Constellium Reports Second Quarter 2017 Financial Results
(Thomson Reuters ONE) -
AMSTERDAM, The Netherlands, July 27, 2017 (GLOBE NEWSWIRE) -- Constellium N.V.
(NYSE:CSTM) and (Euronext Paris:CSTM) today reported results for second quarter
ended June 30, 2017.
* Shipments of 383 thousand metric tons, down 1% compared to Q2 2016;
Automotive shipments up 18% compared to Q2 2016
* Revenue of ?1.4 billion, up 12% compared to Q2 2016 on higher aluminium
prices
* Net income of ?15 million compared to ?9 million in Q2 2016
* Adjusted EBITDA of ?127 million, up 19% from Q2 2016; H1 2017 Adjusted
EBITDA up 11% from H1 2016
* Significant improvement in H1 2017 Cash Flows from Operations and Free Cash
Flow compared to H1 2016
* Completed a $300 million pan U.S. ABL and a new ?100 million inventory based
revolving credit facility
* "Project 2019" initiatives underway and already showing benefits
* Intend to move corporate domicile to France and delist from Euronext to
simplify corporate structure and reduce costs
Jean-Marc Germain, Constellium's Chief Executive Officer said, "Constellium
delivered record Adjusted EBITDA during the second quarter. I'm pleased to note
that each of our business units were meaningful contributors to these results.
Automotive Structures and Industry reported another record quarter as its strong
momentum continues. As we expected, Aerospace and Transportation delivered
significantly improved results. Packaging and Automotive Rolled Products
overcame incremental cost from our automotive readiness program in the U.S. and
delivered results comparable to last year."
Mr. Germain continued, "The strong second quarter results leave us well
positioned to deliver at the high end of our high single-digit Adjusted EBITDA
growth target for 2017. We remain steadfastly focused on executing our strategy
and increasing value for our shareholders."
* Group Summary
Q2 Q2 Var. H1 H1 Var.
2017 2016 2017 2016
Shipments (k metric tons) 383 387 (1 )% 758 749 1 %
Revenue (? millions) 1,382 1,233 12 % 2,710 2,383 14 %
Net income (? millions) 15 9 72 % 28 1 n.m.
Adjusted EBITDA (? millions) 127 107 19 % 220 199 11 %
Adjusted EBITDA per metric ton (?) 330 275 20 % 290 265 9 %
Adjusted EBITDA per metric ton and percentage changes are calculated on
unrounded underlying figures. n.m.: not meaningful
The difference between the sum of reported segment revenue and total group
revenue includes revenue from certain non-core activities, inter-segment
eliminations, and the impact of a ?20 million one-time payment related to the
renegotiation of a customer agreement, which was recorded in the first quarter
of 2016 as a reduction of revenues at the Holdings and Corporate level. The
difference between the sum of reported segment Adjusted EBITDA and the Group
Adjusted EBITDA is related to Holdings and Corporate.
For the second quarter of 2017, shipments of 383k metric tons decreased 1%
compared to the second quarter of 2016 on lower shipments in Packaging and
Automotive Rolled Products, partially offset by higher shipments in Automotive
Structures and Industry. Revenue of ?1.4 billion increased 12% compared to the
second quarter of last year due primarily to higher aluminium prices. Net income
of ?15 million improved from ?9 million in the second quarter of 2016. Adjusted
EBITDA of ?127 million increased 19% from the second quarter of last year on
improved results from the Aerospace and Transportation and the Automotive
Structures and Industry business units.
For the first half of 2017, shipments of 758k metric tons increased 1% compared
to the first half of 2016 on higher shipments in Automotive Structures and
Industry. Revenue of ?2.7 billion increased 14% compared to the first half of
last year due to higher aluminium prices. Net income of ?28 million improved
from ?1 million in the first half of 2016. Adjusted EBITDA of ?220 million
increased by 11% compared to the first half of last year for the reasons stated
above.
* Results by Segment
* Packaging & Automotive Rolled Products (P&ARP)
Q2 Q2 Var. H1 H1 Var.
2017 2016 2017 2016
Shipments (k metric tons) 258 268 (3 )% 512 512 0 %
Revenue (? millions) 736 644 14 % 1,441 1,232 17 %
Adjusted EBITDA (? millions) 57 56 2 % 98 98 0 %
Adjusted EBITDA per metric ton (?) 221 209 6 % 191 192 0 %
Adjusted EBITDA per metric ton and percentage changes are calculated on
unrounded underlying figures.
Second quarter Adjusted EBITDA increased slightly as compared to the second
quarter of 2016 primarily due to better price and mix, offset by incremental
cost from our automotive readiness program in the U.S.
For the second quarter of 2017, shipments of 258k metric tons declined 3% from
the second quarter of last year as a 31% increase in Automotive rolled product
shipments was offset by lower Packaging rolled product shipments. Revenue of
?736 million increased 14% compared to the second quarter of 2016 as a result of
higher aluminium prices.
For the first half of 2017, Adjusted EBITDA of ?98 million was comparable to the
same period of the prior year for the reasons stated above. Shipments of 512k
metric tons were comparable to the first half of last year as higher Automotive
rolled product shipments offset lower Packaging rolled product shipments.
Revenue of ?1.4 billion increased 17% compared to the first half of last year
due to higher aluminium prices.
* Aerospace & Transportation (A&T)
Q2 Q2 Var. H1 H1 Var.
2017 2016 2017 2016
Shipments (k metric tons) 63 62 2 % 124 125 (1 )%
Revenue (? millions) 366 334 10 % 709 666 7 %
Adjusted EBITDA (? millions) 41 31 30 % 69 61 14 %
Adjusted EBITDA per metric ton (?) 639 496 28 % 554 483 15 %
Adjusted EBITDA per metric ton and percentage changes are calculated on
unrounded underlying figures.
Second quarter Adjusted EBITDA increased significantly as compared to the second
quarter of 2016 due to better price and mix, strong operating cost performance
and continued success in developing TID end markets.
For the second quarter of 2017, shipments of 63k metric tons increased 2%
compared to the second quarter of 2016 as higher Transportation, Industry and
Other rolled product shipments more than offset lower Aerospace rolled product
shipments. Revenue of ?366 million increased by 10% compared to the second
quarter of last year on higher aluminium prices.
For the first half of 2017, Adjusted EBITDA of ?69 million increased 14%
compared to the first half of 2016 for the reasons stated above. Shipments of
124k metric tons were comparable to the same period in the prior year. Revenue
of ?709 billion increased 7% compared to the first half of last year on higher
aluminium prices.
* Automotive Structures & Industry (AS&I)
Q2 Q2 Var. H1 H1 Var.
2017 2016 2017 2016
Shipments (k metric tons) 62 58 5 % 122 115 6 %
Revenue (? millions) 288 266 8 % 574 527 9 %
Adjusted EBITDA (? millions) 33 29 12 % 64 56 13 %
Adjusted EBITDA per metric ton (?) 530 497 7 % 522 491 6 %
Adjusted EBITDA per metric ton and percentage changes are calculated on
unrounded underlying figures.
Second quarter Adjusted EBITDA increased to a record level primarily due to
higher shipments of both Automotive and Other extruded products on strong market
demand and solid cost performance.
For the second quarter of 2017, shipments of 62k metric tons increased 5%
compared to the second quarter of last year. Revenue of ?288 million increased
8% compared to the second quarter of 2016 as a result of higher aluminium
prices.
For the first half of 2017, Adjusted EBITDA of ?64 million grew 13% compared to
the first half of last year for the reasons stated above. Shipments of 122k
metric tons increased 6% compared to the first half of last year. Revenue of
?574 million increased 9% compared to the first half of 2016 as a result of
higher aluminium prices.
* Net income and Earnings per share
For the second quarter of 2017, net income of ?15 million improved from ?9
million in the second quarter of 2016. The change in net income is primarily
attributable to the improvement in Adjusted EBITDA discussed above, lower
finance costs and income tax expense and a favorable impact from metal lag,
partially offset by an unfavorable change in unrealized derivatives and a higher
share of loss of joint-ventures. Basic and fully diluted earnings per share were
?0.15 compared to ?0.08 per share for the same period last year. Fully diluted
income and loss per share were based on a weighted average number of ordinary
shares of 106.7 million and 105.5 million for the quarters ended June 30, 2017
and 2016, respectively.
For the first half of 2017, net income of ?28 million improved from ?1 million
in the first half of 2016. The change in net income is primarily attributable to
higher Adjusted EBITDA, a favorable impact from metal lag, a ?22 million gain
from pension and benefit plan amendments and a ?20 million one-time impact in
connection with the re-negotiation of terms of a customer contract in the first
quarter of 2016, partially offset by an unfavorable change in unrealized
derivatives and a higher share of loss of joint-ventures.
* Cash flow and Liquidity
For the first half of 2017, Free Cash Flow was an outflow of ?54 million as
compared to an outflow of ?125 million in the same period of the prior year, an
improvement of ?71 million. Excluding the cash impact of factored receivables,
the Company's Free Cash Flow was positive in the first half of 2017. The
significant improvement as compared to the first half of last year was due to
higher Adjusted EBITDA, reduced working capital, and lower capital expenditures.
Cash flows from operating activities were ?81 million for the first half of
2017 as compared to ?48 million in the first half of last year, an improvement
of ?33 million. We reduced factored receivables by ?78 million compared to an
increase of ?88 million in the first half of last year.
Cash flows used in investing activities were ?135 million for the first half of
2017 as compared to cash flows used in investing activities of ?177 million in
the first half of last year.
Cash flows used in financing activities were ?2 million for the first half of
2017 as compared to cash flows from financing activities of ?274 million in the
first half of last year.
Liquidity at June 30, 2017 was ?557 million, comprised of ?286 million of cash
and cash equivalents and ?271 million available under our committed lending
facilities and factoring arrangements. This compares to liquidity at December
31, 2016 of ?537 million and cash and cash equivalents of ?347 million.
In the second quarter of 2017, Ravenswood and Muscle Shoals consolidated their
existing secured asset-based revolving credit facilities into a single $300
million pan U.S. ABL due in 2022, extending the Company's maturity profile.
During the second quarter of 2017, the Company also entered into a new ?100
million, two year, secured revolving credit facility on inventory to further
enhance liquidity.
Net debt was ?2,044 million at June 30, 2017, as compared to ?2,035 million at
December 31, 2016.
* Outlook
We are updating our Adjusted EBITDA growth guidance for 2017 to the high end of
our high-single digit range. We continue to expect Adjusted EBITDA growth in the
high single digits annually for the next three years, leading to over ?500
million of Adjusted EBITDA in 2020.
The Company is not able to provide a reconciliation of this Adjusted EBITDA
guidance to net income, the comparable GAAP measure, because certain items that
are excluded from Adjusted EBITDA cannot be reasonably predicted or are not in
our control. In particular, it is unable to forecast the timing or magnitude of
realized and unrealized gains and losses on derivative instruments, metal lag,
impairment or restructuring charges, or taxes without unreasonable efforts, and
these items could significantly impact, either individually or in the aggregate,
net income in the future.
* Other recent developments
"Project 2019" is well underway with a wide range of cost reduction and cash
flow improvement initiatives throughout the Company. To date, the Company has
achieved ?10 million of run rate cost savings. In addition, the Company has made
significant progress reducing trade working capital. Capital expenditures are on
track to meet the Company's previous guidance of ?275 million for 2017, an ?80
million reduction compared to 2016.
In line with the Company's initiatives to reduce costs and simplify its
corporate structure, Constellium intends to move its corporate domicile to
France and to close its Amsterdam office. Constellium expects this action to
enable it to reduce its corporate cost structure and to benefit from additional
potential tax savings.
This re-domiciling process is subject to shareholder approval and is expected to
be completed by mid-2018. Constellium will also start the process of delisting
from Euronext Paris to further reduce cost and complexity.
On July 21, 2017, USW Local 5668 ratified a new, five year, labor agreement with
Constellium Rolled Products, LLC, in Ravenswood.
* Forward-looking statements
Certain statements contained in this press release may constitute forward-
looking statements within the meaning of the Private Securities Litigation
Reform Act of 1995. This press release may contain "forward looking statements"
with respect to our business, results of operations and financial condition, and
our expectations or beliefs concerning future events and conditions. You can
identify forward-looking statements because they contain words such as, but not
limited to, "believes," "expects," "may," "should," "approximately,"
"anticipates," "estimates," "intends," "plans," "targets," likely," "will,"
"would," "could" and similar expressions (or the negative of these terminologies
or expressions). All forward-looking statements involve risks and
uncertainties. Many risks and uncertainties are inherent in our industry and
markets. Others are more specific to our business and operations. These risks
and uncertainties include, but are not limited to, the ability of Constellium
and Wise Metals to achieve expected synergies and the timing thereof,
Constellium's increased levels of indebtedness which could limit Constellium's
operating flexibility and opportunities; the potential failure to retain key
employees, the loss of customers, suppliers and other business relationships;
disruptions to business operations; slower or lower than expected growth in the
North American market for Body-in-White aluminium rolled products, and other
risk factors set forth under the heading "Risk Factors" in our Annual Report on
Form 20-F, and as described from time to time in subsequent reports filed with
the U.S. Securities and Exchange Commission. The occurrence of the events
described and the achievement of the expected results depend on many events,
some or all of which are not predictable or within our control. Consequently,
actual results may differ materially from the forward-looking statements
contained in this press release. We undertake no obligation to update or revise
any forward-looking statement as a result of new information, future events or
otherwise, except as required by law.
* About Constellium
Constellium (NYSE and Euronext Paris: CSTM) is a global sector leader that
develops innovative, value added aluminium products for a broad scope of markets
and applications, including aerospace, automotive and packaging. Constellium
generated ?4.7 billion of revenue in 2016. Constellium's earnings materials for
the quarter ended June 30, 2017 are also available on the company's website
(www.constellium.com).
CONSOLIDATED INCOME STATEMENT
Three Three
months months Six months Six months
(in millions of ended ended ended ended
Euros) June June June 30, 2017 June 30, 2016
30, 2017 30, 2016 (Unaudited) (Unaudited)
(Unaudited) (Unaudited)
Revenue 1,382 1,233 2,710 2,383
Cost of sales (1,232 ) (1,093 ) (2,420 ) (2,129 )
Gross profit 150 140 290 254
Selling and
administrative (62 ) (63 ) (127 ) (124 )
expenses
Research and
development (8 ) (5 ) (19 ) (14 )
expenses
Restructuring - (4 ) (2 ) (4 )
costs
Other gains / (7 ) 12 31 21
(losses) - net
Income from 73 80 173 133
operations
Finance costs - (39 ) (44 ) (93 ) (85 )
net
Share of loss of (7 ) (1 ) (13 ) (2 )
joint-ventures
Income before 27 35 67 46
income tax
Income tax expense (12 ) (26 ) (39 ) (45 )
Net income 15 9 28 1
Net income /
(loss)
attributable to:
Equity holders of 16 9 29 1
Constellium
Non-controlling (1 ) - (1 ) -
interests
Net income 15 9 28 1
EARNINGS PER SHARE ATTRIBUTABLE TO THE EQUITY HOLDERS OF CONSTELLIUM
(in Euros per Three months Three months Six months Six months
share) ended ended ended ended
June 30, 2017 June 30, 2016 June 30, 2017 June 30, 2016
Basic 0.15 0.08 0.27 0.00
Diluted 0.15 0.08 0.27 0.00
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME / (LOSS)
Three Three
months months Six months Six months
(in millions of ended ended ended ended
Euros) June June June 30, 2017 June 30, 2016
30, 2017 30, 2016 (unaudited) (unaudited)
(unaudited) (unaudited)
Net income 15 9 28 1
Other
comprehensive
income / (loss)
Items that will
not be
reclassified
subsequently to
the consolidated
income statement
Remeasurement of
post-employment 8 (45 ) 17 (98 )
benefit
obligations
Income tax on
remeasurement of
post-employment - 13 (2 ) 26
benefit
obligations
Items that may be
reclassified
subsequently to
the consolidated
income statement
Cash flow hedge 24 (14 ) 29 (6 )
Income tax on cash (7 ) 5 (9 ) 2
flow hedge
Currency
translation (11 ) 1 (13 ) 2
differences
Other
comprehensive 14 (40 ) 22 (74 )
income / (loss)
Total
comprehensive 29 (31 ) 50 (73 )
income / (loss)
Attributable to:
Equity holders of 30 (31 ) 51 (73 )
Constellium
Non-controlling (1 ) - (1 ) -
interests
Total
comprehensive 29 (31 ) 50 (73 )
income / (loss)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At June
30, 2017 At
(Unaudited) December
(in millions of Euros) 31, 2016
Assets
Current assets
Cash and cash equivalents 286 347
Trade receivables and other 520 355
Inventories 607 591
Other financial assets 112 117
1,525 1,410
Non-current assets
Property, plant and equipment 1,463 1,477
Goodwill 423 457
Intangible assets 77 79
Investments accounted for under the equity method 2 16
Deferred income tax assets 213 252
Trade receivables and other 51 47
Other financial assets 10 49
2,239 2,377
Total Assets 3,764 3,787
Liabilities
Current liabilities
Trade payables and other 989 839
Borrowings 121 107
Other financial liabilities 20 34
Income tax payable 17 13
Provisions 39 42
1,186 1,035
Non-current liabilities
Trade payables and other 54 59
Borrowings 2,205 2,361
Other financial liabilities 22 30
Pension and other post-employment benefit obligations 675 735
Provisions 105 107
Deferred income tax liabilities 34 30
3,095 3,322
Total Liabilities 4,281 4,357
Equity
Share capital 2 2
Share premium 162 162
Retained deficit and other reserves (689 ) (743 )
Equity attributable to equity holders of Constellium (525 ) (579 )
Non-controlling interests 8 9
Total Equity (517 ) (570 )
Total Equity and Liabilities 3,764 3,787
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)
Foreign
Share Re- Cash Currency Other Re- Total Non-
(in millions Share Pre- measure- flow Transla- re- tained Equity controlling Total
of Euros) Capital mium ment hedges tion serves losses holders of inte- equity
re- Constellium rests
serve
At January 2 162 (151 ) (18 ) 12 17 (603 ) (579 ) 9 (570 )
1, 2017
Net income / - - - - - - 29 29 (1 ) 28
(loss)
Other compre-
hensive - - 15 20 (13 ) - - 22 - 22
income /
(loss)
Total
compre-
hensive - - 15 20 (13 ) - 29 51 (1 ) 50
income /
(loss)
Transactions
with Equity
holders
Share-based - - - - - 3 - 3 - 3
compensation
Transactions
with non- - - - - - - - - - -
controlling
interests
At June 2 162 (136 ) 2 (1 ) 20 (574 ) (525 ) 8 (517 )
30, 2017
Foreign
Share Re- Cash Currency Other Re- Total Non-
(in million Share Pre- measure- flow Trans- re- tained Equity controlling Total
of Euros) Capital mium ment hedges lation serves losses holders of inte- equity
re- Constellium rests
serve
At January 1, 2 162 (133 ) - 6 11 (599 ) (551 ) 11 (540 )
2016
Net Income - - - - - - 1 1 - 1
Other compre-
hensive - - (72 ) (4 ) 2 - - (74 ) - (74 )
(loss) /
income
Total compre-
hensive - - (72 ) (4 ) 2 - 1 (73 ) - (73 )
income /
(loss)
Transactions
with Equity
holders
Share-based - - - - - 3 - 3 - 3
compensation
Transactions
with non- - - - - - - - - 1 1
controlling
interests
At June 30, 2 162 (205 ) (4 ) 8 14 (598 ) (621 ) 12 (609 )
2016
CONSOLIDATED STATEMENT OF CASH FLOWS
Three Three Six months Six months
months months ended ended
(in millions of Euros) ended ended June June
June June 30, 2017 30, 2016
30, 2017 30, 2016 (Unaudited) (Unaudited)
(Unaudited) (Unaudited)
Net income 15 9 28 1
Adjustments
Depreciation and 41 38 84 72
amortization
Finance costs - net 39 44 93 85
Income tax expense 12 26 39 45
Share of loss of joint- 7 1 13 2
ventures
Unrealized (gains) /
losses on derivatives -
net and from 9 (25 ) (14 ) (55 )
remeasurement of
monetary assets and
liabilities - net
Losses on disposal 1 - 2 (1 )
Other - net 2 4 3 5
Interest paid* (41 ) (47 ) (80 ) (75 )
Income tax paid (5 ) (4 ) (7 ) (6 )
Change in trade working
capital
Inventories (10 ) 34 (37 ) 12
Trade receivables (48 ) 86 (170 ) (38 )
Trade payables 29 (12 ) 152 37
Change in provisions and (1 ) - (22 ) (4 )
pension obligations
Other working capital (5 ) (19 ) (3 ) (32 )
Net cash flows from 45 135 81 48
operating activities
Purchases of property, (60 ) (78 ) (120 ) (156 )
plant and equipment
Proceeds from disposals - - - (4 )
net of cash
Equity contributions and (10 ) (4 ) (24 ) (23 )
loans to joint-ventures
Other investing activities 4 4 9 6
Net cash flows used in (66 ) (78 ) (135 ) (177 )
investing activities
Proceeds from issuance of - - 610 375
Senior Notes
Repayments of Senior Notes - - (610 ) -
Proceeds / (Repayments)
from revolving credit 8 (53 ) 18 (87 )
facilities and other loans
Payment of deferred
financing costs and exit (2 ) (4 ) (42 ) (12 )
costs
Transactions with non- - 1 - 1
controlling interests
Other financing activities (4 ) (7 ) 22 (3 )
Net cash flows from /
(used in) financing 2 (63 ) (2 ) 274
activities
Net (decrease) / increase
in cash and cash (19 ) (6 ) (56 ) 145
equivalents
Cash and cash equivalents 309 625 347 472
- beginning of period
Cash and cash equivalents
classified as held for - - - 4
sale - beginning of period
Effect of exchange rate
changes on cash and cash (4 ) 3 (5 ) 1
equivalents
Cash and cash equivalents 286 622 286 622
- end of period
* In Q4 2016, we changed the presentation of interest paid in our cash flow
statement. Interest paid, which was previously reported as financing cash flows,
is now reported as operating cash flows. Prior year numbers were reclassified to
conform to the current year presentation.
SEGMENT ADJUSTED EBITDA
Three Three Six months Six months
months months ended ended
(in millions of Euros) ended ended June June
June June 30, 2017 30, 2016
30, 2017 30, 2016
P&ARP 57 56 98 98
A&T 41 31 69 61
AS&I 33 29 64 56
Holdings and Corporate
(4 ) (9 ) (11 ) (16 )
Total 127 107 220 199
SHIPMENTS AND REVENUE BY PRODUCT LINE
Three Three Six months Six months
months months ended ended
(in k metric tons) ended ended June June
June June 30, 2017 30, 2016
30, 2017 30, 2016
Packaging rolled 208 227 416 432
products
Automotive rolled 39 30 73 57
products
Specialty and other 11 11 23 23
thin-rolled products
Aerospace rolled 28 30 56 61
products
Transportation, industry
and other rolled 35 32 68 64
products
Automotive extruded 28 26 56 52
products
Other extruded products 34 32 66 63
Other - (1 ) - (3 )
Total shipments 383 387 758 749
(in millions of Euros)
Packaging rolled 566 517 1,116 980
products
Automotive rolled 123 82 227 156
products
Specialty and other 47 45 98 96
thin-rolled products
Aerospace rolled 207 201 408 410
products
Transportation, industry
and other rolled 159 133 301 256
products
Automotive extruded 151 141 309 280
products
Other extruded products 137 125 265 247
Other and inter-segment (8 ) (11 ) (14 ) (42 )
eliminations*
Total revenue 1,382 1,233 2,710 2,383
* Includes ?20 million one-time payment related to the renegotiation of a
customer agreement, which was recorded in the first quarter of 2016 as a
reduction of revenues at the Holdings and Corporate level.
NON-GAAP MEASURES
Reconciliation of net income to Adjusted EBITDA (a non-GAAP measure)
Three Three Six months Six months
months months ended ended
(in millions of Euros) ended ended June June
June June 30, 2017 30, 2016
30, 2017 30, 2016
Net income 15 9 28 1
Income tax expense 12 26 39 45
Income before income tax 27 35 67 46
Finance costs - net 39 44 93 85
Share of loss of joint- 7 1 13 2
ventures
Income from operations 73 80 173 133
Depreciation and 41 38 84 72
amortization
Restructuring costs - 4 2 4
Unrealized losses / 10 (23 ) (18 ) (53 )
(gains) on derivatives
Unrealized exchange
losses / (gains) from
remeasurement of 1 (3 ) 5 (2 )
monetary assets and
liabilities - net
Gain on pension plans - - (22 ) -
amendments ((A))
Share based compensation 1 2 3 3
Metal price lag ((B)) (7 ) 2 (20 ) 5
Start-up and development 5 8 10 13
costs ((C))
Manufacturing system and
process transformation 1 1 1 4
costs
Wise integration and - - - 2
acquisition costs
Wise one-time - - - 20
costs ((D))
Losses on disposals 1 - 2 -
Other 1 (2 ) - (2 )
Adjusted EBITDA 127 107 220 199
(A) In January 2017, certain Swiss and US pension plans and OPEB were amended,
which resulted in a ?12 million and ?10 million gain respectively.
Metal price lag represents the financial impact of the timing difference
between when aluminium prices included within Constellium revenues are
established and when aluminium purchase prices included in Cost of sales are
established. The Group accounts for inventory using a weighted average price
basis and this adjustment aims to remove the effect of volatility in LME
(B) prices. The calculation of the Group metal price lag adjustment is based on
an internal standardized methodology calculated at each of Constellium
manufacturing sites and is calculated as the average value of product
recorded in inventory, which approximates the spot price in the market, less
the average value transferred out of inventory, which is the weighted
average of the metal element of cost of sales, based on the quantity sold in
the period.
For the six months ended June 30, 2017, start-up costs and development costs
include ?7 million related to new sites in our AS&I operating segment and ?3
(C) million to BiW/ABS growth projects both in Europe and the U.S. For the six
months ended June 30, 2016, start-up costs and development costs include ?13
million related to BiW/ABS growth projects.
For the six months ended June 30, 2016, Wise one-time costs related to a
one-time payment of ?20 million, recorded as a reduction of revenues, in
relation to the re-negotiation of payment terms, pass through of Midwest
(D) premium amounts and other pricing mechanisms in a contract with one of
Wise's customers. We entered into the re-negotiation of these terms in order
to align the terms of this contract, acquired during the acquisition of
Wise, with Constellium's normal business terms.
Reconciliation of net cash flows from operating activities to Free Cash Flow (a
non-GAAP measure)
Three Three Six months Six months
months months ended ended
ended ended June June
June June 30, 2017 30, 2016
30, 2017 30, 2016
Net cash flows from 45 135 81 48
operating activities
Purchases of property, (60 ) (78 ) (120 ) (156 )
plant and equipment
Equity contributions and
loans to joint-ventures (10 ) (4 ) (24 ) (23 )
Other investing activities 4 4 9 6
Free Cash Flow (21 ) 57 (54 ) (125 )
Reconciliation of borrowings to Net debt (a non-GAAP measure)
At June At
(in millions of Euros) 30, December
2017 31, 2016
Borrowings 2,326 2,468
Fair value of cross currency basis swaps 11 (77 )
Cash and cash equivalents (286 ) (347 )
Cash pledged for issuance of guarantees
(7 ) (9 )
Net debt 2,044 2,035
Non-GAAP measures
In addition to the results reported in accordance with International Financial
Reporting Standards ("IFRS"), this press release includes information regarding
certain financial measures which are not prepared in accordance with IFRS ("non-
GAAP measures"). The non-GAAP financial measures used in this press release are:
Adjusted EBITDA, Adjusted EBITDA per metric ton, Free cash flow and Net debt.
Reconciliations to the most directly comparable IFRS financial measures are
presented in the schedules to this press release. We believe these non-GAAP
measures are important supplemental measures of our operating and financial
performance. By providing these measures, together with the reconciliations, we
believe we are enhancing investors' understanding of our business, our results
of operations and our financial position, as well as assisting investors in
evaluating how well we are executing our strategic initiatives. However, these
non-GAAP financial measures supplement our IFRS disclosures and should not be
considered an alternative to the IFRS measures and may not be comparable to
similarly titled measures of other companies.
In considering the financial performance of the business, management and our
chief operational decision maker, as defined by IFRS, analyze the primary
financial performance measure of Adjusted EBITDA in all of our business
segments. The most directly comparable IFRS measure to Adjusted EBITDA is our
net income or loss for the period. We believe Adjusted EBITDA, as defined below,
is useful to investors and is used by our management for measuring profitability
because it excludes the impact of certain non-cash charges, such as
depreciation, amortization, impairment and unrealized gains and losses on
derivatives as well as items that do not impact the day-to-day operations and
that management in many cases does not directly control or influence. Therefore,
such adjustments eliminate items which have less bearing on our core operating
performance.
Adjusted EBITDA measures are frequently used by securities analysts, investors
and other interested parties in their evaluation of Constellium and in
comparison to other companies, many of which present an Adjusted EBITDA-related
performance measure when reporting their results.
Adjusted EBITDA is defined as income / (loss) from continuing operations before
income taxes, results from joint ventures, net finance costs, other expenses and
depreciation and amortization as adjusted to exclude restructuring costs,
impairment charges, unrealized gains or losses on derivatives and on foreign
exchange differences on transactions which do not qualify for hedge accounting,
metal price lag, share based compensation expense, effects of certain purchase
accounting adjustments, start-up and development costs or acquisition,
integration and separation costs, certain incremental costs and other
exceptional, unusual or generally non-recurring items.
Adjusted EBITDA is the measure of performance used by management in evaluating
our operating performance, in preparing internal forecasts and budgets necessary
for managing our business and, specifically in relation to the exclusion of the
effect of favorable or unfavorable metal price lag, this measure allows
management and the investor to assess operating results and trends without the
impact of our accounting for inventories. We use the weighted average cost
method in accordance with IFRS which leads to the purchase price paid for metal
impacting our cost of goods sold and therefore profitability in the period
subsequent to when the related sales price impacts our revenues. Management
believes this measure also provides additional information used by our lending
facilities providers with respect to the ongoing performance of our underlying
business activities. Historically, we have used Adjusted EBITDA in calculating
our compliance with financial covenants under certain of our loan facilities.
Adjusted EBITDA is not a presentation made in accordance with IFRS, is not a
measure of financial condition, liquidity or profitability and should not be
considered as an alternative to profit or loss for the period, revenues or
operating cash flows determined in accordance with IFRS.
Free Cash Flow is net cash flow from operating activities less capital
expenditure, equity contributions and loans to joint ventures and other
investing activities. Net debt is defined as borrowings plus or minus the fair
value of cross currency basis swaps less cash and cash equivalents and cash
pledged for the issuance of guarantees.
Management believes that Free Cash Flow is a useful measure of the net cash flow
generated or used by the business as it takes into account both the cash
generated or consumed by operating activities, including working capital, and
the capital expenditure requirements of the business. Management believes that
Net debt is a useful measure of indebtedness because it takes into account the
cash and cash equivalent balances held by the Company as well as the total
external debt of the Company.
Net debt and Free Cash Flow are not presentations made in accordance with IFRS,
and should not be considered as an alternative to borrowings or operating cash
flows determined in accordance with IFRS.
Ryan Wentling - Investor Relations
Phone: +1 (212) 675-5450
Investor-relations(at)constellium.com
Delphine Dahan-Kocher - Communications
Phone: +1 (212) 858 9963
delphine.dahan-kocher(at)constellium.com
This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Constellium Paris via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 27.07.2017 - 08:00 Uhr
Sprache: Deutsch
News-ID 554132
Anzahl Zeichen: 51576
contact information:
Town:
Paris
Kategorie:
Business News
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Die Pressemitteilung mit dem Titel:
"Constellium Reports Second Quarter 2017 Financial Results"
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Constellium Paris (Nachricht senden)
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