03 November 2017
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Highlights Q2 FY2018
(Standalone – Unaudited)
Hindalco attained revenues of Rs.10,308 crore, higher as compared to Q2 FY2017, led by aluminium volumes and improved realisation across both the segments. EBITDA (Earnings before Interest, Tax, Depreciation and Amortisation) for the quarter was Rs.1,577 crore, up by 6 per cent compared to the previous year, on account of higher aluminium volumes and supportive macro factors, partly offset by higher input costs and lower volumes in copper segment. Depreciation rose by 8 per cent Y-o-Y, due to progressive capitalisation. Interest expense for the quarter was lower by 19 per cent given the prepayment of loans. Net profit for Q2 FY2018 was at Rs.393 crore vs. Rs.440 crore in the previous year, after factoring in net exceptional provisioning of Rs.106 crore, based on various recent judgements pronounced by the Hon’ble Supreme Court.
The standalone aluminium revenue for Q2 FY2018 was up Y-o-Y at Rs.5,213 crore, led by higher sales of aluminium metal and increased realisation. EBITDA for Q2 FY2018 was Y-o-Y grew 18 per cent to Rs.957 crore on the back supporting macro factors and higher volumes, partly offset by rise in input costs.
For Q2 FY2018, aluminium metal production stood at 326 kilotonne (Y-o-Y increased by 2 per cent) and alumina (including Utkal Alumina) at 712 kilotonne (Y-o-Y fell by 2 per cent). VAP (including wire rod) production was at 119 kilotonne, marginally lower by 2 per cent as compared to the previous year, mainly due to subdued demand. Aditya, Mahan and Utkal Alumina continued to operate at their rated capacities.
The revenue from copper segment increased Y-o-Y to Rs.5,097 crore, driven by higher realisation. EBITDA as compared to the previous year soared by 28 per cent to Rs.467 crore consequent to higher by-product realisation and supportive macro factors, partially offset by lower volumes due to certain operational issues.
For Q2 FY2018, the company’s cathode production was 96 kilotonne lower by 10 per cent, because of certain operational issues and CC rod production at 39 kilotonne was down 7 per cent as compared to Q2 FY2017, mainly due to subdued demand.
Utkal Alumina International Limited:
The EBITDA for Q2 FY2018 surged by 18 per cent to Rs.201 crore on the back of higher realisation.
Utkal Alumina continues to be amongst the lowest cost producers globally. During the quarter, Utkal Alumina refinery produced 380 kilotonne of alumina, up 1 per cent vis-a-vis the previous year.
Net sales increased 18 per cent Y-o-Y to USD 2.8 billion in Q2 FY2018, which was supported by all-time record quarterly shipment of 802 kilotonnes (Y-o-Y grew by 4 per cent), including a 12 per cent increase in shipments of automotive products and higher average aluminium prices.
Adjusted EBITDA (excluding metal price lag), increased 12 per cent to USD 302 million in Q2 FY2018, from USD 270 million in the previous year. The year-over-year improvement in adjusted EBITDA is primarily a result of higher shipments, favourable metal costs and operational efficiencies, partially offset by lower beverage can pricing. Adjusted EBITDA reached USD 377 per ton in the quarter.
Novelis completed its joint venture transaction with Kobe Steel this quarter by selling approximate 50 per cent of its ownership interest in its Ulsan, South Korea facility. It received USD 314 million in cash proceeds for the transaction.
Novelis reported a net income of USD 307 million for the Q2 FY2018, compared to a net loss of USD 89 million in the previous year. Excluding tax-affected special items in both years, the reported net income is at USD 78 million in Q2 FY2018, up from USD 60 million reported in Q2 FY2017.
Hindalco (including Novelis) delivered a robust business performance and the company continued strengthening its balance sheet by deleveraging. The overall domestic demand from user industries remained subdued in July and August, signs of improvement were visible in September. High level of the copper imports and an increase in domestic aluminium production continue to affect domestic sales volumes. Overall, we remain positive on the outlook, Government reforms are expected to facilitate domestic investment and growth in the coming years. Hindalco remains focused on accelerated deleveraging, operational excellence, higher value addition, customer centricity and cash conservation to deliver stakeholder value.
Statements in this “Press Release” describing the company’s objectives, projections, estimates, expectations or predictions may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the company’s operations include global and Indian demand supply conditions, finished goods prices, feed stock availability and prices, cyclical demand and pricing in the company’s principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which the company conducts business and other factors such as litigation and labour negotiations. The company assume no responsibility to publicly amend, modify or revise any forward looking statement, on the basis of any subsequent development, information or events, or otherwise.
Dr. Pragnya RamGroup Executive President, Corporate Communications & CSRAditya Birla Management Corporation Private LimitedAditya Birla Centre, 1st Floor, 'C' WingS.K. Ahire Marg, WorliMumbai 400 030.
91-22-6652 5000 /2499 5000
Fax: 91-22-6652 5741/ 42