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Hindalco Reports Q1 Results

Metal News - Published on Tue, 13 Aug 2019

Image Source: livemint.com
Hindalco Industries Ltd announced consolidated results for the first quarter ended 30 June 2019. While profits were impacted by the global downturn and lower commodity prices, Hindalco held its ground and delivered a steady performance. Novelis led from the front to achieve record quarterly results, and the Indian businesses put up a resilient show amid subdued economic conditions. Mr Satish Pai, Managing Director, Hindalco Industries, said, “We continued to maintain our strong position in aluminium and copper in Q1 FY20 despite headwinds. The resilient performance owes as much to our backward integration, resource security, strong balance sheet, operational capabilities and rich product portfolio. Today, 79 per cent of Hindalco’s consolidated EBITDA is non-LME linked, reflecting a balanced and sustainable business model, which will serve us well in all market conditions.”

Key highlights of Q1 FY20 (vs. Q1 FY19):
Record Novelis Adjusted EBITDA at USD 372 million, up 11 per cent
Record Novelis Adjusted EBITDA per ton at USD 448, up 7 per cent
Novelis Net Income (excluding special items1) at USD 145 million (vs. USD 115 million) up 26 per cent
Aluminium Metal Sales at Hindalco, up 7 per cent at 320 Kt (vs. 300 Kt)
Record quarterly Copper Continuous Cast Rod (CCR) production at 66 Kt (vs. 65 Kt), up 2 per cent
Consolidated EBITDA at INR 3,770 crore (vs. INR 4,335 crore), down 13 per cent
Consolidated PAT at INR 1,063 crore (vs. INR 1,475 crore), lower by 28 per cent

Novelis - Novelis delivered yet another strong operational and financial quarterly performance. Adjusted EBITDA grew 11 per cent to touch a record high of USD 372 million in Q1 FY20. This performance was driven by higher shipments coupled with favourable price and product mix, partially offset by less favourable recycling benefits due to lower aluminium prices. Novelis achieved its best-ever Adjusted EBITDA per ton of USD 448 in Q1 FY20, up 7 per cent YoY. The company recorded its best-ever Net Income (excluding tax-effected special items1) of USD 145 million in Q1 FY20, up 26 per cent YoY. Total shipments of flat rolled products (FRP) in Q1 FY20 grew 4 per cent to 830 Kt. The revenues were at USD 2.9 billion in Q1 FY20, down 6 per cent YoY; this decline was mainly due to a fall in average base aluminium price, partially offset by higher total shipments and a favourable product price and mix.

Aluminium (Hindalco including Utkal Alumina) - Stable operations of the Indian Aluminium Business helped achieve Alumina (including Utkal) and Aluminium metal production of 686 Kt and 326 Kt in respectively, in Q1 FY20. Reported revenue of INR 5,472 crore in Q1 FY20 (INR 5,668 crore a year ago) was lower by 3 per cent due to lower realisations. EBITDA stood at Rs.889 crore in Q1 FY20 compared to INR 1,532 crore in Q1 FY19 due to lower realisations. EBITDA margins were at 16 per cent in Q1 FY20. Production of Aluminium Value Added Products (VAPs), excluding wire rods, was at 79 Kt in Q1 FY20 vs. 78 Kt in Q1 FY19. The impact of the Muri Alumina refinery closure was partially offset by higher volumes at Utkal Alumina.

Copper - The Copper Business recorded its highest quarterly Value Added Product (VAP) production at 66 Kt in Q1 FY20, up 2 per cent YoY. The VAP sales were up 3 per cent at 63 Kt in the first quarter. The overall production volumes (Copper Cathodes) were at 76 Kt in Q1 FY20, lower compared to the prior year, due to planned maintenance shutdown. The total copper metal sales remained steady at 82 Kt in Q1 FY20 vis-à-vis Q1 FY19. Revenue from the Copper Business was at INR 4,593 crore in Q1 FY20 vs. INR 5,012 crore a year ago. EBITDA was lower at INR 267 crore in Q1 FY20 compared to INR 347 crore in Q1 FY19, due to lower by-product volumes and realisations.

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Posted By : Rabi Wangkhem on Tue, 13 Aug 2019
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