Novelis Inc., a leader in aluminum rolling and recycling, reported net income attributable to its common shareholder of $127 million for the first quarter of fiscal year 2020, compared to $137 million in the prior year period.
Excluding tax-effected special items, such as $33 million in favorable metal price lag in the prior year, the company reported net income of $145 million in the first quarter of fiscal 2020, compared to $115 million in the prior year period. This 26 percent increase is primarily due to higher Adjusted EBITDA.
Adjusted EBITDA increased 11 percent over the prior year period to $372 million in the first quarter of fiscal 2020, primarily driven by higher total shipments as well as favorable price and product mix, partially offset by less favorable recycling benefits due to lower aluminum prices. Adjusted EBITDA per ton reached $448 in the quarter, as compared to $419 in the prior year period.
Net sales decreased six percent over the prior year period to $2.9 billion for the first quarter of fiscal 2020, driven by lower average aluminum prices and local market premiums, partially offset by higher total shipments and more favorable product price and mix. Shipments of flat rolled products increased four percent over the prior year to 830 kilotonnes.
The company reported negative $94 million of free cash flow for the first quarter of fiscal 2020, including a three-fold increase in capital expenditures year-over-year to $162 million mainly to support strategic capacity expansion projects underway in the US, China and Brazil. Free cash flow before capital expenditures improved 36 percent over the prior year period to $68 million, driven primarily by higher Adjusted EBITDA and favorable working capital from lower aluminum prices and inventory levels.
First quarter fiscal year 2020 highlights:
•Net income attributable to common shareholder of $127 million; excluding special items, net income of $145 million
•Adjusted EBITDA of $372 million
•Net sales of $2.9 billion
•Shipments of 830 kilotonnes
Published in the September 2019 Edition