Nemak, S. A. B. de C. V. Announces Consolidated Earnings Results for the Fourth Quarter and Full Year 2017; Provides Earnings Guidance for the Year 2018
February 13, 2018 at 11:30 am EST
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Nemak, S. A. B. de C. V. announced consolidated earnings results for the fourth quarter and full year 2017. For the year, the company reported revenues increased 9.8% due to higher aluminum volumes and aluminum prices. EBITDA finished at $166 million, 10.8% lower than fourth quarter of 2016, mainly due to the adverse impact of negative metal price lag as well as higher launching expenses, particularly in North America. Operating income of $66 million, 26.7% lower than the year-ago figure. This result was mainly due to the following 2 factors: first, rising aluminum prices resulted in a continuation of negative metal price lag. This effect was accentuated by recent increases in premiums on primary aluminum in North America, creating a divergence between buying and selling indicators, which historically have been very closely correlated. EBITDA per unit was $13.80, which compares to $15.80 a year ago. Despite the decrease in EBITDA, the company free cash flow was $40 million better than the same period last year. Net income amounted to $36 million, a 40% decline over fourth quarter of 2016. The company invested $109 million in CapEx, adding capacity and revamping equipment across all regions and product lines to support new program launches.
For the full year, EBITDA was affected by the same factors behind quarterly variations, finishing 10.4% lower than in 2016.
For the year 2018, The company expects 50.1 million equivalent units; revenues of $4.5 billion; EBITDA of $700 million, and last, CapEx of $384 million.
Nemak SAB De CV, formerly Tenedora Nemak SA de CV, is a Mexico-based holding company primarily engaged in the automotive industry. The Company specializes in the design, manufacture and distribution of aluminum components for powertrain and body structure applications. Its product portfolio comprises cylinder heads, engine blocks, shock towers, tank cover frames, B-pillars, transmission housings, frame rails, and cross members, among others. The Company operates manufacturing facilities in a range of countries, such as Canada, the United States, Mexico, Brazil, Spain, Germany, Poland, Russia, India and China. Furthermore, Its customers include Audi, BMW, KIA, Ford, Hyundai, Chrysler, Nissan, Volvo, Toyota, as well as Volkswagen, among others. The Company controls a number of subsidiaries, including Modellbau Schonheide GMBH, Camen International Trading Inc, Nemak Canada SA de CV and Nemak Czech Republic Sro, among others. Its parent is ALFA SAB de CV.
Nemak, S. A. B. de C. V. Announces Consolidated Earnings Results for the Fourth Quarter and Full Year 2017; Provides Earnings Guidance for the Year 2018