Nemak reports 16.4% YoY drop in revenue in 3Q19 on lower aluminium price; sales volume down 14%

Nemak, a leading provider of innovative light weighting solutions for the global automotive industry, published its operational and financial results for the third quarter of 2019. The company’s revenue was down 16.4% YoY to US$963 million in 3Q19, mainly due to lower shipments and aluminium prices.

Total sales volume decreased by 13.8% year-on-year to 10.6 million equivalent units during 3Q19. This was due to a less favourable product mix in North America and softer customer production in China.

Nemak manufactures aluminium components for powertrain and body structure applications. It generated revenue of US$4.7 billion in 2018.

EBITDA came in at US$139 million, a drop of 13.1% YoY. “This variation followed a lower volume, unfavourable exchange rate effects, and non-recurring expenses associated with a planned facility closure in North America; these factors were partially offset by the achievement of further operational efficiencies.” 

“We finished the quarter in line with our expectations, leveraging efficiency initiatives to mitigate the negative effects of lower volume on our results. These efforts focused on driving optimization of our shop-floor operations across all regions. Notwithstanding increased volatility in most of the markets we serve, we remain on track to meet our 2019 Guidance, said Armando Tamez,” CEO of Nemak.

“Likewise, we made further inroads in the ramp-up of our structural and EV components business. We harnessed our technological capabilities—including design engineering, casting, and joining & assembly—to initiate series production of complex battery housings for plug-in hybrid electric applications in Europe.”