Novelis’ Q4 flat rolled shipments down due to the initial impacts from COVID-19; Adjusted EBITDA up 7%

Novelis Inc., the world leader in aluminium rolling and recycling, announced fourth quarter and fiscal 2020 results. Net income stood at $63 million in Q4 FY 2020, down 39% from last year. For the full year, net income decreased by 3% to$420 million 

Excluding tax-effected special items, the company grew its fourth quarter net income by 18% to $153 million, and its full year net income by 26% to $590 million. The increase was due to higher Adjusted EBITDA and lower interest expense.

"Our strategy to invest in our operations and our people has delivered four consecutive years of record financial results and an exceptionally strong balance sheet. It is this solid foundation, coupled with an unwavering commitment to our purpose of shaping a sustainable world together, that will help us safely and successfully navigate the challenges posed by the novel coronavirus and extend our leadership position in the aluminium industry," said Steve Fisher, President and CEO, Novelis Inc.

"In addition, with the acquisition of Aleris now complete, I am more confident than ever that our diverse product portfolio, global footprint, deep customer relationships, reliable assets, and disciplined investments will deliver even more value to our customers and shareholder moving forward."

In Q4, Net sales decreased 12% from the prior year to $2.7 billion on lower average LME aluminium prices and local market premiums, and a 7% decline in shipments. Shipments of flat rolled products decreased to 811 thousand tons, partially due to the initial impacts from COVID-19 related disruptions in March. Adjusted EBITDA increased 7% to $383 million.

For full year fiscal 2020, net sales decreased 9% from the prior year to $11.2 billion. Flat rolled product shipments were flat compared to the prior year at 3,273 thousand tons. Adjusted EBITDA increased 8% to a record $1,472 million, primarily driven by portfolio optimization efforts, favourable North American Specialties product pricing, operating cost efficiencies, and favourable foreign exchange, partially offset by less favourable recycling benefits due to lower aluminium prices.