Novelis: Net income increased four percent to $161 million in fiscal 2015

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Source: Novelis Inc.

Atlanta, Georgia / USA — Novelis, the world leader in aluminum rolling and recycling, has reported net income of $148 million for fiscal year 2015, a 42 percent increase from the $104 million reported in fiscal 2014. Excluding certain tax-effected items, net income increased four percent to $161 million in fiscal 2015.

„Fiscal 2015 was a successful year as we grew our portfolio of high-recycled, premium products,“ balanced Steve Fisher, Interim President and Chief Executive Officer for Novelis. „We achieved record total shipments, drove benefits from expanding low-cost recycling capabilities worldwide, and grew automotive shipments to record levels, strengthening our leadership position in this fast growing segment. While we are pleased with these achievements, the strengthening U.S. dollar and declining local market metal premiums in the fourth quarter tempered our results.“

Higher percentage of recycled metal inputs used

Adjusted EBITDA grew two percent to $902 million in fiscal 2015 compared to the $885 million reported in fiscal 2014. The increase was primarily driven by higher shipments, favorable product mix due to a strategic shift to grow automotive shipments and cost benefits from using a higher percentage of recycled metal inputs. Partially offsetting these gains were higher costs associated with the start-up and support of new capacity, lower pricing in some Asian markets, as well as unfavorable foreign exchange and metal price lag.

Fiscal 2015 revenues increased 14 percent to $11.1 billion compared to $9.8 billion in fiscal 2014. Revenue growth was driven by a five percent increase in shipments of rolled aluminum products to 3,050 kilotonnes in fiscal year 2015. Every operating region reported an increase in shipments year-over-year. Higher average metal prices in fiscal year 2015 also contributed to the increase in revenues.

The Company noted a number of accomplishments over the past fiscal year:

  • generated positive free cash flow after funding $518 million in capital investments;
  • captured strong automotive and can sheet demand through strategic capacity additions to grow global shipments;
  • grew automotive shipments 28 percent over the prior year by meeting strong customer demand across Europe and by utilizing new automotive finishing capacity in the U.S. and China;
  • drove cost benefits through expanded recycling operations globally, increasing the fiscal year 2015 average recycled content rate by three points to 49 percent for the full year and achieving a record fourth quarter rate of 53 percent;
  • added evercycle™, the world’s first independently certified high-recycled content specialty sheet, to its unique portfolio of certified high-recycled content products including evercan™; and
  • strengthened its core premium product portfolio by completing the sale of its household foil operations in North America and the majority of its hydroelectric power generation operations in Brazil, as well as closing its smelter in Brazil.

Fourth Quarter Results

Shipments of aluminum rolled products totaled 758 kilotonnes for the fourth quarter of fiscal 2015, up slightly compared to shipments of 753 kilotonnes for the same period last year. Net sales increased to $2.8 billion compared to $2.5 billion in the prior year period.

Adjusted EBITDA for the fourth quarter of fiscal 2015 was $201 million compared to the $250 million reported for the same period a year ago. While automotive shipments ramped up as expected, the positive benefits from product mix shift were more than offset by unfavorable foreign exchange, falling local market metal premiums in the fourth quarter of fiscal 2015 compared to rising premiums in the fourth quarter of fiscal 2014, and an unexpected North American hot mill outage early in the fourth quarter of fiscal 2015.

The Company reported net income of $29 million for the fourth quarter of fiscal 2015.

Source: Novelis Inc. / PRNewswire