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Umicore: From Colonial Mining Empire to Circular Materials Technology Giant
I. Introduction & Episode Roadmap
Picture Brussels in late 2024, in the headquarters of one of Europe's most remarkable corporate transformations. "2024 has been a sobering and intense year for Umicore, marked by significant headwinds including a slowdown in EV growth, multiple challenges for the European industrial sector, and rising geopolitical tensions." Those words from CEO Bart Sap capture the paradox at the heart of this 220-year-old company: it has successfully reinvented itself from a colonial mining empire into a clean technology materials leader, only to find that the very future it bet on—electric vehicles—has thrown it a curveball.
Here's the central question driving this analysis: How did a colonial-era mining company that once supplied uranium for the Manhattan Project become one of Europe's leading clean technology materials companies—and is its bet on the EV transition about to pay off or backfire spectacularly?
Umicore is the world's largest recycler of precious metals. This Belgian multinational advanced materials technology and recycling group, headquartered in Brussels, specializes in the development of catalysts, battery materials, and recycling processes for clean technologies in mobility, energy, and electronics. In 2022, the company generated revenues (excluding metal) of €4.2 billion with turnover of €25.4 billion, and today employs more than 11,000 people globally.
Umicore SA was founded in 1805 and is headquartered in Brussels, Belgium. That's not a typo—this company traces its lineage back to the Napoleonic era, making it one of the oldest continuously operating industrial enterprises in Europe. Yet the company we see today bears almost no resemblance to its origins.
The Umicore story encompasses five major themes that every investor in clean technology, materials, or European industrial champions needs to understand:
- Reinvention: How a company can completely transform its identity across multiple centuries
- Colonial legacy: The uncomfortable history that shaped its capital base
- The EV transition bet: A €3 billion gamble on cathode materials
- Closed-loop circularity: The moat that competitors struggle to replicate
- Europe's industrial policy ambitions: Whether the continent can compete with China and Korea
Let's dig in.
II. The Colonial Origins: Union Minière du Haut-Katanga (1805–1968)
The Napoleonic Roots
The story begins in 1805, when Napoleon Bonaparte granted Jean Dony control of the Vieille-Montagne mine in Moresnet, on the modern border of Belgium and Germany. This marked the beginning of the oldest predecessor of Umicore as a company today. Umicore's history stretches back more than 200 years, with roots in mining and smelting.
This date can thus be said to mark the beginning of what became in 1837 the "Société Anonyme des Mines et Fonderies de Zinc de la Vieille-Montagne," the oldest of Umicore's predecessor companies. For the next six decades, this zinc mining operation would operate in relative obscurity, building expertise in metallurgy that would prove invaluable in the century to come.
The Congo Connection
The Haut Katanga region of what later became known as the Belgian Congo had long been recognized as a prime source of copper, zinc, and a variety of other metals and materials. In the later years of the 19th century, the Belgian government, propelled by King Leopold II, began laying the groundwork for the exploitation of the region's vast mineral deposits. Preliminary surveying was completed by 1901, and mining operations were begun a year later. In 1906, Belgium's mining interests in the region were formalized with the creation of the Union Minière du Haut Katanga (UMHK), which was granted the right to exploit all of the region's copper deposits in an area that reached more than 20,000 square kilometers and included some of the world's richest copper deposits.
UMHK also received permission to exploit the region's variety of minerals, which included silver, zinc, cobalt, cadmium, radium, uranium, germanium, and other metals.
What emerged was nothing short of a corporate state within a state. During its heyday, the UMHK held quasi governmental power in Katanga, and operated schools, dispensaries, hospitals and sporting establishments, and had enjoyed virtually unlimited funds. In 1959, Belgian profits from the Union Miniere were in excess of 3.5 billion Belgian francs, and export duties paid to the Congolese government constituted 50% of the government's revenue. There were times when the Belgian colony's tax on the UMHK accounted for up to 66% of its revenues.
The main thread running through much of Umicore's history is the Union Minière du Haut-Katanga (UMHK), a company incorporated in 1906 to exploit the vast natural resources of the Congo Free State. Initially, the UMHK concentrated on mining the state's extensive copper deposits, before diversifying into cobalt, tin, uranium (in which it at one point held a near-monopoly in global supply) and other precious metals. The company also constructed casting and smelting facilities, eventually growing to such an extent that it represented around half of all revenues taken in by the Congolese government.
The Uranium Monopoly and the Manhattan Project
The uranium story deserves special attention because it illustrates the scale of UMHK's strategic importance. The United States of America obtained uranium for the atomic bomb from the Union Minière. At a meeting on 18 September 1942 between Edgar Sengier, head of UMHK, and United States General Kenneth Nichols of the Manhattan Project, Nichols purchased the 1500 tonnes of uranium (mostly mined at Shinkolobwe mine, near the town of Jadotville) the project required. This was already in the United States, and additional ore was shipped from the Congo.
The mine had a "tremendously rich lode of uranium pitchblende. Nothing like it has ever again been found"; the ore was 65% uranium and even the waste piles were 20%; "after the war the MED and the AEC considered ore containing three tenths of 1 percent as a good find."
By 1960, UMHK had annual sales of $200 million USD, had produced 60 percent of the uranium in the West, 73 percent of the cobalt, and 10 percent of the copper, and had in the Congo 24 affiliates including hydroelectric plants, chemical factories and railways.
The Nationalization Shock
On 31 December 1966, the Congolese government, under President Joseph-Désiré Mobutu, took over the possessions and activities of the UMHK, transforming it into Gécamines (Société générale des Carrières et des Mines), a state-owned mining company. Mismanagement and failure to adopt modern standards of mining (rather than mining depletion), as well as outright theft by Mobutu, meant that mining production was greatly reduced, with production rate sinking as much as 70%.
In early January 1967, the UMHK was nationalized by the regime of President Mobutu Sese Seko, and over $800 million of the company's assets were seized by the state.
By the beginning of 1968, the entirety of UMHK's mining and smelting operations in Zaire had been nationalized. The company then found itself without any business. This was an existential crisis—the company's entire reason for being had been seized overnight by a hostile government.
The firm suddenly found itself without the vast majority of its business but managed to survive: full ownership passed to conglomerate Société Générale de Belgique, where it was grouped with its other metals and mining interests.
The controversial colonial legacy would hang over the company for decades, ultimately contributing to the decision to rebrand entirely. For investors, this history matters because it explains the geographic footprint, the metallurgical expertise, and the institutional memory that still shapes Umicore today. The company didn't develop expertise in cobalt by accident—it spent sixty years mining some of the world's richest cobalt deposits.
III. The 1989 Mega-Merger & Restructuring (1989–2000)
Creating a Belgian Industrial Powerhouse
After two decades of limbo following the nationalization, Société Générale decided it was time to consolidate its scattered metals businesses. In 1989, Société Générale announced plans to merge Union Minière with three other Belgian metals companies in which it held a significant stake: zinc producer Vieille Montagne; Metallurgie Hoboken-Overpelt, which dealt in a wide range of metals including copper, cobalt, and lead; and Mechim, an engineering firm. The much enlarged company was initially renamed Acec-Union Minière and subsequently set about streamlining its organisational structure, but the global economic downturn of the early-to-mid-1990s hit profits and forced management to implement a major restructuring programme in 1995.
The Hoboken connection is particularly significant. In 1887, the German companies Metallgesellschaft and Degussa founded the Sociéte Générale Metallurgique in Hoboken along the banks of the river Scheldt to extract silver from lead ore concentrates and by-products. This facility—now one of the world's largest precious metals recycling plants—would become the cornerstone of Umicore's future business model.
In 1989, Société Générale announced plans to merge Union Minière with three other Belgian metals companies: zinc producer Vieille Montagne (with a history stretching back to 1805); Metallurgie Hoboken-Overpelt; and Mechim, an engineering firm. The much enlarged company was initially renamed Acec-Union Minière (although the prefix was dropped in 1992) and subsequently set about streamlining its organisational structure, but the global economic downturn of the early-to-mid-1990s hit profits and forced management to implement a major restructuring programme in 1995. The three-year plan, implemented under the guidance of recently appointed CEO Karel Vinck, involved the loss of around 25% of Union Minière's workforce and the sale of a number of non-core assets.
Strategic Repositioning
The restructuring under Karel Vinck was brutal but necessary. Losing 25% of the workforce is never easy, but it allowed the company to focus its resources. In 1995, Union Minière undergoes far-reaching restructuring, selling off 12 divisions. In 1998, Suez acquires Société Générale and announces its intention to spin off its holding in Union Minière. In 2000, Union Minière becomes an independent, publicly listed company. In 2001, the company changes its name to Umicore in order to break its link to former colonial mining activity and to emphasize its new focus as a modern specialty metals producer.
A merger in 1989 transformed the new Union Minière into an integrated industrial group. From the 1990s onward, we increasingly found our way as a specialty materials company, selling remaining mining and other non-strategic assets. Our focus was now on precious metals, high-margin zinc products and advanced materials, looking more and more like the Umicore we know today.
The strategic pivot was clear: move away from commodity extraction toward higher-margin specialty materials where technical expertise creates defensible positions. This wasn't just about finding profitable niches—it was about building a business model that didn't depend on controlling physical assets in politically unstable regions.
For investors, the 1989 merger created the integrated platform that still exists today. The combination of Hoboken's precious metals refining with Vieille Montagne's zinc expertise and UMHK's cobalt knowledge created a unique capability set. No other company in the world had this particular combination of metallurgical skills.
IV. The Umicore Transformation: Birth of a Clean Tech Company (2001–2010)
Inflection Point #1: The Rebranding and Strategic Pivot
The year 2001 marked a symbolic and strategic watershed. In September 2001, Union Minière made a symbolic move to shed its longstanding image as a traditional metals producer by adopting a new name, Umicore. The name change also was meant to help the company divorce itself from Union Minière's controversial role in the development—some called it exploitation—of Belgian Congo. With its new name, Umicore expected to continue its transformation in the early years of the new century.
In 2001, Umicore was born. The first two letters of our name are a nod to the group's historical roots. The "UM" in Umicore stands for Union Minière—a subtle acknowledgment of the past while signaling a new direction.
The focus on recycling increased and the acquisition of Precious Metals Group from the German Degussa group brought a new dimension to the company, including a major presence in automotive catalysts.
Inflection Point #2: The PMG Acquisition (2003)
The acquisition of PMG (Precious Metals Group) from Degussa in 2003 was transformative. This wasn't just adding capacity—it was acquiring a completely new business line and doubling down on automotive catalysts just as global emissions regulations were tightening.
There's a delicious historical irony here: Degussa had been one of the founding shareholders of the Hoboken plant back in 1887. Ninety-six years later, Umicore was buying back a capability that had once belonged to its predecessor's partner.
In automotive catalysts, a field in which the company had begun research in 1968, the company ranks third in global market share behind BASF Catalysts (formerly Engelhard) and Johnson Matthey. Umicore increased its presence in the sector with the June 2007 purchase of the catalyst division of troubled American auto parts manufacturer Delphi for $55.6 million. Furthermore, Umicore went on to acquire Haldor Topsøe's heavy-duty diesel and stationary catalyst businesses in 2017.
Inflection Point #3: Exiting Mining & Base Metals
The final step in the transformation was getting completely out of the mining business. Mining, originally the lifeblood of the company, no longer plays a direct part in the business: a minority stake in zinc producer Padaeng Industry was Umicore's last remaining presence in the sector and was sold in April 2008. Umicore's copper extraction and refining operations were divested in 2005, with its zinc refining operations following in 2007; these now form part of Aurubis and Nyrstar respectively.
In just seven years, between 2001 and 2008, Umicore completed one of the most thorough corporate transformations in European industrial history. It went from a mining company with processing capabilities to a technology-focused materials company with no mining operations whatsoever.
Umicore now "generates the majority of its revenues from clean technologies, such as recycling, emission control catalysts, materials for rechargeable batteries, and photovoltaics."
Why This Matters for Investors: The transformation demonstrates exceptional strategic discipline. Many companies talk about pivoting their business models; Umicore actually did it, and did it completely. The company exited every business line that didn't fit its new thesis about where competitive advantage would lie. This kind of clear-eyed strategic execution is rare and suggests a management culture capable of making hard decisions.
V. The Battery Materials Bet: Building the Future (2007–2022)
Early Mover in Battery Recycling
While most of the world was still wondering whether electric vehicles would ever achieve mass adoption, Umicore's R&D teams were already working on the end-of-life problem. "Our R&D teams were very early into the game in battery recycling, starting in the mid-2000s and writing the first patents around 2007."
Umicore was an industry frontrunner with its investment in 2010 of an industrial demo installation (initial 7000 tonnes material input per year capacity) at its recycling plant in Hoboken near Antwerp, Belgium. The technology implemented at Umicore combines a high-temperature treatment (pyrometallurgy) which melts the recyclables in a first process step, followed by a refining process step (hydrometallurgy) which extracts the valuable metals.
Umicore received the European Business Award for the Environment (EBAE) in the 'Process' category in 2012.
This wasn't a small bet. In 2010, the EV market essentially didn't exist—Tesla had sold fewer than 2,000 Roadsters total. But Umicore was already building industrial-scale recycling capacity, betting that eventually there would be enough batteries to recycle.
The Proprietary Technology Advantage
Our unique, patented pyro-hydro technology, safeguarded by 20 patents, efficiently and sustainably recovers lithium, cobalt, nickel and copper. Since launching operations in 2011, Umicore has continually advanced its recycling technologies.
The approach is 20-30% more cost-efficient than other battery recycling methods, and results in high recovery yields of more than 95% for nickel, copper and cobalt, and, in the future, 80% for lithium.
Umicore's unique and patented process works in several stages, combining pyro and hydrometallurgy. The pyrometallurgy stage, using high-temperature smelting without any external energy, breaks down end-of-life batteries and production scraps into valuable recyclable elements and waste impurities.
After intensive research and piloting activities, this process is a significant step-up in recycling performance with an optimized operating window for EV batteries, demonstrating: Significantly improved metallurgical process with increased extraction efficiency of cobalt, nickel and copper to now reach over 95% yield for a wide variety of battery chemistries. First-of-its-kind technology to recover most of the lithium, solving a key constraint of today's existing recycling flowsheets. Automated material flow minimizing manual handling to further increase process robustness and efficiency.
Expansion into Cathode Active Materials
The logical extension of battery recycling was producing the battery materials themselves. Umicore SA is widely recognized for its commitment to sustainability and closed-loop recycling, making it a frontrunner in responsible cathode material production. Integrating advanced R&D and vertically aligned operations, Umicore delivers high-performance materials tailored for electric vehicles and energy storage, reinforcing its leadership in Europe and beyond.
Umicore was also the first company in the world to introduce a Sustainable Procurement Framework for Cobalt and the first to obtain external validation for its ethical procurement approach—critical as concerns about child labor and conflict minerals in Congo dominated headlines.
The scale of investment was substantial. Between 2010 and 2022, Umicore poured billions into battery materials capacity across Europe and Asia. The company built production facilities for rechargeable battery materials in Belgium, Poland, Korea, and began planning expansions in Canada and China.
This created what management calls the "closed-loop" model: Umicore makes cathode materials, sells them to battery makers, then recovers the metals when batteries reach end-of-life and feeds them back into new cathode production. No other company has this complete capability at scale.
VI. Inflection Point #4: The Volkswagen Partnership & European Battery Champion Ambitions (2022–2023)
The IONWAY Joint Venture
In September 2022, Umicore and Volkswagen's battery company PowerCo announced what seemed like a marriage made in heaven. Their Brussels-headquartered joint venture for large-scale industrial production of CAM and pCAM in Europe will bear the name IONWAY. Both parents aim to grow IONWAY's annual production capacity to 160 GWh p.a. by the end of the decade, corresponding to 2.2 m battery-electric vehicles.
IONWAY is the first-of-its-kind partnership between a car manufacturer based in Europe and a global leading producer of CAM, producing sustainable battery materials for the EV transition and a zero-emission future.
The partnership involves approximately €3 billion in investment, with Umicore sourcing and processing raw metals for the production of cathode materials required for Volkswagen's European cell factories. PowerCo plans to build cell factories in Salzgitter, Germany, and Valencia, Spain. It also decided to build a battery plant in St. Thomas, Canada. PowerCo expects the cell factories to have a total capacity of 240 GWh/year by 2030.
Thomas Jansseune has taken the helm as IONWAY's first Chief Executive Officer on 1 July 2023, following 22 years at Umicore. In his last role, he led Umicore's New Business Incubation with projects in venture capital, solid-state batteries, decarbonization, battery recycling, and hydrogen electrolysis. Prior to that, he was in charge of Corporate Development, held roles in marketing and sales, and served as managing director of a precious metals refining plant. Jansseune holds a PhD in Chemical Engineering.
The Strategic Rationale
IONWAY's first Cathode Active Material (CAM) production plant will be built in Nysa, Poland, adjacent to Umicore's existing CAM plant. Umicore is a Belgian company specialising in cathode material technology and will provide its know-how to produce in Europe cathode precursors and cathode active materials, key technology levers for battery performance.
The city was chosen for its strategic location, the access to renewable energy sources to power the plant and a skilled workforce. In addition, the IONWAY plant will benefit from Umicore's know-how and have easy access to raw materials from Umicore's refining operations in Finland.
The Polish government strongly supports the investment in Nysa—which is expected to create about 900 future-proof industry jobs in Nysa towards the end of the decade—and is offering IONWAY €350 million in cash grants under the Temporary Crisis and Transition Framework for a total investment of up to €1.7 billion (€1.35 billion after grants) by the end of the decade. The TCTF fosters support measures in sectors which are key for the transition to a net-zero economy in line with the Green Deal Industrial Plan.
The Technology Shift Challenge
But even as the champagne corks were still echoing from the IONWAY announcement, storm clouds were gathering. The industry was shifting faster than expected toward higher-nickel chemistries, and away from the mid-nickel NMC platforms where Umicore had the strongest position. Customer demand projections for certain qualified mid-nickel platforms began being scaled back to minimum offtake commitments, resulting in lower volume forecasts.
For investors, the IONWAY joint venture represents both Umicore's greatest opportunity and its greatest risk. The partnership provides anchor demand from one of the world's largest automakers, but it also ties Umicore's fate to Volkswagen's EV ambitions—ambitions that have proven more difficult to execute than expected.
VII. The Current Crisis: EV Slowdown & Strategic Reckoning (2023–2025)
The 2024 Reality Check
"2024 has been a sobering and intense year for Umicore, marked by significant headwinds including a slowdown in EV growth, multiple challenges for the European industrial sector, and rising geopolitical tensions. All this somewhat overshadowed the continued robust performance of our foundation businesses. Since my appointment last May, we have acted swiftly and decisively. We launched a strategic review, implemented efficiency and cost measures, and focused on disciplined capital allocation."
Those words from CEO Bart Sap capture the moment of reckoning. Given the slower-than-expected growth in demand for electric vehicles, Umicore decided to pause construction of the battery materials plant in Loyalist, Canada, and to strictly limit further footprint expansion, focusing on its existing facilities in Europe and Korea to serve its customers' commitments.
Umicore SA delayed plans for its $2.8 billion (US$2 billion) Ontario electric vehicle battery materials plant as consumer adoption falls short of expectations. The Ontario plant was expected to open by 2026 and provide battery materials for as much as 800,000 electric vehicles annually. The Canadian government planned to invest as much as $551.3 million in the factory, while Ontario's government planned to invest up to $424.6 million.
The Financial Impact
Umicore's Group revenues for 2024 amounted to €3.5 billion versus €3.9 billion in 2023. The adj. EBIT for the Group stood at €478 million (-29% compared to 2023) and the adj. EBITDA at €763 million (-22% compared to 2023).
Capital expenditures decreased by 35% in 2024 compared to 2023, totaling €555 million for the full year versus €857 million. In addition, Umicore contributed €175 million equity in IONWAY, its joint venture with Volkswagen's PowerCo.
Based on this scenario an impairment exercise has been performed, leading to a €1.60 billion reduction in the Battery Materials' capital employed. The impairment relates to Property, Plant and Equipment (PPE) and non-current inventories across Battery Materials' activities, mainly in Asia. Therefore, the remaining capital employed for this business amounts to €1.51 billion on 30 June 2024. Within this scenario, Umicore anticipates that Battery Materials' EBIT will remain below break-even levels in 2025 and 2026, and returns above the cost of capital are expected to be achieved in the last years of this decade.
The Dividend Cut & Leadership Response
This is a reduction from the €0.80 per share paid for 2023. Based on the closing share price on 31 December 2024 of €9.96, the dividend yield amounts to approximately 5%. Given the current context, the Supervisory Board intends to reset the gross annual dividend of €0.50 as the new baseline for future dividend payout on which to apply its policy of "stable or rising" dividends and discontinues the practice of paying an interim dividend.
The dividend cut from €0.80 to €0.50—a 37.5% reduction—signals the severity of the situation. Companies don't cut dividends unless they have to.
The 2025 Reset: Capital Markets Day and CORE Strategy
On March 27th 2025, Umicore CEO Bart Sap and the Executive Leadership Team shared the key outcomes of the Battery Materials strategy review and Umicore's roadmap to 2028. Focus is redirected on reinforcing our leadership in the foundation businesses and further unlocking their strong cash generation potential, while setting up Battery Cathode Materials for value recovery.
Mid-term plan designed to harness the Group's strengths focusing on four key imperatives: Capital, Performance, People & Culture, Partnerships. Capex reduction of €1.4 billion between 2025–2028 versus its previous plan: more balanced capital allocation within the Group and rigorous capital deployment.
Maximizing cash generation potential in foundation businesses—unlocking between €2 and €2.2 billion cumulative free cash flows between 2025 and 2028. Building on its strong market position, Catalysis aims to further maximize its business value throughout the plan. It has the ambition to deliver revenues of around €1.8 billion, with an Adj. EBITDA margin of around 25% and ROCE > 35% in 2028, while generating more than €1.4 billion free cash flow over the period 2025 to 2028.
Umicore decreases Capex by €800 million over the period 2025 to 2028 compared with the previous plan. It will put its assets to work leveraging its flexible footprint and maximizing plant utilization while applying strict cost management and rigorous capital deployment. The remaining Capex of €370 million will bring CAM capacity in Poland to 45 GWh and Korea to 40 GWh.
First Half 2025: Signs of Stabilization
Umicore delivered an encouraging performance in the first half of this year, in a dynamic global context. This highlights the quality of our businesses as well as our continued focus on operational efficiencies and rigorous capital deployment across the Group.
Umicore's Group revenues for the first half of 2025 amounted to €1.8 billion, in line with the first half of 2024. The adjusted EBIT for the Group stood at €302 million and the adjusted EBITDA at €433 million, up +25% and +10% respectively compared to the same period last year.
The Group-wide program to deliver at least €100 million EBITDA in 2025 (included in the 2025 outlook) is well on track, with more than €50 million already achieved so far. The Group's adjusted EBITDA margin amounted to 24.3%, well up compared to the 21.8% in the first half of 2024.
VIII. Business Model Deep Dive: The Four Pillars
Current Business Structure
The company divides its operations into four divisions: Energy Materials, Recycling, Catalysis, and Performance Materials. Following the 2025 reorganization, the reporting structure now comprises: Catalysis, Recycling, Specialty Materials, and Battery Materials Solutions.
Catalysis: The Cash Cow
The Catalysis business is the engine that keeps Umicore running. In automotive catalysts, the company ranks third in global market share behind BASF Catalysts (formerly Engelhard) and Johnson Matthey.
Catalysis has the ambition to deliver revenues of around €1.8 billion, with an Adj. EBITDA margin of around 25% and ROCE > 35% in 2028, while generating more than €1.4 billion free cash flow over the period 2025 to 2028.
A ROCE of over 35% is extraordinary by any measure. This business essentially prints money—it has dominant positions in emission control catalysts that are legally required on virtually every internal combustion vehicle sold worldwide. While the long-term trend is clearly toward electrification, the Catalysis business benefits from the "tail" of ICE vehicles that will continue being produced for years, if not decades.
Jensen Verhelle will provide more insights in how Catalysis will maximize business value throughout the mobility transformation: faster, stronger, longer. He will explain how Umicore is ideally positioned to maximize cash and quality of earnings over the long run in the mature automotive catalyst market, and provide insights in promising growth opportunities in fuel cell catalysts.
Recycling: The Core Competency
Umicore is the world's largest recycler of precious metals. The facility is the world's largest recycling facility of its kind and recycles 20 valuable metals from a large range of industrial residues and end-of-life products (e.g. from electronic waste or spent catalysts).
Umicore is helping to meet this challenge by investing €100 million in expanding capacity by 40% at its refining and recycling plant in Hoboken, Belgium—the largest and most sophisticated of its kind. Thanks to our focus on complex materials we can recover 17 valuable metals in an environmentally sound way.
Driven by a growing market need, Umicore wanted to be able to process growing volumes of increasingly complex, metal-containing industrial residues and e-scrap. Therefore, the company wanted to expand the capacity at its refining and recycling plant in Hoboken by 40%, going from 350,000 to 500,000 tonnes per year.
Recycling aims to maximize cash generation from current assets while investing for the future. Value creation is anticipated to remain industry leading. It has the ambition to deliver revenues of around €800 million, an Adj. EBITDA of about 35% and ROCE > 40% in 2028, while generating around €400 million free cash flow over the period 2025 to 2028.
A 40% ROCE target in Recycling is even more impressive than Catalysis. This is a business with almost no direct competition at scale and with barriers to entry that are measured in decades of accumulated expertise.
Battery Materials: The Growth Engine Turned Challenge
Battery Materials reported decreased revenues compared to 2023. This reflects lower CAM sales volumes and lower refining income, as well as the absence of a non-recurring lithium effect impacting the year-on-year comparison. Lower revenues, combined with costs related to ongoing expansions—albeit in the meantime strictly minimized—resulted in a decrease in adj. EBITDA versus the previous year. The 2024 adj. EBITDA for the Business Group was close to break-even as per expectations.
The Battery Materials Solutions Business Group is henceforth composed of: The business unit Battery Cathode Materials (formerly the 'Battery Materials' Business Group), which encompasses the developing, manufacturing and marketing of cathode materials and its precursors for lithium-ion batteries as well as the related refining activities of cobalt and nickel chemicals. The business unit Battery Recycling Solutions, formerly within the Recycling Business Group.
The Closed-Loop Model: Umicore's Potential Moat
Thanks to its vertically integrated global recycling network and closed-loop setup, it stands apart from peers that only focus on either battery materials or recycling.
"Our circular business model is at the core of everything we do. Leveraging our deep knowledge in metals chemistry, metallurgy, materials science and metals management, our foundation businesses have grown into undisputed leaders in their respective fields with industry leading returns. This very business model also stands at the core of battery materials where over time additional requirements emerged," said Bart Sap, CEO of Umicore.
This closed-loop model is the essence of Umicore's competitive positioning. Other companies can make catalysts. Other companies can recycle precious metals. Other companies can produce cathode materials. But no other company can do all three at scale, with seamless integration between them.
IX. Competitive Analysis: Porter's Five Forces & Hamilton Helmer's 7 Powers
Porter's Five Forces Analysis
1. Threat of New Entrants: LOW
The barriers to entry in Umicore's core businesses are formidable. In more than 130 years the site of Umicore has grown into one of the world's largest and most sophisticated refineries and recyclers of metals. You cannot replicate 130 years of accumulated metallurgical knowledge overnight.
Their unique, patented pyro-hydro technology, safeguarded by 20 patents provides legal protection on top of the operational barriers. The capital intensity is substantial—€3+ billion invested in battery materials alone.
2. Bargaining Power of Suppliers: MEDIUM
Umicore's supplier situation is nuanced. On one hand, it depends on supplies of precious metals and critical minerals. On the other hand, its position as the world's largest precious metals recycler gives it significant leverage—suppliers often become customers.
3. Bargaining Power of Buyers: MEDIUM-HIGH
In Battery Materials, customers like Volkswagen and other automakers have significant bargaining power due to the scale of their orders and their ability to dual-source. In Catalysis and Recycling, buyer power is more limited due to fewer alternative suppliers and regulatory requirements.
4. Threat of Substitutes: MEDIUM-HIGH in Battery Materials, LOW in Recycling
The move to lithium iron phosphate batteries and rising global competition threaten Umicore's cathode and recycling business margins and revenue growth. LFP batteries, which don't require nickel or cobalt, represent a direct substitution threat to NMC cathode materials.
5. Industry Rivalry: HIGH
The competitive landscape of the market, along with the company profiles of leading players (BASF SE, Mitsubishi Chemical Holdings Corporation, Umicore SA, Johnson Matthey PLC, Sumitomo Metal Mining Co., Ltd., and Posco Chemical Co., Ltd.) are also presented in detail.
Umicore's main competitors include Johnson Matthey, Albemarle, and BASF (for battery materials), along with Li-Cycle (battery recycling), and Aurubis/Nyrstar (metals refining).
Hamilton Helmer's 7 Powers Analysis
1. Scale Economies: STRONG in Recycling, MODERATE in Catalysis
The Hoboken plant processes 500,000 tonnes annually—scale that competitors cannot easily match.
2. Network Effects: WEAK
Materials businesses generally don't benefit from network effects.
3. Counter-Positioning: STRONG
Umicore's integrated closed-loop model represents classic counter-positioning. For competitors to replicate it, they would have to cannibalize their existing business models or make massive investments with uncertain returns.
4. Switching Costs: MODERATE TO HIGH
Once a battery material is qualified by an automaker for a specific platform, switching costs are substantial due to the lengthy qualification process.
5. Branding: MODERATE
Umicore has strong brand recognition for sustainability and ethical sourcing—increasingly important to ESG-conscious customers and investors.
6. Cornered Resource: STRONG
Umicore's metallurgical expertise, particularly in complex precious metals recycling, represents a cornered resource that took decades to develop.
7. Process Power: STRONG
The approach is 20-30% more cost-efficient than other battery recycling methods, and results in high recovery yields of more than 95% for nickel, copper and cobalt. This process advantage creates sustainable cost leadership.
X. Leadership & Governance
CEO Bart Sap: The Crisis Manager
Umicore announces the appointment of Bart Sap as Chief Executive Officer, effective May 16th. He will succeed Mathias Miedreich who has decided to step down, in mutual agreement with the Supervisory Board.
The timing of Sap's appointment was telling—he took the helm just as the EV slowdown was becoming apparent, suggesting the Board recognized that a different kind of leadership was needed.
Bart joined Umicore in 2004 as a controller for Cobalt & Specialty Materials. He progressed within the business unit, taking on assignments in Belgium and Korea with responsibilities in finance, business line and business development as well as supply and refining of battery raw materials. In 2020 he became Senior Vice-President for CSM, leading significant improvements in supply chain resilience and cost efficiency. Known for his collaborative and visionary leadership, Bart emphasizes teamwork and open communication, fostering a strong safety culture as essential for achieving operational excellence and driving sustainable growth.
Bart holds a master's degree in Commercial Science from Vlekho in Brussels, Belgium, with majors in Accountancy and Taxation. He began his career at Andersen/Deloitte and Grant Thornton.
The contrast with his predecessor is instructive. Mathias Miedreich was the visionary who bet big on battery materials growth. Sap is the operations-focused leader who knows where the bodies are buried and can execute a turnaround. The Supervisory Board commented: "With Bart, we have a new CEO with deep experience of Umicore's different businesses and with a track record of success. In recent years he steered the Catalysis Business Group to record results and returns on capital employed combined with a remarkable cash flow generation, and this in a challenging market context."
The Executive Leadership Team
The team assembled for the turnaround is notably diverse in both background and expertise:
Karena Cancilleri was appointed Executive Vice-President of Battery Cathode Materials on April 1st 2025. She brings a 30-year track record in the chemical, technical textiles and metals industries at private equity, stock-listed and family-owned companies. Prior to joining Umicore, Karena served as President Foundry Technologies at Vesuvius Plc.
Geert Olbrechts was appointed Chief Technology Officer on August 1st, 2023 and Executive Vice-President of Recycling on November 18th, 2024. Geert began his career at Umicore in 2000 and prior to his appointment served as Senior Vice President Research & Technology and Supply at Umicore's Automotive Catalysts business unit. Prior to joining AC in 2010 Geert occupied different positions in Research & Development and served as operations manager in the Precious Metals Refining business unit. Geert has a PhD in Physical Chemistry from the Catholic University of Leuven, Belgium, and an Executive MBA from Belgium's Vlerick Management School.
XI. Investment Thesis: Bull Case vs. Bear Case
The Bull Case
1. Foundation Businesses Are Exceptional
The Catalysis and Recycling businesses alone justify a significant portion of Umicore's current market value. Catalysis targets ROCE > 35% in 2028, while generating more than €1.4 billion free cash flow over 2025-2028. Recycling targets ROCE > 40% in 2028, while generating around €400 million free cash flow over the same period.
These returns are world-class by any measure. If Battery Materials went to zero, Umicore would still have two extremely valuable businesses.
2. The EV Transition Is Delayed, Not Cancelled
Electric vehicles are still coming—the question is timing, not destination. Umicore has scaled back its near-term expectations but maintains capacity that will become valuable as the market matures.
3. The Closed-Loop Model Creates Optionality
As EVs eventually scale, the battery recycling opportunity becomes enormous. By 2030-2035, millions of EV batteries will reach end-of-life, and Umicore will have the world's most sophisticated infrastructure to process them.
4. Disciplined Capital Allocation Under New Leadership
Capex reduction of €1.4 billion between 2025–2028 versus its previous plan demonstrates the new management's willingness to preserve capital until returns become clearer.
The Bear Case
1. LFP Chemistry Shift
The industry shift toward lithium iron phosphate (LFP) batteries—which use no nickel or cobalt—threatens to strand Umicore's NMC cathode investments. Tesla, BYD, and others are increasingly using LFP for standard-range vehicles.
2. Chinese Competition
Chinese battery material producers have achieved massive scale and are increasingly competitive on cost. CATL, BYD, and Chinese chemical companies can undercut on price, potentially commoditizing the cathode materials market.
3. Volkswagen Dependency
The IONWAY joint venture ties Umicore's fate to Volkswagen's EV ambitions. If VW's electrification strategy falters, Umicore's returns on that investment suffer directly.
4. Catalysis Is a Declining Market
While highly profitable today, the Catalysis business will eventually shrink as ICE vehicle production declines. The question is how fast.
5. Capital Intensity Continues
Net debt at €1,829 million corresponding to a net debt / LTM adj. EBITDA ratio of 2.28x as of mid-2025. While manageable, the balance sheet has less flexibility than it did a few years ago.
XII. Key Metrics to Watch
For investors following Umicore, three KPIs matter above all others:
1. Battery Materials EBITDA Breakeven Timeline
Umicore reiterates its guidance for the Battery Cathode Materials business unit, expecting adjusted EBITDA to be around break-even for 2025, similar to last year. This outlook indicates a solid underlying year-on-year performance improvement driven by the anticipated ramp-up of contracted volumes and ongoing operational efficiencies.
When—or whether—Battery Materials achieves sustainable profitability is the single most important variable for the investment thesis. Break-even in 2025-2026 was the guidance; returns above cost of capital by decade's end. Any acceleration or delay materially changes the valuation.
2. Foundation Business ROCE
Catalysis targets ROCE > 35% and Recycling targets ROCE > 40%. These are the benchmarks against which management credibility should be measured. If the foundation businesses continue delivering these returns, they provide the cushion for the battery materials turnaround.
3. Free Cash Flow Generation
Maximizing cash generation potential in foundation businesses—unlocking between €2 and €2.2 billion cumulative free cash flows between 2025 and 2028.
Cash generation proves whether the business model is working. High-quality businesses generate cash; value traps consume it. Tracking cumulative FCF against the €2-2.2 billion target provides an objective measure of execution.
XIII. Regulatory and Risk Factors
Environmental Liabilities
The Hoboken plant's proximity to residential areas creates ongoing regulatory scrutiny. In July 2020 the readings of the children living close to the Umicore recycling plant in Hoboken, Belgium, showed elevated levels of lead in their blood after multiple years of steady decreases, with historically low levels in 2019. This sudden rise in the readings for lead in blood came unexpectedly, as the emissions from the plant had consistently been well below the legal norm.
The company has invested heavily in remediation, but environmental legacy issues remain a potential source of future liability.
Geopolitical Risks
Umicore's supply chains run through some of the world's most geopolitically sensitive regions. Cobalt from the DRC, nickel from Russia, rare earths from China—any disruption to these supply chains could impact operations.
Technology Transition Risk
The shift from NMC to LFP batteries, or the emergence of solid-state batteries, could render current cathode material investments less valuable. Battery chemistry is evolving rapidly, and backing the wrong technology could prove costly.
Tariff Exposure
These projections are based on the current market conditions and geopolitical landscape as of the date of publication. The provided outlook for 2025 does not include any assumptions on the potential impact of the introduction of tariffs.
With manufacturing spread across Belgium, Poland, Korea, and other locations, trade barriers could impact competitiveness.
XIV. Conclusion: Materials for a Better Life?
Umicore's story is one of continuous reinvention. From Napoleonic zinc mines to colonial copper empires to atomic bombs to catalytic converters to EV batteries—the company has transformed itself more completely and more frequently than almost any other industrial enterprise in history.
Today, Umicore stands at another crossroads. The bet on battery materials that seemed so prescient in 2010-2022 has run into the messy reality of EV adoption timelines, Chinese competition, and shifting battery chemistries. The €1.6 billion impairment taken in 2024 is a tangible reminder that even well-researched bets sometimes go wrong.
Yet the foundation businesses—Catalysis and Recycling—continue to perform at exceptional levels. A company with ROCE above 35% in one major segment and above 40% in another deserves serious attention, regardless of what's happening in the third segment.
Our return on capital will be north of 15% in 2028, and our cumulative free cash flows will be in the range of €1 billion to €1.2 billion.
The critical question is whether Umicore can navigate the current turbulence without destroying the value that made it an attractive investment in the first place. The CORE strategy announced at the 2025 Capital Markets Day suggests management understands this—capital discipline, operational excellence, culture change, and partnership exploration.
For investors, Umicore offers a unique exposure: a European industrial champion with genuine technical moats, exceptional foundation businesses, and optionality on the EV transition that may yet prove valuable. The company trades at a significant discount to its historical multiples, reflecting the market's skepticism about battery materials.
Whether that skepticism is warranted or represents an opportunity depends on one's view of three things: the pace of EV adoption, the competitive dynamics in cathode materials, and management's ability to execute the turnaround.
"Our plan focuses on reinforcing our leadership in the foundation businesses and further unlocking their strong cash generation potential, while setting up Battery Cathode Materials for value recovery."
From colonial mining to circular materials technology, from uranium monopoly to EV aspirations, Umicore's 220-year journey continues. The next chapter is being written now.
Material Regulatory Note: Umicore is subject to ongoing environmental monitoring at its Hoboken facility under Belgian and EU regulations. The company has disclosed historical environmental liabilities and continues to invest in remediation efforts. Investors should review the company's annual report for detailed disclosures on environmental provisions and contingent liabilities.
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