Novelis reports third quarter 2013 results
Novelis Inc. reported net income attributable to its common shareholder of $3 million for the third quarter of fiscal 2013. Excluding tax-effected restructuring in both periods, net income for the third quarter of 2013 was $8 million, compared to a net loss of $11 million for the same period in 2012.
Adjusted EBITDA was $185 million for the third quarter of 2013, compared to $213 million reported for the same period in 2012. This decline was primarily due to the implementation of an Enterprise Resource Planning system which resulted in lost shipments, reduced productivity and stabilization costs, and negatively impacted the third quarter of fiscal 2013 by approximately $39 million. In addition, the company experienced unfavorable pricing dynamics in several regions, higher metal input costs in North America, and incremental project start-up costs associated with its global expansions.
Phil Martens, Novelis president and chief executive officer commented, “The third quarter was challenging as we experienced more production disruptions than expected related to our ERP implementation in North America. These implementation issues are largely behind us and production has returned to near normal levels.”
Shipments of aluminum rolled products totaled 647 kilotonnes for the third quarter of fiscal 2013, flat compared to shipments of 648 kilotonnes for the same period last year.
Net sales for the third quarter of fiscal 2013 were $2.3 billion, a 6 percent decrease compared to the $2.5 billion reported in the same period a year ago, which included sales from the Company’s three foil plants in Europe that were divested. In addition, sales were also impacted by lower conversion premiums as well as lower average aluminum prices when compared to last year.
For the third quarter of fiscal 2013, Novelis reported liquidity of $775 million. Free cash flow was a negative $309 million for the third quarter of 2013, primarily due to capital expenditures of $193 million, a $107 million bond interest payment and negative changes in working capital.