Novelis Q2 sees net sales rise 25% while rolled product shipments fell 2%

Novelis reported a 20 per cent year-on-year increase in adjusted EBITDA to USD 508 million in the second quarter of fiscal year 2027, while rolled product shipments declined 2 per cent to 919,000 tonnes.

Net sales rose 25 per cent to USD 5.9 billion from USD 4.7 billion in the corresponding quarter last year, mainly due to higher average aluminium prices. Higher shipments of beverage packaging and aerospace products were partly offset by lower volumes in automotive and speciality products.

Net income attributable to Novelis' common shareholders increased 29 per cent to USD 210 million, compared with USD 163 million a year earlier. Excluding special items, net income also rose 29 per cent to USD 146 million.

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The increase in net income was partly supported by insurance recoveries related to the 2025 fires at the company's Oswego facility. Novelis received USD 39 million in business interruption insurance recoveries during the quarter. It also reported a favourable metal benefit, supported by higher scrap consumption and lower scrap aluminium prices. Cumulative insurance recoveries related to the fires reached USD 519 million by the end of the quarter.

Adjusted EBITDA per tonne shipped increased 23 per cent year on year to USD 553.

Bay Minette produces first coil

Novelis' new rolling and recycling plant in Bay Minette, Alabama, produced its first coil on the cold mill in September. The company is working towards starting commercial shipments in the first quarter of fiscal year 2028.

Steve Fisher, president and CEO of Novelis Inc., said, "We are excited about the opportunities ahead as Bay Minette moves closer to commercial production, increasing our ability to serve the undersupplied North American market.”

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Capital expenditure for the first six months of fiscal year 2027 reached USD 1.54 billion, compared with USD 913 million in the same period last year. The company said spending included investment in its Bay Minette rolling and recycling plant. 

Novelis reported an adjusted free cash flow outflow of USD 1.8 billion for the first half of the fiscal year, against an outflow of USD 499 million a year earlier. Net cash used in operating activities stood at USD 418 million, compared with an inflow of USD 411 million in the corresponding period. The company attributed the change largely to working capital movements and the impact of the Oswego fires.

At the end of September 2026, Novelis had a net leverage ratio of 4.7 times and total liquidity of USD 2 billion, including USD 1.3 billion in cash and cash equivalents and USD 761 million available under committed credit facilities.

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Dev Ahuja, executive vice president and CFO, Novelis Inc., said, "As Bay Minette transitions from construction to start-up, reduced capital spending, continued cost discipline and solid underlying business conditions are expected to drive a return to positive free cash flow and mark the beginning of a deleveraging cycle toward the end of this fiscal year." 

Novelis Inc. is a subsidiary of Hindalco Industries Limited and a global producer of aluminium products and solutions, operating across North America, Europe, Asia and South America.