest income on cash
balances on deposit (2023: €20 million).
Foreign exchange gains of €11 million
were recorded in 2024 compared to foreign
exchange related losses of €30 million
in 2023, mainly driven by US dollar
strength in Q4, weakness in the Brazilian
Real and Mexican Peso and a €(1) million
hyperinflation adjustment related to
Argentina (2023: €3 million).
Other net financial expenses amounted to
€14 million (2023: €32 million) including
factoring costs of €10 million (2023:
€12 million), pension charges of €12 million
(2023: €12 million) and present value
adjustments of €7 million (2023:
€8 million). Net financial expenses in 2024
also benefitted from a non-cash gain of
€22 million due to the revaluation of the
Group’s obligation to purchase the remaining
stakes it does not already own in Jinan New
Emei and Chongqing.
Guidance for net interest expenses
including Resco in 2025 is €60 million.
Guidance for other adjusted net financial
expenses is €30 million, resulting in
€90 million of adjusted net finance expenses
guided for 2025.
Items excluded from
adjusted performance
In order to accurately assess the
underlying performance of the business,
the Group excludes certain items from
Adjusted EBITA. Sizeable charges in the
year have been driven by Group wide
programmes aimed at improving operating
efficiency and future profitability through
business process improvements and plant
network optimisation.
In 2024 the total net adjustments to
EBITA amount to €125 million, including:
• €14 million of amortisation of onerous
contracts imposed by EU as part of
the merger with Magnesita.
• €9 million related to the disposal
of the Dashiquiao plant in China.
• €6 million related to receivables
previously written down to zero.
• €3 million of other miscellaneous income.
• €(52) million of expenditure on digital
architecture, previously guided as capital
expenditure. Spending on Software as
a Service is classified as an expense in
IFRS and cannot be capitalised as would
normally be the case with capital
expenditure. The Group incurred charges
of €39 million on the ERP upgrade in
2024 and €7 million reclassified from
2023 and €6 million on logistics and
supply chain planning software upgrades.
Investments in digital architecture are
expected to deliver value through cost
savings and margin improvement,
planning and operating efficiencies and
improved working capital management.
FINANCIAL REVIEW CONTINUED
(€m) 2024
2023
reported
2023
(constant
currency) Change
Change
(constant
currency)
Revenue 3,487 3,572 3,529 (2)% (1)%
Cost of goods sold (2,639) (2,715) (2,647) (3)% 0%
Gross profit 848 857 881 (1)% (4)%
SG&A (435) (449) (443) (3)% (2)%
R&D expenses (45) (43) (42) 6% 7%
Other income & expenses (“OIE”) (125) (31) (32) 299% 296%
EBIT 242 333 364 (27)% (34)%
Amortisation (39) (44) (43) (10)% (9)%
EBITA 281 378 408 (25)% (31)%
Adjusted items 125 31 32 299% 296%
Adjusted EBITA 407 409 439 (1)% (7)%
Refractory EBITA 379 348 - 9%
Vertical integration EBITA 28 61 - (54)%
1. Adjusted EBITA is an APM used by the Group. Refer to page 325 for definitions.
(€m) 2024 2023
Net interest
expenses (39) (38)
Interest income 22 20
Interest expenses (61) (58)
FX effects 11 (30)
Balance sheet
translation 29 (41)
Deliverables (18) 11
Other net financial
expenses (14) (32)
Present value
adjustment (7) (8)
Factoring costs (10) (12)
Pension charges (12) (12)
Capitalization of
borrowing costs 3 8
Interest expense -
Transaction costs (1) (1)
Other 13 (7)
Total (42) (100)
41RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Personnel €523m
R&D €45m
SG&A
€435m
Freight €200m
Energy €226m
Depreciation (COGS) €89m
Supplies €169m
Other €374m
Purchased
Raw Materials
€1,058m
Cost of
goods sold €2,639m
Gross Profit
€848m
Adjusted EBITA
1
€407m
Adjusted Profit
after Tax €263m
Adjusted Profit attributable
to shareholders €251m
Operating Expenses
€481m
Steel
€2,373m
Revenue
and P&L
€3,487m
Steel
€2,373m
Revenue
€3,487m
Industrial
€1,114m
Cement/ Lime
€376m
Non-Ferrous
Metals €247m
Process Industries
€426m
Minerals €65m
Tax €84m
Other net financial expenses €22m
Net interest expense €38m
Minorities €12m
• €(39) million amortisation in intangible
assets arising at the time of the merger
with Magnesita.
• €(29) million non-cash impairment of
fixed assets in Brazil, where the second
stage of the Hexa Contagem expansion
project will not be advanced following
the acquisition of Resco and intended
transfer of production capacity to the US.
The impact of this impairment was
considered as part of the business case
for the acquisition of Resco.
• €(25) million provision for restructuring
expenses at the Mainzlar, Germany
plant, to be paid in 2025 following the
announced closure of the plant in line
with the Group’s original Production
Optimisation Plan and after an
assessment of surplus production
capacity in Europe.
• €(12) million of expenses related to
investments in and losses from the
disposal of special Argentinian
government bonds.
Taxation
Total tax for 2024 in the income statement
amounted to €46 million (2023: €62 million),
representing a 23% reported effective tax
rate (2023: 27%).
Reported profit before tax amounted
to €200 million (2023: €233 million).
Adjusted profit before tax amounted
to €347 million (2023: €317 million),
with an adjusted effective tax rate of
24% (2023: 24%). Adjusted items include
non-taxable IFRS revenues related to put
option valuation and sale of fixed assets
in China, as well as non-deductible legal
restructuring costs.
The adjusted effective tax rate guidance
is between 23-25% for 2025.
Profit after tax
On a reported basis the Group recorded
profit after tax of €154 million (2023: €171
million), profit attributable to shareholders
of €142 million (2023: €165 million) and
earnings per share of €3.01 (2023: €3.50).
Adjusted profit after tax increased to
€263 million (2023: €241 million) and
Adjusted earnings per share was €5.32
FINANCIAL REVIEW CONTINUED
(€m)
2024
reported
Items
excluded
from
adjusted
performance
2024
adjusted
2023
reported
Items
excluded
from
adjusted
performance
2023
adjusted
EBITA 282 125 407 378 31 409
Amortisation (39) 39 - (44) 44 -
Net financial
expenses (43) (17) (60) (101) 9 (92)
Result of profit in joint
ventures - - - - - -
Profit before tax 200 147 347 233 84 317
Income tax (46) (38) (84) (62) (14) (76)
Profit after tax 154 109 263 171 70 241
Non-controlling
interests 12 - 12 7 - 7
Profit attributable to
shareholders 142 109 251 165 - 235
Shares outstanding 47 - 47 47 - 47
Earnings per share
(€ per share) 3.01 2.31 5.32 3.50 1.49 4.98
1. EBITA reconciled to revenue on page 40. EBITA is an APM, refer to page 325 for definition.
2. Total issued and outstanding share capital as at 31 December 2023 was 47,130,338. The Company held
2,347,367 ordinary shares in treasury. The weighted average number of shares used for calculating basic
earnings per share in FY 2023 is 47,078,254.
Revenue and P&L summary
1. Adjusted EBITA excludes amortisation of intangible assets of € 39million, which is partially accounted for in COGS and partly in SG&A.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202442
(2023: €4.98). A full reconciliation of EBITA
to EPS and Adjusted EBITA to Adjusted EPS
can be found in the table on the previous
page. Items excluded from Adjusted Profit
after tax included €17 million of net financial
expenses mainly arising from the revaluation
of the Group’s obligation to purchase the
remaining stakes it does not already own
in Jinan New Emei and Chongqing.
Profit attributable to shareholders is
stated after deducting non-controlling
interests of €12 million (2023: €6 million)
mainly arising from RHI Magnesita India Ltd.,
in which the Group holds a stake of 56%.
Guidance for non-controlling interest
expense in 2025 is approximately
€15 million.
Financial guidance and outlook
Refractory demand remains weak, with
no recovery in end market demand visible.
Falling domestic demand of customer
industries in China results in exports
of steel and other materials from China,
reducing customer output in most world
markets and therewith reducing refractory
usage. 2024 was a relatively strong year
for higher margin non-ferrous metals and
glass projects due to the timing of customer
investment projects. However, markedly
lower capex investments by these industrial
customers will reduce demand in 2025,
offsetting forecasted growth in steel
refractory demand in India, West Asia &
Africa. Revenue performance in 2025 year
to date and the outlook for H1 is weak,
driven by low volumes in steel and pricing
pressure in particular in cement and
non-ferrous metals.
The Adjusted EBITA performance in 2025
is therefore expected to be modestly above
2024 levels including the acquisition of
Resco. Adjusted EBITA is expected to be
weighted approximately 45% in the first
half and 55% in the second half of the year.
An increasing trade tariff environment may
protect customers in certain jurisdictions
and benefit refractory producers with local
for local production in the short term but
risks a medium-term negative impact on
global trade.
Sales volumes in the base business are
expected to remain flat. Adjusted EBITA
margin is guided to be stable at
approximately 11.5%.
Gearing will rise in the short term due to
the completion of the Resco transaction
but is expected to reduce back within the
targeted range of c.2.0-2.5x Pro Forma
Adjusted EBITDA by the end of 2025.
Capital expenditure on fixed assets will be
reduced to €145 million (below depreciation
of approximately €150 million), in favour
of continuing to invest in our digital
transformation, which will incur costs of
approximately €35 million per year over
the three-year period 2024-26. Capex
associated with the integration of Resco
is expected to be €30 million, spread over
the next two financial years.
The Group expects to incur network
optimisation expenses in Europe and Brazil
as a result of plant footprint adjustments
following the Resco acquisition and other
M&A transactions completed in 2022 and
2023. Total restructuring costs in the base
business of €60 million and associated
capital expenditure of €40 million are
planned over the period 2025-27, to deliver
€10 million of EBITA benefit in 2025,
€20 million in 2026 and €30 million
per annum thereafter.
Working capital
Working capital decreased to €865 million
(31 December 2023: €980 million) driven
by inventory reduction, lower accounts
receivable and higher payables.
Working capital intensity, measured
as a percentage of the last three months’
annualised revenue, decreased to 23.4%
(31 December 2023: 24.4%). Accounts
receivable intensity was 12.9%
(31 December 2023: 11.9%), accounts payable
intensity was 15.5% (31 December 2023:
12.4%) and inventory intensity increased
to 26.1% (31 December 2023: 24.9%).
Inventories decreased to €962 million
(31 December 2023: €1001 million),
due to lower input costs, reduced inventory
volumes and inventory improvement
measure implemented at plants acquired
in 2023.
Accounts receivable decreased slightly
to €474 million (31 December 2023:
€477 million), reflecting lower pricing.
Accounts receivable is calculated as
trade receivables excluding factoring
plus contract assets less contract liabilities
and downpayments received, and a full
reconciliation can be found in the
APMs section.
FINANCIAL REVIEW CONTINUED
Adjusted EPS
€5.32
2023: €4.98 per share
Adjusted EBITA margin
11.7%
2023: 11.4%
Capital expenditure
€145m
2023: €180m
43RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Accounts payable increased to €572 million
(31 December 2023: €498 million) due to
extended payment terms and higher value
raw material purchases in the second half.
Working capital financing, used to
provide low-cost liquidity and support the
Group’s commercial offering to customers,
was €289 million on 31 December 2024
(31 December 2023: €298 million),
comprising €237 million of accounts
receivable financing (factoring) and
€53 million of accounts payable
financing (forfaiting).
Working capital financing levels vary
according to business activity, and
the Board has set an internal limit
of €320 million on its use.
Working capital intensity is targeted
to be approximately 24% in 2025.
Other assets and liabilities
Cash flows from other assets and liabilities
amounted to €(93) million (2023: €(12)
million) comprising, indirect and other tax
rebates of €4 million (2023: € 14 million,),
employee pension pay outs and pension
provision movements of €(22) million
(2023: €(19) million), employee variable
remuneration and employee-related
provisions of €(24) million (2023: €29
million) and other cash flows of €(51) million
(2023: € (36) million). The €53 million
difference in variable remuneration and
employee related provisions is due to a
relatively high staff bonus payout in 2024
relating to 2023 performance, compared
to a lower bonus payout in 2023.
Capital expenditure
The Group incurred €145 million of
capital expenditure (2023: €180 million),
of which €65 million was maintenance
related (2023: €86million), €68 million
was expansionary capital expenditure
(2023: €74 million) and €12 million of
maintenance and integration capital
expenditure was incurred at newly
acquired businesses (2023: €19 million).
Capital expenditure in 2025 is expected
to be around €145 million. Maintenance
capital expenditure in the base business is
expected to be approximately €75 million,
with expansionary capital expenditure
of €55 million and maintenance and
integration capital expenditure in newly
acquired businesses of €15 million.
Spending of approximately €35 million
on digital infrastructure projects will be
expensed in accordance with IFRS and
will not be capitalised.
Acquisitions
In April 2024 the Group announced its
intention to acquire Resco Group, a US
based producer of alumina monolithics
and wide range of basic and non-basic
refractories, for an enterprise value of up
to $430 million. The transaction completed
on 28 January 2025 for an enterprise value
of $410 million, or c.€391 million.
In June 2024 the Group announced the
€5 million acquisition of Refrattari Trezzi,
a recycling specialist in Italy, expanding
its recycling footprint in Europe. Refrattari
Trezzi has been combined into the Group’s
existing MIRECO joint venture, increasing
the Group’s share in MIRECO to 55%
(2023: 51%).
The Group incurred €58 million of cash
outflow relating to acquisitions in 2024,
including € 44 million of prepayments
for the intended acquisition of Resco,
€5 million for the acquisition of Refrattari
Trezzi, €3 million for the purchase of the
remaining 49% stake in Seven Refractories
Cyprus not already owned by the Group, a
€3 million deferred payment for Jinan New
Emei and €3 million purchase of additional
stake in P-D Refractories.
Cash flow
Adjusted operating cash flow increased
to €419 million (2023: €418 million)
representing cash flow conversion from
Adjusted EBITA 103% (2023: 102%),
supported by the €115 million release
of working capital.
Free cash flow decreased to €225 million
(2023: €258 million), mainly due to higher
interest and restructuring expenses.
FINANCIAL REVIEW CONTINUED
Cash flow €m
,
 2024 2023
Adjusted EBITDA 543 543
Shared-based payments - gross non-cash 9 9
Working capital changes 105 53
Changes in other assets and liabilities (93) (7)
Investments in PP&E, IA (145) (180)
Adjusted operating cash flow 419 418
Income taxes paid (69) (60)
Cash effects of other income/expenses and restructuring (62) (32)
Investments in financial assets (19) (14)
Cash inflows from the sale of PP&E and IA 16 4
Cash inflows from the sale of financial assets 11 0
Investment subsidies received 2 0
Net interest paid (71) (56)
Dividend payments to non-controlling interest (3) (3)
Other investing activities 1 1
Free cash flow 225 258
Investment in subsidiaries net of cash (7) (313)
Cash contribution NCI 0 100
Resco prepayment (44) 0
Investments in NCI (6) (8)
Payment for share issue costs 0 (3)
Dividend payments (87) (77)
Change financial receivables from joint ventures and associates (1) 2
Cash change in net debt 80 (41)
Debt from acquisitions 0 (87)
New lease obligations (29) (15)
Exchange effects 2 (1)
Others 1 (2)
Actual change in net debt 54 (146)
1. The cash flow reconciliation to net debt has been restated to reflect a change in definitions of Adjusted
operating cash flow, Free cash flow and cash change in net debt.
2. A full reconciliation to the change in cash and cash equivalents can be found in the APM section
on pages 325 and 326.
3. Adjusted operating cash flow is an APM. A definition and reconciliation can be found in the APM section
on page 325.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202444
Cash income tax payments increased to
€69 million (2023: €60 million) and net
interest paid also increased to €71 million
(2023: €56 million), as a result of higher
average interest rates and borrowings.
Cash dividends paid in 2024 amounted
to €87million (2023: €77 million) and the
cash change in Net debt was an increase
of €80 million compared to a decrease
of €41 million in 2023.
Financial position
Net debt decreased to €1,251 million,
comprising total debt of €1,750 million,
leases of €77 million and cash and cash
equivalents of €576 million.
Total leases of €77 million (2023:
€70 million) are included in the Group’s
Net debt position as required by IFRS 16.
The Group’s gearing at the year-end
was 2.3x Net debt to Pro Forma Adjusted
EBITDA (31 December 2023: 2.3x).
Available liquidity at 31 December 2024
was €1,376 million, comprising undrawn
committed facilities of €800 million and
cash and cash equivalents of €576 million.
Out of the total gross debt of €1,750 million,
98% is denominated in euro. The floating
to fixed ratio of the gross debt is 27%
floating to 73% fixed and the weighted
average cost of debt as of 31 December
2024 was 2.96%, including swaps.
The Group will seek to maintain the ratio
of Net debt to Pro Forma Adjusted EBITDA
within the guided range of 2.0-2.5x or
above for periods of compelling M&A.
Return on invested capital
ROIC is used to assess the Group’s efficiency
in executing its capital allocation strategy,
which is aimed at enabling organic growth,
disciplined M&A and shareholder returns.
ROIC is an APM, see the APM section for
full details of how ROIC reconciles to
IFRS metrics.
Under the APM definition, ROIC was 9.8%
in 2024 (2023: 10.7%) based on Average
Invested Capital of €3,043 million (2023:
€2,854 million) and NOPAT of €298 million
(2023: €305 million). ROIC generated by
the Group’s raw material assets was 3.5%
(2023: 8.9%) and ROIC from the refractory
business was 11.0% (2023: 11.0%). The
main drivers of the decrease in ROIC were
the increase in Average Invested Capital
to €3,043 million (2023: €2,854 million)
as a result of M&A transactions completed
in 2023 and the reduction in contribution
from the Raw material assets, due to low
market prices for refractory raw materials.
The Group intends to carry out a network
optimisation over the period 2025-27
following M&A completed in the previous
three years, reducing invested capital.
Returns to shareholders
The Board’s capital allocation policy
remains to support the long-term Group
strategy, providing flexibility for both
organic and inorganic investment
opportunities and delivering attractive
shareholder returns over the medium term.
These opportunities are assessed against a
framework of strategic fit, risk profile, rates
of return, synergy potential and balance
sheet strength.
In 2024, the Group invested €68 million
in expansionary capital expenditure in
the base business and €12 million in the
integration of newly acquired businesses.
Maintenance capital expenditure was
€65 million. A further €391 million was
agreed to be allocated to the acquisition
of Resco.
Following the strong profitability, cash
generation and strategic progress delivered
in 2024, the Board has recommended a
final dividend of €1.20 per share for the
full financial year, and €85 million in
aggregate. This represents a dividend
cover of 3.0x Adjusted earnings per share.
Subject to approval at the AGM scheduled
for 7 May 2025, the final dividend will be
payable on 12 June 2025 to shareholders
on the register at the close of trading on
23 May 2025. The ex-dividend date will
be 22 May 2025. Together with the interim
dividend of €0.60 per share paid on
26 September 2024, the recommended
final dividend represents a full year
dividend of €1.80 per share in respect
of the 2024 financial year.
The Board’s dividend policy remains
to target a dividend cover of below 3.0x
adjusted earnings over the medium term.
Dividends will be paid on a semi-annual
basis with one third of the prior year’s full
year dividend being paid at the interim.
FINANCIAL REVIEW CONTINUED
ROIC
9.8%
2023: €10.7%
Adjusted EBITA
€407m
2023: €409m
Adjusted operating cash flow
€419m
2023: €418m
Dividend
€1.80 per share
2023: €1.80 per share
45RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
SUSTAINABILITY
Leading
sustainability
in our industry
RHI Magnesita’s purpose is to master heat, enabling global
industries to build sustainable modern life. Our advanced
products are essential for our customers in the steel, cement,
metals, glass, energy and chemicals industries. Through the
reliable supply of innovative refractory products and services,
we enable our customers to sustainably deliver the basic materials
that are essential for modern life. We aim to be our customers’
partner of choice on their own decarbonisation journeys.
“ We believe that
long-term financial
success is only
possible if we
also deliver our
sustainability goals.”
Highlights in 2024 Priorities for 2025
CO emissions
intensity vs 2018
reduced by
14%
Achieve CO
intensity reduction
target vs 2018
15%
Achieve recycling
rate target
15%
Female
representation
in senior
leadership at
26%
Conducted
double materiality
assessment
aligned with CSRD
requirements
Absolute CO emissions
6,050 kt CO
Scope 1, 2 and 3
Herbert Cordt
Chair
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202446
SUSTAINABILITY CONTINUED
Our framework and progress
to lead with sustainability
Our value chain Our planet Our people Our communities
We have a framework for supply
chain due diligence and we
engage with suppliers to ensure
ethical and compliant practices.
RHI Magnesita has published
a theoretical decarbonisation
pathway which sets out a
potential route to eliminate CO
emissions in its core operations
and upstream value chain
by 2060.
Our people are our greatest
strength and our first priority
is safety in the workplace.
We also seek to benefit from a
diverse and inclusive workforce
and we have targets to increase
female representation at
leadership levels.
Maintaining positive
relationships with our local
communities is integral to our
ongoing success.
Our sites are located in diverse
and sometimes remote regions
and it is essential for us to
understand local context. We
regularly engage and consult
with our stakeholders, seeking
to understand and respect their
interests and priorities.
Our target
EcoVadis assessments to
cover two-thirds of supplier
base by spend by 2025
Our target
Reduce CO emissions by 15%
per tonne of product by 2025
Reduce energy use by 5%
per tonne of product by 2025
Our target
Increase women on the
board and in leadership
to 33% by 2025
Maintain LTIF at <0.30
Our target
Maintain positive and
constructive relationships
with our host communities
Related SDG Related SDG Related SDG Related SDG
Read more on page 27 Read more on page 128 Read more on page 23 Read more on page 28
47RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR RISK MANAGEMENT APPROACH
Effective
risk management
“ Our risk management
approach helps the Board
and EMT to understand
the risks associated with
the adopted strategy,
periodically assess if the
strategy is aligned with
our risk appetite, and
understand how the
chosen strategy could
affect the Group’s risk
profile, specifically the
types and amount of risk
to which the Group is
potentially exposed.”
Herbert Cordt
Chair of the
Board of Directors
Our approach to risk management
The approach to risk management
established over recent years was
maintained throughout 2024 and has
included the new plants added to the
production footprint through the
acquisitions. In 2024, a new approach
to assess the plant health and safety risks
was introduced. This was achieved by
applying an externally recognised best
practice framework for Health & Safety
risk assessment.
The risk management approach combines
top-down, bottom-up and deep-dive risk
assessments. The bottom-up risk assessment
is based on each of the plants, which
maintain ongoing risk management activity
linked to the ISO risk management practices.
Deep-dive risk assessments are performed
for areas of emerging or prevailing risks,
which, in 2024, included plant operations,
fraud management, sustainability, human
rights and trade compliance.
The top-down risk assessment is performed
by the EMT and integrates the information
from the bottom-up and the deep-dive risk
assessments to ensure that the Group risk
profile is complete and accurate. This is
then reviewed by the Audit & Compliance
Committee and the Board of Directors.
Reporting against these risks is included
periodically within EMT meetings, Audit &
Compliance Committee meetings and the
annual Board-led strategic review.
Risks and strategy
Our risk management approach helps
the Board and EMT to understand the risks
associated with the adopted strategy,
periodically assess if the strategy is aligned
with our risk appetite and understand how
the chosen strategy could affect the
Group’s risk profile, specifically the types
and amount of risk to which the Group is
potentially exposed. As part of this process,
risk scenarios are evaluated to assess
potential outcomes.
The assessment, monitoring and mitigation
of key risks to the strategy are core features
of the established risk management
approach. Risk workshops were conducted
with the EMT and Board to review the
Group risk profile in the context of the 2025
strategy and the risk appetite of the top risks
to the Group. The Group’s key financial
risks are disclosed under Note 36 to the
Consolidated Financial Statements.
Risk management cycle
1
2
3
4
5
1. Identification
Starting from all the possible
categories of risks potentially
impacting the Group, specific
risks relevant to RHI Magnesita
are identified through several
analytical tools, including
comparative analysis and
risk benchmarking.
2. Assessment
The risks identified are linked
to potential root causes and
assessed for their inherent
likelihood, inherent impact, and
velocity. Risk analysis to develop
an understanding of the possible
interdependencies between
risks is performed.
3. Mitigation
All risks considered to be outside
of the Group risk appetite, due
to their nature or their potential
financial or qualitative impacts,
are mitigated by appropriate risk
management strategies. The
implementation and effectiveness
of the defined mitigation measures
are reviewed, and additional
actions are defined if necessary.
For this purpose, risks are assessed
based on their likelihood and
impact before and after the
implementation of those
mitigation measures.
4. Monitoring
Risks and associated mitigating
measures are reassessed
quarterly during the year, with
increased frequency for those
areas experiencing significant
changes in the risk landscape.
The remaining risk level is
evaluated to ensure that it is
aligned with the Group’s risk
appetite and reviewed on a
quarterly basis by the EMT.
5. Reporting
Risks that require immediate
action are reported immediately
to line management for action.
Risks that do not require
immediate action are reported
periodically to the operational
management and on a quarterly
basis to the EMT.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202448
OUR RISK MANAGEMENT APPROACH CONTINUED
Risk appetite
We define risk appetite as “the nature
and extent of risk RHI Magnesita is willing
to accept in relation to the pursuit of its
objectives”. We look at risk appetite from
different angles, such as the severity of the
consequences should the risk materialise,
any relevant internal or external factors
influencing the risk, and the status of
management actions to mitigate or control
the risk. A scale is used to help determine
the risk appetite threshold for each risk,
recognising that risk appetite can change
over time.
If a particular risk exceeds its risk appetite
threshold, it could threaten the delivery
of our objectives and therefore require
significant risk mitigation and potentially a
change to the strategy. Risks that approach
the limit of the Group’s risk appetite may
require acceleration or enhancement of
management actions to ensure that risk
remains within appetite levels.
The risk management approach is based
on an assessment of the risk appetite
formed by the Board, covering the key risk
categories (“averse”, “limited”, “moderate”
and “high”). The risk appetite statements
are approved by the Board and are a
foundational element of our risk framework
as they provide guidance to management
on the amount and type of risk we seek to
take in pursuing our objectives. The Board
has carried out a robust assessment of the
Group’s principal and emerging risks.
In 2024, scenarios relating to Trade
Compliance were discussed in depth at the
Audit & Compliance Committee and Board
to assess the risk management approach,
alignment with the strategy, and the risk
appetite being applied.
VERY
LIKELY
LIKELY
POSSIBLE
UNLIKELY
LOW HIGHMODERATE CRITICAL
Group risk chart
Principal risks 2024
1
Macroeconomic and geopolitical environment
2
Inability to execute key strategic initiatives
3
Significant changes in the competitive environment
or speed of disruptive innovation
4
Reliability of the end-to-end supply chain
5
Sustainability – environmental and climate risks
6
Sustainability – Health & Safety risks
7
Regulatory and compliance risks (excluding trade compliance)
8
Cyber and information security risks
9
Trade compliance
10
Organisational capacity to execute strategy, including demonstrating
Company cultural values
12
5 8 9
4
7
3 6
10
49RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR RISK MANAGEMENT APPROACH CONTINUED
Our principal risks
The principal risks are those that the
Board considers may have a significant
impact on the results of the Group and on
its ability to achieve its strategic objectives.
This does not represent an exhaustive list of
risks faced by the Group but encompasses
those considered to be most material to
business performance.
The risks can occur independently from
each other or in combination. Extraordinary
events have the potential to crystallise
multiple principal risks simultaneously,
significantly magnifying the adverse impact.
Eight of the ten principal risks included
in the 2023 Annual Report have been
confirmed to be equally relevant for 2024
and are reported with the same risk
definition as 2023. The principal risk for
“Regulatory and Compliance”, as reported
on in 2023, has been split into two
principal risks in 2024 (“Regulatory and
Compliance” and “Trade Compliance”)
reflecting the distinctive risk characteristics
of Trade Compliance risk compared to the
other risk elements within this category.
The principal risk reported in 2023 of
“Ability to strategically price and deliver
price increases” has been reduced in
risk rating during 2024 (due to the
demonstrated effectiveness of the related
processes and controls) and removed from
the principal risks list. Therefore, there are
again ten principal risks in 2024.
All risks have been reviewed throughout the
year and changes have been assessed to the
rating of five principal risks. Additionally, the
risk appetite relating to two of the principal
risks (“Reliability of the end-to-end supply
chain” and “Environmental and climate
risks”) has changed in 2024. These changes
are described in the section below.
Emerging risks
Identifying emerging risks is a key part
of our risk management process. All risk
assessment sessions at regional or global
level dedicate time to identifying and
discussing emerging risks. These
discussions are facilitated by Internal Audit,
Risk & Compliance who raise risk topics
with knowledge gained from benchmarking
and expert studies and combine these with
the input from over 50 senior leaders on
at least a six-monthly basis.
Emerging risks are assessed to determine
if they need to be added to the principal
risks, Top-20 Group Risk Dashboard,
lower-level risk tracking or retained on
a watchlist. Once added to the formal risk
register, emerging risks are managed in
the same manner as established risks.
The consideration of emerging risks and
changing risk landscape can also lead
to changes in the risk appetite levels.
Risks that have emerged in 2024 or
increased in relevance and therefore
received more focus include:
• Structural weaknesses in the production
network.
• Increasing complexity of sanctions
regimes.
• Risks reflecting market disruptions
and deflationary pressure.
These risks have increased due to the
impact on the Group of increased legislative
requirements, geopolitical factors and
emerging technologies. Additional risk
drivers include the enhanced production
footprint from acquisitions and the digital
transformation of the Group.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202450
The Board reviews the effectiveness of
the system of internal financial, operational
and compliance controls and the risk
management framework. RHI Magnesita
follows the corporate governance
requirements of both the Netherlands,
given the location of its incorporation, and
the UK, due to its listing. Where possible,
the disclosures are combined in this report,
however there are certain risk areas where
the respective governance requirements
necessitate similar but separate assessments.
One such area is the required disclosure
and description of RHI Magnesita’s control
environment and systems. Therefore, the
Company provides both a Management
“In-Control Statement” as is required by
the Dutch Corporate Governance Code
and an internal control system report
as is required under the UK Corporate
Governance Code. Both outline the
measures that RHI Magnesita takes to
ensure a strong control environment. You
can read more about how the Company is
preparing to meet Provision 29 of the UK
Corporate Governance Code on page 209.
The Board is ultimately responsible for
maintaining effective corporate governance,
which includes the Group’s risk management
approach, its system of internal controls
and its internal audit approach.
The Board regularly reviews the
effectiveness of the system of internal
financial, operational and compliance
controls, and the risk management
framework. The Board examines whether
the system of internal controls operates
effectively throughout the year and will
make recommendations when appropriate.
These systems have been in place
throughout 2024, and up to the date of this
report, and comply with the UK Financial
Reporting Council’s Guidance on Risk
Management, Internal Control and Related
Financial and Business Reporting. They are
based on the three lines of defence model,
supported by an end-to-end process
model and a delegation of authorities
structure reflecting the responsibility for
risk management and internal controls
at all management levels.
The Group’s internal control framework
is designed to enable the application of the
Group’s risk appetite. This typically seeks
to avoid or mitigate risks rather than to
completely eliminate the risks associated
with the accomplishment of the Group’s
strategic objectives. It provides reasonable,
but not absolute, assurance against
material misstatement or loss.
The Group has a specific risk management
approach in place and an internal control
framework in relation to its financial reporting
process. These systems include policies
and procedures to ensure that adequate
accounting records are maintained, and
transactions are recorded accurately and
fairly to permit the preparation of financial
statements in accordance with the applicable
accounting standards. For the accounting
process, an accounting manual is used to
structure the internal controls over the
accounting process. In 2024, an Internal
Controls Hub was developed which monitors
control performance, ensuring consistency in
the application of financial reporting controls.
In 2024 the Group developed and
executed projects to improve the internal
processes and systems of the Group. A key
focus area has been delivered by designing
a single set of Group-wide processes for
key activities. In 2025, a complete end to
end “process house” for all major processes
will be implemented.
Alongside this work the Group has
outsourced key transactional processes
to a company specialising in managing
service centre operations. This will ensure
continuous, quality delivery of the selected
transactional services. The main transfer
of activities to the outsource provider
occurred on 1 December 2024 and a
dedicated project team including risk
management, transition management and
service delivery monitoring was established
to ensure the continued effectiveness of
the internal control framework through and
beyond the transfer date. The Group is also
in the execution stages of a multi-year
project in replacing and upgrading its ERP
system. These activities will lead to a step
change improvement in the consistency
and efficiency of the internal control system.
The Group has an Internal Audit function,
with a reporting line to the Chair of the
Audit & Compliance Committee and a
secondary reporting line, for day-to-day
operational matters, to the CFO. The
Internal Audit function provides assurance
to the Audit & Compliance Committee and
the Board on the design and effectiveness
of the internal control framework. Internal
Audit operates within a single department
also comprising Risk Management and
Compliance. The Audit & Compliance
Committee and management ensure that
appropriate safeguards are in place to
maintain the independence of Internal
Audit. The Internal Audit, Risk &
Compliance function works as regionally
based teams, providing a locally focused
governance presence to support regional
management in line with the established
Group-wide model.
In 2024 the Head of Internal Audit, Risk
& Compliance has also fulfilled a role
to oversee the design and development
of finance-related Group processes
underpinning the upgraded ERP system.
The design of the processes and the
associated internal controls do not fall
under his responsibility. The ERP project
has an assurance provider (separate from
Internal Audit) providing updates to the
Board and EMT. The Audit & Compliance
Committee have closely monitored this
arrangement with the Head of Internal
Audit, Risk & Compliance and the work
performed to ensure that the
independence of Internal Audit and the
effectiveness of Risk Management and
Compliance are not compromised.
An external quality assessment of the
effectiveness and capability of the Internal
Audit function was performed in 2021. The
delivery of improvement points from this
report has been completed in subsequent
years and maintained in 2024.
During 2024, Internal Audit conducted
13 planned internal audits and 13 special
regional-focused investigations, reporting
OUR RISK MANAGEMENT APPROACH CONTINUED
Our internal control system
51RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
the most relevant observations and
recommendations to regional management,
the Executive Management team, and
summarised reports to the Audit &
Compliance Committee.
The reports by management and Internal
Audit, Risk & Compliance also facilitated
consideration by the Audit & Compliance
Committee of management actions in
respect of the following key control
framework challenges:
• Improving management and the internal
controls of transformational initiatives.
• Effective integration of acquired entities
into the Group’s culture and internal
control framework.
• Benchmarking the internal control
performance across the regions.
• Continuing the journey towards global
process standardisation.
The Board considers the Company’s risk
management and internal control system
are appropriate and effective to give
reasonable, but not absolute, assurance
against material misstatement or loss.
Planned and implemented improvements
of the internal control systems are
discussed regularly between the Board
and Audit & Compliance Committee.
Given the dynamic nature of the Group and
the continuing evolution of its regionalised
model, the Board has emphasised the
importance of further internal control
system improvements in 2025, most
notably the completion of global process
standardisation work to drive the new ERP
system implementation.
Management “In-Control Statement”
The Board and EMT are responsible for
ensuring adequate risk management and
internal controls systems are in place.
The core design of the internal control
systems is based on extensive work
conducted as part of the merger activity
in 2017 and reassessed in 2020 to create
a more regionally focused and agile
structure. The regional focus was further
increased in early 2022. A further step
change in process standardisation is
expected in 2025 when the new “process
house” will be implemented, including
a refreshed design for the internal control
system. The new internal control system
will be rolled out in the medium term
as part of the new ERP system.
The key internal control measures include
reviews of financial performance and key
control weaknesses at each Board meeting.
To complement the M&A strategy and
increase the focus on integration efforts of
newly acquired companies, the corporate
meeting structure to govern and monitor
the integration of acquired companies has
evolved in 2024. An Integration Toolkit
guides inputs from standardised integration
workstream teams, led by regional and
senior leaders which are consolidated
into EMT-sponsored periodic meetings.
These meetings focus on the review of
the operational and financial performance
delivery and risks against the business
cases for a period of 12 months after the
closing of the acquisition. Outputs are
consolidated in a standard format and
status updates shared with the senior
leadership group of the Company.
To further increase the focus on the
execution of the transformational initiatives
and deliver through a structured progress
tracking and a lean programme structure,
a standardised forum was created. The
structure enabled to focus on
interdependencies across the initiatives
and its risks. Furthermore, standardised key
performance indicators were established
to track the progress and effectiveness
of the initiatives. In 2025, the focus will
remain on these strategic initiatives with
a newly established governance structure
for these projects, including an EMT-led
project board for oversight, monthly project
performance review meetings, and project
circles to ensure a sustainable and
performance driven execution.
The EMT continues to monitor the effective
adoption of corporate culture and values,
especially in respect of the more remote
and newly integrated areas of the
Company; the enhancement of the
corporate culture has been accelerated by
the regional approach. The EMT have visited
selected regions in 2024 and performed
on-site deep dives into all key aspects
of regional performance. Following the
update of the Code of Conduct in early
2023, the policy to report and investigate
misconduct has been updated and
reinforced through increased training and
communication in 2024. The Board and
EMT monitor the response to issues raised
via the whistleblowing process. All key
changes in the internal control framework
were reviewed by the EMT.
OUR RISK MANAGEMENT APPROACH CONTINUED
Each leader is accountable for the
effectiveness of the internal controls within
their areas of responsibility and is required
to complete a self-certification of their
assessment. The self-certification is also
signed-off on a regional level. Measures
are applied in each functional area and
region to assess the effectiveness of
internal controls and to escalate any
identified issues. Control weaknesses
identified by management and those
identified through the quality management
system reviews, risk management activity
and internal audit reports are escalated
to the EMT for review and resolution,
all of which is overseen by the Audit &
Compliance Committee. The key control
weaknesses identified from these processes
were addressed within 2024.
In 2024, risk management activity focused
on maintaining the previously established,
mechanisms and integrating acquired
entities and outsourced services into the risk
assessment models. Plant risk management
and fraud risk management were executed
in 2024 following the established
approaches. This approach continued
to further strengthen the link between
strategy setting and risk management,
enhanced by extensive collaboration
between the respective teams.
The delivery of the risk management
approach and the results of the internal
quality assessment and planned next steps
were reviewed by the Audit & Compliance
Committee. In addition, the risk appetite
was discussed and approved by the Audit
& Compliance Committee and the Board
following a series of discussion workshops.
Therefore, Management confirms that:
• the report provides sufficient insights
into any failings in the effectiveness
of the internal risk management and
control systems with regard to the risks;
• the aforementioned systems provide
reasonable assurance that the financial
reporting does not contain any material
inaccuracies;
• based on the current state of affairs, it
is justified that the financial reporting is
prepared on a going concern basis; and
• the report states the material risks, and
the uncertainties, to the extent that they
are relevant to the expectation of the
Company’s continuity for the period
of twelve months after the preparation
of the report.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202452
Viability statement
Assessment period
The Board has assessed the prospects
and the viability of the Group over the
forthcoming 12 months, based on a detailed
financial plan (i.e. for financial year 2025)
as well as a longer period e.g. the long-term
plan to 2027. The Board believes that the
three year period remains appropriate,
being based on its internal budget,
financial planning timeframes and the
established targets and aims, which
combine to give reasonable expectations
of the Group’s position and performance.
The assessment process and
key assumptions
The Board’s assessment included review
of the potential financial impacts as well
as available financial headroom in the most
severe but still plausible scenarios that
could threaten the viability of the Group.
These scenarios considered the current
financial position of the Group and the
potential mitigations that management
reasonably believes would be available
to the Company. These mitigations include
the use of cash, access to debt facilities and
credit lines, reductions in capital expenditure,
divestments and dividend reductions.
The financial forecast is based on a number
of key assumptions, including product
prices, exchange rates, raw material prices,
energy, freight and labour costs, estimates
of production volumes, future capital
expenditure and delivery of our strategic
cost reduction and sales initiatives. In
addition, the forecast does not assume the
renewal of existing debt facilities or raising of
new debt. A key component of the financial
forecast and strategic plan is the expected
growth of steel production and the output
of non-steel clients in all regions, combined
with the development of the specific
refractory consumption, taking account
of technological improvements.
Management also performed a reverse
stress test assuming a severe decrease in
sales volumes of 14% sustained over 30
months. Management analysed the impact
of the 2008 Global Financial crisis and the
COVID-19 impact over sales volumes and
margins. Whilst the decrease in volumes
was notable, the Group was able to recover
the volumes within 12 months.
The scenarios that have been modelled are
based on severe but plausible outcomes
and associated costs are based on actual
experience where possible. The scenarios
have been considered individually and
as a cluster of events.
Assessment of viability
The Group’s liquidity amounts to
€1,176 million comprising cash and cash
equivalents of €576 million and undrawn
committed credit facilities of €600 million
as of 31 December 2024. This is sufficient
to absorb the financial impact of the risks
modelled in the stress and sensitivity
analysis. However, if these risks were to
materialise, the Group also has a range of
additional mitigating actions that enable it
to maintain its financial strength, including
reduction in fixed costs and capital
expenditure, raising debt or reducing
or cancelling the dividend.
Viability statement
The Directors believe that the Group is
well-placed to manage its principal risks
successfully. In making this statement the
Directors have considered the resilience
of the Group, taking account of its current
position, the risk appetite, the principal risks
facing the business in severe but plausible
scenarios, and the effectiveness of any
mitigating actions.
The Directors have a reasonable
expectation that the Group and Company
will be able to continue in operation and
meet its liabilities as they fall due over
the period to December 2027.
Going concern
In considering the appropriateness of
adopting the going concern basis, the
Directors assessed the Group’s potential
cash generation and considered a range
of downside scenarios that model different
degrees of potential economic downturn,
using the same model as for the viability
assessment. This assessment covers at least
12 months from the from the date of approval
of the Consolidated Financial Statements.
The scenarios considered by the Directors
include a severe but plausible downside
and a reverse stress test which determines
the level of EBITDA that breaches the
Group’s debt covenant. Further mitigating
actions within management control would
be undertaken in such scenarios, including
but not limited to, reduced future operating
and fixed costs, capital expenditure, and
dividend distributions. These mitigation
actions were not incorporated in the
downside modelling. The Directors also
considered the Group’s current liquidity
and available facilities as outlined above.
In the above scenarios and taking into
account liquidity and available resources,
and before the inclusion of all mitigating
actions, the Directors consider it is
appropriate to continue to adopt the
going concern basis for the period
ended 31 December 2024.
Scenario Principal risks
Severity of
the impact
Severe macroeconomic
downturn
1. Macroeconomic and geopolitical environment. Low
Severe macroeconomic
downturn with impact
of multiple principal risk
1. Macroeconomic and geopolitical environment,
2. Inability to deliver strategic projects,
3. Significant changes in the competitive
environment or speed of disruptive innovation,
4. Reliability of end-to-end supply chain,
10. Organisational capacity to execute strategy,
including demonstrating company cultural values.
Medium
Reverse stress test
assuming significant
and sustained reduction
in sales volumes
1. Macroeconomic and geopolitical environment. High
OUR RISK MANAGEMENT APPROACH CONTINUED
“ The Directors have a reasonable expectation that
the Group and Company will be able to continue
in operation and meet their liabilities as they fall
due over the period to December 2027.”
53RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Principal risks
OUR RISK MANAGEMENT APPROACH CONTINUED
1. Macroeconomic and
geopolitical environment
Link to strategy
Target risk appetite
KPIs
Revenue, Adjusted EBITA margin,
Adjusted EPS, ROIC
Internally monitored metrics
Key macroeconomic and financial market
indicators, steel, cement, and aluminium
forecasted production.
Risk description
Changes in the global economic
environment, financial markets conditions
and adverse geopolitical developments
may have an impact on the Group’s
revenue and profitability.
The macroeconomic environment changes
leading to sales volume reductions can
arise from industrial factors or from wider
global issues, such as a global economic
conditions, regional conflicts, or global
logistic challenges.
The demand for refractory products is
directly influenced by steel, cement, glass
and non-ferrous metal production, energy
prices and the production methods used
by customers.
Due to the current market situation,
fluctuations in sales volumes have an
impact on the utilisation of production
capacities and consequently on the
Group’s profitability and gearing.
Examples of specific risks:
• Decreasing investment and delays
in customers’ infrastructure projects
(therefore reducing steel and cement
demand) leading to lower refractory
consumption and depressed
sales volumes.
• Customers focusing on lower-cost
and more commoditised refractories
because of low-capacity utilisation.
• Lower sales volumes leading to lower
fixed cost absorption.
• Increasing costs of core resources
and supplies (e.g. energy, labour,
raw materials, freight and packaging).
• Increased trade restrictions, tariffs,
or export bans could disrupt supply
chains and increase material costs.
• Currency fluctuations could impact
the cost of imports and exports.
Target risk appetite
High
Moderate
Limited
Averse
Risk mitigation
• Initiatives to increase the Group’s
resilience, through establishing leaner
processes and lower fixed cost structures
whilst increasing the Group’s market
share and the value for our customers.
• Diversification of geographies
and industries.
• Close monitoring of production
costs fluctuations to guarantee
the expected profitability.
• Price increase initiative to pass
inflationary costs to customers.
• Early leading indicators to ensure
identification of emerging
macroeconomic trends.
• Treasury Policy and usage of financial
instruments to mitigate risk exposure
to financial markets.
• Agile, experienced, and solution-focused
management teams who can respond
quickly and innovatively to challenges.
Risk movement
During 2024, the macroeconomic
environment continued to be challenging
for the refractory industry. The refractory
industry experienced a drop in customer
demand in most markets. In addition
to major ongoing geopolitical conflicts,
2024 saw an increase in smaller but more
frequent crises, the implications of which
can be difficult to assess or predict.
This also led to inflation levels remaining
stable and tightened input production
costs. The outlook for 2025 expects a
stable inflation rate with continued high
interest rates.
The risk appetite remains high (no change
from 2023). The risk score is unchanged and
within the risk appetite but has the potential
to exceed it and is closely monitored.
Link to strategy
Competitiveness
Business model
Markets
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202454
OUR RISK MANAGEMENT APPROACH CONTINUED
Target risk appetite
High
Moderate
Limited
Averse
2. Inability to execute
key strategic initiatives
Link to strategy
Target risk appetite
KPIs
Voluntary employee turnover, Revenue,
Adjusted EBITA margin, Adjusted EPS,
Leverage, ROIC
Internally monitored metrics
Adjusted EBITA from strategic initiatives,
ROIC from strategic initiatives, completion
of strategic initiatives on-time and
on-budget.
Risk description
The Group’s strategic initiatives include
digitalisation, cost optimisation, sales
expansion, production network optimisation,
recycling and M&A projects.
Effective prioritisation and execution are
key to delivering the Group strategy. The
ambition level of these initiatives requires
a high level of management capacity to
effectively deliver change management
and strategic initiatives execution.
The failure to effectively execute these
initiatives because of external or internal
circumstances may lead to lower than
planned financial performance, including
loss of revenue and margin.
Examples of specific risks:
• Failure to develop the Company strategy
into specific actions.
• Failure to react in a timely manner
to a changing environment.
• Failure to identify trends and emerging
technologies.
• Failure to effectively deliver strategic
initiatives.
• M&A underperformance.
• Inability to fully realise benefits from
fixed asset capex investments.
Risk mitigation
• Group-wide strategy with a high focus
on key priorities.
• Postponement or cessation of
strategically non-important projects.
• Strengthening of the culture
of accountability.
• Leadership capability development
programme.
• Deep dive learning-based review
on each strategic initiative.
• Increased focus and oversight of
investments and enhanced financially-
based tracking during the delivery phase
of corporate development and cost
saving initiatives.
• Strong and impactful Group strategy
team to have a broader more challenging
role across the Group, concentrated on
global strategies for core product groups.
Risk movement
Since December 2021 the Group has
undertaken a programme of acquisitions
and much focus has been given to
generating the strategic benefits from
integrating these acquisitions with a
geographically diversified footprint.
In 2024 most focus was dedicated to
the integration of acquired companies
and transformational change projects
to enhance strategic execution and set
a strong basis to be fit for the future.
The Group has taken many learnings from
major capex projects and successfully
embedded these learnings within a new
mindset for capex for future projects.
Considering that the principal risk
covers a broad range of strategic initiatives,
the overall risk score is unchanged and
remains within the risk appetite but requires
close monitoring.
Link to strategy
Competitiveness
Business model
Markets
55RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR RISK MANAGEMENT APPROACH CONTINUED
Target risk appetite
High
Moderate
Limited
Averse
Risk mitigation
• Create a climate that fosters innovation
and “out of the box” thinking.
• Continued investment in R&D,
including, importantly, on sustainability
in line with the Group’s strategy.
• Focus development activity on projects
aimed at an agile and fast impact on
the market.
• Monitoring of key R&D and innovation
metrics.
• Partnering with third-party innovation
leaders.
• Develop a digital strategy and invest
in technology infrastructure, tools,
and talent.
Risk movement
The success of this approach has been
seen in the customer satisfaction surveys.
In 2024, the Company experienced an
increase of non-traditional competitors,
particularly from regions with lower
production costs leveraging an aggressive
pricing strategy and increasing the market
pressures. Therefore the likelihood rating
and overall risk score has increased.
The Company has successfully made
progress on the strategy to enhance
capabilities and market reach through
acquisitions and continues to invest in
recycling business and sustainability.
Furthermore, the Group retains the capability
and ambition to develop customer-facing
digital solutions but aligned to the pace
of change sought by our customers.
The risk remains within the risk appetite
and is consistently monitored.
Link to strategy
Competitiveness
Business model
Markets
3. Significant changes
in the competitive
environment or speed
of disruptive innovation
Link to strategy
Target risk appetite
KPIs
Revenue, Adjusted EBITA margin,
Adjusted EPS, ROIC, R&D & Technical
Marketing Spend
Internally monitored metrics
R&D and technical marketing spend, ROIC
on such spend and time-to-market, sales
of digital products, cost savings generated
by usage of digital technologies.
Risk description
Depending on the ability of the Group to
develop adequate products and services,
the changes in customers’ preferences
towards innovative products may present
either an opportunity or a threat by
increasing pressure on demand
and margins.
The speed of evolution of customer
demand for environmentally beneficial
features, digitalisation and services may
be faster than the pace of implementation
of the Group’s digital strategy.
Examples of specific risks:
• Disruptive product technology
introduced by a competitor.
• Failure to identify digitalisation trends
and technologies.
• Competitors being faster and more
agile in responding to changing
customer requirements.
• New market entrants or non-traditional
competitors leveraging an aggressive
pricing strategy attracting customers.
• Failing to adopt AI-powered predictive
maintenance and manufacturing
processes.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202456
4. Reliability of
the end-to-end
supply chain
Link to strategy
Target risk appetite
KPIs
Revenue, Adjusted EBITA margin,
Adjusted EPS, ROIC
Internally monitored metrics
Refractory lead times, plants’ capacity
utilisation, Supply in Full on Time,
Inventory levels, customer surveys.
Risk description
The journey from raw material to finished
goods can span several months and
might require shipments across the globe.
The ability to react quickly to changes
prompted by internal and external factors
is therefore key to ensuring value delivery
to our customers.
In addition, the ability to forecast the
demand for the Group’s products is key
to enabling efficient and effective planning
of production-related activities, including
procurement, inventory planning and the
size and locations of the plants in our
production network.
Our global operations can be disrupted
by issues in a specific geography or by
industry-wide challenges. However, the
ability to transfer some of the production
between geographies to mitigate the risk
of business interruption can be deployed
as a risk mitigation strategy.
Examples of specific risks:
• Structural weakness in production
network.
• Production interruption at a single-source
manufacturing site.
• Inability to accurately predict customer
demand leading to missed sales
opportunities, inefficient production
planning and additional costs.
• Global logistic challenges impacting
the stability, speed and cost of our
end-to-end supply chain.
• A natural disaster or major political crisis
in one or more countries or regions.
OUR RISK MANAGEMENT APPROACH CONTINUED
Target risk appetite
High
Moderate
Limited
Averse
Risk mitigation
• Supply chain initiatives to improve and
address specific operational challenges.
• Regular reviews of sales, production and
financial plans, as well as longer-term
portfolio decisions, are based on
extensive research.
• Additional system resources leading
to improvements in delivery reliability
and reduction of production backlog.
• Geographical diversification of the
production network.
• Implementation of an optimised
production footprint to meet planned
requirements.
• Risk-based investment policy.
• Global insurance coverage.
• Focus on the minimisation of sole-source
materials and strategically increasing
stock levels.
• Concentrated efforts on increasing
transparency and enhancing the
communication flow.
Risk movement
In 2024 the Group achieved its highest
ever customer satisfaction ratings and the
highest PIFOT rating for on-time deliveries
in a second consecutive period.
Localised logistics challenges are still
monitored and mitigated, such as the
Red Sea shipping lane issues in late 2023.
The focus has evolved to assessing
how well the acquired sites and a more
local-for-local production approach fit with
legacy sites together to form an optimum
production network. This is being evaluated
in a single approach led by global product
strategies. The Group is currently operating
at lower than optimum plant capacity
utilisation levels in anticipation of a recovery
in core markets. Should this recovery not
occur then the risk of structural weakness
in the production network increases,
particularly given the increased plant
footprint from M&A.
Consequently, the likelihood of this risk
and the risk score has increased. The risk
remains within the risk appetite and is
consistently monitored.
Link to strategy
Competitiveness
Business model
Markets
57RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR RISK MANAGEMENT APPROACH CONTINUED
Target risk appetite
High
Moderate
Limited
Averse
Risk mitigation
• Regular environmental audits and risk
monitoring at all sites.
• Well-established Board-level Corporate
Sustainability Committee (“CSC”) to
oversee and challenge management’s
environmental and climate strategy.
• We manage, measure and report our
climate-related risks and opportunities
according to the Task Force on Climate-
related Financial Disclosures (“TCFD”)
recommendations (as described on
pages 64 to 171).
• A climate strategy focused on recycling,
carbon capture and usage, fuel switch,
energy efficiency, and innovative
customer solutions. Read more about
Tackling Climate Change on page 22.
• Increased focus on the use of secondary
raw material as a core element of the
Group’s strategy.
• The geographical diversity of the
Group’s operations and the ability to shift
production reduce the impact of single
events impacting specific geographies.
• Increased focus on sustainable
procurement.
• Executive Long-Term Incentive Plan
(LTIP) and employee bonus linked to
achievement of the Group’s CO
reduction and recycling targets.
Risk movement
In 2024, the risk appetite was changed
from Limited to Moderate. An increasing
regulatory complexity and rising risk of
potential fines is mitigated by the good
progress in the achievement of the
Group sustainability targets.
The strategic partnership between
RHI Magnesita and MCi Carbon to produce
CO-negative mineral value-added
products was granted significant funding
at the end of 2024. This will further support
to build the world’s first Carbon Capture
Utilisation (“CCU”) pilot plant for the
refractory industry in Hochfilzen, Austria.
A continuing major risk for the Group is the
proposed introduction of CBAM. For the
refractory industry, it could create a
significant impact.
The medium-term R&D programme
focused on sustainability improvement
initiatives continued during 2024.
The risk is within the Group’s risk appetite and
is continuously monitored by management.
Link to strategy
Competitiveness
Business model
Markets
5. Sustainability –
environmental and
climate risks
Link to strategy
Target risk appetite
KPIs
Relative CO emissions,
Use of secondary raw material,
Revenue, Adjusted EBITA margin,
Adjusted EPS, ROIC
Internally monitored metrics
Relative CO emissions, use of secondary
raw material, progress towards the
achievement of environmental and
climate targets.
Risk description
Controlled emissions and use of potentially
hazardous materials are inherent to the
production of refractory products.
The risk of failing to meet environmental
regulatory targets or uncontrolled emissions
at our production sites exists and may result
in high financial losses and liabilities.
The evolving regulatory environment,
the increased stakeholders’ focus, and the
Group’s commitment to sustainability led
to increasing investment and effort being
dedicated to achieving environmental
and climate goals.
There are future environmental and
climate targets that can only be met by
new technological solutions to change the
Group’s production processes and by the
delivery of environmental improvements
by the Group’s suppliers and customers.
Examples of specific risks:
• Uncontrolled emissions.
• Inability to meet sustainability targets.
• Failure in meeting stakeholders’
expectations.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202458
OUR RISK MANAGEMENT APPROACH CONTINUED
Target risk appetite
High
Moderate
Limited
Averse
Risk mitigation
• H&S objectives are defined as a core
Company objective, and the performance
is constantly monitored.
• H&S approach is based on leading global
standards and practices, including regular
risk monitoring, emphasis on “near miss”
reporting and root cause analysis.
• Focus on collaboratively enhancing
the H&S approach at customer and
supplier sites.
• Extensive focus on H&S at the Corporate
Sustainability Committee.
• Specific action plans in the event of
employee or contractor H&S incidents.
• Globally harmonised safety
instruction videos.
• Global personal protective equipment
(“PPE”) standards implemented.
• Measures focussing on a safety-conscious
workforce driven by a strong leadership
culture of H&S.
Risk movement
Following the fatal accident in 2023,
the two fatal accidents in 2024, and the
comprehensive root cause analysis of these
accidents with external specialist-led
reviews, initiatives to improve the working
practices and significant cultural changes
in relation to H&S risks were launched.
Additional measures implemented in 2024
include increased specialist resources to
develop global guidelines, and deep-dive
safety workshops with EMT, strengthening
the tone from the top to drive significant
cultural change.
Safety remains the top priority for the
Group with increased focus, investment
and management efforts in order to improve
the overall H&S performance and bring
the risk back to within the risk appetite.
Whilst recognising the measures launched
in 2024 and the planned additional
measures for 2025, Executive Management
emphasise that meaningful change to this
risk can only come from sustained cultural
change across the Group. Recent statistical
analysis showed that a significant level of
all accidents within the Group recorded in
2024 had the potential to be severe or fatal
accidents. Therefore the likelihood rating
of the risk has increased from 2023.
The risk level remains outside the risk
appetite with continued management
commitment to reduce the risk level and
bring it within the risk appetite in 2025.
Link to strategy
Competitiveness
Business model
Markets
6. Sustainability –
Health & Safety risks
Link to strategy
Target risk appetite
KPIs
LTIF, Revenue, Adjusted EBITA margin,
Adjusted EPS, ROIC, SIFp
Internally monitored metrics
Total Recordable Injury Frequency (“TRIF”),
Lost Time Injury Frequency (“LTIF”),
Preventive Ratio, Near Misses, Unsafe
Situations, Serious Injuries & Fatalities (“SIFp”)
Risk description
Employees and contractors may be
exposed to Health & Safety (“H&S”) hazards
in our plants of which inherent risks cannot
be completely eliminated.
Our activities and products may potentially
cause accidents at our customers’ sites.
Beyond the harm to individuals, H&S
incidents can lead to high financial penalties,
site closure, the loss of licence to operate
in geographical territories and a loss in
reputation for the Group.
The health of our employees and
contractors, both mental and physical,
is a significant area of risk to the Group.
Examples of specific risks:
• Fatal or serious accident at
manufacturing or customer site.
• Site shut down due to H&S incidents.
• Loss in reputation for the Group due
to severe H&S accidents.
59RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR RISK MANAGEMENT APPROACH CONTINUED
Target risk appetite
High
Moderate
Limited
Averse
7. Regulatory and
compliance risks
(excluding trade
compliance)
Link to strategy
Target risk appetite
KPIs
Revenue, Adjusted EBITA margin,
Adjusted EPS, ROIC
Internally monitored metrics
Completion rate of various internal
compliance trainings, whistleblowing
reports, data privacy incidents.
Risk description
The Group faces increasing
regulatory complexity and operates
in some geographies with inherently
high corruption risks.
We strive to establish a culture of
compliance throughout the organisation.
We are exposed to regulatory and
compliance risks which may result in
financial losses or operational restrictions.
Regulatory changes could impact the
profitability of our operations and require
investment to achieve compliance.
Examples of specific risks:
• Failure to act in accordance with our
Code of Conduct.
• Violation of anti-bribery and corruption
laws by employees or third-party
representatives.
• Violation of data privacy regulations.
Risk mitigation
• Ethical values supported by strong
corporate culture.
• Code of Conduct and compliance
policies and procedures.
• Enhancement of global training,
documentation of compliance matters
and communication.
• Various whistleblowing channels are
available to employees and external
parties to report compliance concerns.
Concerns can also be reported
anonymously, and all reports are
followed up by qualified professionals.
• Range of interventions performed in
conjunction with each acquired
business to assess regulatory risk and
introduce and embed the Group’s
compliance approach.
Risk movement
In 2024, the risk was re-evaluated
and split into two risks. This risk focuses
on areas of non-compliance as defined
by the Association of International Fraud
Examiners. The second risk relates to Trade
Compliance and is described as principal
risk 9 on page 49.
This risk has decreased. Integration efforts
in 2024 ensured and demonstrated that
acquired entities have a consistent approach
to compliance. This was mainly measured
by the training programmes launched and
the usage of the established reporting
channels. Furthermore, the processes and
systems are deemed effective to prevent
and detect potential misconduct.
The overall risk level is within the Group’s
risk appetite.
Link to strategy
Competitiveness
Business model
Markets
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202460
OUR RISK MANAGEMENT APPROACH CONTINUED
8. Cyber and information
security risks
Link to strategy
Target risk appetite
KPIs
Revenue, Adjusted EBITA margin,
Adjusted EPS, ROIC
Internally monitored metrics
Security incidents classified by severity,
phishing test fail rates, triage escalation time.
Risk description
The Group’s reliance on IT systems and
the greater focus on digitalisation result in
a growing exposure to cyber and information
security risks due to factors such as the
adoption of advanced technologies,
interconnected systems, and sophisticated
cyber threats.
The possible impact of cyber and
information security risks could range from
operational disruptions, loss of intellectual
property, legal compliance issues and
frauds, to significant reputation losses.
Examples of specific risks:
• Intellectual property or confidential
data theft.
• Personal data breach.
• Software or hardware failure leading
to critical business process interruption.
• Cyber-attacks on office and production
IT leading to financial losses
(e.g. ransomware, sabotage).
Risk mitigation
• EMT crisis management simulation
exercise held focusing on cyber security.
• Global information and cyber security
policies drafted in line with information
security best practices, standards
and frameworks.
• Continuous awareness campaign
and training.
• Regular risk assessment and
penetration testing.
• Cyber security detection and
response team.
• Network, device and application
protection.
Risk movement
The Group experienced a continued
increase in the inherent risk level of cyber
and information security risks due to the
fast-evolving cyber and information
security global landscape.
Furthermore, the Company is undergoing
a transformation process that is increasingly
integrating networked production systems,
technologies and digital platforms
throughout the supply chain. While these
innovations enable significant efficiency
and competitive advantages, they also
come with increased inherent cyber
and information security risks.
The Group continued to implement
additional risk-mitigating measures to
respond to this rising threat, including
awareness campaigns, data encryption
and OT security monitoring, and crisis
management simulations.
The risk level is unchanged from 2023.
Leadership commitment to maintaining
robust internal controls and a proactive
cybersecurity strategy remains.
The risk is still evaluated to be within
the Group’s risk appetite and closely
monitored to drive fast responses
to changing external threats.
Target risk appetite
High
Moderate
Limited
Averse
Link to strategy
Competitiveness
Business model
Markets
61RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
OUR RISK MANAGEMENT APPROACH CONTINUED
Target risk appetite
High
Moderate
Limited
Averse
Risk mitigation
• Robust developed trade compliance
policies and procedures, including
mandatory staff training.
• Clear governance structure for
accountability and oversight.
• Automated trade compliance software
to ensure real-time adherence to
export regulations.
• Bespoke compliance risk assessment
and Know-Your-Customers due diligence
procedures for customers, sales agents,
and other business partners.
• Proactive risk-based monitoring
on high-risk business partners.
Risk movement
The specific risk in relation to sanction
regimes and export controls has become
increasingly complex due to the fast pace
of diverse regulatory developments and
the dynamic geopolitical landscape that
encompass cross-border trade.
In 2024, the Group has devoted a
significant amount of time to strengthen
the tone at the top for geographies
considered to be high risk.
Additionally, a higher risk exposure remains
for acquired entities not integrated in the
Group ERP system and automated sanction
and export control risk screenings until
strategic digitalisation projects are
further progressed.
Link to strategy
Competitiveness
Business model
Markets
9. Trade Compliance
Link to strategy
Target risk appetite
KPIs
Penalties and fees, Revenue, EBITA
Internally monitored metrics
Penalties and other fees regarding Trade
Compliance matters, access to markets
and territories, revenue in exposed markets.
Risk description
Trade compliance risks refer to the
potential legal, financial, and reputational
consequences that arise from non-
compliance with international trade laws,
export control regulations, and sanctions.
Examples of specific risks:
• Operating in or trading with sanctioned
countries or entities could lead to severe
penalties, including fines, asset freezes,
and potential criminal charges.
• Violations of export control laws
or import restrictions, including
misclassification of goods,
underreporting values, or failure to
secure required licences, can result
in penalties or shipment delays.
• Frequent changes in trade policies, such
as tariffs, quotas, and trade agreements,
can create uncertainty and require
constant updates to compliance
strategies.
• Risks associated with suppliers,
distributors, and other third-party
intermediaries not adhering to trade laws
can implicate the Group in violations,
even if unintentional.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202462
OUR RISK MANAGEMENT APPROACH CONTINUED
Target risk appetite
High
Moderate
Limited
Averse
10. Organisational capacity
to execute strategy,
including demonstrating
Company cultural values
Link to strategy
Target risk appetite
KPIs
Gender diversity in leadership, Voluntary
employee turnover, Adjusted EBITA,
Adjusted EPS, ROIC
Internally monitored metrics
Gender diversity in leadership,
Voluntary Employee Turnover, Adjusted
EBITA from strategic initiatives, ROIC
on strategic initiatives.
Risk description
The Group’s corporate culture, combined
with an optimal internal structure, adequate
skills and resources, are key to ensuring the
delivery of the Group strategy. To ensure
access to adequate skills, the Group is
focused on being able to retain talent as
well as attract talent from the market.
A key focus of the Group’s corporate
culture is gender, ethnic and generational
diversity, which is seen as an important
driver to enhance performance.
Examples of specific risks:
• Inability to attract and retain top talent.
• Lack of accountability and responsibility.
• Inconsistent behaviour across the Group.
Risk mitigation
• Specific focus on People and Culture
strategy in the Board and EMT 2024
strategy workshops.
• Continuous emphasis on the Company
culture as a key enabler of performance
and driver of strategy execution.
• Range of other awareness-based
leadership training and initiatives to
support the attraction and retention
of “Generation Z” talent.
• Dedicated leadership capability
enhancement programme.
• “Tone from the Top” leadership culture.
• Developing talent, enhancing diversity
and promoting Company culture
as significant components in the
People Cycle.
• Trainee programme to develop
graduates into future leaders.
Risk movement
Throughout 2024 EMT have successfully
made organisational changes to promote
strategy execution which have confirmed
the capacity is in place to deliver the
strategy, together with the organisational
flexibility to adapt to emerging challenges.
The risk appetite was tightened to ensure
a focus on people retention and managing
any impact within acceptable levels. The
Group has high levels of people retention
and views people attraction risk as low
in the short to medium term. Therefore,
the likelihood of this risk has been reduced
and the risk score reduced.
The risk remains within the risk appetite
and is closely monitored by leadership.
Link to strategy
Competitiveness
Business model
Markets
63RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
Sustainability
Statement
In compliance with the provisions of the Corporate
Sustainability Reporting Directive (“CSRD”),
article 29(a) of EU Directive 2013/34/EU,
including compliance with the European
Sustainability Reporting Standards (ESRS)
and the Taxonomy Regulation, Article 8
of EU Regulation 2020/852.
SUSTAINABILITY
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202464
CONSOLIDATED SUSTAINABILITY STATEMENT
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 65
Contents
Contents ......................................................................................................................................................................................................................... 65
General Information .................................................................................................................................................................................................. 73
Overview ................................................................................................................................................................................................................. 73
Application of CSRD and ESRS ....................................................................................................................................................................... 73
Categories of ESRS standards .......................................................................................................................................................................... 73
Sector-agnostic disclosures according to cross-cutting and topical standards .................................................................................... 73
Disclosures according to topical ESRS ....................................................................................................................................................... 73
Group-specific disclosures........................................................................................................................................................................... 73
CO2 and Energy intensity targets and metrics .......................................................................................................................................... 73
Health and Safety performance .................................................................................................................................................................... 74
Recyclability of spent refractories ................................................................................................................................................................ 74
Avoided Emissions .......................................................................................................................................................................................... 74
Recycling rate ................................................................................................................................................................................................. 74
Scope 3 emissions due to purchased raw materials ................................................................................................................................... 74
Scope 1 emissions due to geogenic process emissions ............................................................................................................................. 74
Supply of enabling technologies and low carbon footprint products ...................................................................................................... 74
The number of ETS certificates and ETS expenditures .............................................................................................................................. 74
Workplace safety incidents and potential incidents of forced labour in the supply chain ................................................................... 74
Reporting areas ................................................................................................................................................................................................... 74
Double materiality as the basis for our sustainability disclosures ................................................................................................................ 74
ESRS 2 General disclosures ................................................................................................................................................................................. 75
Basis for preparation .......................................................................................................................................................................................... 75
Disclosure requirement BP-1 – General basis for preparation of the Consolidated Sustainability Statements ................................ 75
Scope of consolidation ................................................................................................................................................................................. 75
Upstream and downstream value chain ...................................................................................................................................................... 75
Exemptions ..................................................................................................................................................................................................... 76
Disclosure requirement BP-2 – Disclosures in relation to specific circumstances............................................................................... 76
Time horizons ................................................................................................................................................................................................. 76
Value chain estimation .................................................................................................................................................................................. 76
Sources of estimation and outcome uncertainty ....................................................................................................................................... 76
Changes in preparation or presentation of sustainability information .................................................................................................... 76
Reporting errors in prior periods .................................................................................................................................................................. 76
Disclosures stemming from other legislation or generally accepted sustainability reporting pronouncements .............................. 77
Incorporation by reference ........................................................................................................................................................................... 77
Use of phase-in provisions in accordance with Appendix C of ESRS 1 ................................................................................................... 77
Governance .................................................................................................................................................................................................... 77
Disclosure requirement GOV-1 – The role of the administrative, management and supervisory bodies .......................................... 77
Board powers, responsibilities and representation; EMT and delegation of authority; Board composition; Board diversity ............ 77
Executive Management Team ...................................................................................................................................................................... 77
65RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
66 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
EMT role in managing and overseeing sustainability impacts, risks and opportunities ........................................................................ 77
EMT skill and experience in sustainability matters .................................................................................................................................... 78
Process for setting and monitoring sustainability targets ......................................................................................................................... 78
Corporate Sustainability Committee (“CSC”) ............................................................................................................................................ 79
CSC role in managing and overseeing sustainability impacts, risks and opportunities ....................................................................... 79
CSC skill and experience in sustainability matters ................................................................................................................................... 79
Sustainability governance structure .......................................................................................................................................................... 80
Board skills and experience ......................................................................................................................................................................... 80
Disclosure requirement GOV-2 – Information provided to, and sustainability matters addressed by the undertaking’s
administrative, management and supervisory bodies .............................................................................................................................. 80
How CSC is informed about impacts, risks and opportunities ................................................................................................................ 80
How Board considers sustainability related impacts, risks and opportunities ....................................................................................... 80
Disclosure requirement GOV-3 – Integration of sustainability-related performance in incentive schemes .................................... 81
Annual bonus .................................................................................................................................................................................................. 81
Long-term incentive plan (LTIP) .................................................................................................................................................................... 81
Disclosure requirement GOV-4 – Statement on due diligence ............................................................................................................. 82
Disclosure requirement GOV-5 – Risk management and internal controls over sustainability reporting ........................................ 82
Strategy ........................................................................................................................................................................................................... 83
Disclosure requirement SBM-1 – Strategy, business model and value chain ....................................................................................... 83
Business model .............................................................................................................................................................................................. 84
Value chain ..................................................................................................................................................................................................... 85
Significant products and services offered................................................................................................................................................... 85
Significant markets and customers served ................................................................................................................................................. 85
Banned products ........................................................................................................................................................................................... 85
Business relationships along the value chain ............................................................................................................................................ 85
Upstream business actors ............................................................................................................................................................................. 85
Disclosure requirement SBM-2 – Interests and views of stakeholders .................................................................................................. 86
Disclosure requirement SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model
......................................................................................................................................................................................................................... 86
Material impacts, risks and opportunities and their interaction with strategy and business model .................................................... 86
Impact, risk and opportunity management ..................................................................................................................................................100
Disclosure Requirement IRO-1 – Description of the process to identify and assess material impacts, risks and opportunities....100
Impact materiality assessment ...................................................................................................................................................................100
Identification of impacts............................................................................................................................................................................... 101
Scoping and classification of individual impacts ...................................................................................................................................... 101
Assessment of significance of individual impacts .................................................................................................................................... 101
Analysis of results and materiality thresholds ........................................................................................................................................... 101
Financial materiality assessment ................................................................................................................................................................ 101
Gap analysis .................................................................................................................................................................................................. 101
Risk mapping against ESRS topics .............................................................................................................................................................. 101
Analysis of results and materiality thresholds .......................................................................................................................................... 102
Stakeholder perception and validation of Double Materiality Assessment (“DMA”) results............................................................... 102
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202466
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 67
Results ........................................................................................................................................................................................................... 102
Disclosure requirement IRO-2 – Disclosure requirements in ESRS covered by the undertaking’s Consolidated Sustainability
Statement ..................................................................................................................................................................................................... 102
MDR – minimum disclosure requirements .............................................................................................................................................. 107
Environmental information..................................................................................................................................................................................... 108
Disclosures pursuant to Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation) .......................................................................... 108
Accounting policy ....................................................................................................................................................................................... 108
Taxonomy eligible activities of RHI Magnesita ......................................................................................................................................... 108
Manufacture of other low carbon technologies ....................................................................................................................................... 108
EAF refractories ............................................................................................................................................................................................ 108
Digital Solutions........................................................................................................................................................................................... 109
Material recovery from non-hazardous waste .......................................................................................................................................... 109
Sorting and material recovery of non-hazardous waste ......................................................................................................................... 109
Conservation and restoration of habitats, ecosystems and species ....................................................................................................... 110
KPIs ................................................................................................................................................................................................................. 110
Turnover ......................................................................................................................................................................................................... 110
Capital expenditure ...................................................................................................................................................................................... 110
Operating expenditure ................................................................................................................................................................................. 110
Avoidance of double counting ...................................................................................................................................................................... 111
Do No Significant Harm (“DNSH”) ................................................................................................................................................................. 111
DNSH to climate change adaptation ............................................................................................................................................................ 111
Activity 5.9 ...................................................................................................................................................................................................... 111
DNSH to protection and restoration of biodiversity and ecosystems ....................................................................................................... 111
Activity 5.9 ...................................................................................................................................................................................................... 111
Minimum social safeguards ........................................................................................................................................................................... 111
Proportion of turnover from products or services associated with Taxonomy-aligned economic activities – disclosure covering
year 2024 ....................................................................................................................................................................................................... 113
Proportion of CapEx from products or services associated with Taxonomy-aligned economic activities – disclosure covering year
2024 ................................................................................................................................................................................................................ 114
Proportion of OpEx from products or services associated with Taxonomy-aligned economic activities – disclosure covering year
2024 ................................................................................................................................................................................................................ 115
Scope of taxonomy-eligibility and compliance per environmental objective – disclosure covering year 2024 ............................ 116
ESRS E1 Climate change....................................................................................................................................................................................... 117
ESRS 2 General disclosures ............................................................................................................................................................................. 117
Governance ........................................................................................................................................................................................................ 117
Disclosure requirement related to ESRS 2 GOV-3 Integration of sustainability-related performance in incentive schemes ......... 117
Annual bonus ................................................................................................................................................................................................. 117
Long-term incentive plan (LTIP) ................................................................................................................................................................... 117
Disclosure requirement related to ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy
and business model....................................................................................................................................................................................... 117
Climate strategy ............................................................................................................................................................................................. 117
Short term (2025) .......................................................................................................................................................................................... 117
Medium term (2030) ..................................................................................................................................................................................... 117
67RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
68 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Long-term (2050) ......................................................................................................................................................................................... 117
Impact of climate-related risks on the Group’s strategy ........................................................................................................................... 118
Impact, risk and opportunity management ................................................................................................................................................... 119
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material climate-related
impacts, risks and opportunities ................................................................................................................................................................. 119
Climate risks and opportunities management .......................................................................................................................................... 119
Climate-related transitional risks and opportunities ............................................................................................................................... 120
Risks ............................................................................................................................................................................................................... 120
Opportunities ................................................................................................................................................................................................. 121
Climate-related physical risks .................................................................................................................................................................... 125
Classification of climate hazards (source: Commission Delegated Regulation (EU) 2021/2139) ...................................................... 126
Disclosure requirement E1-1 – Transition plan for climate change mitigation ..................................................................................... 128
Carbon capture and utilisation .................................................................................................................................................................. 129
Alternative fuels including hydrogen and biofuels ................................................................................................................................. 129
Reducing the carbon intensity of energy ................................................................................................................................................. 129
Investment and funding .............................................................................................................................................................................. 129
Locked- in emissions ................................................................................................................................................................................... 129
Disclosure requirement E1-2 – Policies related to climate change mitigation and adaptation ........................................................ 130
Disclosure requirement E1-3 – Actions and resources in relation to climate change policies ......................................................... 130
Metrics and targets ........................................................................................................................................................................................ 131
Greenhouse gas emissions methodologies ................................................................................................................................................ 131
Disclosure requirement E1-4 – Targets related to climate change mitigation and adaptation .......................................................... 132
Targets related to climate change mitigation and adaptation Assumptions and methodologies ............................................. 134
Disclosure Requirement E1-5 – Energy consumption and mix .............................................................................................................. 135
Energy intensity based on net sales ................................................................................................................................................ 136
Connectivity of energy intensity based on net revenue with financial reporting information ................................................. 136
Disclosure requirement E1-6 – Gross scopes 1, 2, 3 and total GHG emissions .................................................................................... 137
Scope 1 emissions ......................................................................................................................................................................................... 137
Emission factors ............................................................................................................................................................................................ 137
Scope 2 emissions ........................................................................................................................................................................................ 138
Scope 3 emissions ........................................................................................................................................................................................ 138
Disaggregation of GHG emissions ..................................................................................................................................................... 141
Percentage of Scope 1 GHG emissions from regulated emission trading scheme (%) ................................................................ 141
Emissions from biogenic fuels and additives .................................................................................................................................... 141
Percentage of contractual instruments, Scope 2 GHG emissions ................................................................................................ 142
Current and future financial resources allocated to action plan (OpEx) ...................................................................................... 143
Current and future financial resources allocated to action plan ................................................................................................... 143
Revenue from refractory products that enables decarbonisation in the customer industries (e.g. EAF; ESF; BOF; DRI) ....... 143
GHG intensity per net revenue.................................................................
......................................................................................... 143
Connectivity of energy intensity based on net revenue with financial reporting information .................................................. 143
Disclosure requirement E1-7 – GHG removals and GHG mitigation projects financed through carbon credits ............................. 143
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202468
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 69
Disclosure requirement E1-8 – Internal carbon pricing ..........................................................................................................................144
Disclosure requirement E1-9 – Anticipated financial effects from material physical and transition risks and potential climate-
related opportunities ....................................................................................................................................................................................144
ESRS E2 Pollution .................................................................................................................................................................................................144
ESRS 2 General disclosures ............................................................................................................................................................................144
Impact, risk and opportunity management ...................................................................................................................................................144
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material pollution-related
impacts, risks and opportunities .................................................................................................................................................................144
Disclosure requirement E2-1 – Policies related to pollution ..................................................................................................................144
Disclosure requirement E2-2 – Actions and resources related to pollution ........................................................................................ 145
Metrics and targets ........................................................................................................................................................................................... 145
Disclosure requirement E2-3 – Targets related to pollution .................................................................................................................. 145
Disclosure requirement E2-4 – Pollution of air, water and soil .............................................................................................................. 145
Disclosure requirement E2-5 – Metrics and targets ................................................................................................................................ 145
Air pollutants methodology at RHI Magnesita .......................................................................................................................................... 145
Disclosure requirement E2-6 – Anticipated financial effects from pollution-related risks and opportunities ............................... 146
ESRS E3 Water and marine resources ................................................................................................................................................................ 147
ESRS 2 General disclosures ............................................................................................................................................................................ 147
Impact, risk and opportunity management ................................................................................................................................................... 147
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material water and marine
resources-related impacts, risks and opportunities .................................................................................................................................. 147
Water usage in refractory manufacturing .................................................................................................................................................. 147
Assessment of water impact in RHI Magnesita’s value chain .................................................................................................................. 147
Water risk management in the supply chain ............................................................................................................................................. 147
Conclusion .................................................................................................................................................................................................... 147
ESRS E4 Biodiversity and ecosystems ESRS 2 General disclosures ..............................................................................................................148
Impact, risk and opportunity management ...................................................................................................................................................148
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material biodiversity and
ecosystems-related impacts, risks and opportunities ..............................................................................................................................148
Contribution to direct impact drivers on biodiversity loss ...........................................................................................................................148
Impacts on species and ecosystems ..............................................................................................................................................................148
Biodiversity materiality assessment approach ..............................................................................................................................................148
Biodiversity risk management in the supply chain .......................................................................................................................................148
Stakeholder considerations and Management conclusion ........................................................................................................................ 149
ESRS E5 Resource use and circular economy ................................................................................................................................................. 149
ESRS 2 General disclosures ........................................................................................................................................................................... 149
Impact, risk and opportunity management .................................................................................................................................................. 149
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material resource use and
circular economy-related impacts, risks and opportunities ................................................................................................................... 149
Disclosure requirement E5-1 – Policies related to resource use and circular economy .................................................................... 149
Disclosure requirement E5-2 – Actions and resources related to resource use and circular economy .......................................... 150
Recycling ...................................................................................................................................................................................................... 150
2024 highlights in recycling initiatives .................................................................................................................................................... 150
69RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
70 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Metrics and targets .......................................................................................................................................................................................... 150
Disclosure requirement E5-3 – Targets related to resource use and circular economy .................................................................... 150
Disclosure requirement E5-4 – Resource inflows .................................................................................................................................... 151
Resource inflow .................................................................................................................................................................................... 151
Financial resources (Capex) ................................................................................................................................................................ 151
Assumptions and Methodology ......................................................................................................................................................... 151
Disclosure requirement E5-6 – Anticipated financial effects from resource use and circular economy-related impacts, risks and
opportunities ................................................................................................................................................................................................. 152
Social information .................................................................................................................................................................................................... 153
ESRS S1 Own workforce ....................................................................................................................................................................................... 153
ESRS 2 General disclosures ............................................................................................................................................................................ 153
Strategy .............................................................................................................................................................................................................. 153
Disclosure requirement related to ESRS 2 SBM-2 – Interests and views of stakeholders .................................................................. 153
Disclosure requirement related to ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy
and business model...................................................................................................................................................................................... 153
Health and safety .............................................................................................................................................................................................. 153
Impact, risk and opportunity management ................................................................................................................................................... 153
Disclosure requirement S1-1 – Policies related to own workforce .......................................................................................................... 153
Policies ........................................................................................................................................................................................................... 153
Policies supporting workforce engagement .............................................................................................................................................. 153
All the aforementioned policies are available on the Group’s website and apply to RHI Magnesita’s workforce. The Health and
Safety Policy extends further, covering both employees and contractors. ............................................................................................ 154
Disclosure requirement S1-2 – Processes for engaging with own workforce and workers’ representatives about impacts ........... 154
Focusing on vulnerable and marginalised groups ................................................................................................................................... 154
Employee engagement initiatives .............................................................................................................................................................. 154
Disclosure requirement S1-3 – Processes to remediate negative impacts and channels for own workforce to raise concerns .... 155
Workplace risk assessments ........................................................................................................................................................................ 155
Incident management report ...................................................................................................................................................................... 155
Global standardisation for health and safety excellence ........................................................................................................................ 155
Disclosure requirement S1-4 – Taking action on material impacts on own workforce, and approaches to managing material risks
and pursuing material opportunities related to own workforce, and effectiveness of those actions ................................................. 156
Actions .............................................................................................................................................................................................................. 156
Metrics and targets ........................................................................................................................................................................................... 157
Disclosure requirement S1-5 – Targets related to managing material negative impacts, advancing positive impacts, and managing
material risks and opportunities .................................................................................................................................................................. 157
Health and safety methodologies ................................................................................................................................................................... 157
Health and safety targets ................................................................................................................................................................................. 157
Human rights ..................................................................................................................................................................................................... 158
Potential negative impact of forced labour ................................................................................................................................................ 158
Policies ........................................................................................................................................................................................................... 158
Policies supporting workforce engagement .............................................................................................................................................. 158
General approach to addressing material negative impacts ................................................................................................................... 158
Whistleblowing hotline ............................................................................................................................................................................... 158
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202470
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 71
Channels for workforce to raise concerns ................................................................................................................................................ 159
Tracking, monitoring, and effectiveness evaluation ................................................................................................................................ 159
Protection against retaliation ..................................................................................................................................................................... 159
Actions towards preventing human rights issues, including potential incidents of forced labour .................................................... 159
Training ......................................................................................................................................................................................................... 159
Metrics and targets ...................................................................................................................................................................................... 160
Disclosure requirement S1-6 – Characteristics of RHI Magnesita employees .................................................................................... 160
Assumptions and Methodologies .............................................................................................................................................................. 160
Definition of headcount: ............................................................................................................................................................................. 160
Full-time equivalent (“FTE”) calculations: ................................................................................................................................................ 160
Inclusion criteria: ......................................................................................................................................................................................... 160
Hires and turnovers: ..................................................................................................................................................................................... 160
Turnovers by leave category: ...................................................................................................................................................................... 160
Turnover rate: ............................................................................................................................................................................................... 160
Table 3 – Employees by type of contract and gender .................................................................................................................. 162
Table 4 – Employees by type of contract and region ................................................................................................................... 163
Table 5 – Number of employee turnover ....................................................................................................................................... 163
Disclosure requirement S1-14 – Health and safety metrics ................................................................................................................... 163
Assumptions and Methodologies .................................................................................................................................................... 163
Health and safety performance ................................................................................................................................................................. 164
Disclosure requirement S1-17 – Incidents, complaints and severe human rights impacts ................................................................ 164
ESRS S2 Workers in the value chain ................................................................................................................................................................. 165
ESRS 2 General disclosures ........................................................................................................................................................................... 165
Strategy ............................................................................................................................................................................................................. 165
Disclosure requirement related to ESRS 2 SBM-2 Interests and views of stakeholders ...................................................................... 165
Disclosure requirement related to ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and
business model ............................................................................................................................................................................................ 165
Systemic challenges ................................................................................................................................................................................... 165
Impact, risk and opportunity management .................................................................................................................................................. 165
Disclosure requirement S2-1 – Policies related to value chain workers ............................................................................................... 165
Disclosure requirement S2-2 – Processes for engaging with value chain workers about impacts .................................................. 166
Disclosure requirement S2-3 – Processes to remediate negative impacts and channels for value chain workers to raise concerns
....................................................................................................................................................................................................................... 166
Disclosure requirement S2-4 – Taking action on material impacts on value chain workers, and approaches to managing material
risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions ............................... 166
Metrics and targets ........................................................................................................................................................................................... 167
Assumptions and Methodologies ............................................................................................................................................................... 167
Disclosure requirement S2-5 – Targets related to managing material negative impacts, advancing positive impacts, and managing
material risks and opportunities .................................................................................................................................
................................. 167
Governance information ......................................................................................................................................................................................... 168
ESRS G1 Business conduct ................................................................................................................................................................................. 168
ESRS 2 General disclosures ........................................................................................................................................................................... 168
71RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
72 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Governance ...................................................................................................................................................................................................... 168
Disclosure requirement related to ESRS 2 GOV-1 – The role of the administrative, supervisory and management bodies ......... 168
Impact, risk and opportunity management .................................................................................................................................................. 168
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material impacts, risks and
opportunities ................................................................................................................................................................................................ 168
Disclosure requirement G1-1– Business conduct policies and corporate culture .............................................................................. 168
How RHI Magnesita fosters its corporate culture ..................................................................................................................................... 168
Mechanisms for identifying, reporting and investigating concerns ...................................................................................................... 168
Disclosure requirement G1-2 – Management of relationships with suppliers .................................................................................... 169
Supply chain due diligence ....................................................................................................................................................................... 169
Supplier code of conduct ........................................................................................................................................................................... 169
Supplier assessments through EcoVadis .................................................................................................................................................. 169
Supplier on-site assessments .................................................................................................................................................................... 170
Supplier product carbon footprint ............................................................................................................................................................. 170
Supplier collaboration ................................................................................................................................................................................ 170
Disclosure requirement G1-3 – Prevention and detection of corruption or bribery ........................................................................... 170
Metrics and targets ............................................................................................................................................................................................ 171
Disclosure requirement G1-4 – Incidents of corruption or bribery ......................................................................................................... 171
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202472
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 73
General Information
Overview
RHI Magnesita’s sustainability objectives are based on our core values. We believe that long-term financial success is only possible if we
also deliver our sustainability goals. RHI Magnesita’s purpose is to master heat, enabling global industries to build sustainable modern life.
Our advanced products are essential for our customers in the steel, cement, metals, glass, energy and chemicals industries. Through the
reliable supply of innovative refractory products and services, we enable our customers to sustainably deliver the basic materials that are
essential for modern life. We aim to be our customers’ partner of choice on their own decarbonisation journeys.
Our sustainability strategy is based on the ten Principles of the UN Global Compact (“UNGC”).
RHI Magnesita’s sustainability strategy is focused on:
• Excellent workplace Health & Safety;
• Climate change and environmental impact mitigation;
• Increased use of secondary raw materials to reduce CO
2
emissions;
• R&D investment to develop emissions avoidance, alternative fuels, and carbon capture, storage and utilisation technologies;
• Partnering with our customers to reduce their emissions through innovative refractory products or solutions contracts, including
enabling technologies such as EAF refractories;
• Sustainable procurement practices;
• Upholding diversity in the workplace;
• Building strong relationships with all stakeholders including communities, employees and governments; and
• Linking debt facilities and management compensation to sustainability performance.
Application of CSRD and ESRS
The Consolidated Sustainability Statement was prepared in accordance with the European Sustainability Reporting Standards (ESRS) as
adopted by the European Commission and compliant with the reporting requirements provided for in Article 8 of Regulation (EU) 2020/852
(“Taxonomy Regulation”). The CSRD is not yet transposed into national law in the Netherlands.
This Consolidated Sustainability Statement forms part of the Group’s management report. Certain sections are incorporated by reference
to other parts of the 2024 Annual Report and Accounts, as indicated. All material information on sustainability-related impacts, risks and
opportunities has been presented in accordance with the applicable ESRS, based on the outcome of a Double Materiality Assessment
(“DMA”).
Categories of ESRS standards
Cross cutting and topical standards are provided, in accordance with ESRS. Where material and necessary to improve understanding,
Group-specific information is also disclosed.
Sector-agnostic disclosures according to cross-cutting and topical standards
The ESRS are divided into different categories of standards. The general standards ESRS 1 General Requirements and ESRS 2 General
Disclosures apply to the sustainability aspects covered by thematic and topical standards. The preparation and presentation of this Con-
solidated Sustainability Statement is in line with the general requirements of ESRS 1. According to ESRS 2, we meet the disclosure require-
ments with regard to the information that our Group must provide at a general level with regard to all material sustainability aspects in the
reporting areas of governance, strategy, management of impacts, risks and opportunities, and key figures and objectives.
Disclosures according to topical ESRS
In addition, based on the results of our DMA, we disclose sustainability information in accordance with the thematic standards relating to
the environment, social issues and responsible corporate governance. Information on environmental, social and governance issues covered
by the ESRS whose impacts, risks and opportunities were assessed as “not material” for both our business and the ESG aspects are disregard
in accordance with ESRS 1.
Group-specific disclosures
We have identified impacts, risks, and opportunities that are not adequately covered by an ESRS standards.
CO2 and Energy intensity targets and metrics
To ensure effective sustainability management, RHI Magnesita has implemented intensity-based targets, including CO₂ intensity (CO₂
emissions per tonne of product) and energy intensity (energy consumption per tonne of product). This adaptive approach allows the Group
to respond to evolving business conditions and economic growth. Structural changes, such as mergers, acquisitions, or shifts in market
demand, can significantly influence overall emissions, making it challenging to adhere to rigid absolute targets. Intensity-based targets,
however, offer the flexibility needed to accommodate business expansion while maintaining a strong focus on emissions efficiency.
73RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
74 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Health and Safety performance
The Group reports its Lost Time Injury Frequency (“LTI F ”) per 200,000 hours worked as the key metric for its 2025 health and safety per-
formance.
The Group will use Total Recordable Injuries (“TRI”) as metric per 200,000 hours worked to monitor progress to achieve 2030 health and
safety target (TRI<1.2 per 200,000 hours worked)
Recyclability of spent refractories
The Group has established a global sourcing guideline for recycling, which serves as an internal framework for purchasing spent refractories
and incorporates recyclability as a company-specific metric. This guideline provides guidance on sourcing spent refractories from various
industries and applies across all global regions to all personnel involved in the procurement process.
Avoided Emissions
Avoided emissions resulting from optimised heat management solutions are entity specific and not covered by a specific ESRS disclosure
requirement. The Group intends to develop KPIs and disclose in future, in line with phase-in requirements.
Recycling rate
The Group uses the recycling rate metric to measure and enhance resource efficiency use and circular economy integration. The metric is
based on actual consumption of recycled material and total consumption of raw materials in refractories.
Scope 3 emissions due to purchased raw materials
The Group uses Scope 3 emissions associated with purchased raw materials as a metric to track progress in reducing its carbon footprint.
Scope 1 emissions due to geogenic process emissions
The Group uses Scope 1 emissions associated with raw material processing as a metric to monitor the geogenic emissions. It is an entity
specific metric and is not covered by a specific ESRS disclosure requirement.
Supply of enabling technologies and low carbon footprint products
The supply of enabling technologies and low carbon footprint products for customers to reduce emissions in the downstream value chain
is an entity specific opportunity and is not covered by a specific ESRS disclosure requirement.
The number of ETS certificates and ETS expenditures
The Group uses the number of ETS certificates and ETS expenditures to monitor financial impact on operating and capital expenditures
due to changes in policy and regulation. These are entity specific metrics and are not covered by a specific ESRS disclosure requirement.
Workplace safety incidents and potential incidents of forced labour in the supply chain
The Group collects and assesses supplier data as metric to monitor these topics. They are entity specific and not covered by ESRS standards.
Reporting areas
The disclosure requirements in ESRS 2, topic-related ESRS and topical ESRS are divided into the following reporting areas:
• Governance (“GOV”): the governance procedures, controls and processes for monitoring, managing and overseeing impacts, risks
and opportunities;
• Strategy (Strategy and business model, “SBM”): the interaction of the Group's strategy and business model with its material im-
pacts, risks and opportunities, including how the Group deals with these impacts, risks and opportunities;
• Impact, risk and opportunity management (“IRO”): the process(es) by which the Group identifies impacts, risks and opportunities
and assesses their materiality (see IRO-1 in Section 4.1 of ESRS 2) and addresses material sustainability aspects through concepts
and measures; and
• Metrics and targets (“MT”): the performance of the Group, including the objectives it has set and the progress made towards
achieving those objectives.
Double materiality as the basis for our sustainability disclosures
The principle of double materiality is of fundamental importance for this Consolidated Sustainability Statement. This report should help
users understand RHI Magnesita's impact on ESG aspects (inside out) and how sustainability factors influence the Group's financial position,
performance, cash flows, and access to finance or capital cost (outside in). The materiality analysis is the basis of sustainability reporting
under the ESRS. A sustainability aspect is "material" if it meets the criteria of materiality of impacts or financial materiality or both. This
means that information is considered material, even if only one perspective is met. The materiality analysis is the basis for identifying ma-
terial impacts, risks and opportunities. We explain the details of our materiality analysis in the following chapter ESRS 2 General information,
disclosure requirement IRO-1 – “Description of the procedure for identifying and assessing the material impacts, risks and opportunities“.
A detailed overview of the business model and a representation of the Group’s value chain can be found on pages 8-11, “Our business
model and value chain”, of this Annual Report.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202474
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 75
ESRS 2 General disclosures
Basis for preparation
Disclosure requirement BP-1 – General basis for preparation of the Consolidated Sustainability Statements
The Consolidated Sustainability Statement for this year has been prepared in accordance with Article 29a of EU Directive 2013/34/EU. This
includes compliance with the ESRS and adherence to the disclosure requirements set forth in Article 8 of EU Regulation 2020/852 (the
“Taxonomy Regulation”).
To ensure transparency and alignment with regulatory expectations, we disclose all mandatory reporting requirements and provide cross-
references to other relevant sections of the Annual Report under the principle of ‘Incorporation by Reference‘. Certain disclosures related
to strategy and corporate governance, as outlined in the cross-cutting standard ESRS 2, have been integrated into other sections of this
report - specifically, the corporate governance, risk management, and remuneration reports - where they are best contextualised alongside
related information.
Finally, as a supporter of the Task Force on Climate-related Financial Disclosures (“TCFD”), RHI Magnesita has reviewed, identified and
quantified the climate-related risks and opportunities relevant to our business.
Scope of consolidation
The scope of this report, along with the accompanying financial and sustainability statements, is fully aligned and consolidated at the RHI
Magnesita N.V. level. It encompasses the Parent Company, RHI Magnesita N.V., and all directly and indirectly controlled subsidiaries. The
sustainability statements specifically cover information related to RHI Magnesita and, where available, its main value chain and business
relationships.
Upstream and downstream value chain
The Consolidated Sustainability Statement covers the Group’s upstream and downstream value chain where impacts, risks or opportunities
are deemed to be material, for example in relation to CO
2
emissions and supplier sustainability performance. The Group manufactures and
purchases from external parties’ refractory raw materials which have a high CO
2
intensity, due to fuel-based and geogenic emissions asso-
ciated with their production. Scope 3 emissions from purchased raw materials are reported, based on estimates of likely supplier emissions
using the Group’s knowledge of the raw material production process. Downstream Scope 3 emissions including transportation are also
reported. Scope 3 emissions directly related to the use of the Group’s products by customers (i.e. direct use-phase emissions) have been
included in category 11 of Scope 3 in the Group’s reported emissions.
The emissions of the Group’s customers associated with their activities whilst using refractory products (but not directly arising from the
consumption of refractories) are significant, due to the high energy and CO
2
intensity of customer industrial processes. Based on the
Group’s calculated market share as a refractory supplier to the steel, cement, non-ferrous metals and glass sectors and using estimates for
the total global emissions of those customer industries, these customer emissions are estimated to be approximately 1.4 billion tonnes of
CO
2
eq annually. The Group’s Scope 1, Scope 2 and Scope 3 emissions amounted to 5.9 million tonnes CO
2
eq in 2024 (market based
methodology), i.e. approximately 0.4% of the combined total, if customers’ emissions are included in total reported emissions by the Group
as indirect use-phase emissions. Through GHG Protocol, ESRS recommends reporting indirect use-phase emissions from the use of sold
products when such emissions are significant. However, the Group does not include these indirect emissions in its Scope 3 inventory as it
concluded that this recommended guidance is not applicable for the Group for the following reasons:
• No guidelines exist for the refractory industry as to whether such Scope 3 emissions should be reported by refractory pro-
ducers and which methodologies for recognition and allocation of indirect use-phase emissions would be reasonable and
supportable,
• There is a significant likelihood of inaccuracy in estimations and allocations, since a thinkable methodology would be based
on top-down estimates by industry and would not take account of possible differences in the carbon footprint of the Group’s
customers versus other emitters in that industry as it is currently not possible to comprehensively gather data from customers
to obtain more accurate estimates of customer emissions, and
• RHI Magnesita has no control over these emissions which are separately reported and managed by the Group’s customers,
although the Group does offer products and services aimed at assisting its customers to reduce CO
2
emissions.
RHI Magnesita's assessment of impacts, risks, and opportunities of its upstream and downstream value chain considers factors such as the
scale and scope of impacts, stakeholder expectations, financial and reputational risks, and alignment with the Group's strategic priorities.
By evaluating the extent and severity of topics across environmental, social, and economic dimensions, the Group ensures a balanced
approach to identifying material issues. Moreover, incorporating market trends, regulatory developments, and alignment with global frame-
works such as the UN Sustainable Development Goals (“SDGs”) highlights the Group's commitment to addressing both current and future
challenges.
Where relevant, our disclosures, policies, actions and targets extend to both our upstream and downstream value chain. For example, all of
the principles contained within the Group’s Code of Conduct are also included in the Supplier Code of Conduct, which all suppliers are
expected to abide by. Similarly, RHI Magnesita’s CO
2
emissions intensity target has always included Scope 3 emissions from purchased raw
75RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
76 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
materials since it was first established in 2019. The scope of the 2030 target has now been increased to include Scope 3 emissions from
transportation, which is a downstream source. The definition of each sustainability target clearly sets out whether the upstream or down-
stream value chain is included.
Exemptions
No material information has been excluded for reasons relating to intellectual property, know-how or innovation. The exemption from dis-
closure of impending developments or matters in the course of negotiation has not been utilised.
Disclosure requirement BP-2 – Disclosures in relation to specific circumstances
Time horizons
RHI Magnesita has not deviated from the medium or long-term horizons defined by ESRS 1 section 6.4.
Value chain estimation
When disclosing metrics which include estimation of upstream or downstream value chain data, RHI Magnesita has identified the metrics
for which this is the case, described the basis for preparation, included commentary on the resulting level of accuracy and described any
possible actions that may be taken to improve accuracy in the future.
Sources of estimation and outcome uncertainty
The following data includes or is based on estimates with accompanying levels of uncertainty.
CO
2
– emissions data is calculated by reference to fuel consumption data or raw material processing quantities, multiplied by emissions
factors. Whilst the methodology has been developed over a number of years and has been subject to external review and refinement, CO
2
emissions data is by necessity based on assumptions that could be inaccurate.
Other emissions – emissions of other pollutants such as SOx or NOx are based on spot measurements taken periodically and are not con-
tinuously monitored. This could result in inaccuracies due to fluctuations in production volumes or other variables throughout the year.
Own workforce data including health and safety data – reporting of hours worked and the occurrence of health and safety incidents is
reliant on the accuracy of the Group’s systems and reporting procedures which cannot be guaranteed to be comprehensive. There is a
possibility that health and safety incidents could be concealed, in particular minor incidents.
Supply chain data – any information which is provided in relation to sustainability impacts in the Group’s upstream value chain relies on
the accuracy of data provided by an external party. Since the Group does not have direct ownership and control the accuracy of data
provided cannot be guaranteed and has a wider degree of estimation uncertainty compared to data relating to the Group’s core activities.
Changes in preparation or presentation of sustainability information
RHI Magnesita is reporting according to ESRS for the first time in respect of the year to 31 December 2024.
Reporting errors in prior periods
Notwithstanding the migration from GRI standards to ESRS, baseline adjustments for acquisitions and minor corrections to plant emissions
and energy data in 2023, there are no material reporting errors relating to prior periods that have been identified in the course of preparing
the 2024 Consolidated Sustainability Statement.
General statement on consistency of information within sustainability statement
RHI Magnesita is reporting according to ESRS for the first time in respect of the year to 31 December 2024. Whilst all reasonable efforts
have been made in the compilation of the non-financial data reported, some clerical and casting inconsistencies may exist within the
sustainability statement.
EU Taxonomy 2023 – Restatement of Financial Figures
The turnover for the economic activity “CCM 5.9 Material recovery from non-hazardous waste” has been restated as eligible under the EU
Taxonomy for 2023. The originally reported turnover of €6,058.974 million has been revised to €17,458.974 million.
Additionally, adjustments have been made to the reported OpEx and denominator OpEx within the EU Taxonomy disclosure table for the
economic activity “CCM 3.6 Manufacture of other low-carbon technologies”. The originally reported OpEx of €17,606.412 million has been
restated to €20,795.203 million, while the denominator OpEx has been revised from €151,849.101 million to €172,224.712 million.
The reason for the restatement is that maintenance costs were considered only from plants integrated in the Group’s main SAP system. This
affects OpEx reported for “CCM 3.6 Manufacture of other low-carbon technologies” as OpEx for this activity is estimated based on mainte-
nance OpEx.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202476
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 77
Disclosures stemming from other legislation or generally accepted sustainability reporting pronouncements
The Group is not subject to any other legislation or generally accepted sustainability reporting pronouncements, other than certain provi-
sions of the UK Listing Rules and the UK and Dutch Corporate Governance Codes which do not conflict with ESRS.
Incorporation by reference
Some disclosures are incorporated by reference to other parts of the Annual Report. Whenever this is the case, this is clearly indicated. We
incorporate the following metrics by reference:
• Description of business and markets served
• Integration of sustainability-related performance in incentive schemes
• Diversity in the Board of Directors and Executive Management Team
• Role, expertise and independence of Board of Management
• Integration of sustainability risk management into the overall risk management approach
• Stakeholder engagement
• Note 5 of Financial statements for the Taxonomy KPIs.
Use of phase-in provisions in accordance with Appendix C of ESRS 1
The following phase in and transitional provisions on Disclosure Requirements, as set out in ESRS 1, are excluded from the Sustainability
Statement:
• ESRS E1-9 disclosures regarding anticipated financial effects from material physical and transition risks and potential climate-
related opportunities.
• ESRS E2-6 disclosures regarding anticipated financial effects from pollution-related risks and opportunities.
• ESRS E5-6 disclosures regarding anticipated financial effects from resource use and circular economy-related impacts, risks and
opportunities
• ESRS S1-7 disclosures regarding non-employee workers.
• ESRS S1-14 88(d) and (e) disclosures regarding health and safety metrics ‘number of cases of recordable work-related ill health of
employees’ and ‘number of days lost’.
• ESRS 2 SBM-3(e) related to the anticipated financial effects of the undertaking’s material risks and opportunities on its financial
position, financial performance and cash flows over the short-, medium- and long-term.
• The transitional provision related to entity-specific disclosures based on the topical ESRS, supplemented by an appropriate set
of additional disclosures to address sustainability matters that are material to the Group in its sector.
Comparative data for 2023 has been provided where available and where provision of such data would assist in understanding trends. For
some items, comparative data is not available and, in these cases, the transitional provision to disclose comparative data has been relied
upon.
Governance
Disclosure requirement GOV-1 – The role of the administrative, management and supervisory bodies
The following Governance disclosures are incorporated by reference:
Board powers, responsibilities and representation; EMT and delegation of authority; Board composition; Board diversity
Corporate Governance Report, pages 1 74 -203.
Executive Management Team
Corporate Governance Report, page 182.
EMT role in managing and overseeing sustainability impacts, risks and opportunities
The EMT is the primary management body through which initiatives to address sustainability related impacts, risks and opportunities are
planned, implemented and monitored. In 2024 RHI Magnesita carried out its first DMA in accordance with ESRS requirements. Certain
aspects of each of the topics identified as material in the DMA process were addressed by the EMT as set out in the Group’s 2025 sustain-
ability targets, which cover CO
2
emissions, energy, recycling, safety and other emissions to air. The EMT will continue to be the primary
management body tasked with managing sustainability related impacts, risks and opportunities over the period 2025-30.
The Chief Executive Officer (“CEO”) is the most senior executive responsible for policy implementation. Policies are formulated with key
stakeholder interests in mind and align with the UN Guiding Principles on Business and Human Rights and other internationally recognized
standards.
The CEO is also responsible for the overall monitoring and management of sustainability impacts, risks and opportunities. Individual EMT
members are responsible for delivery in specific areas as follows:
77RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
78 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
EMT member
Sustainability impact, risk or opportunity
CChhiieeff FFiinnaanncciiaall OOffffiicceerr ((““CCFFOO””))
Internal CO
2
pricing
Risk and opportunity financial modelling
ETS allowance purchasing and hedging strategy
ESG rating-backed financial instruments
Tax incentive programmes
Business ethics
Sustainability risks
Modern slavery reporting compliance
CChhiieeff TTeecchhnnoollooggyy OOffffiicceerr ((““CCTTOO””))
Health and Safety
CO
2
emissions
Air emissions
Energy
Water
Waste
Biodiversity
CChhiieeff CCuussttoommeerr OOffffiicceerr ((““CCCCOO””))
Sustainable procurement
Supply chain due diligence
Supplier Scope 3 emissions
Workers in the value chain
EEVVPP PPeeooppllee,, PPrroojjeeccttss,, IInntteeggrraattiioonnss &&
R
R
e
e
c
c
y
y
c
c
l
l
i
i
n
n
g
g
Human Rights
Employee relations
Diversity
Community relations
Recycling
Circular economy
Regional management are responsible for delivery of specific regional sustainability objectives and integration of acquired businesses into
the Group’s sustainability practices.
Executive management holds an annual Sustainability Forum to share progress against targets and co-operate on the delivery of the
Group’s sustainability objectives. The CEO reviews progress against short- and long-term sustainability KPIs during the year.
Controls and procedures are applied to the management of impacts, risks and opportunities at a functional level, with each EMT member
receiving regular updates on progress towards targets in their area of responsibility.
EMT skill and experience in sustainability matters
EMT members are skilled and experienced in their individual specialisms as set out above. Since 2019 each EMT member has been tasked
with delivery of sustainability related goals and priorities and has therefore gained experience in specific areas which fall within their re-
sponsibility. The EMT has access to expertise and skills from specialist staff who are experienced in sustainability matters, from CO
2
certif-
icate trading, to measurement of CO
2
emissions in our plants, other air emissions (e.g. NOx, SOx, etc.), diversity, equity & inclusion, the use
of hydrogen mix in our energy supply and a wide range of other matters, if required.
Process for setting and monitoring sustainability targets
RHI Magnesita’s executive management and the Board considered and set sustainability targets in 2019 to be achieved by 2025, against a
2018 baseline. During 2024 the Group worked to establish new targets for 2030. Teams responsible for material sustainability topics were
tasked with setting realistic and achievable targets by 2030 in the first half of 2024. The CEO reviewed the proposed targets and they were
subsequently presented to the CSC in November 2024 for review and discussion. The CSC recommended changes to the proposed targets
which were then finalised and adopted by the Board of Directors in February 2025.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202478
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 79
 Targets
Baseline
Year

Actual

Target Year

Health and Safety
Maintain LTIF at <. per ,
hours worked
(goal: Zero Harm, No Injuries)
. . <.
CO

e Emissions
(Scope ,, raw materials)
Reduce by % per
tonne of product
. . .
Energy Reduce by % per tonne of product . . .
Recycling
Increase use of secondary raw
materials to %
.% .% %
Sustainable Supply Chain
Enhancing supplier sustainability
management: % Spend Coverage
- % %
Progress against sustainability targets is generally measured on a monthly basis by responsible functions and year to date performance is
reviewed at every meeting of the CSC.
 Targets
Baseline Year

Target Year

Health and Safety
Total recordable injuries frequency rate
(TRIFR) <. per , hours
. <.
CO

e Emissions
(Scope ,, raw
materials)
Reduce by % per
tonne of product
. .
Energy
Reducing energy consumption by % per
plant each year
n.a. n.a.
Recycling
Achieve combined recycling rate of %
.%
%
Sustainable
Supply
Chain - Social
Enhancing supplier sustainability
management: % Spend Coverage
% %
Corporate Sustainability Committee (“CSC”)
This section is incorporated by reference to the Corporate Governance Report, pages 204-205.
CSC role in managing and overseeing sustainability impacts, risks and opportunities
The CSC is the Board committee responsible for overseeing sustainability-related impacts, risks, and opportunities. In 2024, a DMA was
conducted for the first time in alignment with ESRS requirements. CSC members actively participated in the process, providing oversight
and reviewing its findings, while the final approval was granted by the Board of Directors.
The CSC monitors progress towards the Group’s sustainability targets at every meeting, using year to date information and full year forecast
outcomes. Executives responsible for delivering sustainability targets are invited to present to the CSC at least once per year.
New sustainability targets for 2030 were set in 2025 after due consideration by the CSC in November 2024, formally adopted by the Board
in February 2025.
CSC skill and experience in sustainability matters
CSC members are skilled and experienced in their individual specialisms as set out on page 177-178. Since its formation in 2019 the CSC
has been tasked with supervision of the delivery of the Group’s sustainability related goals and priorities and has therefore gained experi-
ence in specific areas relevant to those initiatives. The CSC has access to expertise and skills from specialist staff within RHI Magnesita who
79RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
80 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
are experienced in sustainability matters and undertakes site visits once per annum to broaden its specific RHI Magnesita knowledge, such
as to our Leoben pilot plant to hear directly from experts on the in-trial sorting initiatives to progress recycling progress, supporting the
decarbonisation of the industry.
Sustainability governance structure
At Board level, the above-mentioned CSC supports the Board, acting as an advisory body to deliver the long-term sustainability of the
business. The CSC monitors performance against relevant KPIs and assesses risks and opportunities associated with climate change, en-
vironmental, Health & Safety, stakeholder relations and other ESG risks. They bring their skills and awareness of risks and upcoming topics
to guide management in where to direct their efforts.
At EMT level, the CEO is accountable for driving sustainable practices within the organisation and delivering the Group’s sustainability
targets, supported by the CTO. The CTO actively engages in overseeing and integrating technologies and methodologies across various
aspects of our operations. Strategic decisions and technological initiatives contribute significantly to the achievement of the Group’s sus-
tainability targets, ensuring that innovation and R&D is aligned with our commitment to sustainability.
Reporting to the CTO, the Global Sustainability Team collaborates closely with the CEO, CTO and CSC to monitor progress against targets,
advise on regulatory developments, compile reporting materials and engage with external ratings agencies. A collaborative approach en-
sures co-ordination with key functional areas such as Health & Safety, environment, sustainable technology and decarbonisation, recycling,
finance, risk management and compliance, Group secretary and procurement. This governance framework facilitates a comprehensive and
integrated approach to sustainability.
At the operational level, plant managers and Regional Presidents are accountable for the day-to-day performance of the Group’s assets,
including delivering progress towards sustainability goals. Regional Presidents report to the Chief Customer Officer who in turn reports to
the CEO.
This governance structure combines transparency and accountability with functional expertise.
Board skills and experience
This section is incorporated by reference to the Corporate Governance Report, pages 176-181.
Disclosure requirement GOV-2 – Information provided to, and sustainability matters addressed by the undertaking’s administrative,
management and supervisory bodies
How CSC is informed about impacts, risks and opportunities
This section is incorporated by reference to the Corporate Governance Report, pages 204-205.
How Board considers sustainability related impacts, risks and opportunities
The Board is the supervisory body which considers sustainability impacts, risks and opportunities when assessing strategic decisions, such
as major transactions, and in its semi-annual assessment of principal and emerging risks. Trade-offs between potentially conflicting impacts,
risks and opportunities are considered for example, when, in pursuing an acquisition-led growth strategy the Board assesses the executive
management’s assessment of the potential impacts and opportunities in sustainability performance of each new acquisition, such as the
potential to increase the use of secondary raw materials, but also the possibility that there could be an impact on the Group’s carbon
emissions with the asset’s energy profile or age of equipment. Management provides this assessment following an extensive due diligence
process and provides a risk-based analysis based on their findings from the review of documents provided by the asset and from manage-
ment’s assessment from their visits to the target plants. Where specialist third-party support has been required in due diligence, their
findings are also included. These risks are provided to the Board with associated mitigating actions. The Board assesses the information
provided by management on the risks and opportunities in the course of a transaction in the pursuit of a broad range of objectives and
decides to proceed on the balance of the best interest for the Group and its stakeholders.
On a more routine basis, the Board are updated on at least an annual basis as part of the strategy session on the progress against the targets
set in 2019 for delivery by 2025. You can read more about these on pages 22-25. The annual budget comprises sustainability-related
spending and the Board considers this twice per annum in its agreed schedule. In every Annual Report, which is signed off by the Board,
since the targets were set, progress against the targets has been reported upon. In the course of delivering their duties as effective Directors,
(each Annual Report covers the Board performance reviews which have found them to be effective, including external assessments of the
Board) the Board have engaged with these updates and challenged management on the measurement and progress, as appropriate. This
discussion leads to actions for management to bring further updates on sustainability performance. As part of the Matters Reserved to the
Board (available on our website) and Delegation of Authority framework, the Board reserves matters to itself based on certain characteristics
and thresholds which have included sustainability-related investments and entry into ESG ratings-linked financial instruments and there-
fore management brings these items for discussion and approval. In the course of considering routine matters such as entry into contracts
with customers or suppliers, the sustainability targets and the work of the CSC within its established scope, have meant that the Board
ensures it receives detail about the effect that such a contract would have on the Group’s progress in sustainability and the impact on
performance against the aforementioned targets.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202480
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 81
The CSC receives updates at every meeting (its terms of reference require a minimum of three meetings per annum, see pages 204-205
for more details) on the progress against the targets set as part of its set agenda planner, agreed by the Committee, which delivers the items
required under the CSC terms of reference to be considered. The Remuneration Committee also receives an update on the progress of
incentives which, as outlined on pages 212-216, include sustainability metrics, at each of its meetings. These committees update the Board
at the meeting which follows their meeting as part of their reporting.
Sustainability specific risks are assessed separately and submitted to the principal risk assessment process via the CSC. The Board ranks
sustainability specific risks alongside other risks to the business based on the likelihood of occurrence and potential financial or reputa-
tional impact.
Material impacts, risks and opportunities addressed by the CSC, Board and EMT included all those set out in the DMA which was conducted
for the first time in 2024. In addition, during 2024, the CSC, the Board and the EMT considered the following sustainability topics in detail:
• Health and safety of own workforce;
• Recycling;
• Sustainable sourcing and modern slavery;
• Physical climate change risks;
• Sustainability governance;
• CO
2
capture and utilisation;
• Regulatory developments;
• Assurance of sustainability data;
• Energy and CO
2
markets;
• Customer, employee, investor and supplier perceptions of ESG and related products;
• Community relations;
• Organisational diversity;
• Use of renewable energy;
• Target setting and measurement;
• Capital allocation to sustainability initiatives;
• Decarbonisation strategy;
• Low carbon footprint product strategy; and
• Use of hydrogen and other alternative fuels.
Disclosure requirement GOV-3 – Integration of sustainability-related performance in incentive schemes
Given sustainability is a core element of RHI Magnesita’s strategy, and, given its relevance to Group’s sustainable growth, the Board have
been keen to ensure it is part of the incentivisation of management and for a number of years the Group’s remuneration approach has
included sustainability targets, particularly focusing on those relating to our carbon footprint.
The Group is responsive to feedback from investors and customers on such topics and incorporates their views as inputs to the Group’s
sustainability approach. The CSC supports the Board with its deliberations on sustainable initiatives, target and investments and supports
the Remuneration Committee with priorities to be incentivised.
The Remuneration Committee’s responsibilities include the development of a reward package for Executive Directors and senior managers
that supports the delivery of RHI Magnesita’s vision and strategy as a Group, and to ensure the rewards are performance-based, encourag-
ing long-term shareholder value creation, and taking account of the remuneration of the wider workforce. The Non-Executive Directors of
the Board do not receive incentive-based remuneration; their remuneration is an annual fixed fee, no share-based payments are made. Our
Employee Representative Directors are remunerated on the basis that they are employees of the Group and therefore they participate in
the incentive schemes of the Group to the extent they are eligible as employees. This topic is presented on pages 218-230 of the Remu-
neration Report.
Annual bonus
In 2024, Executive Directors’ maximum annual bonus opportunity remained at 150% of salary with performance assessed against Adjusted
EBITA (45%), operating cash flow (25%) and strategic deliverables (30%). The strategic deliverables comprised transformation projects
delivery (10%), PIFOT (10%) and increasing the use of secondary raw material (10%). Recycling, which is a key sustainability performance
metric, therefore accounts for 10% of the annual bonus. The bonus criteria are identical for all eligible employees and not just the Executive
Directors.
In 2025, recycling will again account for 10% of the annual bonus.
Long-term incentive plan (LTIP)
In 2024, the Remuneration Committee reviewed the performance measures for LTIP as it does on an annual basis and agreed to continue
to dedicate a quarter of the award to CO
2
emissions performance conditions.
81RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
82 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
The 2024 LTIP Award will therefore vest to the extent that the performance conditions of EPS (50%), ROIC (25%) and reduction of CO
2
emissions (25%) are met above a certain threshold. The performance period for these conditions is three financial years, starting in 2024,
and the Executive Directors are then subject to a further holding period of two years to further align their performance with long-term
shareholder value creation.
The 2025 LTIP Award has a 25% component linked to the Group’s target to reduce CO
2
emissions intensity by 2027.
Disclosure requirement GOV-4 – Statement on due diligence
List of information provided on the due diligence process
Core elements of due diligence
Reference in the Sustainability Statement or in the Annual Report
a) Embedding due diligence in
governance, strategy and
business
model
Risk Management pages -
Internal Controls pages -
Code Compliance pages -
Gov- Management Responsibilities pages -
Gov- Oversight of Sustainability Matters - Impacts, Risks and Opportunities pages -
Gov- Sustainability Matters addressed by Management pages -
Gov- Incentive Schemes - Remuneration Report pages -
SBM- Double Materiality Assessment 
b) Engaging with affected
stakeholders in all key steps of the
due diligence
Stakeholder Engagement pages -
Internal Controls page 
Gov- Sustainability Matters addressed by Management page 
IRO- DMA Process page 
Whistleblowing page 
Board workforce engagement page 
c) Identifying and assessing adverse
impacts
SBM- Double Materiality Assessment (DMA) page 
SBM- DMA Results pages -
SBM- DMA Process pages -
d) Taking actions to address those
adverse impacts
Internal Controls page 
E- Climate Change Actions pages -
E - Pollution control page 
E- Managing impacts on Resource Use and Circular Economy page 
S- Managing impacts on Own Workforce page 
S- Managing impacts on Workers in the Value Chain pages -
e) Tracking the effectiveness of
these efforts and communicating
Internal Controls Page 
Board effectiveness Page 
Disclosure requirement GOV-5 – Risk management and internal controls over sustainability reporting
The main mitigation of strategies and controls employed by the Group to ensure the accuracy of sustainability data include the use of
reporting manuals, training for key personnel, multiple internal review processes during the preparation of sustainability information and
periodic reviews by the Group’s internal audit function to identify opportunities for improvement.
An internal audit was undertaken of the Group’s sustainability reporting processes in 2023 which concluded in September 2023 and made
the observations set out in the table below. Follow-up actions were undertaken by relevant teams in response to the observations as follows:
Observation Action Status February 
Implications of acquisitions not fully
considered for global KPIs and
sustainability targets
ESG reporting included in M&A integration
process
Closed
Lack of knowledge and minor data
inaccuracy identified for samples tested
Process manual and job description updates,
training, additional reviews
Closed
Weaknesses in the technical setup of
the system to measure health and
safety KPIs
Update and improve accident reporting
software
Ongoing
Methodology to measure NOx
emissions not reliable
Consider alternative to isokinetic method

Ongoing
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202482
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 83
Risks to comply with future legal
requirements for human rights
legislation
Assignment of new roles and responsibilities
internally in line with requirements of new
legislation
Closed
Current targets related to People &
Culture potentially not sufficient
Review diversity targets, previously focused
only on gender
Closed
1) The Isokinetic method utilises a laser-induced fluorescence (LIF) technology, which is known for its high sensitivity and specificity in detecting NOx gases. This allows for accurate
measurements even at low concentrations, improving overall monitoring precision.
The Group carried out a risk assessment in 2024 in relation to its sustainability reporting. Each area of sustainability reporting was assessed
for the likelihood of error, the possible negative impact on the Group in each case, and mitigating actions to be taken to minimise each risk.
Both likelihood and potential impact were measured on a scale of 0-5 with resulting scores multiplied together to reach an overall risk
score with a maximum score of 25. The methodology including risk impact and risk likelihood definitions used in this risk assessment were
aligned with the framework used in preparation of the Group’s general risk ledger, which is used for the assessment of principal and emerg-
ing risks.
The Group’s risk appetite for sustainability matters is as follows:
• Environment and climate – MODERATE
• Health & Safety – AVERSE
• Regulatory and compliance – AVERSE
A score of 12 is within averse appetite, potential to exceed. A score of higher than 12 would be outside of the acceptable risk appetite. The
highest scores recorded in the 2024 risk assessment were 12, for “Workers in the supply chain data reporting” and “Workers in the supply
chain health and safety data reporting”, which is within the Group’s risk appetite.
The score for each risk assessed is set out in the table below:
Risk description
Risk score
(min 0, max 25)
Inherent risk rating
Risk of error or omission in CO
2
emissions data
4
Very low
Risk of error or omission in pollution data
9
Low
Risk of error or omission in energy data
4
Very low
Risk of error or omission in recycling data
9
Low
Risk of error or omission in own workforce data
6
Low
Risk of error or omission in own workforce health and safety data
9
Low
Risk of error or omission in workers in the supply chain data
12
Medium
Risk of error or omission in workers in the supply chain health and safety data
12
Medium
The findings of the risk assessment process and internal controls are integrated into the annual process that is carried out for the purpose
of reporting sustainability data in the Group’s Annual Report and Accounts. The Global Sustainability Team, relevant functional heads and
functional reporting teams apply the methodology set out in the reporting manual for each area to ensure standardised and accurate re-
porting across the Group.
Internal audit reports and risk assessments relating to sustainability reporting are submitted to the Audit & Compliance Committee and the
CSC for consideration. These Committees hold a joint session annually for this purpose, which last took place on 25 November 2024.
Strategy
Disclosure requirement SBM-1 – Strategy, business model and value chain
RHI Magnesita’s strategy is built on three pillars, all of which are enabled by our people & culture and sustainability leadership.
83RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
84 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
The first strategic pillar is competitiveness, whereby the Group seeks to minimise its operating expenses through initiatives such as footprint
optimisation, automation digitalisation and supply chain management. Becoming more competitive through increasing efficiency often
has a positive impact on sustainability metrics, for example through the reduction in the use of energy, fuels and mineral resources. Finan-
cial sustainability achieved through maintaining a low cost, competitive positioning in the global refractory industry enables the Group to
allocate capital to longer-term sustainability investments and R&D that would not otherwise be possible.
The second strategic pillar is to seek to expand the business model, for example by offering a broader range of products and services or
growing the proportion of revenue derived from solutions contracts. Solutions contracts are based on fixed prices per tonne of customer
output, usually in the steel industry, and are typically between five and seven years in length. Over the course of a solutions contract, RHI
Magnesita will use advanced products and expertise to improve the efficiency of a customers’ operations, often resulting in reduced con-
sumption of refractories and improvements in energy efficiency. Whilst refractories may only represent up to 3% of a customer’s operating
costs, refractory usage strategies can influence a much larger proportion of costs due to the implications for energy use and general process
efficiency. The Group therefore has an important role to play in its downstream value chain, where customer efficiency gains can translate
into significant improvements in sustainability impacts, most notably in energy consumption and CO
2
emissions.
The third strategic pillar is to grow market share in geographies and products where the Group is under-represented. Since the overall
refractory market is mature and net growth in refractory consumption is relatively low, the Group seeks to grow through acquisition, target-
ing businesses in high-growth markets or segments without adding new production capacity to the market. The businesses which RHI
Magnesita acquires are often not operating at industry-leading levels of sustainability practices and once integrated into the Group it is
possible to greatly improve performance. For example, RHI Magnesita has made significant progress in advancing technologies for recy-
cling of reclaimed refractory material and achieved a recycling rate of 14.2% in 2024. Acquired companies are usually using little or no
recycled material and this represents an opportunity to increase recycling activity in the industry as a whole. For each tonne of recycled
material used, approximately 1.6 tonnes of CO
2
emissions are avoided compared to the production of virgin raw material. As RHI Magnesita
grows through acquisition, its leading sustainable business practices can be spread wider throughout the refractory industry.
Refractory production is a resource, energy and CO
2
intensive activity. Refractory producers can also play an important role in supporting
their customers to transition to more sustainable production technologies. For these reasons, and to ensure the long-term success of the
Group, the Board actively pursues a strategy of sustainability leadership in the industry. We believe that by offering more sustainable prod-
ucts to our customers we will gain an advantage in price, market share or preferred supplier status that will become increasingly important
in the future. We also believe that we must minimise the environmental and social impacts associated with our own production process, in
order to maintain our licence to operate and a strong reputation as a responsible producer, which is a minimum expectation for a wide range
of stakeholders.
Business model
RHI Magnesita is the global supplier of high-grade refractory products, systems and solutions which are critical for high-temperature pro-
cesses exceeding 1,200°C in a wide range of industries, including steel, cement, non-ferrous metals and glass. With a vertically integrated
value chain, from raw materials to refractory products and full performance-based solutions, RHI Magnesita serves customers around the
world, with over 20,000 employees in 65 main production sites, 12 recycling facilities and over 70 sales offices. The Group operates 12 raw
material sites, including 8 mines across Austria (3), in Brazil (1), in China (1), in Czech Republic (1), in Türkiye (1), in USA (1).
In the production of refractories, raw materials are blended and combined with chemical additives to be sold as mixes, or subject to further
processing into shaped refractory products. Shaped refractory bricks are pressed into different sizes and shapes depending on the specific
application, employing pressures of up to 3,200 tonnes. After pressing, shaped refractory bricks are tempered at temperatures of up to
350°C and may be further subjected to firing at 1,800°C in tunnel kilns for a number of days.
Unfired products are primarily used in the steel industry, whilst the main applications for fired products are in the cement, non-ferrous
metals, process and mineral industries.
The Group’s comprehensive product range and expertise enables it to offer solutions contracts to customers who are seeking to improve
production efficiency and reduce their costs and environmental impacts and this service offering is one of RHI Magnesita’s key differentia-
tors. Under a solutions contract RHI Magnesita is paid a fixed price per unit of customer production, initially offering a saving to the customer
versus their prior level of refractory operating expenses. Over time the Group is able to deploy more advanced products and technical
expertise to reduce refractory usage or increase productivity by other means over the five-to-seven-year life of the contract. Solutions
contracts are usually renewed upon expiry with revised productivity goals for the subsequent period.
Innovation, research and development are essential drivers of success in the refractory industry. Refractory products are highly customised
for individual customer applications, often representing many years of iterative improvements tailored to specific customer environments.
Development of new technologies requires careful testing and trials at pilot scale and in live production environments, without impacting
customer outcomes.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202484
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 85
Value chain
RHI Magnesita’s value chain starts with the input of refractory raw materials which are sourced from the Group’s own raw material assets or
purchased on the open market. The key raw materials produced or purchased are magnesite or dolomite based (‘basic’) or alumina-based
(‘non-basic’). The production of basic raw materials involves the mining and extraction of raw magnesite or dolomite followed by high tem-
perature processing in either rotary or shaft kilns to calcine the material produce refractory raw materials. The calcination process is pri-
marily fuelled using fossil fuels such as natural gas, fuel oil or petcoke. RHI Magnesita has no alumina-based raw material production assets.
Raw materials are increasingly sourced through the recycling of reclaimed refractories which go through a process of sorting, crushing and
washing prior to re-use.
The purchase of refractory raw materials represents the largest proportion of the Group’s cost of goods sold, followed by personnel costs,
energy, freight and other consumable items such as packaging.
The core production processes for refractory products are as follows:
• Unshaped refractory products – milling, floating, briquetting, screening and sieving;
• Shaped refractory products – moulding, pressing, drying, tempering, firing, heat treatment, finishing; and
• Isostatically pressed products – pressing, curing, machining, glazing, firing, heat treatment, assembly, finishing.
Supporting processes to the core production process include logistics, quality control, research & development and information technol-
ogy.
The Group’s products are purchased by industrial producers who require refractories to protect equipment during high temperature pro-
duction processes. At the end of the useful life of a refractory lining, the Group seeks to partner with its customers to reclaim as much
residual waste as possible for re-use in the refractory production process.
Significant products and services offered
Significant products offered by the Group are:
• Shaped refractory products;
• Unshaped refractory products;
• Other refractory products;
• Systems, sensors, machinery and digital products; and
• Raw materials.
Refractory services are also provided, either as ad hoc additions to the provision of refractory products or via a full solutions contract, ac-
cording to customer preference.
No significant new products or services were added or removed during the reporting period. Please refer to the Note 5, Segment reporting
on page 256 of this document for further details.
Significant markets and customers served
The Group’s customers are producers of steel, cement, lime, non-ferrous metals, glass, energy, chemicals and waste processors. The end
markets served by the Group’s customers are the construction, transportation, machinery, electronics and consumer goods and energy
sectors.
Banned products
None of the Group’s products are banned from use in any geography.
Business relationships along the value chain
Understanding the business ecosystem requires a comprehensive analysis of the key stakeholders and their respective roles across different
stages of the value chain. The following outlines the primary business actors involved in upstream, core, and downstream operations and
their interdependent relationships.
Upstream business actors
In the upstream segment, the Group relies on essential partners to secure resources, drive innovation, and ensure compliance. Key business
actors include:
Suppliers – Provide raw materials, components, and services necessary for production and operations.
Contractors – Deliver specialised expertise and support in areas such as infrastructure, logistics, and development.
Innovation Partners – Collaborate on research and development initiatives to enhance product and process efficiencies.
Regulators – Oversee industry compliance, ensuring adherence to legal and sustainability standards.
Employees – Contribute to operational efficiency, knowledge transfer, and corporate growth.
85RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
86 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Core Business Actors
At the core of business operations, RHI Magnesita engages with critical stakeholders who influence corporate strategy, innovation, and
governance. These include:
Innovation Partners – Drive technological advancements and co-create value through research and strategic alliances.
Investors/Shareholders – Provide financial capital, influence decision-making, and ensure long-term business sustainability.
Regulators – Enforce compliance with industry standards, corporate governance, and environmental policies.
Employees – Form the backbone of the organisation, driving productivity, corporate culture, and innovation.
Communities – Represent the broader societal impact of business activities, influencing corporate social responsibility (CSR) initiatives.
Downstream Business Actors
In the downstream segment, the Group engages with partners who facilitate market access, service delivery, and regulatory compliance.
These include:
Customers – Serve as the end recipients of products and services, shaping demand and market trends.
Contractors – Support the distribution, marketing, and after-sales processes to ensure operational efficiency.
Regulators – Monitor business practices, ensuring ethical, financial, and environmental accountability.
Employees – Play a crucial role in customer service, brand representation, and operational continuity.
Disclosure requirement SBM-2 – Interests and views of stakeholders
This section is incorporated by reference to “Our Stakeholders” section, pages 26-31.
Disclosure requirement SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model
Material impacts, risks and opportunities and their interaction with strategy and business model
RHI Magnesita has conducted a comprehensive DMA in line with the ESRS framework, evaluating sustainability-related impacts, risks and
opportunities across its value chain. The impact materiality assessment identified and classified sustainability impacts, risks and opportu-
nities assessing their significance based on scale, scope, remediability, and likelihood. Simultaneously, the financial materiality assessment
mapped ESG risks and opportunities against ESRS topics, aligning them with RHI Magnesita’s risk management methodology. This assess-
ment, validated by RHI Magnesita’s audit and sustainability committees on behalf of the Board, integrates insights from internal experts and
external stakeholders. A structured validation process, incorporating stakeholder feedback, ensures that the materiality assessment re-
mains dynamic and aligned with evolving regulatory and business contexts. The whole DMA process is described in IRO-1. The DMA pro-
cess and the due diligence process may be impacted by changes over time. Therefore, the Sustainability statements and material IROs
identified may be subject to change.
RHI Magnesita assesses its sustainability risks and opportunities according to the ESRS methodology seen as the same methodology used
in preparation of the Group’s general risk ledger. For each risk and opportunity, likelihood and potential impact (i.e. financial materiality)
were measured on a scale of 1-5 with resulting scores multiplied together to reach an overall materiality score with a maximum of 25. For
impact materiality, RHI Magnesita applied the ESRS methodology, assessing scale, scope, remediability, and likelihood. Scale measures
impact magnitude, scope covers stakeholder and value chain reach, remediability evaluates mitigation feasibility, and likelihood gauges
occurrence probability. Each is rated from 1 to 6, with 6 as the highest. The assessment integrated quantitative metrics and qualitative
insights, ensuring a balanced evaluation of potential impacts based on probability, granularity and time horizon.
TThheemmee
TTooppiicc
SSuubb--ttooppiicc
IIRROO
t
t
y
y
p
p
e
e
VVaalluuee
c
c
h
h
a
a
i
i
n
n
IIRROO ddeessccrriippttiioonn
PPoolliiccyy
AAccttiioonn
22002255
t
t
a
a
r
r
g
g
e
e
t
t
22003300
t
t
a
a
r
r
g
g
e
e
t
t
ENVIRONMENT
E1 – Climate
change
Climate
change miti-
gation
Positive
impact
Core,
Down-
stream
1. Avoided emissions
through optimised
heat management
IMS policy

Positive
impact
Core
2. Saved emissions
through usage of re-
cycled raw materials
IMS policy

Negative
impact
Up-
stream,
Down-
stream
3. Scope 3 CO
2
emis-
sions from purchased
raw material, use of
sold products and
transport
IMS policy



RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202486
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 87
Negative
impact
Core
4. Scope 1 CO
2
geo-
genic process emis-
sions
IMS policy



Negative
impact
Core
5. Scope 1 CO
2
fuel
based emissions
IMS policy



Oppor-
tunity
Down-
stream
6. Increased demand
for refractory prod-
ucts that enable de-
carbonisation of cus-
tomer industries (EAF,
ESF, BOF, DRI)
IMS policy

Oppor-
tunity
Core,
down-
stream
7. Increased demand
for low carbon foot-
print refractory prod-
ucts
IMS policy

Oppor-
tunity
Core
8. Decrease in costs
or increase in revenue
through use of new
technologies to re-
duce or capture CO
2
emissions from re-
fractory production in
ETS zones
IMS policy

Risk
Core
9. Increase in operat-
ing or capital ex-
penditures due to
changes in policy and
regulation
IMS policy

Risk
Up-
stream,
Core,
down-
stream
10. Increase in oper-
ating expenditure
and reputational
damage if decarboni-
sation pathway not
delivered
IMS policy

Energy
Negative
impact
Core
11. Scope 2 CO
2
emis-
sions from energy
consumption
IMS policy



Risk
Core
12. Reputational
damage if energy re-
duction targets not
achieved
IMS policy

E2 - Pollution
Pollution of
air
Negative
impact
Core,
Down-
stream
13. Air pollution from
industrial processes
IMS policy

E5 – Resource
use and circular
economy
Resource in-
ﬂows, in-
cluding re-
source use
Positive
impact
Up-
stream,
Core,
Down-
stream
14. Efficient use of raw
materials and re-
sources including the
use of recycled mate-
rials
IMS policy



SOCIAL
87RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
88 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
S1 – Own work-
force
Health and
safety
Negative
impact
Core
15. Workplace safety
incidents in own
workforce
IMS policy



Forced la-
bour
Potential
negative
impact
Core
16. Incidents of forced
labour in own work-
force
Human
rights pol-
icy

Working
conditions
Risk
Core
17. Reputational dam-
age if health and
safety targets not
achieved
IMS policy

S2 – Workers in
the supply chain
Health and
safety
Negative
impact
Up-
stream
18. Workplace safety
incidents in supply
chain
Supplier
code of
conduct

Forced la-
bour
Potential
negative
impact
Up-
stream
19. Incidents of forced
labour in supply
chain
Supplier
code of
conduct

GOVERNANCE
G1 - Governance
Corruption
and bribery
1
Risk
Up-
stream,
Core,
Down-
stream
20. Fraud and cor-
ruption in various
forms
Code of
conduct,
Anti-cor-
ruption
policy

1) Corruption and bribery were not deemed to be a material impact, risk or opportunity by the Group’s DMA, but was added following stakeholder engagement.
Avoided emissions through optimised heat management
Positive impact
RHI Magnesita’s comprehensive product range and expertise enables it to offer heat management solutions contracts to customers who
are seeking to improve production efficiency and reduce their costs and environmental impacts. Heat management solutions encompass
a range of technologies and strategies designed to prevent overheating, improve energy efficiency, reduce costs, and extend the lifespan
of equipment. The Group’s customers include industrial producers in the steel, cement, metals and glass sectors with high energy usage
and associated CO
2
emissions. Improvements in refractory performance can often lead to significant energy savings and therefore
avoided CO
2
emissions. For example, refractory linings or functional products with a longer service life can extend periods of continuous
operation, improving asset utilisation for the customer, reducing the impact of downtime and energy loss during warming and cooling
phases.
The ability to deliver production efficiency gains to customers is a key focus of the Group’s strategy which requires the provision of a full
range of refractory products and services to a global customer base. RHI Magnesita has adapted its strategy to seek to increase the propor-
tion of its revenue from solutions contracts. Significant capital has been allocated to M&A in order to grow in geographies and product
segments where the Group was previously under-represented, supporting the solutions contract offering, which was expanded and re-
launched under the brand ‘4PRO’ in 2024.
The positive impact from avoided emissions occurs both in the Group’s core operations and in its downstream value chain. The Group is
able to (i) service customer needs whilst using lower volumes of refractories; and (ii) deliver efficiency gains such as energy and emissions
savings at customer sites.
RHI Magnesita intends to continue to offer heat management solutions and has a target to increase the proportion of revenue derived from
these contracts. Solutions contracts are highly valued by many customers and result in a higher proportion of repeat business since they
are usually renewed on expiry. Margins can also be higher over the full life of a contract. The Group is developing new advanced products
and services to further improve its solutions contract offering and bring further efficiency gains for its customers. Allocation of capital to
R&D spending is intended to continue the Group’s leadership position in this area.
Avoided emissions have an immediate positive impact on people and the environment through avoiding the release of CO
2
to the atmos-
phere which would otherwise occur. The positive impact of avoided emissions originates from the Group’s business model to offer heat
management solutions and results from changes to its own activities and from business relationships with its customers.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202488
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 89
The Group has demonstrated its capacity to address the opportunity from offering heat management solutions by increasing the proportion
of revenue derived from such contracts. The contribution from solutions contracts has recently reduced, mainly as a result of M&A, therefore
creating the opportunity to increase revenue from such contracts in the future.
Avoided emissions resulting from optimised heat management solutions are entity specific and not covered by a specific ESRS disclosure
requirement. The Group intends to develop KPIs and disclose in future in line with phase-in requirements.
Saved emissions through usage of recycled raw materials
Positive impact
RHI Magnesita is able to significantly reduce its CO
2
emissions through increasing the use of recycled raw materials. Each tonne of recy-
cled material used saves approximately 1.6 tonnes of emissions compared to the CO
2
intensive process of extracting and processing fresh
raw material. The use of recycled materials improves local raw material availability and self-sufficiency and, in some cases, can result in
cost savings compared to freshly mined material.
The Group will use the recycling rate KPI to measure and enhance resource efficiency and circular economy integration, as increasing the
use of recycled raw materials is a core part of its strategy to lead in sustainability within the refractory industry, driving significant develop-
ments in its business model.
Historically, recycling rates for refractories in the refractory industry were low (4%) due to reduced performance levels for finished products
containing reclaimed materials. RHI Magnesita developed new sorting and cleaning processes to solve this technology challenge and has
now demonstrated in real-world applications that high quantities (up to 96%) of recycled materials can be incorporated into refractory
products without compromising performance. R&D is continuing in this area, and further technical progress is expected to increase the
efficacy of recycling operations.
After proving the new technology, the Group allocated capital to acquisitions of recycling companies including the joint venture estab-
lished with Horn & Co., MIRECO in 2022 and the acquisition of Refrattari Trezzi in 2024, which have increased availability of reclaimed
material. Further acquisitions of recycling companies in other geographies are under consideration. RHI Magnesita has also invested in the
development of its own recycling facility in Mitterdorf, Austria. Achieving higher recycling rates requires developing a closer partnership
with customers to optimise the process of breaking out and collecting waste refractories at customer sites. Increased precision in sorting
and reducing the time between break out and recycling into new products leads to a higher recycling yield. The Group’s solutions contract
offering is the ideal platform to offer this partnership to customers and recycling of residual material now forms an important part of the
‘4PRO’ solutions offering. There is a significant strategic opportunity to roll out recycling activities globally.
The benefits of recycling are realised in the Group’s core activities and in its upstream and downstream value chains. In the upstream value
chain, the use of recycled raw materials displaces the quantity of refractory raw materials that must be purchased from external suppliers,
reducing Scope 3 CO
2
emissions and all other environmental impacts of extracting, processing and shipping virgin material. Within the
Group’s core activities recycled materials may sometimes be obtained at lower cost compared to purchased raw materials. Materials are
generally locally sourced, which reduces freight costs and emissions from transportation whilst shortening the supply chain, with potential
for working capital benefits. In the downstream value chain the Group’s customers derive significant waste management and circular econ-
omy benefits as refractory waste would otherwise have to be disposed of and would usually go to landfill, incurring additional costs.
RHI Magnesita has responded to the benefits of recycling by investing in the technology, infrastructure and changes to its business model
necessary to take full advantage of the opportunity. In the near-term recycling rates have been diluted by the addition of multiple new
acquisitions to the Group, with lower levels of recycling usage compared to the Group average. However, further investments in new sorting
technologies and a global roll-out of recycling are underway and are expected to deliver further benefits in the short and medium term.
In the future, use of recycled materials within the Group’s raw material processing kilns offers the potential to reduce geogenic emissions
which would otherwise incur a CO
2
allowance cost within the EU ETS framework and later CBAM which is expected to be implemented
over the period 2026-2034. Incorporating high proportions of recycled raw materials into finished refractories enables the Group to offer
lower carbon footprint refractories to its customers. This product range is expected to deliver market share gains or a pricing premium as
customers seek to address their Scope 3 emissions from refractory usage, as set out in opportunity (7) “Increased demand for low-carbon
footprint refractory products”, below. In the long-term, recycling rates have a natural ceiling since refractories are largely consumed during
use and only residual materials can be reclaimed.
For 2025, the CapEx budget for recycling is set at €6 million, prioritizing circular raw materials processing and the integration of innovative
technologies to improve operational efficiency. Beyond 2025, the focus will be on expanding in the refractory circular minerals market
outside Europe, leveraging CapEx and M&A to drive growth and market presence. RHI Magnesita will continue to invest in organic and
inorganic projects to increase its recycling activity so long as such investments are calculated to deliver an attractive return on capital
compared to other investment opportunities available to the Group. Sufficient financial and organisational capacity exists to support further
development of recycling and therefore the Group has sufficient capacity to address this opportunity.
The future potential positive impact on equity value of this opportunity is ca. €441 million.
89RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
90 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Recycling is covered by topic “E5 – Resource use and circular economy” and sub-topic “Resource inflows, including resource use” and
further information on recycling performance is therefore provided below in the relevant section of the Group’s Consolidated Sustainability
Statement.
Scope 3 CO
2
emissions from purchased raw material, use of sold products and transport
Negative impact
Refractory production is a CO
2
intensive activity and is a ‘hard to abate’ industry. Raw material processing generally uses fossil fuels for
ignition and burning of carbonate rock, which results in significant geogenic CO
2
emissions. These geogenic emissions are classified as
Scope 1 when resulting from the Group’s own production or Scope 3 in the case of externally purchased raw materials, occurring in the
upstream section of the value chain. RHI Magnesita purchased 50% of its raw materials usage by value in 2024 (2023: 61%), or 32% by
volume (2023: 36%). Scope 3 emissions from purchased raw material represented 35% of total Group CO
2
emissions in 2024 (2023: 37%).
In the downstream section of the value chain, certain finished refractory products may contain hydrocarbon based binders or additives or
other forms of carbon such as graphite which are oxidised during use and this results in additional Scope 3 CO
2
emissions in the downstream
value chain. Scope 3 emissions are also generated in the shipping and distribution of refractory products to customers worldwide.
The Group is aware of the relatively high CO
2
intensity of its business relationships with raw material suppliers and emissions from the
transportation of raw materials and finished goods. Such emissions are recognised to have an impact on people and the environment
through contributing to climate change over the medium and long-term and the Group has therefore sought to adapt its strategy and
business model to reduce this impact to the greatest extent as is sustainably possible.
Scope 3 emissions from purchased raw material usually arise in regions where no carbon emissions costs are currently incurred but may
attract a cost penalty in the future, for example in the case of raw materials imported into Europe after the implementation of CBAM.
The strategy and business model has been adapted to reduce Scope 3 emissions from purchased raw material by (i) replacing raw material
which would otherwise be purchased externally with recycled raw materials; (ii) prioritising raw material suppliers with lower CO
2
footprints;
(iii) engaging with raw material suppliers to help them to reduce the CO
2
footprint of their operations; and (iv) pursuing technological so-
lutions to decarbonise the Group’s own raw material production facilities which can then be utilised in favour of externally purchased raw
material from high CO
2
emitting suppliers in the future.
Scope 3 emissions from shipping and distribution are unavoidable so long as raw material and finished goods movements are required and
transport methods used by the Group (shipping, road and rail) utilise fossil fuels as a primary energy source. However, the extent of raw
material and finished goods movements can be reduced through the implementation of the Group’s ‘local for local’ production strategy,
which seeks to increase self-sufficiency of its regional hubs, reducing reliance on imports and thereby decreasing the number of freight
movements or reducing distance travelled. RHI Magnesita entered into a partnership with Kuehne + Nagel in 2023 to improve efficiency in
transportation and logistics through improved planning and bulk purchasing of freight services. The Group is also currently investing in an
upgrade of its logistics and supply chain planning systems which is expected to generate further efficiencies in this area.
Through the above responses the Group has demonstrated its capacity to act to address the impact of Scope 3 emissions and further
opportunities exist to further reduce such emissions. However, compared to other actions that the Group is able to take to address its overall
CO
2
emissions, Scope 3 emissions from purchased raw materials are one of the areas over which management has the least control and
influence since this will ultimately require the decarbonisation of suppliers who may not be willing, able or incentivised sufficiently to act.
As part of the Group’s decarbonisation commitment, RHI Magnesita has undertaken to (i) lobby governments to invest in the necessary
infrastructure to decarbonise the refractory industry and other energy intensive industries; and (ii) work with partners in the private sector
to develop new renewable energy solutions, hydrogen energy networks and carbon capture and utilisation technologies which will be
applicable to its upstream suppliers of raw materials.
To monitor this topic, the Group will use as a KPI, Scope 3 emissions associated with purchased raw materials, product use, and transport,
to track progress in reducing its carbon footprint.
Scope 3 emissions are covered by topic “E1 – Climate change” and sub-topic “Climate change mitigation” and further information is there-
fore provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Scope 1 CO
2
geogenic process emissions
Negative impact
RHI Magnesita owns and operates refractories raw material production sites worldwide, with total annual production of 1,301kt in 2024. RHI
Magnesita purchased 50% of its raw materials usage by value in 2024 (2023: 61%), or 32% by volume (2023: 36%). Scope 3 emissions
from purchased raw material represented 35% of total Group CO2 emissions in 2024 (2023: 37%). Raw material processing generally uses
fossil fuels for ignition and burning of carbonate minerals such as magnesium carbonate (magnesite) or calcium magnesium carbonate
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202490
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 91
(dolomite), which results in significant geogenic CO
2
emissions. Approximately half of the mass of raw magnesite and dolomite prior to
burning is oxidised and emitted as CO
2
during raw material processing. These geogenic emissions are classified as Scope 1 when resulting
from the Group’s own production. They occur within the Group’s core operations and not in the upstream or downstream value chain.
Upstream emissions resulting from the same process are classified as Scope 3 emissions from purchased raw material. Scope 1 emissions
from geogenic process emissions represented 19% of total Group CO
2
emissions in 2024.
The Group is aware of the relatively high CO
2
intensity of its raw material processing operations and these emissions are recognised to have
an impact on people and the environment through contributing to climate change over the medium and long-term. RHI Magnesita has
therefore sought to adapt its strategy and business model to reduce this impact to the greatest extent as is sustainably possible.
Scope 1 emissions from geogenic process emissions incur carbon costs in the European Union, where the Group is required to purchase
certificates for CO
2
emissions over and above its free allocation. In 2024 the cost of purchasing certificates for these emissions through the
European ETS was €6million (2023: €2 million). The cost of purchasing CO₂ certificates is expected to rise in the future due to the full
implementation of the Carbon Border Adjustment Mechanism (CBAM). Currently in its transition phase, CBAM will eventually lead to the
complete removal of all free allowances, further increasing compliance costs for RHI Magnesita.
Taking into account the expected increase in the cost of Scope 1 CO
2
emissions in Europe and potentially other geographies the Group has
adapted its strategy and business model to reduce Scope 1 geogenic emissions associated with raw material processing in geographies that
are or may be subject to ETS costs.
Since the processing of virgin carbonate raw materials necessitates the emission of geogenic carbon as CO
2
, the only routes available to
reduce such emissions are to (i) develop non-carbonate raw material sources; or (ii) to capture geogenic process emissions for storage or
utilisation to prevent release to the atmosphere.
The Group is assessing possible routes for the use of non-carbonate raw material sources but has not yet identified an economically viable
production process. RHI Magnesita previously operated sea water based raw material assets in Ireland and Norway but these assets were
energy intensive and ultimately proved to be uncompetitive compared to carbonate raw material sources.
The Group is therefore conducting R&D and investing in pilot production facilities for the capture, storage and/or utilisation of geogenic
process emissions. Trials of a process to capture CO
2
emissions from rotary kilns have been completed successfully. The Group is now
participating in trials of a carbon utilisation technology pioneered by MCi Carbon, an Australia based developer of mineralisation technol-
ogy which can efficiently bind CO
2
into saleable solid carbon-negative materials, permanently removing emissions from the atmosphere.
To date, RHI Magnesita has invested a total of €7 million in MCi Carbon and during 2024 provided raw material samples to a demonstration
facility in Newcastle, Australia for testing of the process. Trial production of carbon negative materials utilising captured CO
2
is scheduled
to commence at this facility in 2025. The technology and other similar solutions may have wider implications beyond the refractory indus-
try, for example in cement production where geogenic emissions pose a similar challenge. The Group considers the MCi process to be the
most promising technology for economically reducing geogenic CO
2
emissions because it results in the production of saleable carbon
negative materials, whereas other carbon storage or sequestration methods only represent additional capital and operating expenses with
no additional revenues.
If the MCi process is successfully proven in the demonstration plant in Australia, RHI Magnesita intends to conduct a feasibility study for
the construction of new plant at its Hochfilzen, Austria raw material production site to remineralise CO
2
emissions at that site. The capital
expenditure for the construction of such a facility and impact on operating expenditures is not yet known but is expected to be material.
RHI Magnesita has sufficient capacity to continue to assess the viability of various technologies to reduce the impact of its Scope 1 geogenic
process emissions but may require external support to employ such technologies at industrial scale. In assessing the optimum financing
structure and economic viability of the MCi project, the Group would seek to reduce risk through equity partnering, public subsidy or tax
incentives and the use of specialised financing instruments which may be available for green projects. This project or any similar under-
taking would be assessed according to the Group’s existing capital allocation process and required to deliver an attractive return on capital
compared to other investment opportunities available to the Group if it is to proceed.
The Group will use Scope 1 emission metric related to raw material processing to monitor this topic.
Scope 1 geogenic process emissions are covered by topic “E1 – Climate change” and sub-topic “Climate change mitigation” and further
information is therefore provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Scope 1 CO
2
fuel-based emissions
Negative impact
RHI Magnesita uses carbon based fuels such as natural gas, oil and petcoke at its raw material and refractory production sites worldwide.
The consumption of these fuels results in Scope 1 CO
2
emissions from within the Group’s core operations and not in the upstream or down-
stream value chain. Upstream emissions resulting from the use of fuels by external raw material suppliers are classified within Scope 3
91RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
92 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
emissions from purchased raw material. Fuel based Scope 1 CO
2
emissions from this source were 1,117kt, accounting for 18% of total Group
CO
2
emissions in 2024, with the majority of fuels being consumed at raw material production sites.
The Group is aware of the relatively high CO
2
intensity of its operations arising from the consumption of fuel and these emissions are rec-
ognised to have an impact on people and the environment through contributing to climate change over the medium and long-term. RHI
Magnesita has therefore sought to adapt its strategy and business model to reduce this impact to the greatest extent as is sustainably pos-
sible.
Scope 1 emissions arising from fuel consumption incur carbon costs in the European Union, where the Group is required to purchase cer-
tificates for CO
2
emissions over and above its free allocation, as described in impact (4) “Scope 1 CO
2
geogenic process emissions”, above.
The cost of such emissions is expected to increase significantly between 2026 and 2034 with the introduction of CBAM and with the
possible commencement of similar ETS regimes in other geographies. The Group is therefore actively seeking to adapt its strategy and
business model to reduce its fuel based emissions, to minimise this potential future financial impact.
The primary routes being assessed or utilised to reduce emissions from fuel consumption are (i) energy efficiency; (ii) fuel switches to lower
CO
2
footprint fuels e.g. natural gas; (iii) increased use of carbon neutral alternative fuels e.g. charcoal, biomass, waste; and (iv) use of green
hydrogen as a partial or total replacement for fossil fuels. Electrification has been evaluated as an alternative to the burning of fuels but
was not found to be viable with currently available technologies due to the high temperatures required in the Group’s manufacturing pro-
cesses.
The capital cost of fuel switches can be significant if the Group is required to partially or wholly fund infrastructure connections, in addition
to the cost of equipment upgrades at production sites to accept new fuels. Such capital costs could make a fuel switch project uneconomic,
even after accounting for potential savings on CO
2
emissions certificates. Operating expenditures may also be affected, either positively or
negatively. The Group has successfully implemented a fuel switch at Ponte Alta, Brazil, and is currently conducting biofuel co-firing trials
at Breitenau, Austria. The Group is also evaluating possibilities at Hochfilzen, Austria and York, USA which will depend on infrastructure
provision.
RHI Magnesita has sufficient capacity to continue to implement fuel switches and increase the use of carbon neutral fuels to reduce its
Scope 1 fuel based emissions but requires external support for the provision of the necessary infrastructure and guaranteed supply agree-
ments. Infrastructure is usually provided for multiple users and in accordance with national or regional development plans.
The Group has tested and demonstrated its readiness for the partial use of hydrogen as a fuel in certain of its processes but is wholly reliant
on external parties for the production and distribution of green hydrogen at a price which is competitive with existing alternative energy
sources.
The Group will use Scope 1 emission KPI related to fuel use to monitor this topic.
Scope 1 fuel-based emissions are covered by topic “E1 – Climate change” and sub-topic “Climate change mitigation” and further infor-
mation is therefore provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Increased demand for refractory products that enable decarbonisation of customer industries (EAF, ESF, BOF, DRI)
Opportunity
RHI Magnesita’s customers operate in high-energy and emissions-intensive industrial sectors. Refractory products and heat management
services have an important role to play in energy consumption and associated CO
2
emissions at customer sites and can have a material
impact on reducing emissions in the Group’s downstream value chain. Steel production in particular accounts for around 8% of global CO
2
emissions and steel customers represent around 70% of Group revenues.
Major advancements by our steel customers are underway in the development of technologies for manufacturing steel with low or zero
CO
2
emissions and approximately 20 new plants or trial projects are currently being developed or are under construction worldwide.
Providing refractory linings, new refractory technology and heat management services to green steel projects represents a material new
business opportunity for the Group. Consumption of magnesite-based refractories is expected to be higher in furnaces and other applica-
tions which are likely play a major role in green steel production such as Electric Arc Furnaces (“EAF”), Electro Smelter Furnaces (“ESF”)
facilities and Open Bath Furnaces (“BOF”). Direct Reduction Furnaces (“DRI”) using natural gas or hydrogen also offer a new business op-
portunity, replacing blast furnaces in ironmaking for green steel production.
Recognising this new opportunity in its downstream value chain, RHI Magnesita has adapted its strategy and business model to pursue
green steel contracts. Developing refractory solutions for new technologies in green steel requires similar capabilities to the project busi-
ness in the Industrial division and the Group is therefore well positioned to win such contracts. In 2024 three major green steel projects
were tendered and RHI Magnesita was appointed in each case, with positive financial effects for the Group in 2024 and 2025 and beyond.
The Group intends to cement its position as industry leader in the provision of refractory products and services for green steel projects and
builds a stronger reputation with each contract award. The Group’s M&A strategy has been adapted to grow capabilities which will assist
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202492
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 93
in supplying green steel projects and the Group is willing to invest in personnel, R&D or new production facilities where necessary to satisfy
customer requirements. The successful award of three new contracts is early evidence that the Group has the capacity and capabilities to
take advantage of this new business opportunity.
The future potential positive impact on equity value of this opportunity is ca. €277million.
The supply of enabling technologies for customers to reduce emissions in the downstream value chain is an entity specific opportunity
and is not covered by a specific ESRS disclosure requirement.
Increased demand for low-carbon footprint refractory products
Opportunity
Through the use of recycled raw materials, RHI Magnesita is able to manufacture refractory products with a significantly reduced CO
2
footprint. The low CO
2
footprint product range is marketed to customers who may be seeking to reduce their Scope 3 emissions from re-
fractory usage or to demonstrate a commitment to sustainable procurement practices. The Group is not aware of any competing low CO
2
footprint refractory products on the market and this product range therefore represents an opportunity to increase revenue through market
share gain or pricing premium, subject to customer demand appetite.
In the process of developing its capabilities to increase the use of recycled raw materials, the Group successfully produced and tested
products made up to 96% recycled raw materials. Recognising this new capability and the potential for future customer demand, the
Group adapted its strategy and business model to develop its offering of low CO
2
products and to actively market them as a sustainable
alternative. The opportunity lies in the Group’s core activities where a new and potentially attractive product range may generate additional
revenues, and in the downstream value chain where the Group’s customers may benefit from a reduction in their Scope 3 emissions arising
from refractory consumption. The Group provides carbon footprint information for all of its products and highlights lower carbon footprint
alternatives to its customers.
Whilst sales of low CO
2
footprint products are growing strongly from a low base, there is not yet evidence of widespread demand from
customers, who are focusing first on reducing Scope 1 and Scope 2 emissions from their own production processes and from other raw
materials such as iron ore, which are much higher as a proportion of total emissions than those arising from refractory usage. The Group
expects demand for low CO
2
footprint products to increase in the future, in particular with the growth of green steel producers for whom
CO
2
emissions in the supply chain are expected to be a higher priority. RHI Magnesita carries out regular surveys of customer priorities,
which found in Q2 2024 that 88% of customers are interested in such products provided that there is no increase in price and 29% would
be interested provided there is only a moderate impact on price.
The continued inclusion of low CO
2
refractories in the Group’s product range does not require material new funding. The Group therefore
has the capacity to take advantage of any increase in demand for low CO
2
refractory products which may occur in the future.
The Group tracks the sales of refractory products supporting electric arc furnaces – key to lower-carbon steel production – as a KPI for
this area, reaching €528 million in 2024.
The future potential positive impact on equity value of this opportunity is c. €277 million.
The supply of low-carbon footprint refractories for customers to reduce their Scope 3 emissions from refractory consumption is an entity
specific opportunity and is not covered by a specific ESRS disclosure requirement.
Decrease in costs or increase in revenue through use of new technologies to reduce or capture CO
2
emissions from refractory produc-
tion in ETS zones
Opportunity
Carbon emission costs in Europe are set to increase significantly with the introduction of CBAM over the period from 2026-2034. Addi-
tional geographies may also implement ETS schemes and impose a cost on carbon emissions. If the Group is able to reduce CO
2
emissions
from its production process by avoiding or capturing emissions there is an opportunity to gain a cost advantage versus competitors and to
realise higher prices for finished refractories, since the cost of production for the industry as a whole will increase.
Recognising the change in cost structure for the industry that will be brought about by the introduction of CBAM, the Group has adapted
its strategy and business model to take advantage of this potential opportunity.
The primary routes by which the Group is seeking to reduce its Scope 1 CO
2
emissions in Europe are (i) fuel switches and use of alternative
fuels; (ii) use of recycled material in raw material kilns; and (iii) carbon capture and utilisation or storage. The Group is also able to reduce
the CO
2
footprint of certain finished product ranges through the use of high proportions of recycled raw materials. Using one or a number
of these methods RHI Magnesita has the capability to manufacture refractory products without incurring cost penalties associated with
CO
2
emissions, as CBAM increases the cost of such emissions. Other refractory producers may not be able to reduce CO
2
emissions since
they are not vertically integrated and do not have advanced recycling initiatives similar to RHI Magnesita. Operating on a ‘cost plus’ basis,
93RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
94 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
competing refractory producers may have to increase prices to cover the additional costs incurred in purchasing high CO
2
intensity raw
materials that are imported into Europe in addition to any CO
2
emissions in EU-based refractory plants. As the market price for refractories
increases, RHI Magnesita should therefore be able to increase margins on its low CO
2
footprint products.
The financial benefits from this opportunity are not expected to occur in the short term or in the next reporting period but are expected to
emerge over the period 2026-2034, which is the implementation timetable for CBAM. The additional cost that would be incurred by the
Group if it does not reduce its own emissions is approximately €80 million per year for its European operations, representing the maximum
possible cost impact if the Group is not able to make any reduction in its European Scope 1 emissions. Prices for products sold within Europe
are assumed to rise in line with competitor pricing but this will not apply to c.50% of the Group’s European production which is exported
and sold in markets where no ETS or structure similar to CBAM applies. Over the long-term if CBAM continues to impose a cost of carbon
on high CO
2
emitting producers, the financial benefit from selling low CO
2
footprint products within the EU could be significant.
As set out in IROs (2), (4) and (5) above, significant capital investments may be required to fully decarbonise the Group’s operations in
Europe, in particular for any carbon capture and utilisation project which may be contemplated. The capital cost of achieving this has not
yet been calculated and such initiatives will only be approved for investment if an attractive return on capital can be realised compared to
other opportunities available to the Group. It is therefore not certain that the Group will have the capacity to fully take advantage of this
potential opportunity, which depends on as yet unproven technologies and support from public subsidy or infrastructure provision.
The opportunity to decrease costs or increase revenue through use of new technologies to reduce or capture CO
2
emissions from refractory
production in ETS zones is an entity specific opportunity and is not covered by a specific ESRS disclosure requirement.
The Group will monitor the increase of recycling rate as a KPI for this topic.
Increase in operating or capital expenditures due to changes in policy and regulation
Risk
RHI Magnesita foresees a risk to its business from the increase in operating costs due to an increase in the level or scope of carbon pricing.
Scope 1 emissions arising from fuel consumption or geogenic process emissions incur carbon costs in the European Union, where the Group
is required to purchase certificates for CO
2
emissions over and above its free allocation. The cost of such emissions is expected to increase
significantly between 2026 and 2034 (c.2030 for RHI Magnesita) with the introduction of CBAM and with the possible commencement of
similar ETS regimes in other geographies. The Group is therefore actively seeking to adapt its strategy and business model to reduce its
Scope 1 CO
2
emissions in Europe, to minimise this potential future financial impact.
Higher expected future emissions costs are a key driver behind the Group’s strategic decision to invest in CO
2
emissions reduction initiatives,
such as the use of recycling, fuel switches and alternative fuels, and carbon capture, storage and utilisation projects. The possibility to avoid
the higher future costs of emissions creates a business case for investing in such initiatives.
If the Group is unable to reduce its Scope 1 emissions in Europe, the implementation of CBAM is expected to have a negative financial
impact on the Group from 2030 onwards as free carbon allowances under the existing EU ETS are phased-out. CBAM will apply a charge
to imported raw materials and is expected to increase refractory pricing for all suppliers selling into the EU. Additionally, products manu-
factured in the EU and then exported will incur higher costs, as there are currently no compensation mechanisms for exporters who will
have paid the CO
2
costs on production within the EU.
No negative financial effects are expected in the next reporting period, 2025. The Group is in the process of developing new technologies
and projects to reduce CO
2
emissions but is not yet able to calculate the required capital expenditure or funding sources for such projects.
Emissions reduction projects will be assessed according to the Group’s existing capital allocation process and required to deliver an attrac-
tive return on capital compared to other investment opportunities available to the Group. Whilst the Group may be successful in develop-
ing new technical solutions it is not certain that there will be sufficient financial capacity available to fund large capital projects without
support from public subsidy or tax incentives, co-investors and specialised debt providers.
Without mitigation such as the use of new technologies to reduce CO
2
emissions in the production process, the financial impacts of CBAM
could result in a future negative impact on equity value ranging from €255 million to €480 million.
The Group will use as a KPI to monitor this topic, the number of ETS certificates and ensure regulatory compliance.
Scope 1 emissions are covered by topic “E1 – Climate change” and sub-topic “Climate change mitigation” and further information is there-
fore provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Increase in operating expenditure and reputational damage if decarbonisation pathway not delivered
Risk
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202494
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 95
RHI Magnesita has published a theoretical decarbonisation pathway which sets out a potential route to eliminate CO
2
emissions in its core
operations and upstream value chain by 2060. If the Group is unable to deliver this decarbonisation pathway it could be impacted by an
increase in operating expenditures and may also suffer reputational damage.
The negative financial impacts that may arise due to higher operating expenses if RHI Magnesita is unable to reduce its CO
2
emissions and
the Group’s responses to this risk are described in risk (9) “Increase in operating or capital expenditures due to changes in policy and regu-
lation”, above.
In addition to direct financial effects, RHI Magnesita may suffer criticism from stakeholders and consequent reputational damage if it is not
able to deliver its theoretical decarbonisation pathway. The Group has adopted a theoretical decarbonisation pathway that is not aligned
with a 1.5-degree scenario as set out in the Paris agreement. A detailed assessment was carried out in 2021 and 2022 of all possible
measures to reduce CO
2
emissions based on proven technology and available financial resources. The Board concluded that whilst it may
be possible to reduce emissions in line with a ‘well below 2 degrees’ scenario, it would not be possible to set a target that is aligned with a
1.5-degree scenario as this would be dependent on the development of as-yet-unknown technologies or reliant on significant external
financial and infrastructure support which are uncertain.
As a relatively high emitter of CO
2
RHI Magnesita is aware of the potential damage to its reputation of not achieving its theoretical decar-
bonisation pathway and has therefore responded to this risk by adapting its strategy and business model and by allocating resources to
decarbonisation R&D and projects.
The key strategic measures being taken to reduce CO
2
emissions are set out in impacts (2) to (5) in the table above, and include (i) increasing
the use of recycled raw materials; (ii) energy efficiency programmes, fuel switches and the use of alternative fuels; (iii) carbon capture and
storage or utilisation projects; (iv) working with suppliers of raw materials to reduce or eliminate their CO
2
emissions and (v) transportation
efficiency gains.
The reputational risk of not achieving the theoretical decarbonisation pathway occurs within the Group’s core activities and in its upstream
value chain, where a large proportion of CO
2
emissions are accounted for by suppliers of purchased raw materials.
No negative financial effects arising from this reputational risk are expected to occur in the next reporting period, 2025. In the medium and
long-term the Group could be affected by reputational damage if it is unable to maintain positive relations with key stakeholders such as
its employees, customers, suppliers, shareholders, lenders, host governments and local communities. The specific impact would depend
on the stakeholder relationship that is affected but could include an increase in the cost of equity or debt financing, permitting issues,
market share loss or local operational disruption.
Whilst the Group may be successful in developing new technical solutions for decarbonisation it is not certain that there will be sufficient
financial capacity available to fund large capital projects without external support.
The Group uses ETS expenditure as KPI to track this topic and optimise cost efficiency in emission trading.
CO
2
emissions are covered by topic “E1 – Climate change” and sub-topic “Climate change mitigation” and further information is therefore
provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
95RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
96 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Scope 2 CO
2
emissions from energy consumption
Negative impact
RHI Magnesita purchases electrical energy from external power producers resulting in Scope 2 CO
2
emissions. Scope 2 emissions are a
smaller proportion of the Group’s CO
2
emissions compared to Scope 1 and Scope 3, accounting for only 4% of total emissions in 2024
(2023: 4%).
The Group is aware of the relatively high CO
2
intensity of its operations and Scope 2 emissions are recognised to have an incremental
impact on people and the environment through contributing to climate change over the medium and long-term. RHI Magnesita has there-
fore sought to adapt its strategy and business model to reduce this impact to the greatest extent as is sustainably possible. Due to their
smaller scale and the ability to obtain power from clean energy sources it is easier for RHI Magnesita to reduce its Scope 2 emissions com-
pared to Scope 1 or Scope 3. Scope 2 emissions occur within the Group’s core operations.
Scope 2 emissions do not incur carbon costs in Europe or elsewhere and therefore there are no near term negative financial impacts from
an ETS perspective, including in the next financial reporting period 2025. The Group has a plan to replace its remaining non-renewable
power consumption with a combination of self-generated clean power e.g. from on-site solar installations and via power purchase agree-
ments with certified clean energy providers. Capital expenditure on this plan is expected to be minimal due to the use of external providers
who install equipment in exchange for committed power purchase contracts. Once implemented an annual operating cost saving of up to
€2 million is forecast, compared to existing power contracts. RHI Magnesita has sufficient financial and organisational capacity to address
this risk in the period 2025-2026.
The Group will use as KPI to measure and reduce Scope 2 emissions, the energy efficiency and renewable energy sourcing.
Scope 2 emissions are covered by topic “E1 – Climate change” and sub-topic “Climate change mitigation” and further information is there-
fore provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Reputational damage if energy reduction targets not achieved
Risk
RHI Magnesita has published a target to reduce energy consumption per tonne of production by 5% by 2025, compared to a baseline year
of 2018. By 2030, the Group has committed to reducing absolute energy consumption by 1% per plant each year and to increase coverage
of its plants by ISO 50001 standards to 90%. Failure to achieve some or all these targets could result in reputational damage and may
negatively impact the Group’s ESG ratings.
This risk exists within the Group’s core operations and not in its upstream or downstream value chain. There are no near or long-term major
financial impacts of missing the targets other than slightly higher operating expenditure on energy and potentially higher expenditure on
CO
2
certificates if the energy consumption in question is related to fossil fuel use in Europe.
RHI Magnesita recognises that its business model is energy intensive and has responded to this risk by adapting its strategy and business
model and by allocating resources to energy saving projects. The Group is on track to achieve the 2025 target (the 5% energy intensity
saving has already been achieved in 2024) and considers that it also has sufficient capacity to deliver the 2030 targets.
The Group will establish a KPI in alignment with phase-in requirements to enhance tracking and reporting in this area.
Energy consumption is covered by topic “E1 – Climate change” and sub-topic “Climate change mitigation” and further information is there-
fore provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Air pollution from industrial processes
Negative impact
RHI Magnesita’s raw material processing and refractory plants utilise fossil fuels including natural gas, fuel oil and petcoke. Combustion of
these fuels results in air pollution from Sulphur Dioxide (SOx) and Nitrogen Oxides (NOx). These emissions occur in the Group’s core oper-
ations and have a negative impact on people and the environment due their effects on air quality. Similar emissions are also present in the
Group’s upstream value chain at its raw material suppliers and in the downstream value chain at customer sites and in the transportation
of goods.
The Group is aware of this negative environmental impact and has taken steps to adapt its strategy and business model to reduce it. The
primary method for reducing SOx and NOx emissions is through the installation of emissions abatement equipment at sites where such
pollution occurs. Switching fuels can lead to a reduction in pollution for example by replacing fuel oil or petcoke use with natural gas.
Emissions can also be reduced indirectly by increasing the use of recycled raw materials, which avoids the need to mine and process virgin
raw materials with associated SOx and NOx emissions.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202496
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 97
There are no financial impacts associated with SOx and NOx emissions, either in the next reporting period or the medium to long-term, as
long as emissions are kept below legal limits in the relevant jurisdiction. However, it is possible that legal limits could be reduced in the
future.
The Group has implemented a programme of emissions abatement equipment installation with upgrades completed in China and North
America in 2021 and 2023, respectively. Over the period 2025-2030 similar installations or reductions by other means will be undertaken
in Europe and Brazil. RHI Magnesita has adequate organisational and financial capacity to address this risk and has allocated capital for
equipment over that period. Equipment installed to date has demonstrated its efficacy in reducing pollution from these sources.
The Group monitors emission levels at its production sites and will use them as a KPI to track and improve environmental performance.
Pollution from SOx and NOx emissions is covered by topic “E2 – Pollution” and sub-topic “Air pollution” and further information is therefore
provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Efficient use of raw materials and resources including the use of recycled materials
Positive impact
RHI Magnesita’s use of recycled refractory material has a positive sustainability impact on people and the environment by promoting the
efficient use of raw materials. Using recycled material prevents the consumption of resources required to extract and process fresh raw
material and reduces waste at customer sites. This positive impact occurs within the Group’s core operations and in its upstream value chain,
since quantities of externally purchased raw materials are reduced. Waste disposal and circular economy benefits are realised in the down-
stream value chain.
Seeking to increase the use of recycled raw material is an integral part of the Group’s strategy to be a sustainability leader in the refractory
industry and has led to significant developments in the business model.
As described in impact (2) “Saved emissions through usage of recycled raw materials” above, RHI Magnesita has developed proprietary
technology to utilise recycled raw materials without negatively impacting refractory performance. Investments in R&D, product develop-
ment, acquisitions and internal capital expenditures have been deployed and this has successfully delivered an increase in the recycling
rate from 3.8% in 2018 to 14.2% in 2024. A total of 364 kt of recycled material was utilised, compared to 271 kt in 2023. Without recycling,
this material would have been sourced through new mining and processing activities in 2024. The Group’s solutions contract offering is
the ideal platform and recycling of residual material now forms an important part of the ‘4PRO’ solutions offering.
Further investments in new sorting technologies and a global roll-out of recycling are underway and are expected to deliver further benefits
in the short and medium term. Capital expenditure allocated to recycling in 2025 is budgeted at €3,9million and the Group may also make
further recycling focused acquisitions, although no sum is reserved specifically for this purpose. The Group has sufficient capacity to con-
tinue to invest in recycling opportunities.
The Group uses the recycling rate as KPI to enhance its recycling efforts and drive sustainable material management.
Recycling is covered by topic “E5 – Resource use and circular economy” and sub-topic “Resource inflows, including resource use” and
further information on recycling performance is therefore provided below in the relevant section of the Group’s Consolidated Sustainability
Statement.
Workplace safety incidents in own workforce
Negative impact
Occupational injuries occurring at RHI Magnesita’s operational sites have a negative impact on affected individuals and their families. This
impact is focused on incidents which occur within the Group’s core operations and not in its upstream or downstream value chains.
The Group’s operations may also be affected by poor health and safety performance and such impacts could be both short term and long-
term in nature. Workplace safety incidents have a negative financial impact in the short term due to lost time, reduced production, lower
productivity and costs associated with compensation, investigations and remedial upgrades. Long-term impacts could arise due to higher
costs of production, reputational damage, long-dated compensation payments and impacts on key stakeholders such as difficulty in re-
cruiting or retaining employees.
Health and safety is a core value for RHI Magnesita and adaptations have been made to the strategy and the business model to reduce this
negative impact. Key initiatives aimed at structurally reduce impacts include automation, training, incident investigation, global standards,
safety culture initiatives and reviews by external experts. The Group has sufficient capacity to invest in improving its health and safety
performance and health and safety related capital expenditures are protected and prioritised within the Group’s capital allocation frame-
work.
The Group monitors health and safety performance and will use total recordable injuries (“TRI”) as KPI to track this topic.
97RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
98 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Workplace safety incidents are covered by topic “S1 – Own workforce” and sub-topic “Health and safety” and further information on work-
place safety is therefore provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Incidents of forced labour in own workforce
Potential negative impact
RHI Magnesita employs approximately 16,000 employees and 6,000 contractors across its main production sites globally, operating in a
diverse range of locations. While the risk of forced labour is closely managed, it remains a concern, particularly among the contractor
workforce, where the Group has less direct control over recruitment and working conditions. This risk is specifically focused on incidents
within RHI Magnesita’s core operations and does not extend to its upstream or downstream value chains.
Findings from the Double Materiality Assessment (“DMA”) indicate that the risk of forced labour is significantly higher in regions such as
BRICS, Asia, Africa, and Middle and South America, where regulatory oversight and enforcement mechanisms may be weaker. Forced la-
bour has severe consequences on individuals' quality of life, making prevention and mitigation a key priority. In contrast, regions such as
Europe, North America, Singapore, and South Korea present a significantly lower risk, supported by strong legal frameworks and govern-
ance structures, with only rare cases occurring.
Within RHI Magnesita’s operations, strict Group policies and compliance measures serve as a strong deterrent, minimising the probability
of occurrence to an individual level. However, managing and mitigating the personal and systemic impacts of forced labour remains com-
plex.
The risk of poor labour practices interacts with the Group’s strategy in the area of M&A, which is a primary growth driver for RHI Magnesita.
Through due diligence before transactions and during integration processes after completion the Group seeks to ensure that practices in
acquired businesses are in line with expected minimum standards and policies.
Failure to identify and rectify instances of forced labour within its own workforce could result in fines, enforcement action and reputational
damage. Conditions of forced labour have clear negative impacts on people but are not likely to be connected to environmental impacts.
Given the safeguards that the Group has in place, no material financial effect from this risk is expected in the next reporting period, 2025,
or in the medium to long-term. The Group has sufficient capacity to continue to address this risk in its own workforce.
The Group tracks the number of reports to the whistleblowing hotline, and it will use as a KPI for this area.
Forced labour is covered by topic “S1 – Own workforce” and sub-topic “Forced labour” and further information is therefore provided below
in the relevant section of the Group’s Consolidated Sustainability Statement.
Reputational damage if health and safety targets not achieved
Risk
RHI Magnesita employees and contractors at its main production sites and at customer sites may be exposed to safety hazards in the work-
place. The most common mechanisms of serious injury are falls, falling objects, contact with moving vehicles or industrial equipment and
material handling. The Group has a target to eliminate fatalities and to maintain a Total Recordable Injury Frequency Rate of below 1.2 per
200,000 hours worked. If these targets are not achieved the Group could be subject to reputational damage as well as fines and enforce-
ment action. Poor health and safety performance could also impact the Group’s ESG ratings with a potential negative impact for the interest
rate payable on its sustainability linked debt facilities.
This risk is focused on health and safety performance within the Group’s core operations and not in its upstream or downstream value
chains
Workplace health and safety interacts closely with the Group’s strategy and business model since refractory production in non-automated
plants is labour intensive and necessitates people working in close proximity to equipment, machinery and other potential hazards. As a
responsible employer with an aspiration to lead the refractory industry in sustainability, the Group assigns the highest priority of all sus-
tainability risks and impacts to the safety of its employees and contractors.
Health and safety risk interacts with the Group’s strategy in the area of M&A, which is a primary growth driver for RHI Magnesita. Through
due diligence before transactions and during integration processes after completion the Group seeks to ensure that health and safety
practices in acquired businesses are in line with expected minimum standards and policies.
Given the safeguards that the Group has in place, no material financial effect from this risk is expected in the next reporting period, 2025,
or in the medium to long-term. The Group has sufficient capacity to continue to address this risk in its own workforce.
The Group will develop a reputation-related KPI in line with phase-in requirements for this topic.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 202498
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 99
Health and safety in own workforce is covered by topic “S1 – Own workforce” and sub-topic “Health and Safety” and further information is
therefore provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Workplace safety incidents in supply chain
Negative impact
RHI Magnesita utilises a broad supply chain including raw material producers, energy suppliers, freight service providers, consumables,
packaging and capital goods suppliers, amongst others. Occupational injuries occurring in the supply chain have a negative impact on
affected individuals and their families. This impact is focused on incidents which occur within the upstream value chain and not in the
Group’s core operations or downstream value chains.
Health and safety is a core value for RHI Magnesita and suppliers are expected to maintain compliance with health and safety regulations
according to the Supplier Code of Conduct. Workplace safety incidents in the supply chain are unlikely to have any financial impact on
RHI Magnesita but could result in reputational damage.
RHI Magnesita undertakes audits at supplier sites and requires participation in third party evaluations provided by Eco Vadis to ensure
supplier compliance with a range of sustainability issues, including health and safety performance. The Group has sufficient capacity to
continue addressing this negative impact in its supply chain.
The Group collects and assesses supplier data and uses as a KPI to track this topic.
Workplace safety incidents in the supply chain are covered by topic “S2 – Workers in the supply chain” and sub-topic “Health and safety”
and further information on workplace safety is therefore provided below in the relevant section of the Group’s Consolidated Sustainability
Statement.
Incidents of forced labour in supply chain
Potential negative impact
RHI Magnesita utilises a broad supply chain including raw material producers, energy suppliers, freight service providers, consumables,
packaging and capital goods suppliers, amongst others. Since RHI Magnesita does not have direct managerial control over workers in its
supply chain, there is a relatively higher risk of instances of forced labour. This risk is focused on forced labour which may occur within the
upstream value chain and not within the Group’s core operations or downstream value chain.
According to the terms of RHI Magnesita’s Supplier Code of Conduct, suppliers are expected to respect and promote human and civil rights
and refrain from using any form of forced, compulsory or child labour. Incidents of forced labour in the supply chain are unlikely to have
any financial impact on RHI Magnesita but could result in reputational damage.
RHI Magnesita undertakes audits at supplier sites and requires participation in third-party evaluations provided by Ecovadis to ensure sup-
plier compliance with a range of sustainability issues, including forced labour. The Group has sufficient capacity to continue addressing
this negative impact in its supply chain. In 2023, the Group reacted to the discovery of an incident of forced labour in its supply chain by
terminating its relationship with the supplier. No similar incidents were recorded in 2024.
The risk of poor labour practices interacts with the Group’s strategy in the area of M&A, which is a primary growth driver for RHI Magnesita.
Through due diligence before transactions and during integration processes after completion the Group seeks to ensure that practices in
acquired businesses are in line with expected minimum standards and policies.
The Group collects and assesses supplier data and uses as a KPI to track this topic.
Forced labour in the supply chain is covered by topic “S2 – Workers in the supply chain” and sub-topic “Forced labour” and further infor-
mation on workplace safety is therefore provided below in the relevant section of the Group’s Consolidated Sustainability Statement.
Fraud and corruption in various forms
Risk
RHI Magnesita operates in some geographies with inherently high corruption risks, where employees or third-party representatives may
violate anti-corruption laws. This risk could occur in the Group’s core operations or in its upstream and downstream value chains.
Fines, enforcement action and reputational damage as a result of breaches of anti-corruption laws may be significant. The Group is not
aware of any ongoing investigation which could result in a material financial impact in the next reporting period, 2025. The risk of fraud
and corruption is likely to continue to exist in both the medium and long-term but the Group has sufficient capacity to continue to address
this risk.
Fraud and corruption risk interacts with the Group’s M&A growth strategy as it seeks to grow its business in geographies and product seg-
ments in which it is under-represented. RHI Magnesita may pursue acquisitions in geographies with a higher risk of fraud and corruption.
99RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
100 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Through due diligence before transactions and during integration processes after completion the Group seeks to ensure that practices in
acquired businesses are in line with expected minimum standards and policies.
Responses to the risk of fraud and corruption include:
• Promoting ethical values supported by strong corporate culture;
• Code of Conduct and compliance policies and procedures;
• Enhancement of global training, documentation of compliance matters and communication;
• Whistleblowing channels available to employees and external parties to report compliance concerns; and
• Range of interventions performed in conjunction with acquired businesses to assess regulatory risk and to introduce and embed
the Group’s compliance approach.
The Group tracks the number of reports to the whistleblowing hotline, and it will use as a KPI for this area.
Fraud and corruption are covered by topic “G1 – Business Ethics” and further information is therefore provided below in the relevant section
of the Group’s Consolidated Sustainability Statement.
Impact, risk and opportunity management
Disclosure Requirement IRO-1 – Description of the process to identify and assess material impacts, risks and opportunities
RHI Magnesita has assessed material sustainability related impacts, risks and opportunities according to the ESRS concept and require-
ments of double materiality. The assessment results were presented to management and subsequently reviewed by the joint meeting of
the Corporate Sustainability and Audit & Compliance Committees on behalf of the Board of Directors.
Refractory production is a hard-to-abate industry characterised by energy-intensive processes, high-temperature operations, and reliance
on fossil fuels, leading to significant carbon emissions, including process emissions from raw material calcination and fuel combustion at
raw material processing sites. The impact is exacerbated by rising global demand, particularly in emerging markets, and the inherent chal-
lenges of decarbonisation due to technological limitations (e.g., achieving high temperatures with renewable energy), long investment
cycles, and substantial transition costs. To address these emissions, the Group is actively pursuing and evaluating solutions such as carbon
capture, utilisation, and storage (“CCUS”), electrification, green hydrogen, energy efficiency enhancements, and the integration of low-
carbon materials into its operations.
To prepare for the DMA, RHI Magnesita conducted a comprehensive evaluation of its business model and activities across the value chain.
This included a detailed analysis of the granularity of impact risks and opportunities (IROs) within the Group, ensuring a thorough under-
standing of their specific implications. This process was aimed at identifying key areas of significance, refining the scope of material issues,
and aligning them with the Group’s strategic priorities. This process was guided by the list of sustainability matters outlined in the topical
ESRS and facilitated the identification of key stakeholders. Additionally, RHI Magnesita also made use of performance data, literature review,
ESG public databases, current and upcoming regulations and standards, industry sector benchmarking and external experts to support the
materiality assessment. RHI Magnesita has previously carried out materiality and risk assessments for GRI reporting and TCFD analysis.
The evaluation of potential GHG emissions has been conducted with a focus on the distinct contributions from raw material preparation
plants and refractory production facilities. This analysis accounts for variations in energy and fuel mixes across operations, as well as the
specific carbon intensity of each process. Raw material preparation plants, due to energy-intensive activities such as calcination and ma-
terial processing, have been assessed separately to highlight their unique emission profiles. Similarly, emissions from refractory production
have been analysed, with particular attention to kiln operations, fuel combustion, and electricity consumption. Additionally, the type and
sourcing of raw materials have been considered, given their significant impact on the overall emissions footprint. This approach ensures a
comprehensive understanding of source of emissions across the value chain and highlights key areas for targeted mitigation efforts.
The assessment process incorporated input and validation from key stakeholders, including subject matter experts from group functions in
health and safety, environment, equality, diversity and inclusion, community engagement, sustainable procurement, compliance, and risk
management. Additionally, contributions from the sustainability functions in corporate areas were integral to ensuring a holistic perspective.
Involvement of the risk management resources in the materiality assessment process supports the identification and further evaluation of
sustainability related impacts, risks and opportunities. There are no additional internal controls for the DMA.
Impact materiality assessment
The impact materiality assessment considered both actual and potential sustainability impacts from RHI Magnesita’s own activities and
business relationships across the upstream and downstream value chain, focusing on high-risk areas such as mining and production pro-
cesses, as well as relevant processes and influencing factors. Where applicable, industry-specific issues were also integrated into the eval-
uation to ensure a tailored approach.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024100
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 101
The following steps were taken for the impact materiality assessment:
• Identification of impacts;
• Scoping and classification of individual impacts;
• Assessment of significance of individual impacts;
• Analysis of results and materiality thresholds; and
• Perception and Validation of DMA Outcomes by stakeholders.
Identification of impacts
RHI Magnesita has identified its impacts across the value chain by examining sustainability matters at varying levels of granularity, including
topics, sub-topics, and sub-sub-topics. This analysis considered the direct and indirect consequences of RHI Magnesita’s operations, prod-
ucts, and services on environmental, social, and governance aspects. By aligning with the detailed structure provided by the ESRS, the
assessment captured specific nuances of each sustainability matter, ensuring a thorough understanding of the scale, scope, and depth of
RHI Magnesita’s impacts at every stage of the value chain. This approach enabled the identification of both significant adverse effects and
opportunities for positive contributions to people and environment.
Scoping and classification of individual impacts
As a next step, a detailed analysis of each identified impact, considering its classification along the value chain to pinpoint where it occurs,
and its significance was carried out. Impacts were classified as positive or negative and assessed further to determine whether they are
actual (already occurring) or potential (likely to occur in the future). Each impact was also evaluated based on its time frame - whether it is
short, medium, or long-term - and the probability of its occurrence, enabling a thorough understanding of the likelihood and urgency of
the impact. This approach ensures a comprehensive assessment of sustainability impacts across RHI Magnesita's operations and value
chain.
Assessment of significance of individual impacts
To assess the significance of impacts, RHI Magnesita followed the ESRS methodology, incorporating a comprehensive evaluation of scale,
scope, remediability, and likelihood. Scale measures the magnitude of the impact, while scope evaluates its breadth across stakeholders
and the value chain. Remediability considers the feasibility and timeframe to reverse or mitigate a negative impact, and likelihood assesses
the probability of the impact occurring. Each dimension is rated on a scale from 0 to 6, with 6 representing the highest level of impact. This
evaluation integrates both quantitative data, such as metrics and indicators, and qualitative insights, including expert opinions and stake-
holder feedback. Additionally, potential impacts are analysed with a focus on their probability of occurrence, granularity, and time horizon,
ensuring a balanced assessment.
Analysis of results and materiality thresholds
The analysis of results and materiality thresholds play a critical role in determining which issues are to be included in RHI Magnesita’s
sustainability reporting. Materiality thresholds were carefully evaluated for reasonableness to ensure a balance between comprehensive-
ness and manageability, ensuring that resources are focused on critical areas without diluting efforts across too many topics while meeting
reporting obligations effectively. Both quantitative (e.g. numerical scoring) and qualitative thresholds (e.g., legal compliance, reputational
risk) were utilised, with alignment to Group targets shaping final decisions. Different quantitative thresholds were tested to refine the results.
Financial materiality assessment
Financial materiality is evaluated based on the potential risks of negative reputational, financial, or commercial impacts on RHI Magnesita
arising from sustainability topics, as well as the opportunities linked to sustainability that could benefit RHI Magnesita. The following steps
were taken for the financial materiality:
• Gap analysis;
• Risk mapping against CSRS topics, subtopics and sub-subtopics;
• Assessment based on RHI Magnesita‘s internal risk assessment approach;
• Analysis of results and materiality thresholds; and
• Perception and Validation of DMA Outcomes by stakeholders.
Gap analysis
The gap analysis of financial materiality involves a thorough review of existing risks to assess their alignment with RHI Magnesita's strategy
and sustainability goals. This process includes identifying any emerging risks that may pose reputational, financial, or operational chal-
lenges and evaluating their potential impact on the Group. Simultaneously, the analysis explores untapped opportunities that align with
RHI Magnesita’s strategy, enabling the integration of sustainability-driven initiatives into the business strategy.
Risk mapping against ESRS topics
As part of the risk mapping process, ESG risks and opportunities were aligned with their corresponding topics within the ESRS framework.
By doing so, RHI Magnesita ensured that highly rated impacts identified in the materiality analysis are adequately reflected as risks or op-
portunities within the ESRS universe, providing a cohesive and comprehensive integration of sustainability considerations into risk man-
agement and reporting practices.
101RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
102 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Risk and opportunity assessment following RHI Magnesita’s risk management approach
The assessment of risks and opportunities has followed RHI Magnesita's internal risk assessment methodology, ensuring alignment with the
Group's established approach to evaluating potential impacts. The analysis incorporates a time horizon perspective, considering short-,
medium-, and long-term implications for the business. This comprehensive evaluation enables the identification and prioritisation of risks
and opportunities, ensuring that immediate concerns, emerging trends, and long-range strategic impacts are thoroughly addressed within
the sustainability context.
Analysis of results and materiality thresholds
The analysis of results and materiality thresholds is key in identifying which issues are significant enough to be included in RHI Magnesita’s
sustainability reporting. These thresholds were assessed to ensure a balance between comprehensiveness and focus, allowing resources
to be directed toward critical risks and opportunities while maintaining effective reporting. Both quantitative thresholds (e.g., numerical
scoring) and qualitative criteria (e.g., legal compliance, reputational risk) were applied, with alignment to Group targets guiding final deci-
sions. Various quantitative thresholds were tested to refine the analysis, ensuring the prioritisation of material issues. For financial materiality,
RHI Magnesita will focus on critical areas where the likelihood and impact of risks or opportunities materialising are significant. However,
not all sustainability related risks in the Consolidated Sustainability Statement are specifically highlighted in RHI Magnesita’s aggregate
risk profile.
For impact materiality, 92 matters were assessed. Of these, 12 were classified above the materiality threshold. For financial materiality, 60
matters were assessed. Of these, eight were classified above the materiality threshold and one was added as a result of the stakeholder
validation process.
Stakeholder perception and validation of Double Materiality Assessment (“DMA”) results
RHI Magnesita conducted consultations with internal and external stakeholders (employees, investors, suppliers, customers, NGOs, lenders,
members of Board) for validation and perceived materiality.
The views of RHI Magnesita’s stakeholders are integrated in the materiality assessment. RHI Magnesita’s Group functions and business areas
summarise input provided to them through their engagement with affected stakeholders, and their interaction with external sustainability
experts and users of RHI Magnesita’s Consolidated Sustainability Statement.
Results
All identified sustainability related impacts, risks and opportunities that are considered material for affected stakeholders or users of RHI
Magnesita’s Consolidated Sustainability Statement are presented in the table below, which is the basis for the scope of this Consolidated
Sustainability Statement.
A regular review of the scope of the DMA is expected, to remain responsive to the evolving regulatory environment and/or the Group goes
through significant changes in its industrial footprint (e.g. M&A)
Disclosure requirement IRO-2 – Disclosure requirements in ESRS covered by the undertaking’s Consolidated Sustainability
Statement
Environmental Information
The following index shows the disclosure requirements that were followed in preparing the sustainability statement based on the results of
the materiality assessment (see ESRS 1 Chapter 3), including the page numbers that contain the corresponding disclosures in the sustain-
ability statement.
In addition, we provide below information on data points in the ESRS 2 and the thematic ESRSs arising from other EU legislation (ESRS 2
Annex B) – as well as requirements under the thematic ESRSs that need to be taken into account when reporting on the ESRS 2 disclosure
requirements (ESRS 2 Annex C). List of data points in general and thematic standards arising from other EU legislation (ESRS 2 Annex B).
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024102
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 103
Disclosure Requirement and
related datapoint
(1) SFDR reference
1)
(2) Pillar 3 reference
2)
(3) Benchmark Regulation
reference
3)
(4) EU Climate Law
reference
4)
Page Reference/
Relevance
ESRS 2
GOV
-1 Board’s gender diversity
paragraph 21 (d)
Indicator number 13 of
Table #1 of Annex 1
Commission Delegated
Regulation (EU) 2020/1816
5)
,
Annex II 77
ESRS 2 GOV
-1
Percentage of board members who
are independent paragraph 21 (e)
Delegated Regulation (EU)
2020/1816, Annex II 77
ESRS 2 GOV
-4
Statement on due diligence
paragraph 30
Indicator number 10 Table
#3 of Annex 1 82
ESRS 2 SBM
-1
Involvement in activities related to
fossil fuel activities paragraph 40
(d) i
Indicators number 4 Table
#1 of Annex 1
Article 449a Regulation (EU) No
575/2013; Commission
Implementing Regulation (EU)
2022/2453
6)
Table 1: Qualitative
information on Environmental
risk and Table 2: Qualitative
information on Social risk
Delegated Regulation (EU)
2020/1816, Annex II
Not material
ESRS 2 SBM
-1
Involvement in activities related to
chemical production
paragraph
40 (d) ii
Indicator number 9 Table
#2 of Annex 1
Delegated Regulation (EU)
2020/1816, Annex II Not material
ESRS 2 SBM
-1
Involvement in activities related to
controversial weapons paragraph
40 (d) iii
Indicator number 14 Table
#1 of Annex 1
Delegated Regulation (EU)
2020/1818
7)
, Article 12(1)
Delegated Regulation (EU)
2020/1816, Annex II Not material
ESRS 2 SBM
-1
Involvement in activities related to
cultivation and production of
tobacco paragraph 40 (d) iv
Delegated Regulation (EU)
2020/1818, Article 12(1)
Delegated Regulation (EU)
2020/1816, Annex II
Not material
ESRS E1
-1
Transition plan to reach climate
neutrality by 2050 paragraph 14
Regulation (EU)
2021/1119, Article 2(1)
Not material
ESRS E1
-1
Undertakings excluded from Paris
-
aligned Benchmarks paragraph 16
(g)
Article 449a; Regulation (EU) No
575/2013; Commission
Implementing Regulation (EU)
2022/2453 Template 1: Banking
book – Climate change
transition risk: Credit quality of
exposures by sector, emissions
and residual maturity
Delegated Regulation (EU)
2020/1818, Article12.1 (d) to (g),
and Article 12.2 Not material
ESRS E1
-4
GHG emission reduction targets
paragraph 34
Indicator number 4 Table
#2 of Annex 1
Article 449a Regulation (EU) No
575/2013; Commission
Implementing Regulation (EU)
2022/2453 Template 3: Banking
book – Climate change
transition risk: alignment metrics
Delegated Regulation (EU)
2020/1818, Article 6 134-135
ESRS E1
-5
Energy consumption from fossil
sources disaggregated by sources
(only high climate impact sectors)
paragraph 38
Indicator number 5 Table
#1 and Indicator n. 5 Table
#2 of Annex 1 135-136
ESRS E1
-5
Energy consumption and mix
paragraph 37 ESRS
Indicator number 5 Table
#1 of Annex 1 135
103RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
104 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Disclosure Requirement and
related datapoint
() SFDR reference
)
() Pillar  reference
)
() Benchmark Regulation
reference
)
() EU Climate Law
reference
)
Page Reference/
Relevance
ESRS E
-
Energy intensity associated with
activities in high climate impact
sectors paragraphs  to  ESRS
Indicator number  Table
# of Annex  
ESRS E
-
Gross Scope , ,  and Total GHG
emissions paragraph 
Indicators number  and 
Table # of Annex 
Article a; Regulation (EU) No
/; Commission
Implementing Regulation (EU)
/ Template : Banking
book – Climate change
transition risk: Credit quality of
exposures by sector, emissions
and residual maturity
Delegated Regulation (EU)
/, Article (),  and () -
ESRS E
-
Gross GHG emissions intensity
paragraphs  to 
Indicators number  Table
# of Annex 
Article a Regulation (EU) No
/; Commission
Implementing Regulation (EU)
/ Template : Banking
book – Climate change
transition risk: alignment metrics
Delegated Regulation (EU)
/, Article ()

ESRS E
-
GHG removals and carbon credits
paragraph 
Regulation (EU)
/, Article () 
ESRS E
-
Exposure of the benchmark
portfolio to climate
-related
physical risks paragraph 
Delegated Regulation (EU)
/, Annex II
Delegated Regulation (EU)
/, Annex II

ESRS E
-
Disaggregation of
monetary
amounts by acute and chronic
physical risk paragraph  (a)
ESRS E
-
Location of significant assets at
material physical risk paragraph
 (c).
Article a Regulation (EU) No
/; Commission
Implementing Regulation (EU)
/ paragraphs  and
; Template : Banking book –
Climate change physical risk:
Exposures subject to physical
risk.

ESRS E
-
Breakdown of the carrying value of
its real estate assets by energy
-
efficiency classes paragraph  (c).
Article a Regulation (EU) No
/; Commission
Implementing Regulation (EU)
/ paragraph ;
Template :Banking book –
Climate change transition risk:
Loans collateralised by
immovable property – Energy
efficiency of the collateral Not material
ESRS E
-
Degree of exposure of the portfolio
to climate
- related opportunities
paragraph 
Delegated Regulation (EU)
/, Annex II

ESRS E
-
Amount of each pollutant listed in
Annex II of the E
-PRTR Regulation
(European Pollutant Release and
Transfer Register) emitted to air,
water and soil, paragraph 
Indicator number  Table
# of Annex  Indicator
number  Table # of
Annex  Indicator number
 Table # of Annex 
Indicator number  Table
# of Annex 

ESRS E
-
Water and
marine resources
paragraph 
Indicator number  Table
# of Annex  
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024104
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 105
Disclosure Requirement and
related datapoint
(1) SFDR reference
1)
(2) Pillar 3 reference
2)
(3) Benchmark Regulation
reference
3)
(4) EU Climate Law
reference
4)
Page Reference/
Relevance
ESRS E3
-1
Dedicated policy paragraph 13
Indicator number 8 Table
2 of Annex 1 Not material
ESRS E3
-1
Sustainable oceans and seas
paragraph 14
Indicator number 12 Table
#2 of Annex 1
Not material
ESRS E3
-4
Total water recycled and reused
paragraph 28 (c)
Indicator number 6.2
Table #2 of Annex 1
Not material
ESRS E3
-4
Total water consumption in m3 per
net revenue on own operations
paragraph 29
Indicator number 6.1
Table #2 of Annex 1 Not material
ESRS 2
– SBM-3 – E4,
paragraph 16 (a) i
Indicator number 7 Table
#1 of Annex 1 Not material
ESRS 2
– SBM-3 – E4,
paragraph 16 (b)
Indicator number 10 Table
#2 of Annex 1
Not material
ESRS 2
– SBM-3 – E4,
paragraph 16 (c)
Indicator number 14 Table
#2 of Annex 1 Not material
ESRS E4
-2
Sustainable land/agriculture
practices or policies paragraph 24
(b)
Indicator number 11 Table
#2 of Annex 1 Not material
ESRS
E4-2
Sustainable oceans/seas practices
or policies paragraph 24 (c)
Indicator number 12 Table
#2 of Annex 1 Not material
ESRS E4
-2
Policies to address deforestation
paragraph 24 (d)
Indicator number 15 Table
#2 of Annex 1 Not material
ESRS E5
-5
Non
-recycled waste paragraph 37
(d)
Indicator number 13 Table
#2 of Annex 1
Not material
ESRS E5
-5
Hazardous waste and radioactive
waste paragraph 39
Indicator number 9 Table
#1 of Annex 1
Not material
ESRS 2
-SBM3 – S1
Risk of
incidents of forced labour
paragraph 14 (f)
Indicator number 13 Table
#3 of Annex I 153
ESRS 2
-SBM3 – S1
Risk of incidents of child labour
paragraph 14 (g)
Indicator number 12 Table
#3 of Annex I Not material
ESRS S1
-1
Human rights
policy
commitments, paragraph 20
Indicator number 9 Table
#3 and Indicator number
11 Table #1 of Annex I 153
ESRS S1
-1
Due diligence policies on issues
addressed by the fundamental
International Labor Organisation
Conventions 1 to 8, paragraph 21
Delegated Regulation (EU)
2020/1816, Annex II 153
ESRS S1
-1
processes and measures for
preventing trafficking in human
beings paragraph 22
Indicator number 11 Table
#3 of Annex I 153
105RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
106 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Disclosure Requirement and
related datapoint
() SFDR reference
)
() Pillar  reference
)
() Benchmark Regulation
reference
)
() EU Climate Law
reference
)
Page Reference/
Relevance
ESRS S
-
workplace accident prevention
policy or
management system
paragraph 
Indicator number  Table
# of Annex I 
ESRS S
-
grievance/complaints handling
mechanisms paragraph  (c)
Indicator number  Table
# of Annex I

ESRS S
-
Number of fatalities and number
and rate of
work- related accidents
paragraph  (b) and (c)
Indicator number  Table
# of Annex I
Delegated Regulation (EU)
/, Annex II 
ESRS S
-
Number of days lost to injuries,
accidents, fatalities or illness
paragraph  (e)
Indicator number  Table
# of Annex I 
ESRS S
-
Unadjusted gender pay gap
paragraph  (a)
Indicator number  Table
# of Annex I
Delegated Regulation (EU)
/, Annex II Not material
ESRS S
-
Excessive CEO pay ratio paragraph
 (b)
Indicator number  Table
# of Annex I 
ESRS S
-
Incidents of discrimination
paragraph  (a)
Indicator number  Table
# of Annex I 
ESRS S
-
Non
-respect of UNGPs on
Business and Human Rights and
OECD paragraph  (a)
Indicator number  Table
# and Indicator n. 
Table # of Annex I
Delegated Regulation (EU)
/, Annex II
Delegated Regulation (EU)
/, Art  () 
ESRS 
-SBM – S
Significant risk of child labour or
forced labour in the
value chain
paragraph  (b)
Indicators number  and
n.  Table # of Annex I
Not material
ESRS S
-
Human rights policy commitments
paragraph 
Indicator number  Table
# and Indicator n. 
Table # of Annex  -
ESRS S
-
Policies related to value chain
workers paragraph 
Indicator number  and n.
 Table # of Annex  -
ESRS S
-
Non
-respect of UNGPs on
Business and Human Rights
principles and OECD guidelines
paragraph 
Indicator number  Table
# of Annex 
Delegated Regulation (EU)
/, Annex II
Delegated Regulation (EU)
/, Art  () -
ESRS S
-
Due diligence policies on issues
addressed by the fundamental
International Labor Organisation
Conventions  to , paragraph 
Delegated Regulation (EU)
/, Annex II -
ESRS S
-
Human rights issues and incidents
connected to its upstream and
downstream value chain
paragraph 
Indicator number  Table
# of Annex 
-
ESRS S
-
Human rights
policy commitments
paragraph 
Indicator number  Table
# and Indicator n. 
Table # of Annex 
Not material
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024106
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 107
Disclosure Requirement and
related datapoint
() SFDR reference
)
() Pillar  reference
)
() Benchmark Regulation
reference
)
() EU Climate Law
reference
)
Page Reference/
Relevance
ESRS S
-
non
-respect of UNGPs on
Business and Human Rights, ILO
principles or and OECD guidelines
paragraph 
Indicator number  Table
# of Annex 
Delegated Regulation (EU)
/, Annex II
Delegated Regulation (EU)
/, Art  () Not material
ESRS S
-
Human rights issues and incidents
paragraph 
Indicator number  Table
# of Annex  Not material
ESRS S
-
Policies related to consumers and
end
-users paragraph 
Indicator number  Table
# and Indicator n. 
Table # of Annex  Not material
ESRS S
-
Non
-respect of UNGPs on
Business and Human Rights and
OECD guidelines paragraph 
Indicator number  Table
# of Annex 
Delegated Regulation (EU)
/, Annex II
Delegated Regulation (EU)
/, Art  () Not material
ESRS S
-
Human rights issues and incidents
paragraph 
Indicator number  Table
# of Annex  Not material
ESRS G
-
United Nations Convention against
Corruption paragraph  (b)
Indicator number  Table
# of Annex  -
ESRS G
-
Protection of whistleblowers
paragraph  (d)
Indicator number  Table
# of Annex  -
ESRS
G-
Fines for violation of anti
-
corruption and anti
-bribery laws
paragraph  (a)
Indicator number  Table
# of Annex 
Delegated Regulation (EU)
/, Annex II 
ESRS G
-
Standards of anti
- corruption and
anti
- bribery paragraph  (b)
Indicator number  Table
# of Annex  
1) Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability-related disclosures in the financial services sector
(OJ L 317, 9.12.2019, p. 1).
2) Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms
and amending Regulation (EU) No 648/2012 (Capital Requirements Regulation) (OJ L 176, 27.6.2013, p. 1).
3) Regulation (EU) 2016/1011 of the European Parliament and of the Council of 8 June 2016 on indices used as benchmarks in financial instruments and financial
contracts or to measure the performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No 596/2014 (OJ L 171,
29.6.2016, p. 1).
4) Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending
Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’) (OJ L 243, 9.7.2021, p. 1).
5) Commission Delegated Regulation (EU) 2020/1816 of 17 July 2020 supplementing Regulation (EU) 2016/1011 of the European Parliament and of the Council as regards
the explanation in the benchmark statement of how environmental, social and governance factors are taken into account in each benchmark that is made available
and published (OJ L 406, 3.12.2020, p. 1)
6) Commission Implementing Regulation (EU) 2022/2453 of 30 November 2022 amending the implementing technical standards laid down in Implementing
Regulation (EU) 2021/637 with regard to the disclosure of environmental, social and governance risks (OJ L 324, 19.12.2022, p.1).
(7) Commission Delegated Regulation (EU) 2020/1818 of 17 July 2020 supplementing Regulation (EU) 2016/1011 of the European Parliament and of the Council with
regard to minimum standards for EU climate transition benchmarks and for EU Paris-aligned benchmarks (OJ L 406, 3.12.2020, p. 17).
MDR – minimum disclosure requirements
RHI Magnesita’s Consolidated Sustainability Statement includes separate sections on all material sustainability topics covered by ESRS.
The chapter for each material sustainability topic includes a description of material impacts, risks and opportunities in relation to the
topic, and corresponding disclosures on governance, strategy, policies, metrics and targets.
The adopted policies, actions and targets with reference to the specific sustainability matter concerned, do not necessarily include all the
information required under relevant ESRS, hence it is disclosed as required by ESRS.
107RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
108 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Environmental information
Disclosures pursuant to Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation)
The EU Taxonomy Regulation (“EU Taxonomy”) applies in respect of the financial year to 31 December 2024 and requires the Group to
report annually on the proportion of its turnover, operating expenditure and capital expenditure attaching to economic activities that are
considered to be environmentally sustainable.
The EU Taxonomy identifies the six environmental objectives: climate change mitigation; climate change adaptation; the sustainable use
and protection of water and marine resources; the transition to a circular economy; pollution prevention and control; and the protection
and restoration of biodiversity and ecosystems. In respect of the 2024 financial year, the Group, RHI Magnesita has reviewed its activities
that qualify as eligible and aligned according to the published technical screening criteria for climate change mitigation and adaptation,
including amendments to Article 8. Additionally, RHI Magnesita has assessed the eligibility and alignment on the other four EU environ-
mental objectives according to the technical screening criteria specified in the Taxonomy Environmental Delegated Act. As no sector-
specific guidance for the refractory industry has been published yet and therefore the Group is required to use its own judgement against
the eligibility criteria. The NACE (the statistical classification of economic activities in the European Community) codes most closely de-
scribing the activities of the Group are “23.20 Manufacture of refractory products” and “08.99 Other mining and quarrying”. These NACE
codes are not listed in Annex I or Annex II of the Taxonomy Regulation, but certain activities carried out by the Group do meet the definitions
of economic activities listed in Annex I of the Regulation. As elaborated further by the Commission on Taxonomy, if the NACE code of an
economic activity is not mentioned in the Climate Delegated Act, but the economic activity corresponds to the description of the activity,
it can qualify as Taxonomy eligible.
The EU Taxonomy distinguishes between taxonomy eligibility and taxonomy alignment. An economic activity can be considered eligible
if it is listed in the annexes of Taxonomy regulation. However, in order to be considered “aligned”, further Technical Screening Criteria
(“TSC”) must be met. This requires a further assessment of the eligible activities identified. The TSC comprise Substantial Contribution plus
the Do-No-Significant-Harm criteria (“DNSH”) for each of the environmental objectives associated with the relevant business activities.
Additionally, the Minimum Social Safeguards (“MSS”) at the corporate level have to be met. The overall aim of this process is to establish
the taxonomy-eligibility and alignment.
The EU Taxonomy Alignment refers to the process of aligning the EU’s Taxonomy Regulation with existing and proposed national and in-
ternational sustainable finance initiatives.
Accounting policy
RHI Magnesita N.V. prepares consolidated financial information in accordance with IFRS accounting standards as adopted by the EU and
the financial information for turnover, operating expenditure and capital expenditure presented under the EU Taxonomy has been prepared
under the same accounting principles.
Taxonomy eligible activities of RHI Magnesita
The following RHI Magnesita’s economic activities are outlined in the annexes of EU Taxonomy Delegated Acts and therefore, are deemed
eligible:
• CCM 3.6 Manufacture of other low-carbon technologies.
• CCM 5.9 Material recovery from non-hazardous waste.
• CE 2.7 Sorting and material recovery of non-hazardous waste.
• BIO 1.1 Conservation and restoration of habitats, ecosystems, and species.
R&D supports eligible economic activities, allocated accordingly. GHG emission avoidance related to R&D is not material, and therefore,
not reported separately.
Manufacture of other low carbon technologies
The economic activity CCM 3.6 “Manufacture of other low-carbon technologies” covers the “Manufacture of technologies aimed at sub-
stantial GHG emission reductions in other sectors of the economy”.
EAF refractories
RHI Magnesita provides refractory products specifically designed for EAFs. Additionally, RHI Magnesita provides solutions and services to
its customers to reduce their GHG emissions, including digital solutions as well as advanced refractory products.
EAFs are a vital enabling technology for the reduction of CO
2
emissions in the steel industry. EAFs can be powered using electricity sourced
partially or wholly from renewable electricity and replace the BOF phase of the traditional integrated steel manufacturing process, which
pairs a blast furnace with a BOF and is highly CO
2
intensive. To replace a BOF, EAF steelmaking requires scrap steel, and a source of virgin
iron like DRI or pig iron produced from the reduction of iron ore. EAF steelmaking requires a source of scrap steel or sponge iron produced
from the reduction of iron ore.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024108
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 109
DRI using elevated levels of or exclusively hydrogen and is a new technology under development that seeks to eliminate CO
2
emissions
from the reduction of iron ore in blast furnaces using coke. If enough hydrogen manufactured from renewable sources can be accessed
and if a DRI furnace can be paired with an EAF for the second stage of the steelmaking process that is also powered by renewable energy,
CO
2
emissions from steel production can be largely eliminated. A key limiting factor for increased DRI production is currently the availability
of suitable iron ore, as DRI production requires highest quality iron ore pellets while blast furnaces can consume almost any kind of iron ore
facing no restrictions.
RHI Magnesita has a leading market position in EAF-specific refractories, services and solutions, in part due to the unique chemical com-
position of the Group’s raw material supply. RHI Magnesita’s refractories used in EAF production contribute to reducing CO
2
emissions at
steel plants by supporting the more sustainable electric arc furnace process, which inherently generates lower emissions compared to steel
production via blast furnace and BOF methods,
In its EU taxonomy disclosure for the year to 31 December 2022, RHI Magnesita used its own judgement to categorise the sale of EAF
refractories as both an eligible and aligned activity according to CCM 3.6 “Manufacture of other low-carbon technologies”. This assessment
was based on widely available public information from multiple sources which substantiated that the production of steel through scrap or
DRI fed Electric Arc Furnaces could result in significantly lower CO
2
emissions than the traditional integrated steelmaking process, using
blast furnaces and basic oxygen furnaces.
In 2023, the EU Commission published guidance on the implementation and interpretation of the EU Taxonomy Climate Delegated Act
which specified verification requirements for certain activities. The verification requirements in the guidance stipulate that an external ver-
ifier must provide an independent report to support compliance with alignment criteria. The Group is unable to fulfil this verification re-
quirement in respect of the 2024 financial year but intends to obtain suitable independent verification in the future.
Digital Solutions
RHI Magnesita offers digital solutions and associated physical equipment which achieve CO
2
emissions reductions through process effi-
ciencies, such as wear monitoring and gunning repairs to extend the safe working life of refractory linings. Safely extending the working life
of refractory linings can achieve significant energy savings for steel producers by reducing the number of heating and cooling cycles re-
quired per unit of steel output.
The Group also offers advanced refractory products which enable its customers to substantially reduce GHG emissions by reducing elec-
tricity consumption, improving yield and reducing oxygen consumption.
Other solutions and products which directly contribute to CO
2
emissions reductions at customers’ sites include cold setting mixes, EAF
direct purging plugs and converter inert gas purging.
Material recovery from non-hazardous waste
The activity CCM 5.9 Material recovery from non-hazardous waste covers the “construction and operation of facilities for the sorting and
processing of separately collected non-hazardous waste streams into circular raw materials involving mechanical reprocessing, except for
backfilling purposes.”
RHI Magnesita increased its Secondary Raw Material (“SRM”) input to 14.2% of raw material used in production of refractories. As part of
this effort, RHI Magnesita operates facilities for the sorting and processing of spent refractories from customers’ industries.
Circular raw materials which are mechanically processed by RHI Magnesita and transformed from waste to raw material are eligible for
consideration under the EU Taxonomy, whilst circular raw material processed by a third party and purchased externally by the Group are
non-eligible.
Sorting and material recovery of non-hazardous waste
The activity CE 2.7 “Sorting and material recovery of non-hazardous waste” covers “Construction, upgrade, and operation of facilities for
the sorting or recovery of non-hazardous waste streams into high-quality secondary raw materials using a mechanical transformation pro-
cess”.
RHI Magnesita actively collaborates in the transition to a circular economy through the sorting and material recovery of non-hazardous
waste. This encompasses the construction, upgrade, and operation of facilities for sorting or recovering non-hazardous waste streams into
high-quality secondary raw materials using mechanical transformation processes.
Across various sites, RHI Magnesita engages in sorting non-hazardous waste, recovering materials for use as secondary raw materials in its
refractory production, aligning with the EU taxonomy criteria.
109RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
110 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Conservation and restoration of habitats, ecosystems and species
The activity BIO 1.1 “Conservation and restoration of habitats, ecosystems and species” covers in-situ conservation and restoration activities
aligned with Convention on Biological Diversity”.
RHI Magnesita is committed to the protection and restoration of biodiversity and ecosystems, specifically through the conservation and
restoration of habitats, ecosystems, and species. RHI Magnesita’s engagement in-situ conservation and restoration activities align with the
Convention on Biological Diversity’s definition and applies to its open-pit mining operations, where recovery of ecosystems and habitats is
planned and executed.
The Group operates multiple mines, where a crucial aspect of open-pit mining involves restoring ecosystems and habitats. In 2024, reculti-
vation activities occurred at seven sites.
KPIs
Share of Taxonomy-eligible revenue, operating expenditure and capital expenditure – climate change mitigation, transition to circular
economy, and protection and restoration of biodiversity and ecosystems.
Turnover
The turnover KPI is calculated as the ratio of turnover associated with taxonomy-eligible and/or aligned economic activities in the reporting
period to total turnover in that period. The total turnover of the financial year 2024 of €3.5 billion forms the denominator of the turnover
key figure and can be taken from the Consolidated Statements of Profit or Loss on page 232 of this Annual Report.
The following eligible and/or aligned activities have been identified as relevant in view of turnover:
• CCM 3.6 Manufacture of other low-carbon technologies.
• CCM 5.9 Material recovery from non-hazardous waste.
• CE 2.7 Sorting and material recovery of non-hazardous waste.
Most of our Taxonomy-eligible turnover (numerator) are reported under Activity CCM 3.6. “Manufacture of other low-carbon technologies”.
The only portion of our turnover Taxonomy-aligned is reported under Activity CCM 5.9 “Material recovery from non-hazardous waste”. A
thorough analysis of turnover KPI drivers during the reporting period considered diverse revenue sources, including customer contracts
and lease income. About 90% of materials recovered by the Group from non-hazardous waste are consumed internally. Therefore, the
2024 financials include external Turnover from material recovery in non-hazardous waste.
Capital expenditure
The capex KPI is defined as Taxonomy-eligible capex (numerator) divided by total capex (denominator), for the financial year, ended 31
December 2024.
The following eligible activities have been identified as relevant regarding the capital expenditure KPI:
• CCM 3.6 Manufacture of other low-carbon technologies.
• CCM 5.9 Material recovery from non-hazardous waste
• CE 2.7 Sorting and material recovery of non-hazardous waste.
• BIO 1.1 Conservation and restoration of habitats, ecosystems, and species.
The project descriptions of the additions of assets in the reporting year served as a basis for the necessary identification.
Taxonomy-eligible capex (numerator) is an aggregation of addition to property, plant and equipment reported under Activity CCM 5.9
“Material recovery from non-hazardous waste” and Activity CE 2.7 “Sorting and material recovery of non-hazardous waste”; and to internally
generated intangible assets reported under Activity CCM 3.6 “Manufacture of other low-carbon technologies” and BIO 1.1 “Conservation
and restoration of habitats, ecosystems, and species”. No eligible capex related to acquisitions through business combinations is reported.
There is neither a capex plan to expand RHI Magnesita’s Taxonomy-aligned economic activities nor to upgrade Taxonomy eligible economic
activities to render them Taxonomy-aligned. The total capital expenditures in line with point 1.1.2.1. Annex 1 of the Disclosure Delegated
Act equal the denominator.
Total capex consists of additions to tangible and intangible fixed assets during the financial year, before depreciation, amortisation and any
remeasurements, including those resulting from revaluations and impairments, as well as excluding changes in fair value. It includes ac-
quisitions of tangible fixed assets (IAS 16), intangible fixed assets (IAS 38), right-of-use assets (IFRS 16) and investment properties (IAS 40).
Operating expenditure
The denominator of the operating expenditure KPI shall cover direct non-capitalised costs that relate to R&D, building renovation measures,
short-term lease, maintenance and repair, and any other direct expenditures relating to the day-to-day servicing of assets of property, plant
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024110
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 111
and equipment by the undertaking or third party to whom activities are outsourced that are necessary to ensure the continued and effective
functioning of such assets. The following eligible activities have been identified as relevant regarding the operating expenditure KPI:
• CCM 3.6 Manufacture of other low-carbon technologies.
• CCM 5.9 Material recovery from non-hazardous waste.
• CE 2.7 Sorting and material recovery of non-hazardous waste.
• BIO 1.1 Conservation and restoration of habitats, ecosystems and species.
Most of our Taxonomy-eligible OpEx (numerator) is related to assets or processes associated with taxonomy-eligible activities reported
under Activity CCM 3.6. “Manufacture of other low-carbon technologies”. We have also reported a portion of our turnover under Activity
5.9 “Material recovery from non-hazardous waste”. There is neither a capex plan to expand taxonomy-aligned activities nor related to the
purchase of output of taxonomy-aligned activities. OpEx related to activity CE 2.7 “Sorting and material recovery of non-hazardous waste
is overlapping with OpEx reported under activity CCM 5.9”. “Material recovery from non-hazardous waste” therefore, not reported. Total
applicable OpEx is in line with the Taxonomy legislation consisting of maintenance OpEx, R&D OpEx and Recultivation OpEx. Other OpEx
categories such as short-term lease are excluded as they are immaterial.
Avoidance of double counting
To avoid double counting, data sources for the various reported items are individually cross-checked to identify overlapping classifications.
Where double counting is identified, overlapping data is removed from the eligible amount.
Taxonomy aligned activities of RHI Magnesita
For the eligible economic activities of RHI Magnesita previously described, the following activity are considered aligned:
• Material recovery from non-hazardous waste.
In respect to alignment criteria, RHI Magnesita considered its activities under “Material recovery from non-hazardous waste” aligned be-
cause for each raw material recovery site, yield reports demonstrate a constant yield above 50% which fulfil the alignment criteria.
Do No Significant Harm (“DNSH”)
To fulfil the DNSH criteria for the identified taxonomy-eligible economic activities, corresponding analyses and surveys were carried out in
accordance with (EU) 2021/2139 to establish taxonomy alignment.
For the economic activity Material recovery from non-hazardous waste (5.9), the DNSH criteria to climate change adaptation and to pro-
tection and restoration of biodiversity and ecosystems need to be met.
DNSH to climate change adaptation
Activity 5.9
For the climate risk and vulnerability analysis for objective 2 “climate change adaptation”, potential climate hazards were analysed and
assessed for their risk potential in accordance with the requirements of Appendix A (EU) 2021/2139. RHI Magnesita conducted climate risk
assessment considering both physical and transitional climate risks aligned with TCFD. Four climate scenarios (representative concentra-
tion pathways 2.6, 4.5, 6.0 and 8.5) were considered based on the Intergovernmental Panel on Climate Change Fifth Assessment Report
and the International Energy Agency (“IEA”) Sustainable Development Scenario. The results of the assessment indicated that the impact
for physical risks is limited, since measures are in place to assess on a regular basis the risk of physical damage of assets. Insurance policies
are partially covering physical damaged by natural catastrophes.
DNSH to protection and restoration of biodiversity and ecosystems
Activity 5.9
The requirements for objective 6 “Biodiversity” according to Appendix D of Regulation (EU) 2021/2139 are ensured due to the legal frame-
work within the EU. For sites outside the EU, the national legal framework was analysed.
RHI Magnesita considers its mining sites as the part of the production process with the highest potential for adverse effects on biodiversity.
Therefore, the assessment focuses on mining sites. For all RHI Magnesita’s mining sites an environmental impact screening has been con-
ducted. The mining sites operate within or near IUCN category Ia, II, IV, VI and unclassified (Natura 2000) protected areas. All mining sites
fulfil general environmental protection requirements in line with legal requirements. “Material recovery from non-hazardous waste” re-
places virgin materials with secondary raw materials; thus, contributes in an effective way to reduce the environmental impact associated
with raw material extraction.
Minimum social safeguards
To ensure compliance with minimum social safeguards RHI Magnesita established a due diligence process. According to Article 8 (EU)
2020/852, the OECD Guidelines for Multinational Enterprises, the UN Guiding Principles on Business and Human Rights, including the
111RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
CONSOLIDATED SUSTAINABILITY STATEMENT
As at 31 December 2024
112 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
principles and rights set out in the eight fundamental conventions identified in the Declaration of the International Labour Organisation on
Fundamental Principles and Rights at Work and the International Bill of Human Rights were considered by RHI Magnesita.
A Human Rights Officer has been appointed to oversee and strengthen our commitment to ethical business practices. Comprehensive
policies on global gender equality, anti-discrimination, and harassment are publicly accessible online. The Code of Conduct is available
in 11 languages and can be accessed via the Group website, intranet, and Compliance Portal.
The Anti-Slavery Statement is reviewed and published annually on the Group’s website, reinforcing our dedication to human rights. Sup-
pliers are required to comply with the principles outlined in our Supplier Code of Conduct, which mandates adherence to human rights
protection laws.
To ensure compliance with fundamental human and labour rights, RHI Magnesita has implemented robust screening processes for busi-
ness partners operating in high-risk countries. Additionally, an independent whistleblowing hotline and web-based reporting system allow
employees and third parties to report concerns anonymously. Alternative reporting channels are also available, and all cases are thoroughly
investigated by the Internal Audit, Risk, and Compliance department in collaboration with other relevant functions. Moreover, business
partners (e.g. customers, sales intermediaries and suppliers) and transactions such as mergers or acquisitions are subject to a due diligence
process. All sales agents are certified by Ethixbase360 (formerly TRACE International), a leading international organisation specialised in
third-party due diligence solutions, which is updated annually and includes a reputational screening that can detect any human rights
violations that may have occurred.
With all these measures, RHI Magnesita ensures compliance with the minimum safeguards for itself and its suppliers, and processes are
implemented to become aware of suspicious cases of human rights violations, corruption, and bribery and to be able to react accordingly.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024112
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 113
Proportion of turnover from products or services associated with Taxonomy-aligned economic activities – disclosure covering year 2024
Financial Year 
 Substantial Contribution Criteria DNSH criteria (“Does Not Significantly Harm”)
Economic Activities
()
Code
()
Turnover
()
Proportion of
Turnover
()
CCM
()
CCA
()
WTR
()
CE
()
PPC
()
BIO
()
CCM
()
CCA
()
WTR
()
CE
()
PPC
()
BIO
()
Minimum
safeguards
()
Proportion of Taxonomy aligned (A..) or eligible (A..)
turn over,
year N-
()
Category enabling
activity
()
Category transitional
activity
()
Text
Currency %
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T
A.
TAXONOMY-ELIGIBLE
ACTIVITIES
A.. Environmentally
sustainable activities
(Taxonomy-aligned)
Material recovery from non-
hazardous waste
CCM . ,, .% Y N N/EL N/EL N/EL N/EL Y Y Y Y Y Y Y .% E
Turnover of environmentally
sustainable activities
(Taxonomy-aligned) (A.)
,,
.%
.%
.%
.%
.%
.%
.%
Y
Y
Y
Y
Y
Y
Y
.%
Of which Enabling
,,
.%
.%
.%
.%
.%
.%
.%
Y
Y
Y
Y
Y
Y
Y
.%
E
A. Taxonomy-Eligible but
not environmentally
sustainable activities (not
Taxonomy-aligned activities)
Manufacture of other low
carbon technologies
CCM . ,, .% EL N/EL N/EL N/EL N/EL N/EL .%
Sorting and material recovery
of non
-hazardous waste
CE . - .% N/EL N/EL N/EL EL N/EL N/EL .%
Conservation, including
restoration, of habitats ,
ecosystems and
species BIO . - .% N/EL N/EL N/EL N/EL N/EL EL .%
Turnover of Taxonomy-
eligible but not
environmentally sustainable
activities (not Taxonomy
-
aligned activities) (A.)
,, .% .% .% .% .% .% .% .%
A. Turnover of Taxonomy
eligible activities (A. + A.)
,, .% .% .% .% .% .% .%
B. TAXONOMY
-NON-
ELIGIBLE ACTIVITIES
Turnover of Taxonomy- non-
eligible activities (B)
,,, .%
TOTAL (A + B)
,,, .%
1)
Y – Yes, Taxonomy-eligible and Taxonomy-aligned activity with the relevant environmental objective
N – No, Taxonomy-eligible but not Taxonomy-aligned activity with the relevant environmental objective
N/EL – not eligible, Taxonomy non-eligible activity for the relevant environmental objective
2)
EL – Taxonomy-eligible activity for the relevant objective
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
113RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
114 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Proportion of CapEx from products or services associated with Taxonomy-aligned economic activities – disclosure covering year 2024
Financial Year 
 Substantial Contribution Criteria DNSH criteria (“Does Not Significantly Harm”)
Economic Activities
()
Code
()
CapEx
()
Proportion of
CapEx
()
CCM
()
CCA
()
WTR
()
CE
()
PPC
()
BIO
()
CCM
()
CCA
()
WTR
()
CE
()
PPC
()
BIO
()
Minimum
safeguards
()
Proportion of Taxonomy aligned (A..) or eligible (A..)
CapEx,
year N-
()
Category enabling
activity
()
Category transitional
activity
()
Text
Currency %
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T
A. TAXONOMY-ELIGIBLE
ACTIVITIES
A.. Environmentally sustainable
activities (Taxonomy
-aligned)
Material recovery from non
-
hazardous waste
CCM
. ,, .% Y N N/EL N/EL N/EL N/EL Y Y Y Y Y Y Y .% E
CapEx of environmentally
sustainable activities
(Taxonomy
-aligned) (A.) ,, .% .% .% .% .% .% .% Y Y Y Y Y Y Y .%
Of which Enabling
,, .% .% .% .% .% .% .% Y Y Y Y Y Y Y .% E
A. Taxonomy
-Eligible but not
environmentally sustainable
activities (not Taxonomy
-aligned
activities)
Manufacture of other low carbon
technologies
CCM
. , .% EL N/EL N/EL N/EL N/EL N/EL .%
Sorting and material recovery of
non
-hazardous waste CE .
- .% N/EL N/EL N/EL EL N/EL N/EL .%
Conservation, including
restoration, of habitats ,
ecosystems and species
BIO . , .% N/EL N/EL N/EL N/EL N/EL EL .%
CapEx of Taxonomy
-eligible but
not environmentally sustainable
activities (not Taxonomy
-aligned
activities) (A.)
, .% .% .% .% .% .% .% .%
A.
CapEx of Taxonomy eligible
activities (A.+A.)
,, .% .% .% .% .% .% .%
B. TAXONOMY-NON-ELIGIBLE
ACTIVITIES
CapEx of Taxonomy-non-eligible
activities (B)
,, .%
TOTAL (A + B)
,, .%
1)
Y – Yes, Taxonomy-eligible and Taxonomy-aligned activity with the relevant environmental objective
N – No, Taxonomy-eligible but not Taxonomy-aligned activity with the relevant environmental objective
N/EL – not eligible, Taxonomy non-eligible activity for the relevant environmental objective
2)
EL – Taxonomy-eligible activity for the relevant objective
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024114
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 115
Proportion of OpEx from products or services associated with Taxonomy-aligned economic activities – disclosure covering year 2024
Financial Year 
 Substantial Contribution Criteria DNSH criteria (“Does Not Significantly Harm”)
Economic Activities
()
Code
()
OpEx
()
Proportion of
OpEx
()
CCM
()
CCA
()
WTR
()
CE
()
PPC
()
BIO
()
CCM
()
CCA
()
WTR
()
CE
()
PPC
()
BIO
()
Minimum
safeguards
()
Proportion of Taxonomy
aligned (A..) or eligible
(A..) OpEx,
year N-
()
Category
enabling
activity
()
Category
transitional
activity
()
Text
Currency %
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y; N;
N/EL
)
Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T
A.
TAXONOMY-ELIGIBLE
ACTIVITIES
A.. Environmentally sustainable
activities (Taxonomy
-aligned)
Material recovery from non
-
hazardous waste
CCM
.
,, .% Y N N/EL N/EL N/EL N/EL Y Y Y Y Y Y Y .% E
OpEx of environmentally
sustainable activities (Taxonomy
-
aligned) (A.)
,, .% .% .% .% .% .% .% Y Y Y Y Y Y Y .%
Of which Enabling
 .% .% .% .% .% .% .% Y Y Y Y Y Y Y .% E
A. Taxonomy
-Eligible but not
environmentally sustainable
activities (not Taxonomy
-aligned
activities)
Manufacture of other low carbon
technologies
CCM
.
,, .% EL N/EL N/EL N/EL N/EL N/EL .%
Sorting and material recovery of
non
-hazardous waste
CE
. - .% N/EL N/EL N/EL EL N/EL N/EL .%
Conservation, including restoration,
of habitats , ecosystems and species
BIO
. , .% N/EL N/EL N/EL N/EL N/EL EL .%
OpEx of Taxonomy
-eligible but
not environmentally sustainable
activities (not Taxonomy
-aligned
activities) (A.)
,, .% .% .% .% .% .% .% .%
A. OpEx of Taxonomy eligible
activities (A.+A.)
,, .% .% .% .% .% .% .%
B. TAXONOMY
-NON-ELIGIBLE
ACTIVITIES
OpEx of Taxonomy
-non-eligible
activities (B)
,, .%
TOTAL (A + B)
,, .%
1)
Y – Yes, Taxonomy-eligible and Taxonomy-aligned activity with the relevant environmental objective
N – No, Taxonomy-eligible but not Taxonomy-aligned activity with the relevant environmental objective
N/EL – not eligible, Taxonomy non-eligible activity for the relevant environmental objective
2)
EL – Taxonomy-eligible activity for the relevant objective
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
115RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
116 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Scope of taxonomy-eligibility and compliance per environmental objective – disclosure covering year 2024
Proportion of turnover/Total turnover
Taxonomy-aligned
per objective
Taxonomy-eligible
per objective
CCM
0.5%
16.2%
CE
0.0% 0.0%
BIO
0.0% 0.0%
Proportion of
CapEx/Total CapEx
Taxonomy-aligned per
objective
Taxonomy-eligible
per objective
CCM
1.2% 1.5%
CE
0.0% 0.0%
BIO
0.0% 0.0%
Proportion of OpEx/Total OpEx
Taxonomy-aligned per
objective
Taxonomy-eligible
per objective
CCM
1.7% 14.5%
CE
0.0% 0.0%
BIO
0.0% 0.3%
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024116
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 117
ESRS E1 Climate change
ESRS 2 General disclosures
Governance
Disclosure requirement related to ESRS 2 GOV-3 Integration of sustainability-related performance in incentive schemes
Sustainability related performance measures are included in the Group’s Annual Bonus and Long-Term incentive Plan.
The Board, the CSC and the Remuneration Committee recognise that the use of financial incentives for executive management and other
key functions such as sales can result in the accelerated achievement sustainability goals. RHI Magnesita has also received feedback from
consultation with shareholders that supports the inclusion of such performance measures within overall executive remuneration.
Annual bonus
In 2024, Executive Directors’ maximum annual bonus opportunity remained at 150% of salary with performance assessed against Adjusted
EBITA (45%), inventory coverage (25%) and strategic deliverables (30%). The strategic deliverables were digital projects delivery (10%),
PIFOT (10%) and increasing the use of secondary raw material (10%). Recycling, which is a key sustainability performance metric, therefore
accounts for 10% of the annual bonus. The annual bonus linked to performance is managed uniformly across the Group, with all bonus-
eligible employees receiving the same annual payout ratio as senior management, based on the achievement of the annual Group bonus
targets.
Long-term incentive plan (LTIP)
The Remuneration Committee reviewed the performance measures during the year as part of the overall Policy review and concluded that
the 2024 LTIP should continue to use EPS and CO
2
emissions performance conditions and move from TSR to ROIC.
The 2024 LTIP Award will vest to the extent that the EPS (50%), ROIC (25%) and 25% of the Long-Term Incentive Plan (LTIP) payout criteria
is linked to the Group’s target to reduce CO
2
emissions intensity against 2018 baseline year.
Disclosure requirement related to ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and
business model
Climate strategy
Driving down carbon emissions is a key priority for RHI Magnesita. Besides mapping out our own transition path, we would like to be a
reliable partner to our customers as they venture into a carbon-reduced economy.
The Group’s emission reduction target is a 15% reduction in CO
2
emissions intensity for Scope 1, 2 and 3 (raw materials) emissions by 2025,
compared to 2018. Our climate strategy is based on:
• reducing the carbon footprint of our raw materials, including through the increased use of circular raw materials;
• enhancing energy efficiency in our operations;
• reducing the carbon intensity of our energy sources; and
• providing innovative solutions to reduce customer emissions.
In 2024, the Group updated the modelling and analysis of climate-related transitional risks and opportunities that are foreseen to impact
the Group over short-, medium-, and long-term horizons.
Short term (2025)
For short-term risks (between 0-2 years), the Group’s first set of sustainability targets are planned within this timeframe. In addition, we are
actively monitoring emerging trends and opportunities that may require us to adjust our strategic plans. We are committed to staying agile
and adapting our plans as needed to ensure that we remain competitive in the marketplace and continue to meet our sustainability targets.
In the period to December 2024, the Group has achieved an additional reduction in CO
2
emissions intensity resulting in a 14% reduction
in CO
2
emissions intensity, compared to its base year 2018 (2023: -12%). This progress is mainly a result of recycling overperformance, but
this has been offset by slower progress on switching to alternative fuels which is now uncertain due to capex constraints and infrastructure
provision by external parties.
Medium term (2030)
For medium term risks (between 2-5 years, 2030), it is the most likely horizon for the regulatory frameworks (such as the EU Emissions
Trading System and Carbon Border Adjustment Mechanism) currently over a three-year transition period, and to be expanded to all sectors
within EU ETS in the future thus having partial effect on to RHI Magnesita’s operations due to the gradual phase out of free allocations. We
are anticipating and considering adjustments to our plant footprint.
Long-term (2050)
For the long-term risks, the Group considered the deadline that has been set by the UN and many policy-making bodies to meet decar-
bonisation goals, being the year 2050.
117RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
118 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Time horizons for both physical and transitional risks are aligned with climate scenarios to ensure a structured and forward-looking ap-
proach to sustainability and risk management.
Each year, the Group systematically reviews and evaluates all viable measures to reduce CO
2
emissions across its operations, prioritising
proven technologies and aligning with available financial resources. While achieving emission reductions consistent with a "well below 2
degrees" scenario appears feasible, our current assessment indicates that setting a target aligned with a 1.5-degree scenario is not achiev-
able without the advancement of currently unavailable technologies or substantial external financial and infrastructure support.
We are committed to reducing our carbon footprint and we will continue to monitor the variables which support this conclusion and update
our transition plan accordingly if the Group’s own R&D activities result in the development of new technologies that could deliver a faster
reduction in CO
2
emissions that is financially achievable.
Impact of climate-related risks on the Group’s strategy
RHI Magnesita defines “substantive financial or strategic impact” as impact which is classified as “high” (score 4) or “critical” (score 5) impact.
RHI Magnesita defines the impact of a risk, including those related to climate change, on a scale of 1 (minor) to 5 (critical). Each of these five
ratings has specific definition and quantifiable indicators based on the potential to compromise the ability of RHI Magnesita in achieving
its strategic, operational, financial and compliance goals.
• A score of 1 represents minor impact on our ability to achieve these goals.
• A score of 2 represents low impact in achieving such goals.
• A score of 3 represents moderate impact (for example the potential for one strategic deliverable to be slightly delayed).
• A score of 4 represents high impact on the achievement of our goals, which might result in one objective not being achieved or
being significantly delayed.
• Finally, a score of 5 represents a critical impact on RHI Magnesita’s ability to deliver more than one goal.
With specific reference to climate-related risks, the following four quantifiable indicators are used by RHI Magnesita to define a substantive
strategic or financial impact:
• An impact that would compromise the ability of RHI Magnesita to achieve (or achieve in a timely fashion) one or more objectives
defined in the Group’s 2025 strategy, which includes climate-related targets. RHI Magnesita’s climate-related objectives include
the reduction of CO2 emissions by 15% per tonne of product – Scope 1,2 and 3 (raw materials), a 5% increase in energy efficiency
tonne of product, and the increase of secondary raw materials use to 15%.
• An impact that would compromise our ability to achieve our financial objectives by more than 15% Group budgeted EBITA.
• An impact that would compromise our ability to meet climate regulatory requirements applicable to our Group resulting in neg-
ative international media attention and/or reputational damage to RHI Magnesita.
• An impact that would create a substantial disruption to a) our plants (i.e., the inability to continue operations in more than one of
RHI Magnesita key locations across four global regional areas) and b) our ability to fulfil contracts with customers comprising a
negative impact of more than 15% Group budgeted EBITA for the year and/or c) compromise the safety of our employees.
The impact of risks and opportunities were assessed across three different time horizons. The short-term (2025) sits within our short-term
business plan, while the medium (2030) and long-term (2050) time horizons are oriented towards the broader international policy devel-
opments, including the Paris Agreement, EU Green Deal and the EU Carbon Border Adjustment Mechanism.
The Group believes and endorsed by CSC that it has the essential elements to run the climate resilience analysis. From risk identification,
ability to implement mitigation measures, high adaptive capacity, the Group has the means to reduce risk exposure and embrace the op-
portunities associated with the climate-change related developments across the different scenarios. The Group also collaborates with
governments, industry associations, universities to enhance climate mitigation and adaptation across the regions. By making use of frame-
works like TCFD, the Group discloses transparently and regularly updates stakeholders on climate-related matters.
Climate-related risk opportunities could range from disruptive regulatory developments, physical hazards for our operations or new busi-
ness opportunities, for example, to earn a Green Premium for refractories with low-carbon footprint. By monitoring market developments
and enhancing its business adaptability, innovation and planning, RHI Magnesita can maintain a strong level of climate resilience over the
short, medium and long-term across different scenarios. The Group remains committed to supporting its customers’ decarbonisation efforts
as well as actively managing our own climate-related risks and opportunities.
The Group’s resilience analysis, updated annually, assesses risks across acute and chronic physical hazards, legal factors, evolving regula-
tions, technological shifts, market dynamics, and reputational risks. Risks affecting direct operations, downstream, and upstream activities
are systematically identified through the Group’s risk management framework. The analysis incorporates four climate scenarios - RCP2.6,
RCP4.5, RCP6.0, and RCP8.5, based on the IPCC Fifth Assessment Report - to evaluate exposure under different climate conditions. Re-
sults indicate that 32 sites may be susceptible to physical climate hazards, with insurance policies in place to cover potential damage and
losses, including those caused by natural catastrophes.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024118
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 119
The Board actively advances initiatives that align sustainability with business success. By offering more sustainable products and solutions,
the Group strengthens its competitive position through pricing, market share, and preferred supplier status - key advantages in a low-
carbon economy. At the same time, RHI Magnesita remains committed to minimising its environmental and social impact, maintaining its
licence to operate and reputation as a responsible industry leader.
With a strategic focus on climate resilience, endorsed by CSC, RHI Magnesita is well-positioned to navigate future challenges and oppor-
tunities, ensuring long-term value creation for both the business and its stakeholders.
Impact, risk and opportunity management
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material climate-related
impacts, risks and opportunities
The process to identify and assess material climate-related impacts is described in SBM-3 ESRS2. Time horizons are aligned with strategic
planning to integrate climate risks and opportunities into the Group’s business strategy. The short-term horizon focuses on immediate sus-
tainability targets and operational adjustments, while the medium-term guides investment and regulatory adaptation. The long-term hori-
zon aligns with global decarbonization goals, ensuring resilience and competitiveness.
Climate risks and opportunities management
The Group has an established risk management approach with the objective of identifying, assessing, mitigating, monitoring and reporting
uncertainties and risks that could impact the delivery of RHI Magnesita’s strategy. Since the environment and climate change represents
both strategic and operational risk to our business, they are considered as RHI Magnesita’s principal risks.
Several mitigation measures are in place to ensure that the risk is appropriately managed and within the Group’s risk appetite. The risk
management process at RHI Magnesita combines top-down, bottom-up and subject-specific risk assessments. The top-down risk assess-
ment is performed by the Executive Management Team and reviewed by the Audit & Compliance Committee, and reporting against these
risks is included in Board meetings, Executive Management Team meetings and strategic reviews. The bottom-up risk assessment is based
on operational sites that maintain ongoing risk management activity and is linked to the quality management-based governance practices.
Subject-specific risk assessments are performed for areas of emerging or important risks such as climate change. These risk assessments
are reviewed by the CEO, the Executive Management Team and the Audit & Compliance Committee.
The Corporate Sustainability Committee (“CSC”) reviews the Group’s risk appetite, tolerance and strategy in respect of corporate sustain-
ability risks and advise the Board accordingly. The CSC reviews, at least annually, periodic reports from management identifying the Group’s
material business risks within the Committee’s scope and setting out risk management strategies, controls and mitigating actions applied
to these risks.
Climate change represents both strategic and operational risks to our business. These are grouped as physical risks and transitional risks.
Physical Climate Risk refers to the potential financial and operational impacts on an organisation resulting from climate-related events.
These risks are categorised as:
Acute Risks: Sudden, extreme weather events like tornados, floods, or heatwaves.
Chronic Risks: Long-term changes in climate patterns, such as changing air temperatures, sea-level rise, or soil erosion.
These risks can disrupt operations, damage assets, increase costs, and impact supply chains, requiring proactive risk assessment and adap-
tation strategies.
Transitional climate risk refers to potential financial, operational, and strategic risks that organisations may face as economies transition
toward a low-carbon economy. These risks arise from changes in policies, regulations, market dynamics, technologies, and social attitudes
aimed at mitigating climate change. While these risks can pose challenges, they also present opportunities for innovation, competitive
advantage, and long-term resilience.
The process of identifying and assessing all Group climate-related risks and opportunities, is as follows.
Starting from the risk and opportunity universe (comprising all categories that could impact businesses in the next ten years), categories
which are not applicable to our business are excluded from the risk and opportunity analysis. Categories identified as applicable to our
Group are analysed to identify specific risks and opportunities that impact (or potentially impact) our business. These are linked to potential
root-causes and assessed for their inherent likelihood impact, and velocity. For climate-change risks and opportunities, the following cat-
egories are considered: acute and chronic physical risk, legal, current and emerging regulations, technology, market, and reputational risks.
Within each category, specific risks and opportunities impacting direct operations, downstream and upstream, are identified and assessed
based on the Group’s risk management processes.
119RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
120 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Risk and opportunities impact is evaluated based on a scale of 1 (minor) to 5 (critical). Each rating has a specific definition based on the
impact of the risk on RHI Magnesita’s strategic, operational, financial and compliance goals.
Risks and opportunities are also rated according to their inherent likelihood on a scale of 1 (rare) to 5 (very likely) based on their probability
or expected frequency.
Once likelihood, impact and velocity of a risk have been assessed, an appropriate response is determined. This ranges from mitigating the
risk to transferring or avoiding the risk based on the level of “risk appetite” defined by the Board.
Appropriate initiatives to reduce the level of inherent risk are then identified and implemented. The level of residual likelihood and impact
after mitigation is assessed for each risk and opportunity using the scoring system above (i.e. impact on a scale of 1 “minor” to 5 “critical”
and likelihood on a scale of 1 “rare” to 5 “very likely”).
The overall level of residual risk is evaluated to ensure that it is aligned with the Group’s risk appetite and risk tolerance. Effectiveness of
mitigating measures is monitored over time and risks are reassessed at least on an annual basis and as needed in the case of significant
changes in the risk landscape.
Climate-related transitional risks and opportunities
Operating in an emissions intensive industry, it is likely that RHI Magnesita’s business model will be affected by the transition to a low-
carbon economy. As well as risks, there are significant opportunities that the Group is well positioned to benefit from.
For transitional risks, financial effects are expected due to evolving regulatory frameworks, market dynamics, and technological shifts. These
impacts may include increased costs related to carbon pricing mechanisms, investment requirements for low-carbon technologies, and
adjustments in operational strategies. The specific financial implications of these transitional risks are disclosed in the accompanying table,
providing transparency on potential cost impacts and strategic responses.
The assessment has identified EU sites needing significant efforts to align with climate-neutral goals due to regulatory changes, infrastruc-
ture limitations, and investment requirements for low-carbon technologies. Key challenges include the phase-out of free carbon allow-
ances under the EU ETS and constraints in adopting alternative fuels. The Group is exploring process optimization, renewable energy use,
and industry collaboration with policymakers and industry partners to support a viable and sustainable transition.
RHI Magnesita has updated its climate-risk modelling and analysis of climate-related transitional risks and opportunities across short-,
medium-, and long-term horizons. This update integrates key variables such as CO₂ pricing and energy costs based on IEA references.
Scenario analysis was conducted using two climate pathways: the Paris-aligned mitigation scenario (RCP 2.6), which envisions strength-
ened climate policies limiting warming to below two degrees, and the hot-house world scenario (RCP 8.5), which assumes inadequate
mitigation, leading to three to four degrees of warming. While this report is based on the Paris-aligned scenario, regulatory and market
uncertainties add complexity to quantifications.
Risks
RHI Magnesita’s main risk is the additional operating expense resulting from carbon pricing developments. The financial implications of this
risk have escalated following the implementation of the EU's Carbon Border Adjustment Mechanism (“CBAM”). This policy instrument aims
to create a level playing field for domestic producers subject to carbon pricing by imposing a carbon-based tariff on imports from countries
lacking comparable carbon pricing mechanisms. By increasing the cost of imports from such regions, CBAM mitigates competitive disad-
vantages for domestic industries, ensuring alignment with the EU's climate objectives while protecting local producers.
This mechanism would help to ensure that domestic producers and consumers are not put at an economic disadvantage by having to bear
the cost of carbon pricing, while their international competitors do not. CBAM is intended to incentivise countries to adopt similar carbon
pricing policies, thereby reducing the global greenhouse gases emissions.
CBAM is expected to have a financial impact on the Group from 2030 onwards as free carbon allowances under EU-ETS are phased-out.
This is attributed to levies on imported materials, implemented to safeguard the EU domestic business.
This is expected to increase refractory pricing for all suppliers selling into the EU. Additionally, products manufactured in the EU and then
exported will incur higher costs, as there are currently no compensation mechanisms for exporters.
The financial impacts of CBAM have been included in the Group’s updated TCFD modelling, resulting in a future impact on equity value
of circa €260 million due to the increase in operating costs because of increase in level or scope of carbon pricing. (2023: €180 million)
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024120
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 121
Opportunities
Three opportunities were identified (i) increased demand for products that enables decarbonisation in the customer industries, e.g. EAF
refractories, and (ii) increased demand for low carbon footprint refractory products and (iii) decrease in costs or increase in revenue through
use of new technologies to reduce or capture CO
2
emissions from refractory production in ETS zones.
The steel industry is undergoing a decarbonisation process which is predicted to continue into 2050 and beyond. Long-term emissions
reduction solutions include direct reduced iron in electric arc furnaces and increased scrap steel use. This megatrend has led to an in-
creased demand for electric arc furnaces (“EAF”) and electric smelter furnaces. As global pressure to reduce carbon emissions intensifies,
RHI Magnesita is strategically positioned to capitalise on this trend. Through its vertically integrated business model, the Group secures
essential raw materials for electric arc furnace applications from its European mines in Hochfilzen and Breitenau, Austria. This integration
not only ensures a reliable and sustainable supply chain but also provides RHI Magnesita with a distinct competitive advantage. These
capabilities strengthen the Group’s standing as the preferred refractory partner in the steel industry's transition toward greener and more
sustainable operations.
RHI Magnesita maintains its industry leadership in utilising recycled minerals and recycling has been the major contributor to the Group’s
CO
2
emissions reductions to date.
Moreover, recycling also has significant waste management and circular economy benefits for Group’s customers. RHI Magnesita’s joint
venture with Horn & Co., MIRECO, combines recycling activities in Europe and increases the production, use and offering of secondary raw
materials. This results in a significant decrease in CO
2
emissions. Horn & Co., MIRECO is well positioned at the forefront of the circular
economy, providing services to customers in steel, cement, glass and other process industries.
With an estimated CO₂ reduction of 1.6 tonnes per tonne of secondary raw material used, financial benefits arise from both premium pricing
and lower production costs. However, long-term gains remain uncertain, influenced by carbon price volatility, regulatory changes, and
customer demand for low-carbon solutions. Read more on chapter ESRS E5 – “Resource Use and Circular Economy” and “Business Model”
on page 149.
The net future impact on equity value of these opportunities combined is + €515 million (2023: €388 million, 2022: +123 million; 2021:
+€352 million).
121RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
122 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Climate Drivers
Risk/
Opportunity
Category Impact RHI Magnesita response and strategy
Main
affected
Time Horizon
Related metrics and targets
Policy
-
Making &
Regulatory
Pressure
Increase in
operating
or capital
expenditur
es due to
changes in
policy and
regulation
Risk RHI Magnesita
foresees an
future impact
on equity value
of circa €260m
due to the
increase in
operating costs
because of
increase in level
or scope of
carbon pricing
The Group incorporates carbon
permit price projections into its
financial planning and maintains a
hedging programme to mitigate
future exposure risks.
To further enhance sustainability and
reduce emissions, we are actively
developing innovative technologies,
including carbon capture, utilisation,
and storage (CCUS). Additionally,
advancements in sorting technology
are being pursued to improve
recycling performance.
A key priority is increasing the use of
secondary raw materials, which offers
a lower carbon footprint compared to
the extraction or procurement of
virgin raw materials.
Furthermore, the Group remains
committed to ongoing investments in
fuel switching, renewable energy
adoption, and energy efficiency
measures, all of which contribute to
reducing carbon intensity across
operations.
Medium-
long-
term
We have set a 15%
emissions intensity
reduction target by
2025 on a 2018
baseline of Scope 1, 2
and 3 raw materials
emissions. By the end of
2024, our emissions
intensity was 14% lower
than the 2018 baseline.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024122
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 123
Climate Drivers
Risk/
Opportunity
Category Impact RHI Magnesita response and strategy
Main
affected
Time Horizon
Related metrics and targets
Techno
-
logy
Increased
cost of
capital for
investing in
recycling
technology
to achieve
CO
2
reduction
targets.
Risk RHI Magnesita
anticipates an
estimated
future impact of
approximately
€13 million on
its equity value,
driven by the
increase in the
cost of capital
required to
achieve its CO₂
reduction
targets. This
reflects the
financial
implications of
transitioning
towards lower-
carbon
operations and
compliance
with evolving
regulatory
frameworks.
The 2024 Recycling Rate reached
14.2%. By year-end, RHI Magnesita
plants had consumed 268 kt of
recycled materials and sold 96 kt of
metallurgical additives, marking a
30% volume increase compared to
2023. This led to €36 million in raw
material cost savings for refractory
finished goods and a reduction of 310
kt in CO₂ emissions.
Europe: RHI Magnesita plants
achieved a record 11.0% recycling
rate, driven by high SRM
consumption at Hochfilzen and
increased recycling in basic mixes,
MagCarbon, and dolomite bricks.
Additionally, Horn & C0., MIRECO
acquired the Italian refractory
recycling specialist Refrattari Trezzi,
expanding its production footprint in
Italy and supporting RHI Magnesita’s
decarbonisation goals.
India: Following the integration
phase of recent M&As, plants
established a stable recycling
consumption flow, delivering strong
results in Q3 and Q4 and closing the
year with a recycling rate exceeding
15.5%.
North America: Exceeded its targets
with a 12.7% recycling rate,
supported by a focused effort in the
second half of the year to boost
recycling consumption in the U.S.
Short-
term
We have a target to
increase the use of SRM
to 15% by 2025 and in
2024, the Group
achieved 14.2%
recycling rate.
123RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
124 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Climate Drivers
Risk/
Opportunity
Category Impact RHI Magnesita response and strategy
Main
affected
Time Horizon
Related metrics and targets
Market &
Customers
Increased
demand for
refractory
products
that enable
decarboni-
sation of
customer
industries
(EAF, ESF,
BOF, DRI).
Oppor-
tunity
RHI Magnesita
foresees a
future positive
financial impact
on equity value
of €277m,
regarding the
increased
demand from
customers for
refractory
products that
help them
reduce their
emissions is
considered low
(e.g. EAF).
RHI Magnesita is committed to
supporting its customers in
transitioning to low-carbon
production processes through our
advanced refractory products.
Currently, a significant portion of our
portfolio serves the steel and cement
industries, which together represent
approximately 80% of our business.
In the steel sector, we provide
refractory solutions that enable the
use of electric arc furnaces (EAF), a
key technology for reducing CO₂
emissions. Our market position
reflects this commitment:
RHI Magnesita holds a higher market
share in lower CO₂-emitting
applications, such as EAF, while
maintaining a comparatively lower
share in higher-emission
technologies, such as basic oxygen
furnaces (BOF) and blast furnaces.
The Group will continue to expand
its portfolio of low-energy and low-
carbon solutions, including process
optimisation, recycling services,
advanced coating technologies, and
digital innovations, to further support
our customers in achieving their
sustainability targets.
Short-
medium-
long-
term
Sales of refractory
products supporting
electric arc furnaces,
associated with the
lower carbon
production of steel, was
€528 million in 2024.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024124
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 125
Climate Drivers
Risk/
Opportunity
Category Impact RHI Magnesita response and strategy
Main
affected
Time Horizon
Related metrics and targets
Market &
Customers
Increased
demand for
RHI
Magnesita
products
that are
produced
with lower
carbon
footprint
and
incorpora-
tion of
carbon
expenses.
Oppor-
tunity
Higher revenue
due to
increased
demand for
low-carbon
(e.g. recycled)
refractory
products,
resulting in a
combined
future positive
impact on
equity value of
€m.
In the short term, increasing the
proportion of SRM in our products
will contribute to a reduction in
geogenic emissions from raw material
use while simultaneously enabling
the development of competitive low-
carbon product offerings.
In the long-term, the successful
implementation of carbon capture,
sequestration, and utilisation
technologies, alongside a transition
to renewable energy sources, has the
potential to enable the production of
refractory products with significantly
lower or even net-zero CO₂
emissions.
This strategy is expected to yield a
competitive advantage in terms of
pricing and market positioning,
particularly as customers place
increasing emphasis on reducing
their Scope  emissions. By
proactively addressing these
sustainability concerns, the Group
can strengthen its market presence
and differentiate itself from
competitors with higher carbon
footprints.
Short-
medium-
long-
term
We have set a target of
% SRM content in
refractory products by
. We achieved
.% of secondary raw
material content in
 (:.%)
Our target is to reduce
CO

intensity by % by
.
Climate-related physical risks
The Group has undertaken a comprehensive update its production sites across a broad range of physical climate hazards to cover newly
acquired sites. The analysis considered 70 sites, covering all production sites, recycling facilities and mining locations. Certain value chain
assets were included in the initial physical climate risk assessment conducted in 2021 and were not identified as being exposed to climate-
related risks. The latest assessment conducted in 2023 primarily focused on RHI Magnesita’s own operations, driven by the integration of a
significant number of newly acquired sites. These sites require immediate and focused evaluation to ensure operational resilience, business
continuity, and alignment with the Group’s risk management framework.
The assessment considered four distinct climate scenarios - RCP2.6, RCP4.5, RCP6.0, and RCP8.5 - taken from the findings of the Inter-
governmental Panel on Climate Change Fifth Assessment Report.
These scenarios project varying greenhouse gas concentration trajectories, indicating potential outcomes such as staying below a 2°C
temperature increase, reaching approximately 2°C above the modern climate baseline, a global temperature rise of about 3–4°C by 2100,
and an exceeding 4°C increase in the global average surface temperature by 2100.
The assessment focused on evaluating future exposure of RHI Magnesita sites to climate-related hazards across temperature, wind, water,
and solid matter, encompassing a total of 29 categories as recommended by Delegated Regulation EU 2021/2139, assessing the probability
of future climate conditions surpassing current baseline values.
125RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
126 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Classification of climate hazards (source: Commission Delegated Regulation (EU) 2021/2139)
Classification of
climate
-related
hazards
Temperature-related Wind-related Water-related Solid mass- related
Chronic
Changing temperature
(air, freshwater, marine
water)
Changing wind patterns Changing precipitation
patterns and types (rain,
hail, snow/ice)
Coastal erosion
Heat stress
Precipitation or
hydrological variability
Soil degradation
Temperature variability Ocean acidification Soil erosion
Permafrost thawing Saline intrusion Solifluction
Sea level rise
Water stress
Acute
Heat wave Cyclones, hurricanes,
typhoons
Drought Avalanche
Cold wave/frost Storms (including
blizzards, dust, and
sandstorms)
Heavy precipitation (rain,
hail, snow/ice)
Landslide
Wildfire Tornado Flood (coastal, fluvial,
pluvial, ground water)
Subsidence
Glacial lake outburst
The 2023 results highlighted that certain locations within the Group's industrial footprint are vulnerable to chronic physical climate haz-
ards, such as changes in air temperature, heat stress, and soil erosion, as well as acute risks like floods. For these sites initially flagged as
high-risk, a more detailed risk analysis was undertaken in 2024 to better understand and address these risks. As part of this process, targeted
interviews were conducted to validate the modelling results, assess whether the perceived risk aligns with the categorisation, and identify
any existing or planned adaptation measures. This approach ensures a comprehensive evaluation of site-specific vulnerabilities and sup-
ports the development of appropriate risk mitigation strategies.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024126
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 127
Country
Climate
Hazards
(A-Acute; C-
Chronic)
Site
Current
Risk
Assessment
(Short-term)
2030
-2050 (Medium-long-term)
RCP 2.6 RCP 4.5 RCP 6.0 RCP 8.5
Brazil
Heat stress - C Brumado Low Low High High Red flag
Sea level rise -
C Terminal Aratu Medium Red flag Red flag Red flag Red flag
Soil erosion - C Contagem Low High High
Red flag
Soil erosion - C
Coronel
Fabriciano
Low Red flag Red flag Red flag Red flag
Soil erosion - C Fazenda Funchal Medium Red flag Red flag Red flag Red flag
Soil erosion - C
Retiro Pd
Domingo
Medium Red flag Red flag Red flag
Soil erosion - C
Fazenda Serra
dos Ferreiras Low High High Red flag
Changing air
temperature - C Uberaba Low Low High High Red flag
Heat stress - C Uberaba Low Low High High Red flag
Soil erosion - C Uberaba Low High High Red flag
China
Flood (A) Chizhou Medium Red flag Red flag Red flag Red flag
Changing air
temperature - C Chongqing Low Low Medium High Red flag
Soil erosion - C Chongqing Low Red flag Red flag Red flag Red flag
Soil erosion - C Dalian Low Red flag Red flag Red flag
Germany
Flood - C Niederdollendorf Low Red flag Red flag Red flag Red flag
Flood - C Urmitz Low Red flag
India
Changing air
temperature - C Venkatapuram Low Medium Red flag Red flag Red flag
Changing air
temperature - C
Rajnandgaon Low Low High High Red flag
Soil erosion - C Jamshedpur Low High High
Red flag
Changing air
temperature - C Jamshedpur Medium Medium Red flag Red flag Red flag
Heat stress- C Jamshedpur Low No risk Medium High Red flag
Soil erosion - C Katni Low Low High High Red flag
Soil erosion - C Cuttack Low High Red flag Red flag Red flag
Soil erosion - C Dalmiapuram Low
Medium Medium Red flag
Mexico
Changing air
temperature - C Tlalnepantla Low Low High High Red flag
Switzerland
Water stress - C Pfäffikon Low Red flag
Türkiye
Water stress - C Sörmaş Low High Red flag
Water stress - C Eskisehir Low High Red flag
USA
Soil erosion - C Pevely Low High High Red flag
Changing air
temperature - C
York Low Medium Medium Medium Red flag
This comprehensive process included engaging with local experts to assess the accuracy of climate risk models and reviewing insurance
audits where available. The findings from this analysis revealed that the Group's overall exposure to physical climate risks is limited. The
rationale behind this conclusion is twofold: (i) Imminence of Risks: Many of the flagged sites, under current climate conditions, are not
perceived to face immediate threats, meaning the anticipated risks are either less severe or unlikely to materialise in the near term; (ii)
Proactive Risk Management: For sites where risks are acknowledged, effective adaptation measures have already been implemented or are
planned. These measures demonstrate the Group's proactive approach to resilience and preparedness, significantly mitigating potential
127RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
128 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
vulnerabilities. This targeted approach underlines the Group’s commitment to continuous improvement in climate risk management and
ensures that the business remains resilient even under changing climate conditions.
Moreover, a three-year programme dedicated to the ongoing assessment of physical risks associated with the Group’s assets has been
implemented. This programme involves on-site evaluations by experts to assess preparedness for various risks, including structural condi-
tions and geographical exposure to extreme weather events such as storms, hurricanes, and earthquakes - mainly focusing on acute risks.
Newly acquired sites are seamlessly integrated into the programme to ensure a consistent risk assessment approach. Beyond climate-re-
lated hazards, this initiative also evaluates the overall physical conditions of each site and its exposure to broader operational risks, with
natural catastrophes forming just one part of a holistic risk assessment framework. Additionally, RHI Magnesita’s property, damage, and
business interruption insurance programme provides partial coverage for all production sites and key offices, offering financial protection
against physical damage and losses, particularly those arising from natural catastrophes. This integrated approach enhances resilience
and ensures systematic risk mitigation across the organisation.
No material financial impacts are anticipated from the physical climate risk assessment. Current evaluations indicate that existing mitigation
measures adequately address potential exposures, ensuring resilience against physical climate risks such as extreme weather events or
long-term environmental changes. The Group continues to monitor developments and adapt its strategies as needed to maintain opera-
tional stability.
Disclosure requirement E1-1 – Transition plan for climate change mitigation
Refractory production is a ‘hard to abate’ industry. Raw material processing generally uses fossil fuels for ignition and burning of carbonate
rock. In the burning process, around 50% of the weight of the mineral is converted into CO
2
, resulting in geogenic emissions. These geo-
genic emissions are classified as Scope 1 when originating from the Group’s own production, or Scope 3 in the case of externally purchased
raw materials. Taken together, our own geogenic emissions and those associated with the raw materials that we purchase account for over
half our total CO
2
footprint.
Significant energy is also required for firing of refractory products in the manufacturing process and further emissions are generated in the
shipping and distribution of our products to customers worldwide.
The Group has published a theoretical decarbonisation pathway which sets out a potential route to substantially remove all CO
2
emissions
by 2060. The decarbonisation pathway is not aligned with a 1.5-degree scenario but is aligned with a ‘well below 2.0 degrees’ scenario.
Currently, there are no plans to adjust the business model or strategy to align with this framework.
Actual delivery of decarbonisation pathway is uncertain due to reliance on as yet unproven technologies, infrastructure, energy sources
and the actions of suppliers and governments which are not under the control of management. RHI Magnesita’s decarbonisation commit-
ment is as follow:
• Lead the refractory industry by decarbonising our operations as fast as sustainably possible.
• Annually update our decarbonisation pathway based on technology, infrastructure and capex developments.
• Invest in the research and development of new technologies to avoid or capture CO
2
emissions.
• Offer our customers enabling technologies or solutions for their own low-carbon production technologies and low-carbon re-
fractory products to reduce their Scope 3 emissions.
• Lobby governments to invest in infrastructure to support decarbonisation.
• Work with partners in the private sector to develop new solutions for decarbonisation.
Full decarbonisation will require significant capital expenditure, starting in Europe and subsequently in all regions.
The decarbonisation pathway has been approved by the Board, the CSC and the Executive Management Team.
The first step of CO
2
emissions reduction is to be delivered through measures which can be implemented by the Group without significant
external support, including increased use of recycled raw materials, fuel switches and energy efficiency measures (see E1-4 for details on
levers and respective targets). It is estimated that these measures could deliver an absolute reduction of around one and half million tonnes
of CO
2
emissions, or 24% of the baseline total by 2035. Beyond this initial reduction, decarbonisation measures become progressively
harder to deliver. Recycling has a natural ceiling since refractories are consumed during use and only residual materials can be reclaimed,
whilst fuel switches to natural gas only offer a partial reduction. The next steps of the pathway are reliant on the provision of (i) new infra-
structure or renewable energy sources such as hydrogen by outside parties; (ii) the use of technologies which do not yet exist or are not
proven at pilot or production scale; and (iii) significant capital expenditure, which may not be possible for the Group to generate from its
existing operations, obtain from its finance providers or receive via government funding. While the Group uses in its production natural gas,
pet coke, coal and oil as fuels, it is not engaged in other fossil-fuel related economic activities. The Group is not excluded from the EU Paris-
aligned Benchmarks in accordance with Commission Delegated Regulation (EU) 2020/1818.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024128
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 129
The costs of emitting carbon, which could provide an incentive to accept higher capital expenditure and operating costs for the purposes
of reducing CO
2
emissions, apply in certain jurisdictions and may provide a business case for reducing emissions in those geographies.
Estimates of future potential CO
2
costs are built into the Group’s financial forecasts and planning decisions. However, the Group has a
global production and customer network and competes with other refractory producers who are not subject to additional CO
2
costs.
Carbon capture and utilisation
In 2024, further progress has been made in the evaluation of technologies for CO
2
capture at the Group’s raw material production sites.
Research of potential technology solutions includes cryogenic, chemical separation, and membrane-based techniques.
In the area of Carbon Capture and Utilisation (“CCU”), the Group has progressed its partnership with MCi Carbon to develop technologies
focused on the direct mineralisation of CO
2
from flue gases, through a process which can efficiently transform gaseous waste CO
2
into a
solid mineral. The MCi process offers opportunities for utilisation in other industries, such as the cement sector, which faces similar chal-
lenges with process emissions of CO
2
not originating from the use of fossil fuels. 2024 activity was concentrated on constructing a pilot
facility in Newcastle, Australia. Testing and development programmes with MCi Carbon are set to continue until mid-2025.
Alternative fuels including hydrogen and biofuels
Hydrogen produced using renewable energy is a promising alternative fuel for use in high temperature industrial processes such as those
undertaken by RHI Magnesita. Proof of concept has been achieved and no further significant investments are required until, and unless, an
economic source of clean hydrogen fuel becomes available.
Securing a reliable and economic supply of green hydrogen is an essential pre-cursor to large scale adoption of hydrogen use in quantities
that would make a material difference to the Group’s Scope 1 emissions.
RHI Magnesita is also exploring other non-fossil fuel options including biofuels. RHI Magnesita uses charcoal in Brazil, which is considered
as biofuels and tests are ongoing with sunflower husks.
Reducing the carbon intensity of energy
RHI Magnesita is seeking to reduce the carbon intensity of its energy sources through switching to lower intensity alternatives where pos-
sible. In Europe, plans to transition from CO
2
intensive petroleum coke to more CO
2
efficient natural gas in our plants have been postponed
due to delays in natural gas pipeline construction. Exploring biofuels as an alternative is dependent upon local availability and cost com-
petitiveness. We continue to monitor energy markets and alternative fuel sources to reduce emissions.
At the Ponte Alta raw material production site in Brazil, we have successfully switched away from petroleum coke to sustainably sourced
charcoal.
At the Group’s York plant in Pennsylvania, USA, petcoke is the primary fuel used. The Group is assessing possibilities to transition to natural
gas at this site, but no economically viable solution has yet been identified.
We continue to reduce the CO
2
intensity of purchased electricity. The Group is investigating the potential for solar generation at several
other sites. By the end of 2024, 78% of total electricity consumption was from renewable sources.
Investment and funding
The capital cost of full decarbonisation is highly uncertain but has been estimated at approximately €1 billion. Since there is no payback
outside of jurisdictions where an ETS imposes a cost of carbon emissions, there is a limit to the amount of capital that the Group can commit
to decarbonisation. In 2024 RHI Magnesita generated €225 million of free cash flow and allocates capital to M&A, organic capex, mainte-
nance and dividends to sustain and grow the business. At current levels of cash generation and considering competing demands for capital
it is unlikely that the Group would be able to fund a full decarbonisation of its operations from internally generated cash flow. External
funding may be possible to obtain in the form of subsidies or co-investment in specific projects. The Group’s transition plan is based on a
bottom-up approach to ensure feasibility and alignment with the Group’s overall business strategy and financial planning. The transition
plan does not entail any objectives or plans for aligning with Taxonomy activities as there are not Taxonomy activities for refractory produc-
tion.
Locked- in emissions
The vast majority of direct emissions at RHI Magnesita result from firing at high temperature of various kilns and geogenic emissions from
carbonate raw materials during firing. The Group has set a 2030 target to also reduce direct emissions. Remaining emissions both from
fuels and geogenic emissions are hard to abate and require carbon-neutral fuels such as hydrogen as well as carbon capture for geogenic
emissions which are in nature otherwise unavoidable. We do not expect that the locked-in emissions jeopardise the undertaking’s GHG
emission 2030 reduction target. For a comprehensive decarbonisation beyond the Group’s 2030 target locked-in emissions require a mar-
ket environment which allows the Group to pass on higher costs of carbon-neutral fuels and carbon capture and utilisation.
129RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
130 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Disclosure requirement E1-2 – Policies related to climate change mitigation and adaptation
RHI Magnesita has an Integrated Management System Policy (“IMS policy”) in place which addresses, among others matters, climate
change mitigation. In this policy the Group commits to tackling climate change as far as it is technically and economically feasible. The
Group strives to minimise direct and indirect CO
2
and other greenhouse gas emissions, by improving the energy efficiency of its operations
and the use of cleaner sources. RHI Magnesita's IMS policy covers the environmental policy. With this policy the Group commits to operate
all its business activities in a most sustainable way to ensure environmental protection, tackling climate change, through minimising the
environmental impacts of its operations as far as it’s technically and economically feasible. The policy applies to RHI Magnesita N.V. and
all Group companies (together referred to as “RHI Magnesita”) and employees. The scope of the IMS policy is limited to Group companies
and employees and does not extend to the upstream or downstream value chain. The Supplier Code of Conduct includes references to
environmental compliance and other sustainability priorities and is aimed at the Group’s upstream value chain. The CTO is accountable
for the implementation of the policy. The IMS policy does not refer to any third-party standard and does not consider any particular stake-
holder group. The IMS policy is published on RHI Magnesita's website. The Group's IMS policy is globally applicable and does not specifi-
cally address or exclude stakeholder groups. The Group’s current policy does not yet fully align with all ESRS disclosure requirements. An
update is underway to ensure compliance and comprehensive reporting.
RHI Magnesita’s Corporate Risk-Taking/Management Policy outlines structured processes for identifying and managing risks across the
organisation. The Risk Register includes a diverse range of risks and is not limited to specific categories such as Health & Safety or Environ-
ment. Rather than implementing separate policies for individual risks, the Group relies on this comprehensive risk framework to ensure a
consistent approach to risk management. Additionally, while the IMS Policy covers climate change mitigation and energy efficiency, it does
not explicitly address renewable energy or climate change adaptation. Climate-related risks and opportunities are, however, integrated into
the broader corporate risk management framework to ensure a holistic approach to sustainability and resilience.
Disclosure requirement E1-3 – Actions and resources in relation to climate change policies
A key action to achieve the CO
2
reduction target is to increase the use of secondary raw materials. After having achieved its 10% recycling
target the Group stepped up its ambition and the 2025 recycling target is now 15%. In 2024 the Group increased its recycling rate to 14.2%
(compared to 12.6% in 2023). Every tonne of secondary raw material used replaces virgin raw material with a CO
2
-intensity of 1.6t CO
2
per
tonne of raw material on average. Other actions are energy efficiency measures with the aim to reduce the energy intensity of RHI Magnesita
by 1% per year. In 2024 energy efficiency measures contributed to an emission reduction of around 15,000 t CO
2
. In addition, the switch
from petroleum coke to natural gas at our Hochfilzen plant will be another CO
2
reduction lever. Furthermore, the Group switches to green
electricity where feasible. As a result, most of the electricity consumption in Europe and South America is from renewable sources and in
China an increasing share of green electricity is consumed, and PV panels are installed at several plants in China and India. In China 2.2
MW PV panels were installed in 2024 in our Dalian operations. The scope of the key actions RHI Magnesita’s direct operations in all regions
is addressing is its direct Scope 1, Scope 2 market-based and Scope 3 emissions from purchased raw materials. The scope of the key actions
is direct Scope 1, Scope 2 market based and Scope 3 emissions from purchased raw materials. While the Group has set time-bound targets
to reduce its GHG-footprint, increasing the use of secondary raw materials and increasing energy efficiency are continuous actions. The
switch to natural gas at our Hochfilzen plant is planned for 2025.
The main short-term decarbonisation lever at RHI Magnesita's direct and indirect emissions is the increase of circular raw materials. Actions
to increase the share of circular raw material include improved recipes and processes which allow higher shares of circular raw materials as
well as sales activities aiming at sale of brands with higher circular raw materials share as well as investments in operations to improve the
capacity to process circular raw materials.
Investments in increased recycling capabilities are a continuous effort, and individual investments are short-term and are part of the asset
category ‘Plant Property & Equipment’.
Other short-term levers are increasing energy efficiency, switching to renewable electricity and switching to less CO
2
-intensive fuels.
The implementation of actions to achieve the Group’s 2030 CO
2
reduction target depends on annual capex in the same order of magnitude
as in the reporting year; therefore, no additional availability and allocation of resources is required.
All actions described above contribute to the policy objective to minimise direct and indirect CO
2
and other greenhouse gas emissions.
In 2024 the Group invested €7.3 million to reduce its CO
2
emissions. The Capex mainly contributes to increase the share of circular raw
materials but also includes investments to switch to more CO
2
-efficient fuels and to trial hydrogen-related production routes. Thereof,
around €3.9 million relate to recycling investments according to EU Taxonomy (EU regulation 2021/22178) Material recovery from non-
hazardous waste/sorting and material recovery of non-hazardous waste. Future financial resources are projected to remain at levels com-
parable to those in 2024.
The Capex is part of Note 19 (Property, plant and equipment) in the Financial Statements under ‘Additions’.
The Capex/OpEx reported under Taxonomy-related disclosures deviate for various reasons from the disclosures required by ESRS:
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024130
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 131
• Not all Taxonomy-eligible activities contribute to reducing CO
2
emissions within the scope of the Group’s transition plan (e.g.
downstream indirect emissions).
• Not all Capex or OpEx reported following ESRS for achieving the Group’s transition plan are eligible or aligned with the taxonomy
activities (e.g. purchasing of green electricity or investments to switch to less CO
2
-intensive fuels).
For 2025 and beyond the Group expects similar CO
2
-target-related OpEx and Capex to implement actions along the main reduction levers.
The ability to implement the actions does not depend on specific preconditions. The Group does not use any sustainable finance instru-
ments to enable its decarbonisation action.
Metrics and targets
Greenhouse gas emissions methodologies
RHI Magnesita reports all relevant direct and indirect emissions. Reported GHG emissions considers carbon dioxide, Hydrofluorocarbons,
methane, nitrous oxide and sulphur hexafluoride.
Scope 1 GHG emissions
RHI Magnesita follows the operational control approach for consolidating data and accounts for GHG emissions or removals from opera-
tions over which it has full year operational control in the respective reporting year. Facilities partially owned without operational control
are reported under Scope 3 emissions (Investments). Facilities acquired or built by RHI Magnesita are taken into account at latest in their
first full operative calendar year, if possible, earlier.
Emissions from offices which are not part of operational sites and emissions from Group cars used offsite are not included.
For Scope 1 emissions a significance threshold of 1% of the total direct plant CO
2
emissions (Scope 1) or 1,000 t CO
2
per year is applied on
plant level.
Most relevant Scope 1 GHG sources are 1) fuel-based emissions at our production facilities from firing various types of kilns in the raw ma-
terial production and finished goods production and 2) geogenic process emissions from the raw material (MgCO
3
is calcined to MgO and
CO
2
). Other minor sources of GHG are organic additives in RHI Magnesita’s finished goods production which oxidize to CO
2
in high tem-
perature kilns and emissions from explosives as well as emissions from mobile equipment.
Potentially existing carbon sinks are forests owned by the Group but are at the moment not considered.
The base year is adapted in case of changes in the calculation method; changes in production footprint (e.g. plant divestment or mergers
and acquisitions) but also in case of an error or a number of cumulative errors that are collectively substantial. Start of a new operation or
expansion of an existing operation as well as closure of an operation or part of an operation do not lead to an update of the base year.
Scope 2 GHG emissions
RHI Magnesita follows a dual reporting approach for Scope 2 emissions reporting both market-based and location-based emissions.
Market-based emissions reporting reflects the CO
2
-intensity of purchased electricity as provided by the supplier and includes also unbun-
dled green electricity certificates. If the supplier does not provide a supplier-specific market-based emission factor, the Group aims at using
residual electricity emission factors. If neither supplier-specific emission factors nor residual electricity emission factors are available, lo-
cation-based emission factors are used as a fallback.
Location-based emissions reporting reflects the average CO
2
-intensity of electricity provided in a respective grid.
Scope 3 GHG emissions
RHI Magnesita reports indirect upstream and downstream emissions. Various approaches are used to calculate indirect emissions.
The reporting excludes the following indirect emissions:
• Emissions from offices which are not part of operational sites and emissions from Group cars used offsite.
• Other purchased goods than purchased raw materials, trading goods, packaging and those used in capital goods (e.g. auxiliary
materials).
• Emissions of customers other than those directly from use of RHI Magnesita’s products.
• Processing of sold products
• Downstream/upstream leased assets
Disclosure of reporting boundaries considered and calculation methods for estimating Scope 3 GHG emissions
131RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
132 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
E1-6 51 AR46h
Reporting boundaries
RHI Magnesita follows the operational control approach for consolidating data and accounts for GHG emissions or removals from opera-
tions over which it has full year operational control in the respective reporting year.
Significant Scope 3 categories for RHI Magnesita exceeding 5% of the Group’s Scope 1 emissions are the following:
Scope 3 category: Calculation methods
Purchased goods and services: The indirect emissions from purchased goods and services consists of three main groups: purchased raw
materials, goods for resale and packaging. Indirect emissions of these groups are quantified by applying emission factors to the volumes
of purchased goods. For purchased raw materials emission factors are applied per raw material class. RHI Magnesita actively engages with
suppliers to use emission factors provided by suppliers. For resale goods and estimated emission factors are applied due to a lack of sup-
plier data. For packaging materials literature values are applied for calculating indirect GHG emissions.
Downstream transportation: For all transportation in the corporate ERP system all transport and distribution flows from origin to destination
are fully covered in the GHG calculation, independent if the actual transport activity was performed under the Group’s management re-
sponsibility or customer or supplier management responsibility. Transport distances are are sourced from publicly available routing plat-
forms. Literature-based CO
2
emission factors per ton-kilometre are used to calculate transport-related GHG emissions. Transportation not
covered by the corporate ERP system are extrapolated according to shipped volumes
Fuel and energy related activities: Emissions from fuel and energy related activities are calculated based on fuel-specific emission factors.
Use of sold products: Emissions from the use of sold products origin from two different sources: 1) emissions from organic additives in the
refractory product due to the high temperature during the use phase; 2) emissions from the heating up of refractory products at the cus-
tomer. Emissions from additives in refractories are calculated based on average organic content of certain refractory types and estimated
oxidation rates. Emissions from heating up of refractories at the customer are estimated based on representative energy consumption data.
Upstream transportation: Same as for downstream transportation.
Emissions of Scope 1, 2 and 3 are externally verified by LRQA (LRQA Group Limited).
CO
2
KPI methodology
MDR-M 75/77/80
The CO
2
KPI is the metric used to measure progress against the Group's 15% relative reduction target against a 2018 base year. In line with
the greenhouse gas protocol the metric is adjusted to reflect changes in the operational footprint due to mergers and acquisitions as well
as divestments. As a result, the metric does not show the impact of mergers and acquisitions and divestments on the GHG-intensity of the
Group. The KPI considers only energy consumed directly by the Group. The denominator of the KPI are tons of shipped products excluding
resale and sale of raw materials with very low GHG-intensity (raw magnesite and dolomite). The shipped volumes are corrected by inventory
changes of finished goods and GHG-intensive raw materials produced by RHI Magnesita. The metric is not externally verified. The target
did not undergo any significant change in methodology.
The KPI reflects RHI Magnesita's policy commitment to tackle climate change. The target is not a science-based target and external stake-
holders have not been consulted. The target is based on a bottom-up approach with clearly identified CO
2
reduction levers.
Disclosure requirement E1-4 – Targets related to climate change mitigation and adaptation
RHI Magnesita has set a target in 2019 to reduce its Scope 1, 2, 3 (purchased raw materials) CO
2
emissions by 15% per tonne of product until
2025. The 2018 base year serves as the reference point for the 2025 target, marking the first full year following the RHI and Magnesita
merger in 2017. The 2024 base year is set for the 2030 target, chosen for its representativeness, particularly as a relative target, which
minimises the influence of production volumes on progress. Additionally, the base year is adjusted in cases of mergers, acquisitions, or
divestments to ensure consistency in measurement.
The primary sources of Scope 1 GHG emissions for RHI Magnesita are: (1) fuel-based emissions from firing various kilns in raw material and
finished goods production, and (2) geogenic process emissions from raw materials, where MgCO₃ is calcined into MgO, releasing CO₂.
Since geogenic emissions also occur in purchased raw materials—classified as Scope 3 emissions—and account for approximately 58%
of total Scope 3 emissions, the Group has set a target covering all three emission streams. This integrated approach ensures a more com-
prehensive reduction strategy across direct and indirect emissions.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024132
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 133
The reference 1.5°C reduction for the target period 2024 to 2030 would be a reduction of 42% of Scope 1 and 2 emissions while the Group
targets an 9% reduction of Scope 1 and 5% reduction for Scope 2 emissions. For Scope 3 emissions a 1.5°C reduction target would require
a reduction of 42% and the Group’s targeted reduction of Scope 3 from purchased raw materials by 12%. Therefore, the Group’s CO
2
re-
duction targets are not compatible with limiting global warming to 1.5°C.
The CO
2
KPI is the metric used to measure progress against the Group's 15% relative reduction target against a 2018 base year. CO
2
intensity
has been reduced by 14% between 2018 and 2024 and therefore the Group is confident of achieving the 15% target in 2025.The scope of
the KPI is Scope 1, 2 and 3 from purchased raw materials. In line with the greenhouse gas protocol the metric is adjusted to reflect changes
in the operational footprint due to mergers and acquisitions as well as divestments. As a result, the metric does not show the impact of
mergers and acquisitions and divestments on the GHG-intensity of the Group. The denominator of the KPI are tonnes of shipped products
excluding resale and sale of raw materials with very low GHG-intensity (raw magnesite and dolomite). The shipped volumes are corrected
by inventory changes of finished goods and GHG-intensive raw materials produced by RHI Magnesita. The metric is not externally verified.
The target did not undergo any significant change in methodology.
The KPI reflects RHI Magnesita's policy commitment to tackle climate change. The target is not a science-based target, and external stake-
holders have not been consulted. The target is based on a bottom-up approach with clearly identified CO
2
reduction levers. We receive
external verification from Lloyds Registry.
In addition to the 2025 CO
2
reduction target, the Group has issued a new 2030 target. The Group targets a CO
2
reduction of 10% per
tonne of product by 2030 against a 2024 base year. The Group applies for the 2030 target the same scope and approach as for its 2025
reduction target.
The target does not consider new technologies as their economic and technical feasibility is either not given or uncertain for the target
period. Future changes in regulatory factors are not anticipated as the Group does not have indication of relevant changes for the target
period with sufficient certainty to be considered. As the target is a relative target, changes in sales volumes do not directly affect progress
against the target. The Group follows a bottom-up approach focusing on technical and economic feasibility and quantitative modelling
analysis under our Paris Aligned scenario (RCP 2.6) was considered to assess transitional climate related risks.
The Group has an integrated CO
2
reduction targets covering Scope 1, 2 and 3 from purchased raw materials emissions. Based on the re-
duction levers, the Group expects to reduce, by 2030, its Scope 1 emissions by 9%, its Scope 2 emissions by 5% and its Scope 3 raw
material emissions by 12%. Scope 2 emissions reductions are on a market-based approach. The target covers all RHI Magnesita's operations
globally and is reported as CO
2
equivalent. The target covers around 4.5 million tonnes CO
2
(75%) of total Scope 1, 2 and 3 emissions.
In addition to its CO
2
target, the Group has an energy efficiency target to improve energy use per tonne of product by 5% by 2025 against
a 2018 baseline. In line with the greenhouse gas protocol the metric is adjusted to reflect changes in the operational footprint due to mer-
gers and acquisitions as well as divestments. However, the metric does not adjust for changes in sourcing of energy intensive raw materials
from within or outside the Group. The KPI considers only energy consumed directly by the Group. The denominator of the KPI are tonnes
of shipped products excluding resale and sale of raw materials with very low GHG-intensity (raw magnesite and dolomite). The shipped
volumes are corrected by inventory changes of finished goods and GHG-intensive raw materials produced by RHI Magnesita. The metric is
neither externally verified nor assured. The target did not undergo any significant change in methodology. The 2018 baseline value is 1.91
(adjusted to reflect mergers and acquisitions).
As a successor to the 2025 energy efficiency target and as part of its ongoing commitment to resource efficiency, RHI Magnesita has es-
tablished a new energy efficiency goal. By 2030, the Group aims to improve energy efficiency by 1% per plant annually, using 2024 levels
as the baseline.
Progress toward this target is measured based on implemented projects that enhance energy efficiency at production sites, in alignment
with ISO 50001 standards. To improve traceability, the target has been adjusted from the previous 2018-2025 energy efficiency goal. In
accordance with the Greenhouse Gas Protocol, the base year is adjusted to reflect changes in the Group’s operational footprint resulting
from mergers, acquisitions, and divestments.
This metric is neither externally verified nor assured. The energy efficiency targets are not derived from conclusive scientific evidence, and
external stakeholders were not involved in their development. However, these targets support the Group’s policy of reducing direct and
indirect CO₂ and other greenhouse gas emissions by enhancing operational energy efficiency. The targets are relative and apply to all
direct energy consumption at RHI Magnesita’s production sites.
133RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
134 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
The Group has achieved a 7% reduction of energy intensity compared to the base year; however, compared to 2023 the intensity has
increased by 2%.
Read more about the positive impact of the use of secondary raw materials on CO
2
emissions in ESRS E5.
The Group relies on several levers to achieve its CO
2
target. See table below.
Assumptions and methodologies
The levers reflect the contribution of the main measures to achieving the CO
2
reduction target. The impact of the levers is based on bot-
tom-up assessment of CO
2
reduction potential. For the 2030 target medium-term planed production volumes are applied to 2030 as for
2030 expected production volumes are not yet defined.
Lever
Expected contribution to
 target
Planned savings (tCO

)
Recycling % ,
Fuel switch % ,
Reduced CO

-intensity of purchased raw materials % ,
Energy efficiency in own operations % ,
Renewable electricity % ,
Total % ,
New technologies are not considered as a significant lever given the technical and economic uncertainties associated with them for the
target period.
Targets related to climate change mitigation and adaptation
Assumptions and methodologies
The calculated reduction path in alignment with a 1.5°C path is based on the SBTi calculation tool and an absolute contraction approach
for Scope 1, 2 and 3. The Group has an intensity based target and has provided below the accompanying absolute values based on the
existing production foot-print, medium term planned production volumes and excluding future M&A.
SBTI Approach - Absolute emissions
tCO

eq


 T
 T vs.

Scope 
,, ,, ,, ()%
Scope 
, , , ()%
Scope 
- raw materials ,, ,, ,, ()%
Total
,, ,, ,, ()%
RHI Magnesita approach - Absolute emissions
tCO

eq


 T
 T vs.

Scope 
,, ,, ,, ()%
Scope 
, , , ()%
Scope 
- raw materials ,, ,, ,, ()%
Total
,, ,, ,, ()%
RHI Magnesita approach
- Relative emissions tCO

/t    T
 T vs.

Scope 
. . . ()%
Scope 
. . . ()%
Scope 
- raw materials . . . ()%
Total
. . . ()%
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024134
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 135
  
Reductions planned in own operations
GHG emissions (ktCO

eq) , , 
Energy efficiency and consumption reduction
.% .%
Fuel
switching .% .%
Use of renewable energy
.% .%
Reductions expected in value chain
Supply chain decarbonisation
.% .%
Recycling
.% .%
Disclosure Requirement E1-5 – Energy consumption and mix
RHI Magnesita operates entirely within high climate impact sectors, meaning that total revenue is fully classified as revenue from these
sectors, aligning with financial statement disclosures. The Group’s energy production includes 853 MWh from non-renewable sources and
1,250 MWh from renewable sources.
A key limitation of the 2018-2025 energy target is the challenge of identifying drivers of progress, as changes in product portfolio and
capacity utilisation can influence the metric. Additionally, the measurement of energy metrics is not externally validated beyond assurance
provider reviews.
The Group determines energy intensity based on its operations in high climate impact sectors, which include refractory production and
metallurgical processes, both characterised by energy-intensive manufacturing and resource transformation.
Assumptions and methodologies
Electricity from fossil sources is calculated on a location-based approach.
Energy consumption and mix


) Fuel
consumption from coal and coal products (MWh)
,
,
) Fuel consumption from crude oil and petroleum products (MWh)
,,
,,
) Fuel consumption from natural gas (MWh)
,,
,,
) Fuel consumption from other fossil sources (MWh)
-
-
) Consumption of purchased or acquired electricity, heat, steam, and cooling from fossil sources
(MWh)
,
,
) Total fossil energy consumption (MWh) (calculated as the sum of lines  to )
,,
,,
Share of fossil sources in total energy consumption (%)
.% .%
) Consumption from nuclear sources (MWh)
,
,
Share of consumption from nuclear sources in total energy consumption (%)
.% .%
) Fuel consumption for renewable sources, including biomass (also
comprising industrial and
municipal waste of biologic origin, biogas, renewable hydrogen, etc.) (MWh)
,
,
) Consumption of purchased or acquired electricity, heat, steam, and cooling from renewable
sources (MWh)
,
,
) The consumption of self
-generated non-fuel renewable energy (MWh)
,
-
) Total renewable energy consumption (MWh) (calculated as the
sum of lines  to )
,
,
Share of renewable sources in total energy consumption (%)
.%
.%
Total energy consumption (MWh) (calculated as the sum of lines ,  and )
,,
,,
Assumptions and methodologies:
135RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
136 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Electricity from renewable sources (PV) is considered in the total energy consumption. Energy from non-renewable energy generation is
not considered in the total energy consumption to avoid double reporting. Non-renewable energy generation is estimated based on fuel
inputs to electricity generators with an estimated conversion efficiency of 36%.
Disagregation of non-renewable and renewable energy production

Non
-renewable energy generation (MWh)

Renewable energy generation (MWh)
,
Assumptions and methodologies
Electricity from fossil sources is calculated on a location-based approach.
Consumption of purchased or acquired electricity, heat, steam, or cooling from fossil
sources


Electricity fossil (MWh)
,
,
Energy intensity based on net sales
Assumptions and methodologies
Total energy consumption also considers self-generated electricity from renewable sources.
Energy intensity per net revenue


% N / N-
Total energy consumption from activities in high climate impact sectors
(MWh)
,,
,, .%
Net
revenue from activities in high climate impact sectors (EUR) ,,,
,,,
(.)%
Total energy consumption from activities in high climate impact sectors
per net revenue from activities in high climate impact sectors
(MWh/Monetary unit)
.
. .%
Connectivity of energy intensity based on net revenue with financial reporting information
Connectivity of energy intensity based on net revenue with financial reporting information

Net revenue used to calculate GHG intensity
,,,
Energy efficiency target 2018-2025: 5% energy efficiency improvement
Assumptions and methodologies
Already described in E1 chapter
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024136
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 137
E
Retrospective
Milestones and
target years
Energy efficiency
target 
-:
% energy
efficiency
improvement
Base year ()


%N/N-

(absolute emission
target)
Percentage
(absolute/
relative)
Energy consumption
(MWh)
,,
,,
,, .% ,, (.)%
MWh/t
. . . .% . (.)%
Energy efficiency target: 2025-2030: 1% energy reduction per year
Assumptions and methodologies
Already described in E1 chapter
Energy efficiency target: 
-: % energy
reduction per year
Retrospective
Milestones
and target
years
Base year
()  %N/N-
% of base
year
Energy consumption (MWh)
,, ,
Disclosure requirement E1-6 – Gross scopes 1, 2, 3 and total GHG emissions
All Scope 1 emissions are from activities under operational control. Investments without operational control are reported as Scope 3 emis-
sions. See Consolidated Statement of Profit or Loss in the Financial Statements.
Scope 1 emissions
RHI Magnesita follows the operational control approach for consolidating data and accounts for GHG emissions or removals from opera-
tions over which it has full year operational control in the respective reporting year. Facilities partially owned without operational control
are reported under Scope 3 emissions (Investments). Facilities acquired or built by RHI Magnesita are taken into account at latest in their
first full operative calendar year, if possible, earlier.
For investees that are not fully consolidated in the financial statements of the consolidated accounting group, including associates, joint
ventures, unconsolidated subsidiaries, and contractual joint arrangements where RHI Magnesita has operational control, the following
emissions have been considered: 171 tCO₂ under Scope 1 and 252 tCO₂ under Scope 2 market-based. These figures ensure alignment with
the reporting requirements by reflecting emissions from entities and operations where operational control is exercised, even if they are not
fully consolidated in the financial statements.
Emissions from offices which are not part of operational sites and emissions from Group cars used offsite are not included.
For Scope 1 emissions a significance threshold of 1% of the total direct plant CO
2
emissions (Scope 1) or 1,000 tCO
2
per year is applied on
plant level.
Most relevant Scope 1 GHG sources are 1) fuel-based emissions at our production facilities from firing various types of kilns in the raw ma-
terial production and finished goods production and 2) geogenic process emissions from the raw material (MgCO
3
is calcined to MgO and
CO
2
). Other minor sources of GHG are organic additives in RHI Magnesita’s finished goods production which oxidize to CO
2
in high tem-
perature kilns and emissions from explosives as well as emissions from mobile equipment.
Potentially existing sinks are forests owned by the Group but are at the moment not considered.
Emission factors
For direct Scope 1 emissions, fuel emission factors are used. Where available, supplier and fuel specific emission factors are applied; oth-
erwise, generic fuel emission factors are used. For geogenic emissions from raw materials, emission factors are stoichiometrically calculated.
The emission factors used to calculate Scope 1 GHG emissions are provided as fallback emission factors, link provided below. The selection
137RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
138 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
of these emission factors aligns with established methodologies and ensures consistency in reporting. Furthermore, no third-party calcu-
lation tools were used in the preparation of Scope 1 GHG emissions data.
RHI Magnesita applied the CO₂ emission factors for fossil fuels as published by the German Environmental Agency (Umweltbundesamt,
2016).
Scope 2 emissions
RHI Magnesita follows a dual reporting approach for Scope 2 emissions, disclosing both market-based and location-based emissions. Mar-
ket-based emissions reporting reflects the CO₂ intensity of purchased electricity as provided by the supplier and includes unbundled
green electricity certificates. If the supplier does not provide a supplier-specific market-based emission factor, the Group aims to use re-
sidual electricity emission factors. If neither supplier-specific nor residual electricity emission factors are available, location-based emis-
sion factors are applied as a fallback. Non-CO₂ GHGs are not consistently considered in market-based reporting.
For location-based Scope 2 GHG emissions, fallback emission factors are provided and explained above. Additionally, as the emission fac-
tors are derived from ecoinvent data, disclosure is not permitted. The applied location-based emission factors do not differentiate between
fossil and biogenic greenhouse gases, and non-CO₂ GHG emissions, including CH₄ and N₂O, are incorporated where available. These
factors are sourced from a third-party database, which considers all greenhouse gases except biogenic CO₂. Furthermore, no third-party
calculation tools were used in the preparation of location-based Scope 2 GHG emissions data, and therefore, there are no external refer-
ences or links to disclose regarding calculation tools. This approach ensures compliance with disclosure requirements while maintaining
methodological consistency and adherence to regulatory guidance.
Scope 3 emissions
RHI Magnesita reports indirect upstream and downstream emissions. Various approaches are used to calculate indirect emissions.
The following indirect emissions are excluded from reporting, as they remain below 5% of the Group’s Scope 1 emissions—RHI Magnesita’s
threshold for inclusion. The only exception is customers’ emissions that are not directly related to the use of RHI Magnesita’s products.
• Emissions from offices which are not part of operational sites and emissions from Group cars used offsite.
• Other purchased goods than purchased raw materials, trading goods, packaging and those used in capital goods (e.g. auxiliary
materials).
• Customer’s emissions
• Processing of sold products
• Downstream/upstream leased assets
Reporting boundaries: RHI Magnesita follows the operational control approach for consolidating data and accounts for GHG emissions or
removals from operations over which it has full year operational control in the respective reporting year. No calculation tools have been
used for this purpose.
Calculation methods for significant Scope 3 categories (exceeding 5% of the Group’s Scope 1 emissions):
Purchased goods and services: The indirect emissions from purchased goods and services consists of three main groups: purchased raw
materials, goods for resale and packaging. Indirect emissions of these groups are quantified by applying emission factors to the volumes of
purchased goods. For purchased raw materials emission factors are applied per raw material class. RHI Magnesita actively engages with
suppliers to use emission factors provided by suppliers. For resale goods and estimated emission factors are applied due to a lack of supplier
data. For packaging materials literature values are applied for calculating indirect GHG emissions. Emission factors are applied to actual
tonnages of consumed purchased goods.
The Group uses several sources for emission factors for purchased raw materials, prioritized in descending order:
1. Supplier provides emission factors of their raw materials which are then used for calculating the emission of the respective raw
material independently of the actual supplier.
2. In the case of purchased raw materials which the Group also produces on its own it uses the emission factor from own production,
if production settings are comparable (e.g., fuel use) or it adapts emission factors according to the assumed energy mix (e.g., coal
or electricity based on coal).
3. The emission factor is taken from literature or databases (e.g., ecoinvent).
4. Based on literature research and investigation the CO
2
emission factor is calculated reflecting the production process and as-
sumed energy sources of the supplier; or for other products with similar production method as products for which suppliers pro-
vided emission factors.
5. For raw materials for which none of the four approaches leads to a plausible emission factor the residual category “Others” is
created for which a generic emission factor of 1.8 tCO
2
per tonne of product is taken. The 1.8 t CO
2
were defined per expert judge-
ment as a plausible average value for refractory raw materials.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024138
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 139
Downstream and upstream transportation: For all transportation in the corporate ERP system all transport and distribution flows from origin
to destination are fully covered in the GHG calculation, independent if the actual transport activity was performed under the Group's man-
agement responsibility or customer or supplier management responsibility. Transport distances are sourced from publicly available routing
platforms. Literature-based CO
2
emission factors per tonne-kilometre are used to calculate transport-related GHG emissions. Transporta-
tion not covered by the corporate ERP system are extrapolated according to shipped volumes. For emissions related to transport third party
database emission factors are used.
Fuel and energy related activities: Emissions from fuel and energy related activities are calculated based on fuel-specific emission factors
and applied on fuel-specific energy consumption. For emissions related to fuel and energy related emissions, end of life treatment third
party database emission factors are used.
Use of sold products: Emissions from the use of sold products origin from two different sources: 1) emissions from organic additives in the
refractory product due to the high temperature during the use phase; 2) emissions from the heating up of refractory products at the cus-
tomer. Emissions from additives in refractories are calculated based on average organic content of certain refractory types and estimated
oxidation rates. Emissions from heating up of refractories at the customer are estimated based on representative energy consumption data.
Total emissions are calculated based on sales volumes of respective product groups.
Other Scope 3 categories:
Assumptions and methodologies
Emission factors for calculating indirect emissions from capital goods are based on literature values. For emissions related to packaging
materials, waste, and end-of-life treatment third-party database emission factors are used.
In the reporting period no significant changes in the definition of what constitutes the entity’s upstream value chain, downstream value
chain or reporting entity occurred.
139RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
140 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Retrospective
Milestones and target years
Base year
Comparative
(N-1) (N)
%
(N / N-1)
2018 2023  %2024/2023
2024
progress
against
base year (t
CO2/%)
2025T 2030T
Annual %
target /
Base year
Scope  GHG emissions
Gross Scope 1 GHG
emissions (tCO
2
eq) 2,528,000 2,176,200 ,, 3.8% (10.6)% 2,278,800 2,050,000 1.5%
Percentage of Scope 1 GHG
emissions from regulated
emission trading schemes
(%)
24% 28% %
Scope  GHG emissions
Gross location
-based
Scope 2 GHG emissions
(tCO
2
eq) 293,000 214,000 , 0.9% (26.3)%
Gross market
-based Scope
2 GHG emissions (tCO
2
eq) 239,000 115,000 , (13.9)% (58.6)% 128,900 94,000 0.8%
Significant scope  GHG
emissions
Total Gross indirect
(Scope
3) GHG emissions (tCO
2
eq)
5,021,000 3,692,000 ,, (3.2)% (28.8)%
1) Purchased goods and
services 3,510,000 2,405,000 ,, (5.4)% (35.2)%
there of purchase of
raw materials 3,350,000 2,216,000 ,, (7.1)% (38.6)% 2,340,900 1,811,000 2.0%
2) Capital goods 47,000 71,000
,.
(22.5)% 17.0%
3) Fuel and energy-
related Activities (not
included in Scope1 or
Scope 2) 463,000 344,000 , 5.8% (21.4)%
4) Upstream
transportation and
distribution
457,000 386,000 , (0.8)% (16.2)%
5) Waste generated in
operations 13,000 15,000 , 20.0% 38.5%
6) Business traveling 26,000 8,000 , 75.0% (46.2)%
7) Employee commuting 17,000 20,000 , 0.0% 17.6%
8) Upstream leased assets
-
-
9) Downstream
transportation 106,000 90,000 , (1.1)% (16.0)%
10) Processing of sold
products
-
-
11) Use of sold products 369,000 341,000 , 1.5% (6.2)%
12) End-of-life treatment
of sold products 6,000 5,000 , 0.0% (16.7)%
13) Downstream leased
assets
-
-
14) Franchises
-
-
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024140
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 141
) Investments , , 7,000 .% .%
Total GHG emissions
Total GHG emissions
(location
- based) (tCO

eq)
,, ,, 6,050,000
Total GHG emissions
(market
- based) (tCO

eq) ,, ,, 5,933,000 ,, ,, .%
Disaggregation of GHG emissions
Assumptions and methodologies
Scope 1 emissions are disaggregated into fuel-related emissions and process emissions. The biggest share of process emissions are geo-
genic emissions which result from the dissolution of carbonate minerals where CO
2
. A much smaller share of process emissions are emis-
sions from additives. The disaggregation excludes biogenic emissions.
Scope 


Fuel emissions (t CO

)
,, n.a.
Process emissions (t CO

)
,, n.a.
Percentage of Scope 1 GHG emissions from regulated emission trading scheme (%)
Assumptions and methodologies
Emissions from regulated emission trading schemes cover all emissions covered the EU ETS. Other emission trading schemes do not
cover Scope 1 emissions of RHI Magnesita.
Scope :






ETS covered emissions (t
CO

)
,
%
,
%
,
%
Not ETS covered
emissions (t CO

)
,,
%
,,
%
,,
%
Emissions from biogenic fuels and additives
Assumptions and methodologies
Emissions from biogenic fuels result from the use of charcoal, biofuels for mobile equipment and from biogenic additives to products
which oxidise during the production process to CO
2
.
E- a ARc


Direct emissions from biogenic fuels and organic additives (t CO

)
,
n.a.
Assumptions and methodologies
Indirect emissions from biogenic fuels is calculated based on Ecoinvent emission factors.
E-  AR  j


Indirect emissions from biogenic fuels (t CO

eq)
,
n.a.
Assumptions and methodologies
Purchased electricity which is not green electricity is categorised as 'None'. All green electricity which does not rely on unbundled at-
tribute claims is categorised as 'Default delivered electricity from the grid (e.g. standard product offering by an energy supplier), sup-
ported by energy attribute certificates'. Green electricity based on an unbundled guarantee of origin (e.g. IREC certificate) is categorised
as 'Unbundled attribute claims'.
141RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
142 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Percentage of contractual instruments, Scope 2 GHG emissions
2024
MWh %
None (no active purchases of low carbon electricity)
202,000
34%
Default delivered electricity from the grid (e.g. standard product offering by an energy supplier),
supported by energy attribute certificates
151,000
26%
Unbundled attribute claims
237,000 40%
Green electricity products from an energy supplier (e.g. green tariffs)
-
0%
Total
590,000
100%
Percentage of GHG scope 3 calculated using primary data
Assumptions and methodologies
Emissions are categorised as based on supplier data if emissions are either directly provided by supplier (e.g. business travel) or if relevant
information (e.g. emission factors) are provided by a supplier. For purchased raw materials all raw material related emissions are catego-
rised as based on supplier data if the used emission factor is from a supplier of the raw material class but not all raw materials considered
in a raw material class are from the providing supplier.
tCO
2
Scope 3
Share of
emissions
based on
supplier data
Share of Scope
3 category
among total
Scope 3
emissions
Upstream transportation and distribution
383,000
0%
11%
Downstream transportation and distribution
89,000 0% 2%
Employee commuting
20,000
0% 1%
Purchased goods and services
2,274,000 23% 64%
T
hereof purchased raw materials
2,058,000 25% 58%
Capital goods
55,000
0% 2%
Fuel
-and-energy-related activities
364,000 0% 10%
Waste generated in operations
18,000 0% 1%
Business travel
14,000
85% 0%
Use of sold products
344,000
0%
10%
End
-of-life treatment
5,000 0% 0%
Investment
7,000
0% 0%
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024142
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 143
Current and future financial resources allocated to action plan (OpEx)
Assumptions and methodologies
Additional cost for green electricity and R&D activities in direct relation to CO
2
emissions (e.g. R&D to increase share of secondary raw
material usage) are considered as relevant OpEx. Future financial resources are estimated based on relevant OpEx in 2024.
Green electricity:

T
Europe
,
,
SAM
,
,
China
,
,
R&D
,,
,,
Total
,,
,,
Current and future financial resources allocated to action plan
Assumptions and methodologies
The capex reported considers investments into increasing the Group's recycling rate and investments into CO
2
reduction measures such
as fuel switches or use of waste heat. Future financial resources are projected to remain at levels comparable to those in 2024.

T
CapEx (EUR)
,, n.a
OpEx (EUR)
,, ,,
Revenue from refractory products that enables decarbonisation in the customer industries (e.g. EAF; ESF; BOF; DRI)
Revenue (in EUR)


Revenue from refractory products that enables decarbonisation in the customer industries (e.g.
EAF; ESF; BOF; DRI)
n.a.
,,
The CO
2
KPI is the metric used to measure progress against the Group's 15% relative reduction target against a 2018 base year. In line with
the greenhouse gas protocol the metric is adjusted to reflect changes in the operational footprint due to mergers and acquisitions as well
as divestments. As a result, the metric does not show the impact of mergers and acquisitions and divestments on the GHG-intensity of the
Group. The KPI considers only energy consumed directly by the Group. The denominator of the KPI are tonnes of shipped products ex-
cluding resale and sale of raw materials with very low GHG-intensity (raw magnesite and dolomite). The shipped volumes are corrected by
inventory changes of finished goods and GHG-intensive raw materials produced by RHI Magnesita. The metric is not externally verified.
The target did not undergo any significant change in methodology.
The KPI reflects RHI Magnesita's policy commitment to tackle climate change. The target is not a science-based target, and external stake-
holders have not been consulted. The target is based on a bottom-up approach with clearly identified CO
2
reduction levers.
GHG intensity per net revenue
GHG intensity per net revenue


% N / N-
Total GHG emissions (location
-based) per net revenue (tCO

eq/Monetary unit) . . .%
Total GHG emissions
(market-based) per net revenue (tCO

eq/Monetary unit) . . .%
Connectivity of energy intensity based on net revenue with financial reporting information
Connectivity of energy intensity based on net revenue with financial reporting information

Net revenue used to calculate GHG intensity
,,,
Disclosure requirement E1-7 – GHG removals and GHG mitigation projects financed through carbon credits
The Group has significant CO
2
emissions within its own value chain and there are large emissions savings that can be delivered for its
customers through improved solutions contracts or other solutions. The Board therefore considers that the priority should be to allocate
capital and other resources to reducing the Group’s own CO
2
footprint and the emissions of its customers rather than investing in carbon
offset projects. The Board believes that taking this approach will deliver a faster, greater and more sustainable decrease in net CO
2
emissions
than could be delivered by allocating capital to offsets.
143RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
144 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Disclosure requirement E1-8 – Internal carbon pricing
RHI Magnesita has conducted a thorough evaluation of the implicit carbon pricing approach as a potential element of its sustainability
strategy. While recognising the value of such a mechanism, the Group has opted not to proceed with its adoption at this stage due to the
significant complexity involved in implementation. However, RHI Magnesita remains committed to revisiting this approach as it closely
monitors the evolution of emissions trading schemes and regulatory developments in the countries where it operates. Following this pro-
active approach, the Group remains well-positioned to adapt its strategy to align with emerging sustainability and market requirements.
Disclosure requirement E1-9 – Anticipated financial effects from material physical and transition risks and potential climate-related
opportunities
The anticipated financial effects from material transition risks and potential climate related opportunities are presented on table of climate-
related risks and opportunities on pages 122-125. There are no material physical risks.
ESRS E2 Pollution
ESRS 2 General disclosures
Impact, risk and opportunity management
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material pollution-related
impacts, risks and opportunities
As part of the materiality assessment, the impacts, risks, and opportunities associated with pollution of RHI Magnesita’s production sites
were assessed in addition to operational environmental permit requirements. The environmental permit and the related programme for
monitoring emissions and impacts set the minimum requirements for the observation of environmental impacts. This holistic approach
supports the identification and prioritisation of material topics relevant to RHI Magnesita. The DMA is described on pages 100-102.
As a result, RHI Magnesita has identified that in addition to GHG emissions, RHI Magnesita’s production generates other emissions to air
and can have a negative impact on health and environment. Most of these emissions arise from industrial processes involved in raw material
preparation and refractory production.
Emissions from sources other than RHI Magnesita production sites are not included in the pollution screening. The assessment is based on
emission thresholds defined by the European Pollutant Release and Transfer Register (EC No. 166/2006) and focuses on actual pollution
related to the nature of the IRO. Upstream and downstream value chain emissions were not assessed; however, given that both involve
high-temperature processes, similar pollution impacts are expected.
RHI Magnesita adopts a compliance-driven approach to pollution management, ensuring that all operations meet or exceed the strict
environmental regulations in place. By adhering to enforceable legal standards, such as emission limits and monitoring obligations, the
Group ensures responsible management of pollutants, Production sites are required to record and report their emissions for various param-
eters into the Group's environmental ERP system, ensuring a comprehensive corporate overview of relevant pollutants. Communities were
not consulted for this specific analysis.
Disclosure requirement E2-1 – Policies related to pollution
Policies are formulated with key stakeholder interests in mind and align with the ISO and other internationally recognized standards.
Through its Integrated Management System (“IMS”) policy, RHI Magnesita is committed to minimising emissions—including both direct
and indirect CO
2
as well as other greenhouse gases—along with reducing pollution and the release of harmful substances. This effort
extends across its operations and applications at customer sites, aiming to mitigate potential negative impacts on human health, and the
environment. This policy underscores the Group's dedication to reducing the environmental impact of its activities to the extent that is
technically and economically feasible.
Based on RHI Magnesita's DMA, substances of concern and substances of very high concern are not considered to have material impacts,
risks, or opportunities for the Group. Consequently, there is no stand-alone policy addressing these substances. While the IMS policy
commits to minimising pollution, it does not explicitly include provisions for incidents and emergency situations.
The scope of the IMS policy encompasses RHI Magnesita’s direct operations as well as activities at customer sites. The CTO holds the
highest level of accountability for the policy's implementation within the organisation. The Group’s current policy does not yet fully align
with all ESRS disclosure requirements. An update is underway to ensure compliance and comprehensive reporting.
The IMS policy is integrated into the governance framework of the Group’s ISO-certified management systems and is publicly available on
the RHI Magnesita website.
Business partners (upstream and downstream) are expected to adhere to the RHI Magnesita’s Code of Conduct and Supplier Code of Con-
duct.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024144
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 145
Disclosure requirement E2-2 – Actions and resources related to pollution
The Group adheres to all legal requirements regarding pollution control and proactively takes measures to ensure compliance. In 2024,
several targeted initiatives were implemented to reduce air pollution across the Group's global core operations.
The reported actions, all completed within the reporting year, focused primarily on mitigating dust emissions, with a particular emphasis
on minimising occupational exposure risks. These measures reflect the Group’s ongoing commitment to safeguarding health and main-
taining environmental standards.
To support these efforts, the Group allocated approximately €2.9 million in capital expenditures (CapEx) towards pollution control initia-
tives during the reporting period. Future financial resources are projected to remain at levels comparable to those in 2024.
Metrics and targets
Disclosure requirement E2-3 – Targets related to pollution
The Group has not established specific pollution-related targets, as it adheres to a compliance-driven approach. Air pollution across its
operations is subject to stringent regulatory requirements, including enforceable emission limits and mandatory monitoring obligations.
By prioritising full adherence to these legal standards, the Group ensures that emissions remain within permissible levels and that the
effectiveness of its policies and actions is consistently monitored and maintained.
Disclosure requirement E2-4 – Pollution of air, water and soil
Soil and water pollution were assessed as part of RHI Magnesita’s double materiality evaluation and were deemed immaterial to the Group’s
value chain. The assessment considered the nature of industrial processes, mining activities, existing environmental controls, and regula-
tory compliance measures, which mitigate significant risks in these areas. As a result, no material impacts, risks, or opportunities were iden-
tified related to soil and water pollution.
Main emissions to air from the production of refractory and refractory raw materials are NOx and Sox emissions. Other pollutants relevant
for certain sites are carbon monoxide (CO) and mercury (Hg). Additionally, emissions from Hydrofluorocarbons (HFCs) from air conditioning
are relevant at certain sites. Mercury and carbon monoxide emission levels are reported; however, E2-5 pollutants of high concern are not
material, as the products do not contain these pollutants.
RHI Magnesita has implemented significant actions in recent years to reduce its NOx emissions across key regions. These efforts have led
to a 43% reduction in China, a 38% reduction in North America, and a 14% reduction in Europe, (compared to 2018), resulting in an overall
substantial decrease in NOx emissions. SOx emissions also reduced over time through investment into SOx abatement technologies. Mer-
cury exceeds the reporting threshold in two sites. The unabated emissions result from hard coal or pet coke used as a fuel and show little
variation over time. CO emissions typically occur at the heating up and shut down of kilns when incomplete combustion occurs. Emissions
are quite stable over time. HFC emissions are monitored in 2024 for the first year, therefore no changes over time observed.
Pollution-related data is collected annually or for very few sites monthly via the Group environmental ERP-system. Depending on the
pollutant required information are pollutant-concentration in off gas and off gas volumes, consumption of HFCs.
Disclosure requirement E2-5 – Metrics and targets
Air pollutants methodology at RHI Magnesita
RHI Magnesita systematically monitors key air pollutants, including nitrogen oxides (NOx), sulfur oxides (SOx), carbon monoxide (CO), hy-
drofluorocarbons (HFCs), and mercury (Hg). While NOx, SOx, and CO emissions primarily result from combustion processes, mercury emis-
sions originate from its presence in certain raw materials and coal used as fuel.
Given its global operations, RHI Magnesita adheres to local regulatory standards for air pollutant monitoring. Sites in Europe comply with
EN standards, while the U.S. facility follows EPA reference methods, integrating both continuous and periodic stack testing. In China and
India, sites align with national air quality regulations, while Brazilian operations adhere to CONAMA standards, utilizing monitoring instru-
ments and methodologies comparable to those in Europe and the U.S.
Emissions are measured from off-gases of relevant production units, either continuously or on a spot basis, as specified by environmental
permits that define monitoring locations, frequency, and methodologies. Total emissions are calculated based on pollutant concentration
per cubic meter of off-gas and total annual off-gas volumes. While continuous monitoring provides real-time data, spot measurements
may fail to capture extraordinary off-gas conditions, potentially leading to under- or overestimation of emissions.
For HFC emissions, direct measurement is not feasible; instead, mass balance calculations ensure a more accurate and reliable estimation
compared to online analyzers. HFCs, commonly used in air conditioning, are accounted for by tracking all inputs and outputs, minimizing
measurement uncertainties. Where historical data is incomplete, HFC emissions are estimated based on production volumes, maintaining
consistency in reporting. RHI Magnesita follows the recommended approach for both equipment manufacturers and users who maintain
their own equipment, estimating HFC emissions based on the quantity of refrigerant purchased and used, in accordance with the GHG
145RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
146 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Protocol. This “Sales-Based Approach” requires data that should be available from entity purchase and service records, and tracks emis-
sions from equipment manufacturing (producers) or installation (users), operation, servicing, and disposal.
NOx emissions
t NOx

India

China

North America
,
South America
,
Europe
,
Total
,
SOx emissions
t SOx

India

China

North America

South America

Europe

Total
,
Other air pollutants emissions
t Other air pollutants

CO
,
HFC
.
Hg
.
HCl

Total
,
Disclosure requirement E2-6 – Anticipated financial effects from pollution-related risks and opportunities
The Group omits information prescribed by ESRS E2-6 – except paragraph 40b. The Group did not have any major pollution-related
incidents and deposits are only relevant for pollution of soil which is not material for the Group.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024146
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 147
ESRS E3 Water and marine resources
ESRS 2 General disclosures
As part of its DMA, RHI Magnesita conducted a thorough evaluation of its operations, upstream and downstream value chain, and sector-
specific context to identify water-related impacts, risks, and opportunities. This assessment was guided by RHI Magnesita’s global sustain-
ability team, alongside subject matter experts in health, safety, and environmental management.
Impact, risk and opportunity management
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material water and marine
resources-related impacts, risks and opportunities
Water usage in refractory manufacturing
The refractory industry primarily relies on raw materials, energy, and heat, with minimal water dependency. While certain processes such
as mixing, forming, cooling, and dust suppression require water, overall consumption remains significantly lower than in water-intensive
industries like agriculture or textiles.
Water consumption within RHI Magnesita’s operations is primarily associated with process cooling, including applications in the Rotary
Kiln, Venturi Scrubber, and Flotation systems. Additionally, water is utilised for laboratory and sanitation purposes, such as in toilets, showers,
and water coolers. Another key area of water use is dust suppression, which helps control airborne particulates in mining and production
activities, ensuring compliance with environmental standards and workplace safety regulations.
Assessment of water impact in RHI Magnesita’s value chain
RHI Magnesita has evaluated water pollution risks across its production processes and mining activities, recognising that regional and na-
tional regulations significantly influence the extent of water-related risks.
To ensure compliance with local laws and to proactively conserve resources, RHI Magnesita has conducted a water scarcity risk assessment
using the WWF Water Risk Filter, which helps identify and mitigate potential vulnerabilities.
Additionally, RHI Magnesita has an established water management approach, which includes internal measures to enhance sustainable
water use, incorporating best practices for monitoring, conservation, recycling and responsible water discharge.
Water withdrawal is monitored through the installation of water meters at usage units, with monthly readings conducted to track consump-
tion trends. Conservation measures include the implementation of water efficiency measures such regular inspections key consuming fa-
cilities and maintenance to prevent leaks and awareness campaigns to promote water-saving behaviours. To further optimize water use,
RHI Magnesita implements recycling and reuse initiatives, including the utilisation of drained underground water for beneficiation pro-
cesses and dust suppression, internal recycling in rotary kiln cooling and gas scrubbers, and rainwater harvesting from mine pits for storage
and future use. Wastewater management practices involve the establishment of rainwater harvesting pits for groundwater recharge, con-
nections to sewage treatment plants (“STPs”) and effluent treatment plants (“ETPs”) where applicable, and the use of soak pits in limited
cases. These measures collectively contribute to the sustainable management of RHI Magnesita’s water sources and consumption across
its operations.
RHI Magnesita sources its water from multiple channels, including tap water purchased from municipal utilities, groundwater extracted
from borewells and mine pits, and surface water supplied by industrial partners.
Water risk management in the supply chain
RHI Magnesita actively monitors water-related risks in its upstream supply chain, with a particular focus on raw material mining. Environ-
mental compliance of suppliers is assessed through desk-based risk evaluations and on-site audits. To date, no significant water shortages
or related risks have been identified in supplier operations.
Communities were not directly consulted in the identification of material impacts, risks, and opportunities, as RHI Magnesita maintains close
relationships with key communities through dedicated personnel at various sites. This ongoing engagement provides a comprehensive
understanding of community priorities, enabling the Group to effectively align its initiatives with local needs.
Conclusion
Given the refractory industry’s low water dependency, RHI Magnesita has determined that water-related concerns do not constitute a ma-
terial ESG issue. Following ESRS methodology for scale, scope and remediability, the overall impact score at 4 - below the materiality
threshold of 5 - confirming that water is a non-material ESG factor for RHI Magnesita. Comparative benchmarking with water-intensive
industries reinforced this conclusion.
However, the Group remains committed to ongoing monitoring, compliance, and best practices in water management, ensuring that po-
tential risks are minimised.
147RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
148 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
ESRS E4 Biodiversity and ecosystems
ESRS 2 General disclosures
As part of its DMA, RHI Magnesita has conducted an evaluation of its biodiversity-related impacts, dependencies, risks, and opportunities.
The assessment included key mining sites located in Austria (3), China (1), USA (1), Brazil (1), and Türkiye (1). Mining activities, including land
degradation, blasting, and land use, were assessed for their impact on biodiversity, while also considering potential positive contributions.
Impact, risk and opportunity management
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material biodiversity and
ecosystems-related impacts, risks and opportunities
Contribution to direct impact drivers on biodiversity loss
RHI Magnesita acknowledges that raw material extraction may contribute to biodiversity loss through land-use change and pollution. The
following mitigating measures are in place:
The Group’s mining operations occupy a small environmental footprint, with some sites utilising underground mining to reduce surface
disruption. In 2024, no additional land area was occupied by RHI Magnesita’s mines, while in 2023, land use increased by only 3%, with
rehabilitation efforts conducted in line with local regulations.
RHI Magnesita enforces stringent environmental controls to mitigate pollution from dust emissions and wastewater discharge. The raw
materials extracted are non-hazardous and do not produce acid waste runoff or significant tailings.
The Group’s activities do not introduce invasive alien species or exploit biodiversity beyond standard mineral extraction processes.
Given the refractory industry’s low water dependency, biodiversity risks associated with water use are deemed immaterial. Practices in water
management are described in ESRS E3 IRO-1.
Impacts on species and ecosystems
RHI Magnesita’s operations do not significantly affect species population size or global extinction risks. The RHI Magnesita’s approach to
mining, primarily in long-established sites, ensures that most biodiversity disturbances occurred at the initial development stage rather
than through ongoing operations. Rehabilitation programmes further mitigate residual impacts.
Additionally, RHI Magnesita’s operations do not heavily depend on ecosystem services such as pollination, water purification, or carbon
sequestration. The primary dependency remains on raw mineral extraction.
Biodiversity materiality assessment approach
RHI Magnesita conducted a biodiversity risk screening using the WWF Biodiversity Risk Filter. This analysis identified four primary drivers
of biodiversity loss relevant to the RHI Magnesita’s operations: climate change, pollution, land and water use change, and tree cover loss.
The screening highlighted water scarcity and extreme heat as potential dependencies at certain locations but did not indicate direct expo-
sure to systemic biodiversity risks.
While some mining sites are located near biodiversity-sensitive areas, the RHI Magnesita does not anticipate negative effects. This is sup-
ported by the fact that most mining sites have no specific legal requirements related to protected areas within their operating licences.
Only one site has designated maintenance duties for protected areas, which are regularly fulfilled. Additionally, RHI Magnesita consistently
undertakes land rehabilitation initiatives across its mining operations to mitigate biodiversity-related risks.
RHI Magnesita recognises the interconnection between biodiversity risks and climate risks, particularly in the context of its mining and
production operations. The Group’s latest physical climate risk assessment, conducted in 2023 and refined in 2024, has provided valuable
insights into the vulnerability of certain operational sites to chronic and acute climate hazards, such as temperature fluctuations, heat stress,
soil erosion, and flooding. These climate-related factors can indirectly influence biodiversity by altering ecosystems, disrupting natural
habitats, and impacting soil and water quality. However, the findings indicate that the Group’s overall exposure to physical climate risks
remains limited, primarily due to two key factors: the lack of immediate threats at most flagged sites and the Group’s proactive risk man-
agement approach. For details, see E1 Climate Change – Climate-related physical risks.
Despite approximately 42% of raw materials being sourced from its own mines, RHI Magnesita’s DMA found that the land-use change
impact does not meet the materiality threshold. The assessment assigned a ‘Scale’ score of 5, a ‘Scope’ score of 3, and a ‘Remediability’
score of 5, resulting in an average score of 4.33, which falls below the threshold for materiality. Consequently, while land-use change is
acknowledged as a contributing factor, it does not constitute a significant material impact within the RHI Magnesita’s operational framework.
Biodiversity risk management in the supply chain
RHI Magnesita actively assesses biodiversity-related risks within its supply chain, particularly regarding raw material procurement. Supplier
compliance is monitored through risk evaluations and on-site audits. To date, only one supplier has been identified as a potential
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024148
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 149
environmental risk, with further assessments planned for 2025 to confirm any biodiversity-related concerns. However, given the RHI Mag-
nesita’s stringent supplier standards and the nature of procured materials, overall biodiversity risks are assessed as limited.
Stakeholder considerations and Management conclusion
External stakeholders indicated that biodiversity is a high priority for them, but RHI Magnesita’s management determined that RHI Magne-
sita’s operational footprint and biodiversity impact profile did not meet the materiality threshold compared to other sustainability impacts,
risks and opportunities. Communities were not consulted for this specific analysis.
Management’s conclusion is based on a thorough assessment of RHI Magnesita’s mining activities, which demonstrate a limited and con-
trolled nature of change in land-use annually. RHI Magnesita’s mineral extraction operations are primarily confined to existing, long-estab-
lished mining sites, with minimal expansion and a strong focus on land rehabilitation. Additionally, there are no inherent biodiversity risks
beyond localised land-use effects, as the RHI Magnesita’s mining processes do not involve hazardous materials, invasive species, or signif-
icant ecosystem dependencies. Furthermore, RHI Magnesita remains committed to mitigating environmental impacts through strict adher-
ence to regulatory requirements and proactive rehabilitation measures. It has not been concluded whether biodiversity mitigation
measures, as outlined in relevant EU directives or international standards, are necessary.
ESRS E5 Resource use and circular economy
ESRS 2 General disclosures
Impact, risk and opportunity management
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material resource use and
circular economy-related impacts, risks and opportunities
As part of the materiality assessment, the impacts, risks, and opportunities associated with resource use and circular economy were as-
sessed considering that recycling is a multi-faceted element of Group strategy since it benefits our business model in several ways. There
are clear sustainability benefits from reducing our environment impact whilst assisting our customers with reducing landfill waste and
promoting the circular economy within the industry sector. The DMA is described on pages 100-102.
For the assessment, the impact of efficient use of raw materials and resources including the use of recycled materials affects mainly up-
stream and RHI Magnesita’s core operations. Communities were not directly consulted in the identification of material impacts, risks, and
opportunities, as RHI Magnesita maintains close relationships with key communities through dedicated personnel at various sites. This
ongoing engagement provides a comprehensive understanding of community priorities, enabling the Group to effectively align its initia-
tives with local needs.
Furthermore, RHI Magnesita’s DMA followed a data-driven approach, integrating impact risks and opportunities (IROs) across the value
chain. Insights industry benchmarks, and expert consultations informed the evaluation, with key stakeholders validating the findings.
RHI Magnesita maintains its industry leadership in utilising recycled minerals and recycling has been the major reduction lever to achieve
the Group’s CO
2
emissions reductions target. The reuse of one tonne of recycled refractory material prevents approximately 1.6 tonnes of
CO₂ emissions compared to virgin raw materials, making recycling the most effective short-term lever to achieve the Group’s 2025 emis-
sions intensity target. Beyond emissions reduction, recycling supports waste management and the circular economy for customers. While
refractory recycling was historically limited by lower performance levels of reclaimed materials, RHI Magnesita has successfully demon-
strated through innovative processes and operational examples that recycled materials can now be used without compromising perfor-
mance.
The 2024 Recycling Rate reached 14.2% which is on track to achieve 2025 Target as of 15%. By year-end, RHI Magnesita plants had con-
sumed 268 kt of recycled materials and sold 96 kt of metallurgical additives, marking a 30% volume increase compared to 2023. This led
to €36 million in raw material cost savings for refractory finished goods and a reduction of 310 kt in CO₂ emissions.
Disclosure requirement E5-1 – Policies related to resource use and circular economy
Through its IMS policy, RHI Magnesita strives to increase the usage of recycled materials and promote and develop the circular economy
wherever possible. This effort extends across its operations and applications at customer sites, aiming to mitigate potential negative impacts
on the environment. This policy underscores the Group's dedication to reducing the environmental impact of its activities to the extent that
is technically and economically feasible. The Group's IMS policy is globally applicable and does not specifically address or exclude stake-
holder groups.
The scope of the IMS policy encompasses RHI Magnesita’s direct operations as well as activities at customer sites, but it does not extend to
the upstream and other downstream stages of RHI Magnesita’s value chain. The CTO holds the highest level of accountability for the pol-
icy's implementation within the organisation.
No third-party standards or initiatives are respected through implementation of the policy. For setting the policy, the Group did not consult
with external stakeholders. The IMS policy is integrated into the governance framework of the Group’s ISO-certified management systems
and is publicly available on the RHI Magnesita website.
149RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
150 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
The Group has a global sourcing guideline for recycling, which aims to provide guidance on purchasing of spent refractories and indicates
the recyclability of spent refractories of different industries. This guideline applies to all global regions and all the personnel involved in
the purchasing process of spent refractories.
Disclosure requirement E5-2 – Actions and resources related to resource use and circular economy
The Group has taken substantial steps to enhance its use of circular raw materials, aligning with its commitment to resource efficiency and
circular economy principles. In 2024, the Group invested approximately €3.9 million to expand processing, sorting, and storage capacities
at recycling sites. These investments are aimed at increasing the integration of secondary raw materials into production processes. Addi-
tionally, €2.3 million was allocated to research and development (R&D) initiatives focused on improving recycling methods and product
formulations to accommodate a higher share of circular materials. Future financial resources are projected to remain at levels comparable
to those in 2024.
The Group anticipates maintaining similar levels of spending in the future to sustain its progress in this area. Key actions include advancing
R&D to refine product recipes and investing in internal recycling operations to ensure efficient processing of circular raw materials. Since
2018, these efforts have enabled a consistent increase in the share of circular raw materials used, driven by the continuous development
of recycling capacities, R&D advancements, and strategic sales initiatives.
Recycling
To strengthen our commitment to resource efficiency and circular economy principles, the Group prioritises recycling activities as a key
component of its sustainability strategy. This involves implementing waste management systems, optimising the recovery of materials from
production processes, and ensuring the reintegration of recycled content into new products. Furthermore, the Group actively collaborates
with stakeholders across the value chain to drive resource efficiency, minimising landfill dependency, and advance cutting-edge recycling
technologies. These efforts not only reduce our environmental footprint but also support regulatory compliance and deliver long-term
operational cost efficiencies.
2024 highlights in recycling initiatives
In 2024, the Group implemented a series of targeted technological and processing initiatives, resulting in a significant increase in recycling
volumes — approximately 10,000 tonnes across regions and product lines. Key achievements include:
• Utilisation of MagCarbon leftovers: The integration of MagCarbon leftovers into raw material production processes resulted in a
notable increase of 2,600 tonnes of recycled material in Europe.
• Development of MGG brand with 50% of recycling rate: this milestone, achieved in China, added 970 tonnes of recycled material
to 2024 volumes.
• Enhanced recycling rate in MU: By increasing the recycling rate from 5% to 10% in Europe, the initiative contributed an additional
800 tonnes to overall recycling efforts
• Expansion of recycling in MU: Focused efforts in South America led to the integration of 1,390 tonnes of recycled material, sig-
nificantly advancing sustainability outcomes in the region.
RHI Magnesita is committed to advancing its recycling initiatives through both organic growth and strategic acquisitions to achieve its 2030
target of a 20% recycling rate. As part of this strategy, the Group plans to expand its recycling capabilities beyond Europe through targeted
acquisitions. While these efforts are centred on core operations, they will also impact upstream suppliers, as RHI Magnesita aims to reduce
dependency on purchased raw materials by increasing the use of secondary raw materials.
Metrics and targets
Disclosure requirement E5-3 – Targets related to resource use and circular economy
RHI Magnesita has established ambitious targets to enhance resource efficiency and circular economy efforts, focusing on increasing re-
cycling and reducing waste. The Group aims to increase the share of secondary raw materials in its products, targeting 15% by 2025 and
20% by 2030, reinforcing its commitment to integrating circular materials into production and minimising primary raw material use. This
is a relative target.
These targets apply to refractory and metallurgical product operations, covering upstream and downstream value chains within relevant
geographical boundaries. The focus on secondary raw materials directly supports the waste hierarchy’s recycling layer.
The targets are voluntary and were set in 2018, when the recycling rate was below 4%. The 15% target for 2025 serves as an interim mile-
stone toward 2030. Key considerations include recycling availability, market growth, and supply chain integration, but the targets are not
based on scientific evidence, and stakeholders were not involved in the target-setting process.
These commitments reflect RHI Magnesita’s long-term vision for sustainable resource management, contributing to reduced environmen-
tal impact while fostering innovation in recycling and waste management practices. The target metric has remained unchanged since its
introduction, ensuring consistency in measuring progress.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024150
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 151
Disclosure requirement E5-4 – Resource inflows
A substantial portion of the Group’s inflow consists of purchased raw materials used in refractory production, which often involve energy-
and CO
2
-intensive processing. Therefore, increasing the use of circular raw materials is a critical focus for addressing the environmental
impacts associated with resource inflows.
Refractory products cannot be reused, only recycled; therefore, overlapping categories of reuse and recycling are not applicable.
Material inflow data is primarily sourced from direct measurements, ensuring accuracy. Only very small auxiliary material items are occa-
sionally estimated, excluding production plants not covered by the ERP system, which is already disclosed as an estimate.
The main material inflows include purchased raw materials, auxiliary materials, resale items, packaging, and water. These are calculated
based on direct measurements, with minor estimations applied only when necessary.
In 2024, the total resource inflow amounted to approximately 12.3 million tonnes. Of this, around 0.5% (60,000 tonnes) was biological
material. Due to the low share of biological materials in the Group’s overall resource inflow, sustainably sourced biological materials are not
a significant component of the Group's material portfolio. All metrics are not validated by an external body.
A notable achievement in 2024 was the utilisation of 202,000 tonnes of secondary raw materials in production, representing 1.6% of total
material inflows. This demonstrates the Group’s ongoing efforts to integrate circular raw materials into its operations, thereby reducing
reliance on primary raw materials with higher environmental impacts.
The biggest share of inflow is water. In 2024 the inflow of water was around 10 million m resulting in around 80% of total material inflow.
Of these the biggest share is water from its mining operations.
To ensure accurate tracking and reporting, material inflows are recorded in the Group’s enterprise resource planning ERP system and in its
environmental IT system. For production plants not covered by the central ERP system, material volumes are estimated based on finished
goods production. The reported figures exclude inflows for capital expenditure projects and own-mined raw materials, while double count-
ing is prevented by employing a distinct recycling classification within the ERP system.
Resource inflow
Assumptions and Methodology
The Group captures in its enterprise resource planning tool the actual material inflows. Water inflow is measured on plant level and re-
ported via environmental IT system. Material inflow considers purchased raw materials, trading goods, packaging, spare parts, and auxil-
iary materials and water, excluding own-mined raw materials, and material inflow for capex projects. For plants not considered in the cen-
tral enterprise resource planning tool, volumes are estimated based on finished goods production volumes.
E- //

Resource inflows (tonnes)
.
Percentage of biological materials (ROHF/ROHS)
.%
Percentage of secondary raw materials
.%
Financial resources (Capex)
Assumptions and Methodology
The capex reported considers investments into increasing the Group's recycling rate excluding maintenance capex of recycling operations.

Recycling
Capex in € ,,







Use of
Secondary
raw
materials
(%)
.% .% .% .% .% .% .%
151RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
152 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Assumptions and Methodology
The recycling rate represents the total usage of circular raw materials—such as external recycling, by-products, and obsolete inven-
tory—in the production of refractory finished goods and metallurgical products.







Recycling
quantity
(tonnes)
, , , , , , ,
CO

savings due
to recycling
(tonnes)
, , , , , , ,
Disclosure requirement E5-6 – Anticipated financial effects from resource use and circular economy-related impacts, risks and
opportunities
The Group omits information prescribed by ESRS E5-6.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024152
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 153
Social information
ESRS S1 Own workforce
ESRS 2 General disclosures
RHI Magnesita has identified impacts, risks, and opportunities related to its own workforce through RHI Magnesita’s DMA. Details of the
Materiality Assessment can be found on pages 100-102 of this report.
Strategy
Disclosure requirement related to ESRS 2 SBM-2 – Interests and views of stakeholders
RHI Magnesita is committed to creating sustainable and shared value for its stakeholders. Engaging with stakeholders and diverse social
groups enhances mutual comprehension and supports RHI Magnesita's ability to anticipate risks and identify opportunities for value crea-
tion and deliver key aspects of the Group's strategy and sustainability approach. Read more about RHI Magnesita Stakeholder Engagement
Approach on pages 26-31 of Annual Report.
Disclosure requirement related to ESRS 2 SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and
business model
Health and safety
Maintaining a safe and healthy workplace is fundamental to RHI Magnesita’s culture and mindset. The Group assigns the highest im-
portance to the health and safety of its employees and contractors. Our operations by necessity involve hazardous and higher risk activities
and maintaining high safety standards is a minimum expectation for all stakeholders.
The Group identifies and monitors its impact on own employees and contractors according to the same safety policies and standards,
aligned with ISO 45001 and Code of Conduct.
Health and safety have been identified as a material topic for RHI Magnesita under both dimensions of the DMA – Impact Materiality and
Financial Materiality. Given the inherent risks associated with its high-risk activities and the significant impact on individuals, ensuring the
health and safety of employees and contractors is not only a moral and legal responsibility but also a critical factor in maintaining opera-
tional continuity and productivity. Accidents, injuries, or health incidents can lead to downtime, legal liabilities, reputational damage, and
a decline in workforce morale. By prioritising health and safety, RHI Magnesita demonstrates its commitment to responsible operations,
aligns with stakeholder expectations, and builds trust, ultimately contributing to its long-term business continuity.
Impact, risk and opportunity management
Disclosure requirement S1-1 – Policies related to own workforce
Policies
RHI Magnesita’s Health and Safety policy is aligned with ISO 45001 covering own operations and contractors. The policy outlines RHI
Magnesita’s commitment to act proactively to prevent occupational health and safety risks, and we will continuously improve our health
and safety management systems and performance.
RHI Magnesita’s Health and Safety Policy and procedures ensure comprehensive protection for groups at risk, integrating them into existing
workplace safety measures. Temporary workers are fully covered under the Group’s Health and Safety Management System, ensuring they
receive the same protections as permanent employees. Additionally, young and inexperienced workers are subject to work limitations, pre-
venting them from engaging in high-risk activities without proper supervision and experience. All hazardous tasks undergo a thorough risk
assessment before execution, ensuring that safety controls are in place to minimise exposure to potential risks.
Policies supporting workforce engagement
RHI Magnesita’s policies establish a strong foundation for workforce engagement:
• Anti-Discrimination and Anti-Harassment Policy: aims to ensure the working environment is free from discrimination,
and any forms of harassment. It encourages reporting of discrimination and harassment through multiple confidential
channels, including HR, managers, and the Whistleblowing hotline.
• Speak Up Policy: offers employees confidential and anonymous avenues to report misconduct via web portals, dedi-
cated phone lines, or direct contact with the Internal Audit, Risk & Compliance (“IARC”) team.
• Global Gender Equality Policy: ensures fair and inclusive treatment in the workplace regardless of age, gender, marital
or civil partnership status, pregnancy, maternity, family responsibilities, political beliefs, nationality, ethnicity, religion,
disability, sexual orientation, or gender identity. This policy plays a crucial role in fostering a diverse workforce and pro-
moting an inclusive corporate culture.
Aligned with our Code of Conduct and complementary policies, including the Global Anti-Harassment Policy, the Global Gender Equality
Policy establishes clear expectations for behaviour and interactions at all levels of the organisation. By integrating these principles into our
corporate framework, RHI Magnesita reaffirms its commitment to fostering an inclusive, equitable, and respectful workplace. The policy
153RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
154 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
applies to all individuals associated with the Group, including Board members, consultants, volunteers, contractors, trustees, candidates,
and interns.
RHI Magnesita ensures compliance and transparency through policy commitments, internal controls, supplier due diligence, and the an-
nual Modern Slavery Act (“MSA”) statement, which reports progress and is publicly available on the Group’s website.
The Code of Conduct, signed by EMT members and Regional Presidents, along with the Human Rights policy, applies to all directors,
managers, employees—regardless of position or contract type—and third parties working on behalf of or at RHI Magnesita premises.
The CEO is the most senior executive responsible for policy implementation. Policies are formulated with key stakeholder interests in mind
and align with the UN Guiding Principles on Business and Human Rights and other internationally recognized standards.
All the aforementioned policies are available on the Group’s website and apply to RHI Magnesita’s workforce. The Health and Safety
Policy extends further, covering both employees and contractors.
Disclosure requirement S1-2 – Processes for engaging with own workforce and workers’ representatives about impacts
RHI Magnesita is steadfast in its commitment to cultivating a transparent, inclusive and accountable workplace by actively engaging its
workforce and workers’ representatives to address actual and potential impacts. This commitment is underpinned by robust engagement
mechanisms, comprehensive policies, and global initiatives that prioritise workforce perspectives in decision-making processes.
Engagement takes place directly with employees and through workers' representatives, including the Works Council, in certain countries,
ensuring representation at all organisational levels.
The Global Engagement Team oversees the implementation of engagement processes, developing a global leadership framework while
enabling localised adaptations to ensure inclusivity and relevance. Engagement is conducted regularly through diverse channels, such as
quarterly Works Council meetings, regional initiatives like shop-floor discussions, and global campaigns including Disability Day and In-
ternational Women’s Day.
Digital platforms such as Workvivo and mentoring programmes involving three Board members facilitate direct leadership interaction and
enhance workforce engagement.
Commitments under the Stakeholder Dialogue Policy, Speak Up Policy and Human Rights Policy are upheld, ensuring workforce rights and
perspectives are respected. In Brazil, for instance, union collaborations enhance engagement and inclusiveness.
Engagement effectiveness is assessed through feedback from Works Council meetings, whistleblowing channels, and employee partici-
pation in diversity and inclusion initiatives. These processes lead to outcomes such as improved workplace policies and targeted action
plans.
The EVP for People, Projects, Integrations, and Recycling drives strategic priorities across workforce development, project execution, busi-
ness integrations, and recycling. The Global Engagement Team ensures effective stakeholder engagement, aligning initiatives with corpo-
rate goals. The most senior operational leader, typically the EVP, ensures engagement outcomes inform strategy, shaping policies and
driving business impact.
Focusing on vulnerable and marginalised groups
RHI Magnesita actively incorporates the perspectives of vulnerable and marginalised workforce members, such as women, migrants, and
individuals with disabilities, through targeted initiatives:
• Global Campaigns: Events like Disability Day and Female Day promote awareness and dialogue.
• Business Resource Groups: Regional groups foster inclusivity and representation.
• On-Ground Interventions: Health and safety concerns are escalated to senior leadership, with follow-up shop-floor meetings
conducted by executive management or the Board.
Employee engagement initiatives
To further strengthen its connection with employees, RHI Magnesita implements various initiatives:
• Volunteering Programmes: Empower employees to contribute to their communities.
• Brand Ambassadors: Promote corporate values and strengthen employer branding.
• Female Factor and DEI Campaigns: Highlight diversity, equity, and inclusion priorities.
• Culture Champions: Advocate for RHI Magnesita’s cultural values globally.
Read more about RHI Magnesita’s Stakeholder Engagement Approach in pages 26-31, “Our Stakeholders”.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024154
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 155
Disclosure requirement S1-3 – Processes to remediate negative impacts and channels for own workforce to raise concerns
Workplace risk assessments
RHI Magnesita’s business includes high-risk activities for which hazard identification and risk assessments are carried out, documented,
and shared. Following a continuous improvement approach, the Group performs risk assessments in multidisciplinary teams which include
team leaders, workplace personnel, local health and safety experts and locally assigned occupational health or occupational physician
representatives and worker representatives, depending on local legal requirements.
A “Hierarchy of Controls” approach is applied to the risk assessment process, including but not limited to:
• Assessing whether the risk can be eliminated, e.g. purchasing equipment which is not noisy.
• Implementation of engineered solutions to eliminate or reduce the risk, e.g. automated processes which reduce manual work.
• Organisational measures, such as training and auditing.
• Standard operating procedures and work instructions defined with the involvement of the team who performs the task, with illus-
trations and in local languages.
• Providing personal protective equipment according RHI Magnesita global minimum standard to employees.
• Corrective and preventive actions and further upgrades identified by the risk assessment are documented.
Incident management report
Incident management is a fundamental element of effective safety management systems, enabling leaders such as plant managers, Health
and Safety managers, department heads, and representatives from refractory services to proactively identify and address potential hazards
before they escalate into accidents. Promoting a culture that encourages the reporting of all incidents - especially near-misses and unsafe
situations - ensures thorough investigation and the implementation of preventative actions.
Any incident, regardless of its severity or the personnel involved, must be reported immediately within RHI Magnesita. All employees and
contractors are required to immediately report any “Unsafe Situation” to supervisors so that corrective actions can be put in place to avert
harm. Both “Unsafe Situation” information and a report of a near miss are flagged in RHI Magnesita’s safety reporting system for further
follow-up and analysis.
Global standardisation for health and safety excellence
Standardisation is an effective tool to improve health and safety performance. RHI Magnesita has a global Health & Safety Management
System certified by Bureau Veritas. Regular internal audits ensure that the organisation complies with relevant regulations, standards and
internal policies; it identifies potential risks, enabling proactive mitigation; provide insights and fosters a culture of ongoing improvement,
as corrective actions and lessons learned are implemented organisation wide. RHI Magnesita holds an integrated management system
covering health and safety, environmental, energy and quality. 57% of the industrial footprint holds a certification for health and safety.
The following locations achieved a successful initial certification against ISO 45001 Occupational Health & Safety Management System
in 2024:
• Magnesita Refractories Company, USA.
• RHI Magnesita India Ltd. Jamshedpur, India.
• RHI Magnesita India Refractories Limited, Dalmiapuran, India.
• RHI Magnesita India Refractories Limited, Khambhalia, India.
• RHI Magnesita India Refractories Limited, Katni, India.
Due to the ongoing expansion of the Group’s production network, the integration of other plants has also commenced. We seek to engage
with local senior management and the workforce from the beginning to ensure that our values and standards are adopted.
Health & Safety Fund (RHI Magnesita HELP – Verein zur Unterstützung von Arbeitnehmern in Notsituationen)
In 2024, RHI Magnesita HELP was launched as a dedicated programme to provide financial support to individuals and their direct family
members impacted by occupational work-related accidents or fatalities. This initiative extends beyond RHI Magnesita’s obligations as an
employer, reflecting the Group’s commitment to supporting its employees, operating communities, and business partners—including
suppliers, contractors, and customers.
The scope of HELP is broad and inclusive, ensuring assistance to those in need within our network and beyond. Private individuals world-
wide, including RHI Magnesita employees in any location or role, are invited to contribute voluntarily. Contributions are entirely optional,
and donations are managed with full compliance to regulatory requirements for fund tracking, while maintaining donor anonymity beyond
these necessities.
The HELP initiative raised €810,000 in its first year through voluntary contributions and RHI Magnesita’s matching pledge. This achieve-
ment highlights the strong culture of care and solidarity shared by our workforce and stakeholders.
155RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
156 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
The effectiveness of actions taken is tracked in practice through the Group’s health and safety KPIs, mentioned above. By regularly moni-
toring its health and safety performance the Group ensures that its own working practices are not causing harm to its workforce.
For channels for the workforce to raise concerns, please see subsequent section “Human Rights”.
Disclosure requirement S1-4 – Taking action on material impacts on own workforce, and approaches to managing material risks and
pursuing material opportunities related to own workforce, and effectiveness of those actions
Actions
RHI Magnesita takes action to prevent the negative impact on its workforce from poor health and safety performance and to remedy the
impact of any accidents that may occur. Preventative steps include establishing standardised safe operating procedures, the provision of
personal protective equipment and safety training, designing out risks from work related tasks, carrying out risk assessments, encouraging
near miss reporting and conducting comprehensive incident investigations with detailed follow up actions. Individuals who may be injured
as a result of a workplace incident (or their families) may receive financial assistance in the form of contractual payments, insurance awards
or discretionary awards from the Group’s HELP fund initiative. The main focus of remedial action is taking steps to ensure that the factors
leading up to the incident are not repeated.
Health and safety performance is tracked very closely and is a fundamental KPI for individual plants and regional management teams,
examined on a monthly basis. At Group level the EMT, CSC and Board regularly receive reports on safety performance which includes
overall statistics as well as reports on major incidents and follow up actions if applicable. Performance is assessed using frequency rates for
lost time injuries, medical cases, total incident rate, total recordable injuries, near misses, preventive rate and health projects ratio. Improve-
ment or deterioration in these metrics provides a clear indication of the effectiveness of the actions the Group is taking to improve its health
and safety performance.
The process for identifying actions that the Group must take primarily relies on follow up actions to risk assessments, near miss reporting
and accident investigations. Accident investigations are usually undertaken by local authorities, but the Group also forms its own view of
required remedial actions. Recommendations for changes to procedures to avoid future serious injuries or fatalities are ascribed the highest
importance and applied across the Group’s global operations.
Procurement practices could impact health and safety performance, for example if equipment is of poor quality or otherwise unsafe or
personal protective equipment is not available or of sufficient quality. The Group places a high priority on the safety of its staff when making
such procurement decisions.
Sales practices at RHI Magnesita include the provision of services by RHI Magnesita employees who perform their tasks whilst physically
located at customer sites. In such circumstances the Group’s employees are in the customer’s-controlled location and exposed to safety
risks. The Group seeks to ensure that this practice does not cause or contribute to negative impacts on its workforce by holding the customer
to a high standard of safety, encouraging RHI Magnesita staff to report unsafe situations or incidents and investigating any reports of dan-
gerous conditions or incidents at such sites.
An actual or potential negative health and safety impact on its own workforce would contribute to a decision by the Group to terminate a
business relationship with a supplier or customer. For example, poor safety practices at a customer site where RHI Magnesita staff are work-
ing, or poor driving standards from freight contractors whilst on RHI Magnesita sites would not be tolerated.
In 2024 the Group incurred €9 million of health and safety related capital expenditure. Over the period 2025-30 the Group expects to
allocate a similar amount of capital each year to sustainability and health and safety related capital expenditure, excluding major decar-
bonisation projects.
Key actions taken in 2024 are a review of standards, culture and key serious injury and fatality risks in partnership with dss+, aiming to move
from a compliance-based safety approach to a deeply embedded safety mindset across all levels of the Group. dss+ has been engaged
with RHI Magnesita since April 2024. dss+ works with clients around the world to manage risk and reduce workplace injuries, operate
responsibly and sustainably, and maintain those improvements through transforming the culture and building the capability of leaders and
people. This strategic initiative is dedicated to strengthening RHI Magnesita’s safety culture, with a key focus on mitigating Serious Injuries
and Fatalities potential (SIFp) risks across all operations.
To reduce serious injury and fatality risks and strengthen RHI Magnesita safety culture, the Group will guide and develop leadership capa-
bilities at all levels by implementing a structured coaching programme within the next two years. This initiative aims to foster meaningful
changes in mindset, behaviours, and actions, ensuring leaders are equipped to drive transformation effectively and sustainably. Addition-
ally, the Group will design and implement a structured and sustainable continuous improvement approach to operational risk management.
This will enhance the organisation’s ability to identify, assess, and mitigate risks systematically, ensuring long-term resilience and opera-
tional excellence.
These actions are expected to lead to an improvement in the Group’s health and safety performance metrics over the medium term.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024156
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 157
Metrics and targets
Disclosure requirement S1-5 – Targets related to managing material negative impacts, advancing positive impacts, and managing
material risks and opportunities
Health and safety methodologies
The recording of health and safety incidents is achieved via a Group wide reporting system (“AccStat”) which is available to all employees
and contractors with intranet access. Any employee or contractor with access to the AccStat can submit an incident report and they are
required to do so by Group internal procedures. The number of incidents is divided by hours worked to arrive at a number of different ratios
to monitor performance. For the calculation of total hours worked the Group relies on plant level submissions and where plant level data
is not available an estimate of total hours worked is made.
Total Recordable Injury Frequency (“TRIF”) is defined as the sum of recordable medical cases (i.e. beyond first aid cases) and lost time
injuries affecting employees and contractors divided by total hours worked by those employees and contractors to arrive at a ratio of the
number of incidents per 200,000 hours worked.
Lost Time Injury Frequency (“LTIF”) is defined as the number of lost time injuries affecting employees or contractors divided by total hours
worked by those employees and contractors to arrive at a ratio of the number of incidents per 200,000 hours worked. A lost time injury is
defined as an injury which results in an individual being unable to return to work and perform their duties for their next regular shift.
Fatalities are defined as occupational fatalities affecting employees and contractors occurring as a result of a work-related incident or ex-
posure.
RHI Magnesita is required to report Recordable work-related accidents, a new ESRS metric. A Recordable work related accident is a work-
related injury or ill health that results in death, days away from work, restricted work or transfer to another job, medical treatment beyond
first aid, or loss of consciousness; or significant injury or ill health diagnosed by a physician or other licensed healthcare professional, even
if it does not result in death, days away from work, restricted work or job transfer, medical treatment beyond first aid, or loss of consciousness.
The rate of recordable work-related accidents represents the number of work-related accidents cases per one million hours worked and is
calculated as a ratio between the number of cases registered in the reporting period by the aggregated working hours in RHI Magnesita
Group and multiplied by one million.
RHI Magnesita Group does not have non-guaranteed hours employees.
Health and safety targets
RHI Magnesita has defined its health and safety targets, aligning with the SMART framework. In 2024, the Group conducted a review of
sustainability topics, including Health and Safety. This review involved defining a clear vision, identifying key challenges, and establishing
both the priorities for 2024 and the strategic targets for 2030.
RHI Magnesita has reviewed its performance and its health and safety standards with the support of dss+. The assessment focused on
serious injuries and fatalities (“SIF”) and the gaps identified results in a dedicated programme to strengthen RHI Magnesita’s safety culture.
Although the Lost Time Incident Frequency Rate (“LT IF”) improved from 0.16 in 2023 to 0.11 in 2024 - well below the 2025 target of 0.30
per 200,000 hours worked - This is a Group-specific metric that does not align with the ESRS requirement of reporting per million hours
worked. The current LTIF target, established in 2018, will remain in effect until the target period plan concludes in 2025.
RHI Magnesita remains committed to further reducing serious injuries and eliminating fatality risks. Reinforcing its dedication to Zero Harm,
No Injuries, the Group has set an ambitious goal of achieving zero fatalities and reducing the Total Recordable Injury Frequency Rate (TRIFR)
to below 1.2 per 200,000 hours worked by 2030.
The target-setting process was inclusive, actively engaging plant managers across all regions as well as employees. Feedback was col-
lected through plant visits and health and safety workshops to ensure that the targets are both ambitious and achievable. Performance is
systematically tracked using the in-house developed tool, AccStat, which is available across all sites, including newly acquired locations,
with the exception of recycling sites where the Group does not have direct operational control. A new tool is expected to be implemented
and rolled out across all sites in 2025. This advancement will further enhance data quality, management control, and the continuous
improvement of safety practices.
The target scope is global, ensuring that 100% of RHI Magnesita employees are covered by the Group’s health and safety management
system. Recognising the importance of tailoring interventions to local contexts, RHI Magnesita has also implemented regionalised health
and safety initiatives. These programmes address specific regional challenges while aligning with the Group’s global objectives, ensuring
meaningful and context-specific impacts.
157RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
158 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Human rights
The Group is committed to upholding international human rights principles, ensuring that all employees work under fair, ethical, and safe
conditions. Recently, RHI Magnesita has carried out the human rights risk assessment in its own operation and as part of its supplier due
diligence, the Group actively maps salient human rights risks across the countries where it operates and monitors its suppliers. Through
the DMA, the Group has identified potential negative impact of forced labour as a material topic within its operations and upstream value
chain. Additional human rights potential negative impact identified within its workforce include discrimination and harassment, as well as
health and safety concerns.
Potential negative impact of forced labour
In the regions of BRICS, the heightened risk of forced labour arises from socio-economic challenges, weak enforcement of labour laws, and
systemic vulnerabilities within the rule of law. Forced labour in these areas has profound and devastating consequences on the quality of
life of affected individuals, often trapping them in cycles of exploitation and poverty. In contrast, geographies like Europe, North America,
Singapore, and South Korea benefit from robust legal frameworks and effective governance that significantly mitigate such risks, with inci-
dents being exceedingly rare. Given the global nature of our operations and our reliance on a complex and extensive supply chain network,
our industry is inherently exposed to risks of forced labor, particularly in high-risk regions. Addressing these risks requires proactive and
rigorous measures to protect human rights and ensure the integrity of our operations.
RHI Magnesita’s strict policies play a crucial role in minimising the probability of forced labour at an individual level, addressing and over-
coming its impacts requires substantial, long-term remediation efforts. This includes dedicated resources, strategic interventions, and col-
laboration with stakeholders to ensure the sustainable resolution of such issues.
Policies
RHI Magnesita is firmly committed to upholding human rights within its workforce, ensuring alignment with international standards such
as the UN Guiding Principles on Business and Human Rights, the International Labour Organisation (“ILO”) Declaration on Fundamental
Principles and Rights at Work, and the Organisation for Economic Co-operation and Development (“OECD”) Guidelines for Multinational
Enterprises. These commitments include upholding fair labour practices, ensuring freedom of association, promoting non-discrimination,
and strictly prohibiting child labour, forced labour, and any form of modern slavery or human trafficking within our business operations and
supply chain.
RHI Magnesita is committed to adhering to international standards and, as a participant in the UN Global Compact, has pledged to integrate
its principles in the areas of human and labour rights into our business strategy and operations. Our Code of Conduct reflects these com-
mitments, ensuring compliance with human and civil rights as well as applicable labour and social laws. Respect, fairness, and equal op-
portunities are core values we demand from our employees and business partners alike.
This Code is applicable across the entire Group and is binding for all employees, regardless of their position or employment type. Addi-
tionally, our Human Rights Policy underscores our zero-tolerance approach to modern slavery and human trafficking within our business
and supply chain.
For a detailed overview of our approach throughout the value chain, please refer to Chapter S2 – Workers in the value chain of this report.
Policies supporting workforce engagement
RHI Magnesita’s policies establish a strong foundation for workforce engagement:
• Anti-Harassment Policy: Encourages reporting of discrimination and harassment through multiple confidential channels, includ-
ing HR, managers, and the Whistleblowing hotline.
• Speak Up Policy: Offers employees confidential and anonymous avenues to report misconduct via web portals, dedicated phone
lines, or direct contact with the IARC team.
General approach to addressing material negative impacts
RHI Magnesita employs a proactive and structured approach to remedying material negative impacts on its workforce. Central to this ap-
proach is the availability of multiple confidential and anonymous reporting channels that ensure accessibility and trust.
Whistleblowing hotline
RHI Magnesita Whistleblowing Hotline is a confidential platform designed to enable employees and external stakeholders to report sus-
pected misconduct, including violations of human rights or ethical standards, at any time. All compliance violations - therefore also suspi-
cions regarding slavery, forced labour and human right violations (e.g. harassment and discrimination) - can be reported (also anonymously)
both by employees and external parties in more than 50 languages via various communication channels. Indications of serious misbehav-
iour will typically be investigated by IARC, People and Culture and other appropriate departments in the organisation. There were no new
reported complaints related to forced or compulsory labour or human trafficking in the year 2024. Additionally, Group’s Speak Up policy
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024158
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 159
provides the necessary information on how to report misconduct, unethical practice, or behaviour that goes against RHI Magnesita’s Group
values. It also outlines the key investigative principles when handling a report.
Whistleblowing channels are accessible to everyone, both internally and externally. Reported data confirm that these channels are widely
recognised and trusted as official channels for reporting.
Read more about our business conduct in G1.
Channels for workforce to raise concerns
RHI Magnesita has established robust mechanisms to enable its workforce to report potential misconduct or workplace concerns, fostering
a transparent and accountable work environment. These mechanisms include:
• Whistleblowing hotline: A global platform available to employees, third parties, and external stakeholders, ensuring anonymity
and confidentiality.
• Works Council: A primary mechanism for employees to raise concerns, established across countries to address workplace issues.
• Leadership Access Platforms: Tools such as Workvivo (an employee app) facilitate direct feedback and communication between
employees and leadership.
These channels are designed or facilitated through third-party mechanisms, ensuring independence and objectivity. Employees are made
aware of these mechanisms through training sessions, internal communication campaigns, and dedicated initiatives.
Tracking, monitoring, and effectiveness evaluation
RHI Magnesita has implemented structured processes to track and monitor reported concerns, led by the IARC team and local committees.
• Follow-ups and Timeliness: Regular follow-ups ensure issues are addressed promptly and resolutions are effective.
• Stakeholder Involvement: Feedback from employees and other stakeholders is incorporated to review and enhance reporting
systems.
• Awareness and Trust: The Group promotes awareness of its reporting mechanisms through training and engagement campaigns,
such as International Women’s Day and Disability Days. Leadership visibility and consistent communication of the Speak Up Pol-
icy further foster trust in the system.
Protection against retaliation
RHI Magnesita’s policies, including the Speak Up Policy, explicitly prohibit any form of retaliation against individuals who report concerns
in good faith. This protection extends to workers’ representatives and includes disciplinary actions against those who intentionally file false
reports.
Actions towards preventing human rights issues, including potential incidents of forced labour
RHI Magnesita aligns with ILO principles and has adopted policies to combat forced labour and trafficking, and the Group is committed to
identifying, addressing, and mitigating actual and potential negative impacts on its workforce through structured risk management, reme-
diation efforts, and continuous improvement initiatives.
When material workforce-related impacts are identified, RHI Magnesita takes immediate action to assess, remediate, and prevent recur-
rence. The IARC department is responsible to oversee Group overall risk management process, ensuring that incidents related to working
conditions, labour rights, and health and safety are reviewed. Findings are escalated through internal governance mechanisms, ensuring
timely interventions and corrective measures. Corrective actions may include enhanced monitoring, and engagement with affected em-
ployees to provide appropriate remedies. For further details, see chapter G1 – Business conduct on pages 168-169 and Our Stakeholders
section in the Annual Report on pages 26-31.
The Group continuously monitors and assesses the effectiveness of workforce-related actions through internal audits, employee surveys
and compliance reviews. Key performance indicators (KPIs) such as turnover rates, health and safety metrics, and whistleblower reports are
used to evaluate impact and drive improvements. For further information, see Internal Controls in the Annual Report on pages 51-52.
For supplier due diligence actions, see subsequent section “Supplier Assessment” and chapter S2 – “Workers in the value chain”.
Training
An e-learning module on specific business ethics topics was introduced globally in 2020, also covering same aspects of human rights,
and was refreshed in 2023. In addition, a dedicated training on the fundamentals of human rights was added to our training portfolio in the
past year. A training module on ESG-related topics for our employees responsible for procurement was also rolled out and developed in
2024, including putting stronger focus on human rights.
In 2024 particular attention continued to be given to the integration of acquired entities in respect of ethics and compliance standards. Ex-
tensive work was conducted as part of integration activities to understand the compliance culture of each new entity and work to harmonise
159RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
160 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
their approach with Group practices. Through targeted training and upskilling programmes, the Group ensures employees are equipped
to adapt to evolving industry requirements. Strengthened due diligence and compliance monitoring reduce labour-related risks and up-
hold ethical employment standards.
Metrics and targets
In line with our commitment to transparency and accountability we have adopted a phased approach to develop entity-specific metrics.
Our efforts aim to ensure a robust and tailored framework that reflects our operational realities while driving meaningful progress.
Disclosure requirement S1-6 – Characteristics of RHI Magnesita employees
The turnover rate 2024 considering death, involuntary, voluntary and retirement as per ESRS requirement was 12.02% (including seasonal
staff).
Assumptions and Methodologies
These metrics have not been externally validated by any organisation other than the assurance provider.
Definition of headcount:
The headcount includes employees actively employed within the organisation, categorised into the following groups: employees, appren-
tices, trainees, and interns. Temporary workers, contractors, and consultants are explicitly excluded from this definition. Additionally, indi-
viduals on extended unpaid leave are not considered part of the active headcount. Headcount is the number of employees at the end of
reporting period. RHI Magnesita’s financial statements adhere to the IFRS framework, which mandates the disclosure of the average work-
force to ensure standardized and consistent reporting.
Full-time equivalent (“FTE”) calculations:
FTE is used as a standardized metric for employee contributions, adjusted for part-time arrangements. Full-time employees are assigned
an FTE value of one, while part-time employees are calculated as a fraction of one based on their actual working hours relative to the full-
time schedule.
Inclusion criteria:
Only employees who hold a signed employment contract with the Group are included in the headcount. This ensures that the data reflects
the organisation's contractual workforce accurately.
Hires and turnovers:
Employees who join or leave during the reporting period are included in the headcount as active only if they have worked for at least one
day within the period.
Turnovers by leave category:
Turnover data is segmented into specific leave categories, including death, dismissal, retirement, and voluntary departures. However, the
group "Other," which encompasses contract expirations (this includes contracts that were chosen to be renewed) and employee transfers,
is excluded to maintain clarity in turnover reporting.
Turnover rate:
“Employee turnover” is defined as the cumulative headcount of employees who have departed from the RHI Magnesita Group, whereas the
“employee turnover rate” is defined as the proportion of employees who have left the Group expressed as a percentage. To determine the
percentage of departing employees, the total is divided by the total number of employees at the end of the reporting period, which differs
from the method in Note 10 to the Financial Statements, whereas the denominator takes into account the average number of employees
during the reporting period,
Headcount is allocated to regions based on the primary legal entity location of the office where the employee is associated, irrespective of
remote working arrangements. This approach aligns headcount data with organisational and legal structures.
These assumptions ensure clarity, consistency, and precision in calculating and reporting headcount-related KPIs, enabling accurate workforce anal-
ysis and strategic decision-making.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024160
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 161
Table 1 – Employees by gender
Gender

Male
,
Female
,
Total Employees
,
161RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
162 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Table 2 – Employees by country
Country

Argentina

Austria
,
Belgium

Brazil
,
Canada

Chile

China
,
Colombia

Cyprus

Czech Republic

France

Germany
,
Hong Kong

India
,
Italy

Mexico

Netherlands

Peru

Romania

Russian Fed.

Singapore

Slovenia

South Africa

Spain

Sweden

Switzerland

Taiwan

Türkiye

Ukraine

United Arab Emirates

United Kingdom

USA

Vietnam

Total Employees
,
Table 3 – Employees by type of contract and gender

Female
Male
Other
Not reported
Total
Number of
employees (Headcount) , ,   ,
Number of permanent employees (Headcount)
, ,   ,
Number of temporary employees (Headcount)
 ,   ,
Number of full
-time employees (Headcount) , ,   ,
Number of
part-time employees (Headcount)     
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024162
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 163
Table 4 – Employees by type of contract and region
Table 5 – Number of employee turnover
Number of employee turnover

Death

Dismissal (Involuntary)

Retirement

Voluntary

Total Employees
,
Disclosure requirement S1-14 – Health and safety metrics
Assumptions and Methodologies
These metrics have not been externally validated by any organisation other than the assurance provider.
Health and safety metrics

Percentage of people in its
own workforce who are covered by health and safety management system based on
legal requirements and (or) recognised standards or guidelines
%
Number of fatalities in own workforce as result of work
-related injuries and work-related ill health 
Number of fatalities as result of work
-related injuries and work-related ill health of other workers working on
undertaking's sites

Number of recordable work
-related accidents for own workforce 
Rate of recordable work
-related accidents for own workforce (per ,, hours worked) .

China & East
Asia
Europe, CIS
& Türkiye
India, West
Asia & Africa
North
America
South
America Total
Number of employees
(Headcount)
, , , , , ,
Number of permanent
employees (Headcount)
, , , , , ,
Number of temporary
employees (Headcount)
,     ,
Number of full
-time
employees (Headcount)
, , , , , ,
Number of part
-time
employees (Headcount)
     
163RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
164 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Health and safety performance
Lost Time Injury Frequency Rate (LTIF) improved to 0.11 in 2024 (2023: 0.16) per 200.000 hours worked. Overall, there were 30 Lost Time
Injuries (LTIs) in 2024 (2023:37) within RHI Magnesita. A fatality occurred at the Breitenau mine Austria in February 2024.
A contractor had a fatal accident occurred at the Dalian plant in China in June 2024. New technical measures have been implemented
globally to prevent a repeat of the circumstances leading up to this accident.
Disclosure requirement S1-17 – Incidents, complaints and severe human rights impacts
This metric has not been externally validated by any organisation other than the assurance provider. There are no fines, penalties and
compensations for damages as a result of incidents of discrimination.
A discrimination incident is defined as direct or indirect discrimination on the basis of protected characteristics, which may include, but
are not limited to gender or gender identity, sex, ethnicity, religion or culture, disability, sexuality, age. Indirect discrimination could be
putting a criterion in place that may seem neutral, but that would practically be unfavourable for a person with a protected attribute.
Incidents, complaints and severe human rights impacts

Number of incidents of
discrimination including harassment 
Number of complaints filed through channels for people in own workforce to raise concerns

Number of complaints filed to National Contact Points for OECD Multinational Enterprises

Number of severe human
rights issues and incidents connected to own workforce 
Number of severe human rights issues and incidents connected to own workforce that are cases of non respect of
UN Guiding Principles and OECD Guidelines for Multinational Enterprises

RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024164
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 165
ESRS S2 Workers in the value chain
ESRS 2 General disclosures
RHI Magnesita has identified impacts, risks, and opportunities related to its workers in the value chain through RHI Magnesita’s risk man-
agement approach. Details of the materiality assessment can be found on pages 100-102 of this report.
Strategy
Disclosure requirement related to ESRS 2 SBM-2 Interests and views of stakeholders
See ESRS SBM2 for Stakeholder engagement
Disclosure requirement related to ESRS 2 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and
business model
RHI Magnesita’s diverse and global upstream supply chain presents a wide range of risks for supply chain workers. These risks vary based
on factors such as workers' country of residence and employment, gender, age, and status as migrant workers. Industry-specific factors also
play a critical role, with labour-intensive sectors like mining and manufacturing posing higher risks for occupational safety and forced la-
bour.
The Group uses a risk-based approach to identify a broad range of risks within the value chain with the use of risk indicators and assess-
ments and closely monitors suppliers at risk. To assess specific risks, such as forced labour and child labour comprehensively, the Group
conducted sector benchmarking and reviewed labour standards across regions. The Global Slavery Index was used to identify countries
with high risks of forced labour, such as India, North Korea, and Pakistan. Relevant value chain stakeholders for the Group are located in
India. In the context of health and safety as well as child labour risks, a dual approach was taken addressing country-specific factors as well
as industry- and commodity-specific considerations, particularly in labour-intensive industries. High risk areas with regards to child labour,
as stated by UNICEF and the International Labour Organisation), are Sub-Saharan Africa, Central and Southern Asia and Eastern and South-
Eastern Asia. More than two-thirds of children in child labour work within the agriculture sector, followed by Services and Industry. The
material streams and services required for RHI Magnesita have, due to the nature of the Group’s industry, little interaction with the agricul-
ture sector and its associated risks. Suppliers located within Asia are a relevant part of RHI Magnesita’s value chain. Only a few value chain
stakeholders are located in Sub-Saharan Africa.
Material impacts within the Group’s value chain were primarily identified in relation to suppliers’ employees, especially those working in
mining and production units. Occupational safety was identified as material, alongside the potential for incidents of forced labour. Partic-
ularly vulnerable worker groups with regards to these material impacts are migrant workers, young workers and women.
The Group acknowledges the complexity of ensuring transparency and compliance in a global value chain, especially in industries with
varying labour standards and safety regulations. Addressing these risks requires continued collaboration, monitoring, and the integration
of robust standards to protect workers' rights and well-being.
Read more about RHI Magnesita’s strategy and business model at ESRS 2 SBM-1.
Systemic challenges
The risks identified are often systemic and widespread, particularly regarding forced labour, where limited transparency within certain busi-
ness relationships exacerbates the challenge. Negative impacts may also arise from individual incidents, such as workplace accidents, af-
fecting the health and safety of workers in the value chain. Workers conducting physical labour or operating heavy machinery in countries
with lower safety regulations face heightened risks. Examples include insufficient safety mechanisms and inadequate training for machin-
ery operation.
Impact, risk and opportunity management
Disclosure requirement S2-1 – Policies related to value chain workers
RHI Magnesita has established a comprehensive set of policies to ensure respect for human rights and ethical practices throughout its
value chain. These include the Human Rights Policy, Supplier Code of Conduct, and Anti-Slavery Statement, which align with the require-
ments of the UK Modern Slavery Act and the California Transparency in Supply Chains Act.
The Group adheres to internationally recognized human rights standards and expects its suppliers and contractors to uphold the same
high standards. The Group’s Human Rights Policy serves as a guiding framework, consistent with the principles outlined in the United
Nations Universal Declaration of Human Rights, the United Nations Global Compact, and relevant local legislation. This policy underscores
our commitment to respecting human and labour rights, prohibiting human trafficking and slavery, and promoting safe and fair working
conditions across our operations and supply chain.
The Supplier Code of Conduct mandates that suppliers respect human rights and strictly prohibits any form of precarious work such as
human trafficking or slavery as well as child labour and forced labour. To ensure compliance, suppliers may be required to complete self-
assessment questionnaires, respond to further inquiries, and, if necessary, undergo on-site assessments or full compliance evaluations.
165RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
166 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Non-compliance with the Supplier Code of Conduct may result in corrective action plans or, in severe cases, termination of the business
relationship in accordance with applicable legal agreements.
As a participant in the UN Global Compact, RHI Magnesita is committed to integrating the principles of UN Guiding Principles of Business
and Human Rights into its business strategy and operations. This commitment is explicitly outlined in the Code of Conduct, which prioritises
compliance with human and civil rights, applicable labour laws, and social standards. Respectful treatment, equal opportunities, and fair-
ness are core values demanded of all employees and business partners.
RHI Magnesita actively encourages transparency and ethical practices by providing a Whistleblowing hotline. Suppliers, employees, and
stakeholders are encouraged to report any unethical or illegal behaviour, including suspicions of misconduct by employees or its suppliers.
The helpline is accessible via https://www.rhimagnesita.com/compliance-helpline/
By embedding internationally recognized human rights standards into its policies and operations, the Group ensures a robust framework to
address risks related to forced labour, human trafficking, child labour and workplace safety. These measures not only demonstrate RHI
Magnesita’s commitment to ethical business practices but also promote transparency and accountability throughout its global supply
chain.
Disclosure requirement S2-2 – Processes for engaging with value chain workers about impacts
Direct engagement with value chain workers is a key component of on-site sustainability supplier assessments, conducted annually with
selected suppliers worldwide. Negative findings or identified risks with regards to value chain workers and other established minimum
requirements trigger risk reduction and mitigation processes together with the supplier. Lacking remediation of identified risks within the
defined period will influence future decision-making processes and supplier relationships. These processes are governed by our internal
supplier on-site assessment guideline, which outlines clear procedures for addressing negative or risk-attributed findings.
The type of engagement during on-site assessments varies based on their focus. Assessments emphasizing the social pillar include direct
interviews with selected value chain workers to identify specific risks and challenges. For suppliers identified as higher risk, the social pillar
is automatically part of the assessment.
Suppliers with concerning results are required to develop a time-bound action plan to mitigate identified issues. The implementation of
these plans is monitored within a pre-defined timeframe, ensuring accountability and measurable improvements.
Governance of these processes is overseen by the Human Rights Officer, the highest function responsible for worker-related compliance
matters, who reports annually to the Board of Directors.
This structured approach ensures risks are identified, mitigated, and managed effectively, aligning with the Group’s commitment to uphold
ethical and sustainable practices across its value chain.
Disclosure requirement S2-3 – Processes to remediate negative impacts and channels for value chain workers to raise concerns
There are multiple processes on channels for value chain workers to raise concern. Direct engagement with value chain workers occurs
during our on-site sustainability supplier assessments. On an annual basis, suppliers are selected worldwide for our on-site sustainability
assessments. Results from our on-site sustainability supplier assessments as well influence our future decisions. Our internal supplier on-
site assessment guideline defines our processes in case of negative or risk attributed findings. Additionally, value chain workers can voice
risks and issues using our whistleblowing hotline.
These cases are investigated according to our “Whistleblowing hotline Guideline” which is visible to the public on our website. When
raising a concern, parties can either disclose their identity or stay anonymous. All concerns reported on the web, the mobile application,
by phone or by email will be passed on to responsible members of RHI Magnesita’s Internal Audit, Risk & Compliance team who will get
back within seven days latest to acknowledge the receipt of your report. All complaints are processed objectively and with the same level
of care and diligence by trained professionals of RHI Magnesita’s Internal Audit, Risk & Compliance team. Their identity will be kept confi-
dential throughout the process and all information pertinent to the investigation will only be shared on a need-to-know basis.
The effectiveness of actions taken is monitored through regular follow-ups and continuous assessment of supplier performance and con-
duct. The Group upholds the expectations outlined in the Supplier Code of Conduct, with a focus on workers' rights and well-being
throughout the value chain.
Read more about RHI Magnesita’s business conduct, mechanisms of investigation and supplier management in G1-1.
Disclosure requirement S2-4 – Taking action on material impacts on value chain workers, and approaches to managing material
risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions
The Group has established robust mechanisms to identify and address human rights risks in its supply chain, with country-specific risk data
internally accessible to the procurement department. This resource is integral to risk identification and forms the basis for targeted
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024166
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 167
mitigation actions. Financial resources are allocated to managing the supply chain and material impacts and enable the supplier assess-
ments with EcoVadis and the on-site supplier assessments. The strategic target for 2025 is to assess suppliers representing 66% of spend
through EcoVadis sustainability assessments, which enhance transparency and aid in mitigating adverse impacts. These assessments pro-
vide valuable insights into suppliers' human rights policies and practices, enabling the Group to request improvements or conduct further
validation through on-site assessments when necessary.
The internal on-site assessment guidelines define clear procedures for addressing risks, categorised by severity. Severe risks, such as child
or forced labour, are explicitly outlined in our Supplier Code of Conduct. Incidents of the highest severity activate a high-priority response
process involving case creation, detailed investigation, and escalation to executive management for action planning.
In addition to EcoVadis assessments, RHI Magnesita conducts on-site sustainability assessments globally to verify compliance with the
Group’s standards. Identified risks or non-compliance issues are communicated to suppliers, who are given a defined timeframe for correc-
tive action. Progress is monitored, and follow-up assessments ensure the effective implementation of improvements.
The Supplier Code of Conduct formalises the expectations of RHI Magnesita for ethical and sustainable practices throughout the value
chain. Suppliers are contractually required to align with these standards, which include explicit protections for workers' rights. The detailed
process on the Group’s actions and processes on material impacts is described in section S2-2.
Up to date, 641 suppliers were assessed by EcoVadis, representing 55% of RHI Magnesita procurement spend. A supplier in EcoVadis is as-
sessed on four key themes: Environment (energy use, emissions, waste management, and resource efficiency), Labour & Human Rights
(working conditions, health & safety, diversity, and human rights policies), Ethics (anti-corruption, fair business practices, and data protec-
tion), and Sustainable Procurement (supplier monitoring, responsible sourcing, and supply chain transparency). The assessment evaluates
the supplier’s policies, actions, and reporting practices to determine their sustainability performance. EcoVadis assessment commitment
has been selectively made part of contracts to ensure transparency in areas with low coverage.
In 2024 one gross misconduct was identified with EcoVadis Adverse Media Alerts. The incident was with regards to child labour which was
connected to a supplier that was banned in 2023 due to similar allegations. This new misconduct enforced the continued ban of the sup-
plier.
Metrics and targets
Assumptions and Methodologies
The metrics used is based on the total spend of the Group.
For 2025, RHI Magnesita’s goal is to achieve 66% of spend assessed by EcoVadis Sustainability Assessments.
For 2030, RHI Magnesita will enhance its supplier sustainability management to cover 80% Spend Coverage.
In line with our commitment to transparency and accountability we have adopted a phased approach to develop entity-specific metrics.
Our efforts aim to ensure a robust and tailored framework that reflects our operational realities while driving meaningful progress.
Disclosure requirement S2-5 – Targets related to managing material negative impacts, advancing positive impacts, and managing
material risks and opportunities
To enhance supply chain compliance and sustainability, RHI Magnesita has committed to having 66% of its suppliers assessed by EcoVadis
by 2025 and conducting 50 on-site supplier assessments in 2024. These targets were established based on findings from previous as-
sessments and ongoing communications within the supply chain. Both targets aim to increase the transparency within the supply chain to
identify risks and opportunities on a supplier individual level. The gained transparency enables RHI Magnesita to work on the reduction of
identified negative impacts, manage material risks and advance positive impacts on value chain workers as well as the environment.
Supplier on-site assessments play a critical role in evaluating the alignment of supplier practices with Group standards. These assessments
include reviews of operational processes and direct interviews with workers to ensure adherence to ethical and safety standards. The find-
ings from our described supply chain due diligence mechanisms play an integral part of defining targets and define our focus areas. By
integrating these evaluations, RHI Magnesita reinforces its commitment to fostering transparency, improving supplier performance, and
upholding responsible sourcing practices across the value chain.
Sources:
1. International Labour Office and United Nations Children’s Fund, Child Labour: Global estimates 2020, trends and the road for-
ward, ILO and UNICEF, New York, 2021. Licence: CC BY 4.0.
167RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
168 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Governance information
ESRS G1 Business conduct
ESRS 2 General disclosures
Governance
Disclosure requirement related to ESRS 2 GOV-1 – The role of the administrative, supervisory and management bodies
This section is incorporated by reference to the Corporate Governance Report, pages 183-199,
Impact, risk and opportunity management
Disclosure requirement related to ESRS 2 IRO-1 – Description of the processes to identify and assess material impacts, risks and
opportunities
See SBM3 section above, pages 48-63, “Our Risk management approach”.
Disclosure requirement G1-1– Business conduct policies and corporate culture
RHI Magnesita has adopted eight policies that applies globally, covering the whole value chain, which are relevant to business conduct, as
follows:
i. Anti-Corruption Policy – mandatory policy with zero tolerance of bribery and corruption which prohibits employees from offering,
promising or granting any advantage with the objective of obtaining unlawful consideration – implemented since 2020.
ii. Anti-trust and Fair Competition Policy – mandatory compliance with all anti-trust and competition laws in all relevant jurisdictions.
Prohibits anti- competitive behaviour such as communicating with competitors concerning pricing or tenders or obtaining competitive
knowledge through illegal means. Provides guidance for dealing with possible situations and how staff should react, including proce-
dures for reporting potentially anti-competitive behaviour.
iii. Conflict of Interest Guideline – complements Code of Conduct and Anti-Corruption Policy, providing more detailed explanations for
staff as to what practical scenarios may give rise to a conflict of interest. Sets out procedure for disclosing any potential conflict of
interest for internal management.
iv. Gifts and Invitations Guideline – complements Code of Conduct and Anti-Corruption Policy, providing more detailed explanations for
staff as to when gifts and invitations should be declared and/or refused so as not to give rise to a potential conflict of interest or percep-
tion of potentially corrupt behaviour.
v. Code of Conduct – detailed document setting out standards of behaviour that are expected of employees, covering general principles
and specific guidance in all areas of business conduct.
vi. Supplier Code of Conduct – declaration for signing by all suppliers committing to minimum standards of business conduct, aligned
with the Group’s own Code of Conduct.
vii. Global Gender Equality Policy – policy establishing RHI Magnesita’s commitment to equality across all genders and how individuals
are treated in the workplace irrespective of their personal characteristics.
viii. Sanctions, Export Controls and Business Partner Due Diligence Policy
RHI Magnesita is committed to adhering to international standards and, as a participant in the UN Global Compact, has pledged to integrate
its principles in the areas of human and labour rights into our business strategy and operations. Our Code of Conduct reflects this commit-
ment, ensuring compliance with human and civil rights as well as applicable labour and social laws. Respect, fairness, and equal opportuni-
ties are core values we demand from our employees and business partners alike. The CEO is the most senior executive responsible for
policy implementation. All policies are publicly available on the Group’s website in the Policy Library section.
How RHI Magnesita fosters its corporate culture
This section is incorporated by reference to the Corporate Governance Report, pages 190-192, “Culture and Purpose”.
Mechanisms for identifying, reporting and investigating concerns
Potential concerns about ethical misconduct or any compliance matters can be reported by all stakeholders (both internal and external) to
an independently operated, confidential, and anonymous whistleblowing hotline, available in areas where the Group operates as well as
other locations, in several languages. Contact details are communicated throughout the business and are available externally on the
Group’s website. In addition to the hotline, whistleblowing reports can also be submitted via other channels, such as to a dedicated email
address. All reports are assessed by the Internal Audit, Risk & Compliance team and then addressed on a case-by-case basis.
The Audit & Compliance Committee and Board reviews this process and the reports arising from it, ensuring there are arrangements in
place for the appropriate and independent investigation of these cases and that follow-up actions to address the root causes are completed.
We regularly conduct compliance risk assessments, such as fraud risk assessments, with results presented to management and the Audit
& Compliance Committee each year. The regular risk assessments conducted at Group, regional and plant level cover Compliance risks
(including corruption risks). The plant risk assessment carried out in 2024 included 54 plants and mines (100% coverage).
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024168
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024 — 169
We use digital registers, workflows and employee guidelines to address, document and monitor conflicts of interest declarations, gifts and
invitations, and community investment approvals.
Business partners (e.g. customers, sales intermediaries and suppliers) and transactions such as mergers or acquisitions are subject to a
separate due diligence process. All sales agents are certified by Ethixbase360 (formerly TRACE International), a leading international or-
ganisation specialised in third-party due diligence solutions.
Our focus on human rights and labour rights includes a programme of supplier audits. In 2025, we will continue to strengthen our human
rights due diligence processes within the Group and in the supply chain. Following recent M&A activity, certain German legal entities
within the Group are now subject to the requirements of the German Supply Chain Due Diligence Act.
In compliance with this legislation, a Human Rights Officer has been appointed. The Board approves an annual statement in accordance
with the UK Modern Slavery Act 2015 and the California Transparency in Supply Chains Act.
In 2024 particular attention continued to be given to the integration of acquired entities in respect of ethics and compliance standards.
Extensive work was conducted as part of integration activities to understand the compliance culture of each new entity and work to har-
monise their approach with Group practices.
Emphasis was placed on face-to-face interaction and discussion to jointly evolve Business Ethics approaches.
We encourage anyone with ethics or compliance concerns to report them to an independently operated hotline, which is confidential and
can be used anonymously.
RHI Magnesita is firmly committed to whistleblower protection, adhering to the principle of non-retaliation and ensuring that all reports
are independently investigated with appropriate follow-up actions. The Group is subject to various legal requirements for whistleblower
protection, which vary based on national legislation. To ensure transparency and oversight, the Audit & Compliance Committee regularly
reviews data on cases submitted via the hotline and other reporting channels, as well as the outcomes of investigations. This approach
reinforces RHI Magnesita’s commitment to ethical business practices and compliance with legal and regulatory standards.
Disclosure requirement G1-2 – Management of relationships with suppliers
RHI Magnesita’s top 20 suppliers account for approximately 20% of our expenditure and the top 200 around 55%. Procurement extends
to suppliers producing refractory raw materials, energy suppliers facilitating the conversion of raw materials to finished products, transport
suppliers, and manufacturing suppliers. While contractual commitments generally do not exceed one year, the Group may enter into
longer contracts on an exceptional basis for critical raw materials and energy. Our operational focus is on capital and energy intensive
processes, especially in equipment for raw material and finished product production. Most specific raw materials are sourced from China,
resulting in a lengthy supply chain. Procurement spending in our industry equates to about two-thirds of revenue, on average.
Despite a high reliance on Chinese raw materials in the broader refractory industry, RHI Magnesita’s suppliers are predominantly situated
in the regions where its production facilities operate. Europe leads in supplier concentration, followed by China, Brazil, the USA, and India.
In our commitment to sustainable procurement, RHI Magnesita aims to integrate sustainability priorities into our procurement processes.
Supply chain due diligence
Since 2022, RHI Magnesita has established a framework for supply chain due diligence, to ensure ethical and compliant practices across
the Group’s supplier network. A comprehensive Supplier Code of Conduct outlines the standards and expectations the Group holds for all
partners in the supply chain. Supplier desktop evaluations and on-site inspections are also used to proactively identify and address any
potential risks, fostering a sustainable and resilient supply chain.
Supplier code of conduct
The Supplier Code of Conduct requires suppliers to follow the same principles as set out in RHI Magnesita’s own Code of Conduct. It is
distributed to all suppliers who are required to confirm compliance.
Supplier assessments through EcoVadis
An assessment system developed with EcoVadis is used to rate potential suppliers for sustainability impacts such as energy use, CO
2
emis-
sions and waste. The ratings resulting from this assessment form an important part of the Group’s procurement decision-making process.
The initial phase of supplier assessments was started in 2021 based on contract size and risk mapping. The process has continued in 2024,
now covering 55% of spend. Our target is to cover two-thirds of the supplier base by spend by 2025, including all suppliers delivering raw
materials with a high CO
2
intensity.
169RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024
STRATEGIC REPORT GOVERNANCE FINANCIAL STATEMENTS OTHER INFORMATION
CONSOLIDATED SUSTAINABILITY STATEMENT CONTINUED
170 — RHI MAGNESITA, ANNUAL REPORT AND ACCOUNTS 2024
Supplier on-site assessments
The Group conducts on-site assessments to evaluate suppliers based on product quality, Health & Safety and ESG aspects. RHI Magnesita
has significantly increased the number of on-site assessments from nine in 2022, to 42 in 2023 and 52 in 2024. The assessments were
conducted worldwide, including 16 in India, five in Sub-Sahara Africa and nine in China.
Supplier product carbon footprint
Since the contribution of raw material extraction and processing is the largest single source of CO
2
emissions in the refractory value chain,
the Group is seeking to increase the accuracy of its supplier CO
2
emissions data. In 2023 our specific focus with selected raw material
suppliers included raising their awareness of our data requirements and providing support on the required calculation methodology. Ac-
curate information enables the Group to prioritise suppliers with lower emissions in order to minimise Scope 3 emissions. Engagement on
the subject of emissions also demonstrates to potential suppliers that CO
2
reduction is a key priority for the Group, which is expected to
drive long-term changes in supplier behaviour and energy use.
Supplier collaboration
RHI Magnesita is committed to shaping a more resilient and sustainable supply chain. Therefore, the Group seeks collaborations with stra-
tegic suppliers to create more sustainable goods and services, with lower environmental impact. Several collaborations in 2024 resulted in
projects with positive impacts such as emission reduction in Europe and Scope 2 emission reduction in China and India and the Group is
continuing optimising transport routes to reduce emissions.
The second European Supplier Innovation Day 2024 reaffirmed that true innovation flourishes through collaboration. By fostering strong,
strategic partnerships with our valued suppliers, we accelerate the development of groundbreaking solutions and drive long-term success.
This initiative highlights the importance of early supplier involvement and a co-engineering approach, enabling the joint development of
innovative projects, methodologies, and products. Through structured collaboration, we create synergies that enhance efficiency, sustain-
ability, and competitiveness. This year, more than 20 business partners gathered to present their latest ideas and technological advance-
ments. The most innovative and promising solutions were recognised with awards, underscoring our commitment to cultivating a culture
of innovation through strong supplier partnerships.
Read more about our actions in chapter ESRS S2.
Disclosure requirement G1-3 – Prevention and detection of corruption or bribery
In 2024 we continued to embed and evolve our compliance policies and procedures. We take a zero-tolerance approach to incidents of
fraud, bribery or corruption in our business. This approach is set out in our Code of Conduct, which was updated and re-launched in 2023,
and in our Supplier Code of Conduct. The reshaped Code of Conduct with an emphasis on simple, focused messaging for key areas, in-
cluding business ethics, integrity, health and safety, anti-corruption, legal compliance, data privacy, sustainability, and conflict of interest
avoidance has been well received across the Group. All 109 governance body members and employees have been informed of the Group’s
Anti-Corruption (AC) policies and procedures. As part of compliance measures, they have completed mandatory e-learning training.
Comprehensive online training is mandatory for key compliance areas, including business ethics, data privacy, sanctions, and export con-
trols. Regular monitoring ensures completion across all office-based employees. Newly onboarded employees are required to complete
these training sessions within the first three months of employment.
During 2024 ensuring the continuity of high standards for ethics and compliance was a prominent element of the transfer of staff to
Capgemini. Specific arrangements were agreed to ensure the continuity and ongoing quality of the ethics and compliance training to be
delivered by Capgemini in 2025.
The anti-corruption and bribery training covers:
• definition and legal framework of bribery and corruption;
• consequences of non-compliance;
• identification of high-risk activities and locations;
• risks associated with cash transactions, gifts, and entertainment;
• preventative measures to mitigate bribery and corruption risks;
• proper maintenance of books and records;
• identification of politically exposed persons (PEPs); and
• adherence to Group policy on anti-corruption and bribery.
This structured approach reinforces compliance, mitigates legal and reputational risks, and strengthens ethical business practices across
the organisation and value chain.
RHI MAGNESITA ANNUAL REPORT AND ACCOUNTS 2024170