Fourth quarter 2023 highlights:
- Shipments of 336 thousand metric tons, down 9% compared to Q4 2022
- Revenue of €1.6 billion, down 13% compared to Q4 2022
- Value-Added Revenue (VAR) of €681 million, down 2% compared to Q4 2022
- Net income of €11 million compared to net income of €30 million in Q4 2022
- Adjusted EBITDA of €171 million, up 15% compared to Q4 2022
- Cash from Operations of €185 million and Free Cash Flow of €58 million
Full year 2023 highlights:
- Shipments of 1.5 million metric tons, down 6% compared to 2022
- Revenue of €7.2 billion, down 11% compared to 2022
- VAR of €2.9 billion, up 7% compared to 2022
- Net income of €129 million compared to net income of €308 million in 2022
- Adjusted EBITDA of €713 million, up 6% compared to 2022
- Cash from Operations of €506 million and Free Cash Flow of €170 million
- Adjusted Return on
Invested Capital (Adjusted ROIC) of 11.3%, up 30 bps compared to 2022 - Net debt / LTM Adjusted EBITDA of 2.3x at
December 31, 2023
Other highlights:
- The Company today announces a three-year share repurchase program of up to
$300 million expiring inDecember 2026
Group Summary
Q4 2023 | Q4 2022 | Var. | FY 2023 | FY 2022 | Var. | |||
Shipments (k metric tons) | 336 | 368 | (9)% | 1,492 | 1,580 | (6)% | ||
Revenue (€ millions) | 1,613 | 1,844 | (13)% | 7,239 | 8,120 | (11)% | ||
VAR (€ millions) | 681 | 696 | (2)% | 2,924 | 2,725 | 7% | ||
Net income (€ millions) | 11 | 30 | n.m. | 129 | 308 | n.m. | ||
Adjusted EBITDA (€ millions) | 171 | 148 | 15% | 713 | 673 | 6% | ||
Adjusted EBITDA per metric ton (€) | 509 | 403 | 26% | 478 | 426 | 12% |
The difference between the sum of reported segment revenue and total group revenue includes revenue from certain non-core activities and inter-segment eliminations. The difference between the sum of reported segment Adjusted EBITDA and the Group Adjusted EBITDA is related to Holdings and Corporate.
For the fourth quarter of 2023, shipments of 336 thousand metric tons decreased 9% compared to the fourth quarter of 2022 due to lower shipments in each of our segments. Revenue of €1.6 billion decreased 13% compared to the fourth quarter of the prior year primarily due to lower shipments and lower metal prices, partially offset by improved price and mix. VAR of €681 million decreased 2% compared to the fourth quarter of the prior year primarily due to lower shipments, unfavorable metal impacts, the sale of
For the full year of 2023, shipments of 1.5 million metric tons decreased 6% compared to the full year of 2022 primarily due to lower shipments in the P&ARP and AS&I segments. Revenue of €7.2 billion decreased 11% compared to the full year of 2022 primarily due to lower shipments and lower metal prices, partially offset by improved price and mix. VAR of €2.9 billion increased 7% compared to the full year of 2022 primarily due to improved price and mix, partially offset by lower shipments, unfavorable metal impacts and unfavorable foreign exchange translation. Net income of €129 million decreased €179 million compared to net income of €308 million in the full year of 2022. Adjusted EBITDA of €713 million increased 6% compared to the full year of 2022 due to stronger results in our A&T segment, partially offset by weaker results in our P&ARP and AS&I segments.
Results by Segment
Packaging & Automotive Rolled Products (P&ARP)
Q4 2023 | Q4 2022 | Var. | FY 2023 | FY 2022 | Var. | ||
Shipments (k metric tons) | 238 | 254 | (6)% | 1,030 | 1,089 | (5)% | |
Revenue (€ millions) | 865 | 1,008 | (14)% | 3,898 | 4,664 | (16)% | |
Adjusted EBITDA (€ millions) | 82 | 71 | 16% | 283 | 326 | (13)% | |
Adjusted EBITDA per metric ton (€) | 345 | 278 | 24% | 274 | 299 | (8)% |
For the fourth quarter of 2023, Adjusted EBITDA of €82 million increased 16% compared to the fourth quarter of 2022 primarily due to improved price and mix and improved overall costs, partially offset by lower shipments. Higher operating costs were more than offset by favorable metal costs, favorable inflation and energy-related government grants. Shipments of 238 thousand metric tons decreased 6% compared to the fourth quarter of the prior year due to lower shipments of packaging and specialty rolled products, partially offset by higher shipments of automotive rolled products. Revenue of €865 million decreased 14% compared to the fourth quarter of 2022 primarily due to lower shipments and lower metal prices.
For the full year of 2023, Adjusted EBITDA of €283 million decreased 13% compared to the full year of 2022 as a result of lower shipments and higher operating costs mainly due to inflation, operating challenges at our Muscle Shoals facility and unfavorable metal costs, partially offset by improved price and mix. Shipments of 1.0 million metric tons decreased 5% compared to the full year of 2022 due to lower shipments of packaging and specialty rolled products, partially offset by higher shipments of automotive rolled products. Revenue of €3.9 billion decreased 16% compared to the full year of 2022 primarily due to lower shipments and lower metal prices, partially offset by improved price and mix.
Aerospace & Transportation (A&T)
Q4 2023 | Q4 2022 | Var. | FY 2023 | FY 2022 | Var. | |||
Shipments (k metric tons) | 48 | 53 | (9)% | 219 | 223 | (2)% | ||
Revenue (€ millions) | 408 | 422 | (3)% | 1,728 | 1,700 | 2% | ||
Adjusted EBITDA (€ millions) | 76 | 56 | 36 | % | 324 | 217 | 50% | |
Adjusted EBITDA per metric ton (€) | 1,583 | 1,079 | 47 | % | 1,475 | 976 | 51% |
For the fourth quarter of 2023, Adjusted EBITDA of €76 million increased 36% compared to the fourth quarter of 2022 primarily due to improved price and mix, partially offset by lower shipments and higher operating costs. Shipments of 48 thousand metric tons decreased 9% compared to the fourth quarter of 2022 on higher shipments of aerospace rolled products, more than offset by lower shipments of transportation, industry and defense (TID) rolled products. Revenue of €408 million decreased 3% compared to the fourth quarter of 2022 primarily due to lower shipments and lower metal prices, partially offset by improved price and mix.
For the full year of 2023, Adjusted EBITDA of €324 million increased 50% compared to the full year of 2022 primarily due to improved price and mix, partially offset by higher operating costs mainly due to inflation and increased activity levels. Shipments of 219 thousand metric tons decreased 2% compared to the full year of 2022 on higher shipments of aerospace rolled products, more than offset by lower shipments of TID rolled products. Revenue of €1.7 billion increased 2% compared to the full year of 2022 primarily due to improved price and mix, partially offset by lower metal prices.
Automotive Structures & Industry (AS&I)
Q4 2023 | Q4 2022 | Var. | FY 2023 | FY 2022 | Var. | |
Shipments (k metric tons) | 50 | 61 | (17)% | 243 | 268 | (9)% |
Revenue (€ millions) | 334 | 428 | (22)% | 1,630 | 1,861 | (12)% |
Adjusted EBITDA (€ millions) | 25 | 31 | (22)% | 133 | 149 | (11)% |
Adjusted EBITDA per metric ton (€) | 500 | 514 | (3)% | 545 | 557 | (2)% |
For the fourth quarter of 2023, Adjusted EBITDA of €25 million decreased 22% compared to the fourth quarter of 2022 primarily due to lower shipments and higher costs, partially offset by improved price and mix. Shipments of 50 thousand metric tons decreased 17% compared to the fourth quarter of 2022 on stable shipments of automotive extruded products and lower shipments of other extruded products including the impact from the sale of CED in
For the full year of 2023, Adjusted EBITDA of €133 million decreased 11% compared to the full year of 2022 primarily due to lower shipments and higher operating costs mainly due to inflation, partially offset by improved price and mix. Shipments of 243 thousand metric tons decreased 9% compared to the full year of 2022 due to lower shipments of other extruded products including the impact from the sale of CED in
Net Income
For the fourth quarter of 2023, net income of €11 million compares to net income of €30 million in the fourth quarter of the prior year. The decrease in net income is primarily related to gains on OPEB and pension plan amendments recorded in 2022 and higher tax expense, partially offset by higher gross profit.
For the full year of 2023, net income of €129 million compares to net income of €308 million in the prior year. The decrease in net income is primarily related to the recognition in the prior year of previously unrecognized deferred tax assets of €154 million, gains on OPEB and pension plan amendments recorded in 2022, higher selling and administrative expenses and higher tax expense, partially offset by higher gross profit and a gain related to the sale of CED in
Cash Flow
Free Cash Flow was €170 million in the full year of 2023 compared to €182 million in the prior year, reflecting a €55 million increase in cash flows from operating activities which was more than offset by increased capital expenditures as we continue to invest in maintaining and growing our manufacturing asset base including our recycling and casting investment in
Cash flows from operating activities were €506 million for the full year of 2023 compared to cash flows from operating activities of €451 million in the prior year.
Cash flows used in investing activities were €288 million for the full year of 2023 compared to cash flows used in investing activities of €270 million in the prior year. In 2023, cash flows used in investing activities included €47 million of net proceeds from the sale of CED in
Cash flows used in financing activities were €182 million for the full year of 2023 compared to cash flows used in financing activities of €163 million in the prior year. In 2023,
Liquidity and Net Debt
Liquidity at
Net debt was €1,664 million at
Outlook
Based on our current outlook, we expect Adjusted EBITDA, which excludes the non-cash impact of metal price lag, to be in the range of €740 million to €770 million and Free Cash Flow in excess of €130 million in 2024.
We are not able to provide a reconciliation of this Adjusted EBITDA guidance to net income, the comparable GAAP measure, because certain items that are excluded from Adjusted EBITDA cannot be reasonably predicted or are not in our control. In particular, we are unable to forecast the timing or magnitude of realized and unrealized gains and losses on derivative instruments, metal price lag, impairment or restructuring charges, or taxes, without unreasonable efforts, and these items could significantly impact, either individually or in the aggregate, future net income.
Recent Developments
Share Repurchase Program
Under this program, the Company may purchase shares from time to time for cash in open market transactions or in privately-negotiated transactions, in accordance with applicable state and federal securities laws and in compliance with applicable provisions of French corporate law, and it may make all or part of the purchases pursuant to Rule 10b5-1 plans. The timing and the amount of repurchases, if any, will be determined based on the Company's evaluation of market conditions, capital allocation alternatives and other factors. The share repurchase program does not require the Company to acquire any dollar amount or number of shares of CSTM common stock and may be modified, suspended, extended or terminated by the Company's Board of Directors at any time without prior notice.
The Company intends to use a portion of the repurchased shares under this new program to satisfy employee equity obligations in lieu of issuing new shares, which would limit future dilution for its shareholders.
Changes to the Presentation of Certain Non-GAAP Financial Measures
Following the
Based on discussions with the
For the years ended | |||||||||||||||
(in millions of Euros) | 2023 | 2022 | 2021 | 2020 | 2019 | ||||||||||
Net income | 129 | 308 | 262 | (17 | ) | 64 | |||||||||
Income tax expense / (benefit) | 67 | (105 | ) | 55 | (17 | ) | 18 | ||||||||
Income before tax | 196 | 203 | 317 | (34 | ) | 82 | |||||||||
Finance costs - net | 141 | 131 | 167 | 159 | 175 | ||||||||||
Share of income of joint-ventures | — | — | — | — | (2 | ) | |||||||||
Income from operations | 337 | 334 | 484 | 125 | 255 | ||||||||||
Depreciation and amortization | 294 | 287 | 267 | 259 | 256 | ||||||||||
Impairment of assets | — | — | — | 43 | — | ||||||||||
Restructuring costs | — | 1 | 3 | 13 | 4 | ||||||||||
Unrealized (gains) / losses on derivatives | 3 | 46 | (35 | ) | (16 | ) | (33 | ) | |||||||
Unrealized exchange losses / (gains) from the remeasurement of monetary assets and liabilities – net | 2 | 1 | (1 | ) | (1 | ) | — | ||||||||
Losses / (gains) on pension plan amendments | — | (47 | ) | 32 | 2 | (1 | ) | ||||||||
Share based compensation costs | 20 | 18 | 15 | 15 | 16 | ||||||||||
Start-up and development costs | — | — | — | 5 | 11 | ||||||||||
(Gains) / losses on disposal | (29 | ) | 4 | 3 | 4 | 3 | |||||||||
Bowling Green one-time cost related to the acquisition | — | — | — | — | 5 | ||||||||||
Other | — | — | — | 8 | — | ||||||||||
Metal price lag | 86 | 29 | (187 | ) | 8 | 46 | |||||||||
Adjusted EBITDA (current) | 713 | 673 | 581 | 465 | 562 | ||||||||||
less: Metal price lag | (86 | ) | (29 | ) | 187 | (8 | ) | (46 | ) | ||||||
Adjusted EBITDA (future) | 627 | 644 | 768 | 457 | 516 |
For the three months ended | |||||||||||||
(in millions of Euros) | 2023 | 2023 | 2023 | 2023 | |||||||||
Net income | 11 | 64 | 32 | 22 | |||||||||
Income tax expense / (benefit) | 32 | 18 | 12 | 5 | |||||||||
Income before tax | 43 | 82 | 44 | 27 | |||||||||
Finance costs - net | 35 | 36 | 35 | 35 | |||||||||
Income from operations | 78 | 118 | 79 | 62 | |||||||||
Depreciation and amortization | 73 | 77 | 72 | 72 | |||||||||
Unrealized (gains) / losses on derivatives | (2 | ) | (23 | ) | 20 | 8 | |||||||
Unrealized exchange losses / (gains) from the remeasurement of monetary assets and liabilities – net | 2 | — | 1 | (1 | ) | ||||||||
Share based compensation costs | 5 | 5 | 7 | 3 | |||||||||
Losses / (gains) on disposal | 1 | (36 | ) | — | 6 | ||||||||
Metal price lag | 14 | 27 | 30 | 16 | |||||||||
Adjusted EBITDA (current) | 171 | 168 | 209 | 166 | |||||||||
less: Metal price lag | (14 | ) | (27 | ) | (30 | ) | (16 | ) | |||||
Adjusted EBITDA (future) | 157 | 141 | 179 | 150 |
Forward-looking statements
Certain statements contained in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. This press release may contain “forward-looking statements” with respect to our business, results of operations and financial condition, and our expectations or beliefs concerning future events and conditions. You can identify forward-looking statements because they contain words such as, but not limited to, “believes,” “expects,” “may,” “should,” “approximately,” “anticipates,” “estimates,” “intends,” “plans,” “targets,” likely,” “will,” “would,” “could” and similar expressions (or the negative of these terminologies or expressions). All forward-looking statements involve risks and uncertainties. Many risks and uncertainties are inherent in our industry and markets, while others are more specific to our business and operations. These risks and uncertainties include, but are not limited to: market competition; economic downturn; disruption to business operations; the Russian war on
About
Constellium’s earnings materials for the fourth quarter and full year ended
CONSOLIDATED INCOME STATEMENT (UNAUDITED)
Three months ended | Year ended | |||||||||||
(in millions of Euros) | 2023 | 2022 | 2023 | 2022 | ||||||||
Revenue | 1,613 | 1,844 | 7,239 | 8,120 | ||||||||
Cost of sales | (1,435 | ) | (1,737 | ) | (6,529 | ) | (7,448 | ) | ||||
Gross profit | 178 | 107 | 710 | 672 | ||||||||
Selling and administrative expenses | (81 | ) | (76 | ) | (302 | ) | (282 | ) | ||||
Research and development expenses | (15 | ) | (16 | ) | (52 | ) | (48 | ) | ||||
Other gains and losses - net | (4 | ) | 45 | (19 | ) | (8 | ) | |||||
Income from operations | 78 | 60 | 337 | 334 | ||||||||
Finance costs - net | (35 | ) | (33 | ) | (141 | ) | (131 | ) | ||||
Income before tax | 43 | 27 | 196 | 203 | ||||||||
Income tax (expense) / benefit | (32 | ) | 3 | (67 | ) | 105 | ||||||
Net income | 11 | 30 | 129 | 308 | ||||||||
Net income attributable to: | ||||||||||||
Equity holders of | 10 | 28 | 125 | 301 | ||||||||
Non-controlling interests | 1 | 2 | 4 | 7 | ||||||||
Net income | 11 | 30 | 129 | 308 |
Earnings per share attributable to the equity holders of | ||||||||
Basic | 0.07 | 0.20 | 0.85 | 2.10 | ||||
Diluted | 0.07 | 0.20 | 0.84 | 2.06 | ||||
Weighted average number of shares, (in thousands) | ||||||||
Basic | 146,820 | 144,302 | 146,130 | 143,626 | ||||
Diluted | 149,236 | 146,606 | 149,236 | 146,606 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME / (LOSS) (UNAUDITED)
Three months ended | Year ended | |||||||||||
(in millions of Euros) | 2023 | 2022 | 2023 | 2022 | ||||||||
Net income | 11 | 30 | 129 | 308 | ||||||||
Other comprehensive (loss) / income | ||||||||||||
Items that will not be reclassified subsequently to the consolidated income statement | ||||||||||||
Remeasurement on post-employment benefit obligations | (46 | ) | (24 | ) | (16 | ) | 157 | |||||
Income tax on remeasurement on post-employment benefit obligations | 10 | 4 | 2 | (35 | ) | |||||||
Items that may be reclassified subsequently to the consolidated income statement | ||||||||||||
Cash flow hedges | 9 | 19 | 7 | (8 | ) | |||||||
Income tax on cash flow hedges | (2 | ) | (5 | ) | (1 | ) | 2 | |||||
Currency translation differences | (33 | ) | (68 | ) | (26 | ) | 21 | |||||
Other comprehensive (loss) / income | (62 | ) | (74 | ) | (34 | ) | 137 | |||||
Total comprehensive (loss) / income | (51 | ) | (44 | ) | 95 | 445 | ||||||
Attributable to: | ||||||||||||
Equity holders of | (51 | ) | (44 | ) | 92 | 439 | ||||||
Non-controlling interests | — | — | 3 | 6 | ||||||||
Total comprehensive (loss) / income | (51 | ) | (44 | ) | 95 | 445 |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)
(in millions of Euros) | At | At | ||
Assets | ||||
Current assets | ||||
Cash and cash equivalents | 202 | 166 | ||
Trade receivables and other | 490 | 539 | ||
Inventories | 1,098 | 1,320 | ||
Other financial assets | 30 | 31 | ||
1,820 | 2,056 | |||
Non-current assets | ||||
Property, plant and equipment | 2,047 | 2,017 | ||
462 | 478 | |||
Intangible assets | 47 | 54 | ||
Deferred tax assets | 252 | 271 | ||
Trade receivables and other | 31 | 43 | ||
Other financial assets | 2 | 8 | ||
2,841 | 2,871 | |||
Assets of disposal group classified as held for sale | — | 14 | ||
Total Assets | 4,661 | 4,941 | ||
Liabilities | ||||
Current liabilities | ||||
Trade payables and other | 1,263 | 1,467 | ||
Borrowings | 54 | 148 | ||
Other financial liabilities | 34 | 41 | ||
Income tax payable | 19 | 16 | ||
Provisions | 18 | 21 | ||
1,388 | 1,693 | |||
Non-current liabilities | ||||
Trade payables and other | 59 | 43 | ||
Borrowings | 1,814 | 1,908 | ||
Other financial liabilities | 8 | 14 | ||
Pension and other post-employment benefit obligations | 411 | 403 | ||
Provisions | 89 | 90 | ||
Deferred tax liabilities | 28 | 28 | ||
2,409 | 2,486 | |||
Liabilities of disposal group classified as held for sale | — | 10 | ||
Total Liabilities | 3,797 | 4,189 | ||
Equity | ||||
Share capital | 3 | 3 | ||
Share premium | 420 | 420 | ||
Retained earnings and other reserves | 420 | 308 | ||
Equity attributable to equity holders of | 843 | 731 | ||
Non-controlling interests | 21 | 21 | ||
Total Equity | 864 | 752 | ||
Total Equity and Liabilities | 4,661 | 4,941 |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)
(in millions of Euros) | Share capital | Share premium | Re- measurement | Cash flow hedges | Foreign currency translation reserve | Other reserves | Retained earnings | Total | Non-controlling interests | Total equity | |||||||||||||||||
At | 3 | 420 | 28 | (10 | ) | 41 | 101 | 148 | 731 | 21 | 752 | ||||||||||||||||
Net income | — | — | — | — | — | — | 125 | 125 | 4 | 129 | |||||||||||||||||
Other comprehensive (loss) / income | — | — | (14 | ) | 6 | (25 | ) | — | — | (33 | ) | (1 | ) | (34 | ) | ||||||||||||
Total comprehensive (loss) / income | — | — | (14 | ) | 6 | (25 | ) | — | 125 | 92 | 3 | 95 | |||||||||||||||
Share-based compensation | — | — | — | — | — | 20 | — | 20 | — | 20 | |||||||||||||||||
Other | — | — | (1 | ) | — | — | — | 1 | — | — | — | ||||||||||||||||
Transactions with non-controlling interests | — | — | — | — | — | — | — | — | (3 | ) | (3 | ) | |||||||||||||||
At | 3 | 420 | 13 | (4 | ) | 16 | 121 | 274 | 843 | 21 | 864 | ||||||||||||||||
(in millions of Euros) | Share capital | Share premium | Re- measurement | Cash flow hedges | Foreign currency translation reserve | Other reserves | Retained (deficit) / earnings | Total | Non-controlling interests | Total equity | |||||||||||||||||
At | 3 | 420 | (94 | ) | (4 | ) | 19 | 83 | (153 | ) | 274 | 17 | 291 | ||||||||||||||
Net income | — | — | — | — | — | — | 301 | 301 | 7 | 308 | |||||||||||||||||
Other comprehensive income / (loss) | — | — | 122 | (6 | ) | 22 | — | — | 138 | (1 | ) | 137 | |||||||||||||||
Total comprehensive income / (loss) | — | — | 122 | (6 | ) | 22 | — | 301 | 439 | 6 | 445 | ||||||||||||||||
Share-based compensation | — | — | — | — | — | 18 | — | 18 | — | 18 | |||||||||||||||||
Transactions with non-controlling interests | — | — | — | — | — | — | — | — | (2 | ) | (2 | ) | |||||||||||||||
At | 3 | 420 | 28 | (10 | ) | 41 | 101 | 148 | 731 | 21 | 752 |
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
Three months ended | Year ended | |||||||||||
(in millions of Euros) | 2023 | 2022 | 2023 | 2022 | ||||||||
Net income | 11 | 30 | 129 | 308 | ||||||||
Adjustments | ||||||||||||
Depreciation and amortization | 73 | 78 | 294 | 287 | ||||||||
Pension and other post-employment benefits service costs | 7 | (40 | ) | 23 | (22 | ) | ||||||
Finance costs - net | 35 | 33 | 141 | 131 | ||||||||
Income tax expense / (benefit) | 32 | (3 | ) | 67 | (105 | ) | ||||||
Unrealized losses / (gains) on derivatives - net and from remeasurement of monetary assets and liabilities - net | — | (20 | ) | 5 | 47 | |||||||
Losses / (gains) on disposal | 1 | 2 | (29 | ) | 4 | |||||||
Other - net | 5 | 5 | 20 | 17 | ||||||||
Change in working capital | ||||||||||||
Inventories | 19 | (3 | ) | 194 | (241 | ) | ||||||
Trade receivables | 146 | 247 | 55 | 155 | ||||||||
Trade payables | (67 | ) | (165 | ) | (190 | ) | 41 | |||||
Other | (25 | ) | 10 | (5 | ) | 13 | ||||||
Change in provisions | (2 | ) | (3 | ) | (5 | ) | (10 | ) | ||||
Pension and other post-employment benefits paid | (9 | ) | (11 | ) | (39 | ) | (44 | ) | ||||
Interest paid | (27 | ) | (28 | ) | (123 | ) | (113 | ) | ||||
Income tax paid | (14 | ) | (4 | ) | (31 | ) | (17 | ) | ||||
Net cash flows from operating activities | 185 | 128 | 506 | 451 | ||||||||
Purchases of property, plant and equipment | (127 | ) | (109 | ) | (337 | ) | (273 | ) | ||||
Property, plant and equipment grants received | — | 3 | 1 | 4 | ||||||||
Proceeds from disposals, net of cash | — | — | 48 | — | ||||||||
Other investing activities | — | (1 | ) | — | (1 | ) | ||||||
Net cash flows used in investing activities | (127 | ) | (107 | ) | (288 | ) | (270 | ) | ||||
Repayments of long-term borrowings | (2 | ) | (4 | ) | (53 | ) | (192 | ) | ||||
Net change in revolving credit facilities and short-term borrowings | — | 5 | (83 | ) | 72 | |||||||
Lease repayments | (8 | ) | (10 | ) | (37 | ) | (37 | ) | ||||
Payment of financing costs and redemption fees | — | — | — | (1 | ) | |||||||
Transactions with non-controlling interests | — | — | (3 | ) | (2 | ) | ||||||
Other financing activities | (5 | ) | (13 | ) | (6 | ) | (3 | ) | ||||
Net cash flows used in financing activities | (15 | ) | (22 | ) | (182 | ) | (163 | ) | ||||
Net increase / (decrease) in cash and cash equivalent | 43 | (1 | ) | 36 | 18 | |||||||
Cash and cash equivalents - beginning of period | 159 | 171 | 166 | 147 | ||||||||
Transfer of cash and cash equivalents from / (to) assets classified as held for sale | — | (1 | ) | 1 | (1 | ) | ||||||
Effect of exchange rate changes on cash and cash equivalents | — | (3 | ) | (1 | ) | 2 | ||||||
Cash and cash equivalents - end of year | 202 | 166 | 202 | 166 |
SEGMENT ADJUSTED EBITDA
Three months ended | Year ended | |||||||||||
(in millions of Euros) | 2023 | 2022 | 2023 | 2022 | ||||||||
P&ARP | 82 | 71 | 283 | 326 | ||||||||
A&T | 76 | 56 | 324 | 217 | ||||||||
AS&I | 25 | 31 | 133 | 149 | ||||||||
Holdings and Corporate | (12 | ) | (10 | ) | (27 | ) | (19 | ) | ||||
Total | 171 | 148 | 713 | 673 |
SHIPMENTS AND REVENUE BY PRODUCT LINE
Three months ended | Year ended | ||||||||||
(in k metric tons) | 2023 | 2022 | 2023 | 2022 | |||||||
Packaging rolled products | 172 | 186 | 736 | 809 | |||||||
Automotive rolled products | 62 | 61 | 271 | 245 | |||||||
Specialty and other thin-rolled products | 4 | 7 | 23 | 35 | |||||||
Aerospace rolled products | 22 | 21 | 96 | 76 | |||||||
Transportation, industry, defense and other rolled products | 26 | 32 | 123 | 147 | |||||||
Automotive extruded products | 28 | 28 | 121 | 117 | |||||||
Other extruded products | 22 | 33 | 122 | 151 | |||||||
Total shipments | 336 | 368 | 1,492 | 1,580 | |||||||
(in millions of Euros) | |||||||||||
Packaging rolled products | 582 | 697 | 2,596 | 3,326 | |||||||
Automotive rolled products | 254 | 275 | 1,156 | 1,154 | |||||||
Specialty and other thin-rolled products | 29 | 35 | 146 | 183 | |||||||
Aerospace rolled products | 264 | 218 | 1,022 | 728 | |||||||
Transportation, industry, defense and other rolled products | 144 | 204 | 706 | 972 | |||||||
Automotive extruded products | 211 | 228 | 934 | 949 | |||||||
Other extruded products | 123 | 200 | 696 | 912 | |||||||
Other and inter-segment eliminations | 6 | (13 | ) | (17 | ) | (104 | ) | ||||
Total revenue | 1,613 | 1,844 | 7,239 | 8,120 |
NON-GAAP MEASURES
Reconciliation of Revenue to VAR (a non-GAAP measure)
Three months ended | Year ended | |||||||||||
(in millions of Euros) | 2023 | 2022 | 2023 | 2022 | ||||||||
Revenue | 1,613 | 1,844 | 7,239 | 8,120 | ||||||||
Hedged cost of alloyed metal | (939 | ) | (1,212 | ) | (4,374 | ) | (5,403 | ) | ||||
Revenue from incidental activities | (7 | ) | (5 | ) | (27 | ) | (21 | ) | ||||
Metal price lag | 14 | 69 | 86 | 29 | ||||||||
VAR | 681 | 696 | 2,924 | 2,725 |
Reconciliation of net income to Adjusted EBITDA (a non-GAAP measure)
Three months ended | Year ended | |||||||||||
(in millions of Euros) | 2023 | 2022 | 2023 | 2022 | ||||||||
Net income | 11 | 30 | 129 | 308 | ||||||||
Income tax expense / (benefit) | 32 | (3 | ) | 67 | (105 | ) | ||||||
Income before tax | 43 | 27 | 196 | 203 | ||||||||
Finance costs - net | 35 | 33 | 141 | 131 | ||||||||
Income from operations | 78 | 60 | 337 | 334 | ||||||||
Depreciation and amortization | 73 | 78 | 294 | 287 | ||||||||
Restructuring costs | — | 1 | — | 1 | ||||||||
Unrealized (gains) / losses on derivatives | (2 | ) | (19 | ) | 3 | 46 | ||||||
Unrealized exchange losses / (gains) from the remeasurement of monetary assets and liabilities – net | 2 | (1 | ) | 2 | 1 | |||||||
Losses / (gains) on pension plan amendments (A) | — | (47 | ) | — | (47 | ) | ||||||
Share based compensation costs | 5 | 5 | 20 | 18 | ||||||||
(Gains) / losses on disposal | 1 | 2 | (29 | ) | 4 | |||||||
Metal price lag (B) | 14 | 69 | 86 | 29 | ||||||||
Adjusted EBITDA | 171 | 148 | 713 | 673 |
(A) In the year ended
(B) Metal price lag represents the financial impact of the timing difference between when aluminium prices included within
Reconciliation of net cash flows from operating activities to Free Cash Flow (a non-GAAP measure)
Three months ended | Year ended | |||||||||||
(in millions of Euros) | 2023 | 2022 | 2023 | 2022 | ||||||||
Net cash flows from operating activities | 185 | 128 | 506 | 451 | ||||||||
Purchases of property, plant and equipment, net of grants received | (127 | ) | (106 | ) | (336 | ) | (269 | ) | ||||
Free Cash Flow | 58 | 22 | 170 | 182 |
Reconciliation of borrowings to Net debt (a non-GAAP measure)
(in millions of Euros) | At | At | ||||
Borrowings | 1,868 | 2,056 | ||||
Fair value of net debt derivatives, net of margin calls | (2 | ) | 1 | |||
Cash and cash equivalents | (202 | ) | (166 | ) | ||
Net debt | 1,664 | 1,891 |
Reconciliation of Net income to Adjusted NOPAT and Adjusted ROIC (non-GAAP measures)
Year ended | ||||||
(in millions of Euros) | 2023 | 2022 | ||||
Net income | 129 | 308 | ||||
Income tax expense / (benefit) | 67 | (105 | ) | |||
Income before tax | 196 | 203 | ||||
Finance costs - net | 141 | 131 | ||||
Income from operations | 337 | 334 | ||||
Unrealized losses on derivatives | 3 | 46 | ||||
Unrealized exchange losses from the remeasurement of monetary assets and liabilities - net | 2 | 1 | ||||
Losses / (gains) on pension plan amendments | — | (47 | ) | |||
Share based compensation costs | 20 | 18 | ||||
Metal price lag | 86 | 29 | ||||
(Gains) / losses on disposals | (29 | ) | 4 | |||
Tax impact(1) | (103 | ) | (92 | ) | ||
Adjusted NOPAT (A) | 316 | 293 |
(in millions of Euros) | At 2022 | At 2021 | ||||
Intangible assets | 54 | 58 | ||||
PP&E, net | 2,017 | 1,948 | ||||
Trade receivables and other - current | 539 | 683 | ||||
Derecognized trade receivables(2) | 368 | 345 | ||||
Inventories | 1,320 | 1,050 | ||||
Trade payables and other - current | (1,467 | ) | (1,377 | ) | ||
Provisions current portion | (21 | ) | (20 | ) | ||
Income tax payable | (16 | ) | (34 | ) | ||
2,794 | 2,653 | |||||
| | | ||||
| 2023 | 2022 | ||||
Adjusted NOPAT for fiscal year (A) | 316 | 293 | ||||
Total invested capital as of | 2,794 | 2,653 | ||||
Adjusted ROIC (A)/(B) | 11.3 | % | 11.0 | % |
(1) Tax impact on net operating profit computed using the Group's average statutory tax rate
(2) Trade receivables derecognized under our factoring agreements
Non-GAAP measures
In addition to the results reported in accordance with International Financial Reporting Standards (“IFRS”), this press release includes information regarding certain financial measures which are not prepared in accordance with IFRS (“non-GAAP measures”). The non-GAAP measures used in this press release are: VAR, Adjusted EBITDA, Adjusted EBITDA per metric ton, Free Cash Flow, Adjusted NOPAT,
Value-Added Revenue ("VAR") is defined as revenue, excluding revenue from incidental activities, minus cost of metal which includes, cost of aluminium adjusted for metal price lag, cost of other alloying metals, freight out costs, and realized gains and losses from hedging. Management believes that VAR is a useful measure of our activity as it eliminates the impact of metal costs from our revenue and reflects the value-added elements of our activity. VAR eliminates the impact of metal price fluctuations which are not under our control and which we generally pass through to our customers and facilitates comparisons from period to period. VAR is not a presentation made in accordance with IFRS and should not be considered as an alternative to revenue determined in accordance with IFRS.
In considering the financial performance of the business, management and our chief operational decision maker, as defined by IFRS, analyze the primary financial performance measure of Adjusted EBITDA in all of our business segments. The most directly comparable IFRS measure to Adjusted EBITDA is our net income or loss for the period. We believe Adjusted EBITDA, as defined below, is useful to investors and is used by our management for measuring profitability because it excludes the impact of certain non-cash charges, such as depreciation, amortization, impairment and unrealized gains and losses on derivatives as well as items that do not impact the day-to-day operations and that management in many cases does not directly control or influence. Therefore, such adjustments eliminate items which have less bearing on our core operating performance.
Adjusted EBITDA measures are frequently used by securities analysts, investors and other interested parties in their evaluation of
Adjusted EBITDA is defined as income / (loss) from continuing operations before income taxes, results from joint ventures, net finance costs, other expenses and depreciation and amortization as adjusted to exclude restructuring costs, impairment charges, unrealized gains or losses on derivatives and on foreign exchange differences on transactions which do not qualify for hedge accounting, metal price lag, share based compensation expense, effects of certain purchase accounting adjustments, start-up and development costs or acquisition, integration and separation costs, certain incremental costs and other exceptional, unusual or generally non-recurring items.
Adjusted EBITDA is the measure of performance used by management in evaluating our operating performance, in preparing internal forecasts and budgets necessary for managing our business and, specifically in relation to the exclusion of the effect of favorable or unfavorable metal price lag, this measure allows management and the investor to assess operating results and trends without the impact of our accounting for inventories. We use the weighted average cost method in accordance with IFRS which leads to the purchase price paid for metal impacting our cost of goods sold and therefore profitability in the period subsequent to when the related sales price impacts our revenues. Management believes this measure also provides additional information used by our lending facilities providers with respect to the ongoing performance of our underlying business activities. Historically, we have used Adjusted EBITDA in calculating our compliance with financial covenants under certain of our loan facilities.
Adjusted EBITDA is not a presentation made in accordance with IFRS, is not a measure of financial condition, liquidity or profitability and should not be considered as an alternative to profit or loss for the period, revenues or operating cash flows determined in accordance with IFRS.
Free Cash Flow is defined as net cash flow from operating activities less capital expenditure, net of grants received. Management believes that Free Cash Flow is a useful measure of the net cash flow generated or used by the business as it takes into account both the cash generated or consumed by operating activities, including working capital, and the capital expenditure requirements of the business. However, Free Cash Flow is not a presentation made in accordance with IFRS and should not be considered as an alternative to operating cash flows determined in accordance with IFRS. Free Cash Flow has certain inherent limitations, including the fact that it does not represent residual cash flows available for discretionary spending, notably because it does not reflect principal repayments required in connection with our debt or capital lease obligations.
Adjusted Return on
Net debt is defined as borrowings plus or minus the fair value of cross currency basis swaps net of margin calls less cash and cash equivalents and cash pledged for the issuance of guarantees. Management believes that Net debt is a useful measure of indebtedness because it takes into account the cash and cash equivalent balances held by the Company as well as the total external debt of the Company. Net debt is not a presentation made in accordance with IFRS, and should not be considered as an alternative to borrowings determined in accordance with IFRS.
Jason Hershiser—Investor Relations
Phone: +1 (443) 988-0600
investor-relations@constellium.com
Delphine Dahan-Kocher—Communications
Phone: +1 443 420 7860
delphine.dahan-kocher@constellium.com
Source: Constellium Paris
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