Nemak, S. A. B. de C. V. Reports Unaudited Earnings Results for the Second Quarter and Six Months Ended June 30, 2017; Revised Earnings Guidance for 2017
July 25, 2017
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Nemak, S. A. B. de C. V. reported unaudited earnings results for the second quarter and six months ended June 30, 2017. For the quarter, the company reported total revenue of $1,165 million against $1,122 million a year ago. Operating income was $124 million against $142 million a year ago. This result was mainly due to the following factors. First, higher aluminum prices resulted in a negative metal price lag effect previously described, which amounted to approximately $9 million this quarter as aluminum prices increase by 4% in this period. While this negative effect was less than the first quarter of this year, the year-over-year comparison is difficult due to a positive metal lag of a similar amount in the second quarter of 2016. Net income was $78 million against $77 million a year ago. EBITDA was $206 million against $221 million a year ago. CapEX was $88 million against $129 million a year ago.
For the six months, the company reported total revenue of $2,288 million against $2,198 million a year ago. Operating income was $237 million against $276 million a year ago. Net income was $145 million against $174 million a year ago. EBITDA was $396 million against $430 million a year ago. CapEX was $231 million against $260 million a year ago. As of June 30, 2017, the company reported net debt in the amount of $1.4 billion, including Cash and Marketable Securities worth $108 million.
The company revised 2017 guidance. For volume, the company expects 50.4 million equivalent units instead of 51.6 million. Revenue remains unchanged at $4.4 billion because the company expects that lower volumes will be offset by higher aluminum prices. Turning to EBITDA, the company expects $750 million instead of $802 million. And last, the company expects that continued efforts to optimize capital allocation will enable to finish this year with the CapEx of $385 million instead $430 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. Reports Unaudited Earnings Results for the Second Quarter and Six Months Ended June 30, 2017; Revised Earnings Guidance for 2017