Hindalco Reports Consolidated Q4 FY2023 Results

Resilient operational performance despite inflationary and macro-economic challenges

All-time high Full Year Consolidated Revenue at ₹2,23,202 crore

Industry-best Aluminium Upstream EBITDA per ton at $825 in Q4

Highest-ever Copper EBITDA at ₹598 crore in Q4

Q4 FY23 Performance (vs Q4 FY22)

• Consolidated revenue at ₹55,857 crore, similar YoY, up 5% sequentially
• Consolidated PAT at ₹2,411 crore, down 37% YoY, up 77% sequentially 
• Consolidated EBITDA at ₹5,818 crore, down 23% YoY, up 48% sequentially
• All-time high quarterly Copper EBITDA at ₹598 crore, up 55% YoY, up 10% QoQ
• Novelis’ Adjusted EBITDA per ton at $431*, down 1% YoY, up 15% QoQ
• Novelis’ Net Income at $175 million*, down 7% YoY, up 82% sequentially
• Hindalco begins delivery of low-carbon aluminium to global customers

FY23 Performance (vs FY22)

• Consolidated revenue at ₹2,23,202 crore, up 14% YoY
• Consolidated PAT at ₹10,097 crore, down 26% YoY
• Consolidated EBITDA at ₹24,131 crore, down 20% YoY
• All-time high Aluminium Downstream EBITDA at ₹627 crore, up 64% YoY
• All-time high Copper EBITDA at ₹2,253 crore, up 62% YoY
• Consolidated Net Debt to EBITDA at 1.39x as of March 31st, 2023 vs 1.36x a year ago
• Hindalco-Novelis in the top 1% S&P Global ESG score in the Aluminium Industry
• Board recommends dividend @300%(₹3/share) for FY23 vs 400%(₹4/share) for FY22
   

Hindalco Industries Limited, the Aditya Birla Group metals flagship, reported a consolidated quarterly Net Profit of ₹2,411 crore, a sequential growth of 77%, driven by a continued focus on cost control and a resilient operational performance by India business. Novelis delivered an improved quarter-on-quarter performance with Net Income of $175 million, up 82% sequentially.   

Consolidated revenue for the full year touched an all-time high of ₹2,23,202 crore, up 14% YoY. 

Copper Business delivered an exemplary performance in FY23, with EBITDA at a record ₹2,253 crore, up 62% YoY, backed by record copper rod production and domestic sales. 

Aluminium Downstream EBITDA for the year was at an all-time high of ₹627 crore, up 64% YoY, due to better pricing and volumes. Aluminium Upstream reported higher revenues for FY23 at ₹33,010 crore, up 7% due to higher metal volumes. However, EBITDA for the full year was impacted by inflationary pressures. Despite macro-economic headwinds, Hindalco maintained a strong balance sheet and liquidity position which helped the company keep the Net Debt to EBITDA ratio below 2x.

Commenting on the results, Mr. Satish Pai, Managing Director, Hindalco Industries, said, “Our diversified business model continues to drive Hindalco’s resilient performance in challenging times. Our Copper Business delivered exceptional results recording its highest-ever EBITDA, driven by robust market demand, stable operations and higher value-added product sales. Our India Aluminium Downstream Business, which experienced its highest-ever EBITDA growth in FY23, reflects our strategic focus on enhancing this segment. Despite macroeconomic headwinds, Novelis has shown quarter-on-quarter recovery supported by improved product pricing and favourable product mix.   
                                                                                                            
Looking ahead, a Net-Debt-Free India business and a strong balance sheet will continue to power our ambitions for organic growth. We also continue to drive our holistic ESG approach with specific targets that go beyond carbon emissions, and encompass other planet-critical aspects like waste, biodiversity, water positivity, and community inclusion.”

Consolidated Results

Consolidated revenue for the fourth quarter stood at ₹55,857 crore (vs ₹55,764 crore), similar YoY and up 5% QoQ, on account of better realisations and volumes in India operations.

Hindalco reported an EBITDA of ₹5,818 crore (vs ₹7,597 crore) in Q4 FY23, down 23% YoY, impacted by higher input costs and unfavourable macros, partially offset by better operational performance of Copper Business. On a sequential basis, EBITDA was up 48% driven by better performance of India Aluminium and Copper Business and Novelis.

Consolidated PAT in Q4 FY23 was ₹2,411 crore compared to ₹3,851 crore in Q4 FY22, lower by 37% YoY, and up 77% QoQ. Consolidated Net Debt to EBITDA stood at 1.39x as of March 31st, 2023 vs 1.36x as of March 31st, 2022.  
 

Business Segment Performance in Q4 FY23 (vs Q4 FY22)

Novelis

Total shipments of flat rolled products were at 936 Kt in Q4 FY23 vs 987 Kt in Q4 FY22, down 5% YoY, and up 3% QoQ supported by higher aerospace and record automotive shipments in Q4. Novelis’ revenue in Q4 FY23 stood at $4.4 billion (vs $4.8 billion), down 8% YoY, impacted by lower average aluminium prices and subdued sales volume YoY. Novelis reported an adjusted EBITDA of $403 million (vs $431 million), down 6% YoY, and up 18% QoQ supported by higher product pricing and volumes product mix. Novelis’ adjusted EBITDA per ton at $431 was down 1% YoY, and up 15% sequentially. Net income from continuing operations, excluding special items, was $175 million in Q4 FY23, a decline of 7% YoY, and up 82% QoQ.

Aluminium (India)

Quarterly Upstream revenue was ₹8,050 crore in Q4 FY23 vs ₹9,253 crore in the prior year period. Aluminium Upstream EBITDA stood at ₹2,192 crore in Q4 FY23, compared with ₹3,742 crore for Q4 FY22, down 41% YoY, and up 38% QoQ supported by lower input costs. Upstream EBITDA margins were at 27% and continue to be one of the best in the global industry.

Downstream revenue was ₹2,738 crore in Q4 FY23 vs ₹3,282 crore in the prior year period. Sales of Downstream Aluminium stood at 90 Kt vs 93 Kt in Q4 FY22, down 4% YoY, and down 1% sequentially.

Downstream EBITDA stood at ₹112 crore in Q4 FY23, compared to ₹140 crore for Q4 FY22, down 20% YoY and down 29% QoQ. Downstream EBITDA for the year was at an all-time high of ₹627 crore, up 64% YoY, driven by better pricing and volumes.  
 

Copper

Quarterly revenue from the Copper Business stood at ₹11,206 crore, up 14% YoY, on account of higher global prices of copper and higher volumes. EBITDA for the Copper Business was at an all-time high of ₹598 crore in Q4 FY23 compared to ₹387 crore in Q4 FY22, up 55% YoY, and up 10% QoQ backed by continued stable operations, higher domestic sales, and better TC/RCs. Quarterly Copper metal sales were at a record 117 Kt (vs 105 Kt). Copper Continuous Cast Rod (CCR) sales also touched a record 95 Kt in Q4 FY23 (vs 74 Kt), up 28% YoY in line with growing market demand for value added products.

Business Updates & Recognition

• 34 Kt aluminium extrusions plant in Silvassa begins commercial production
• Hindalco begins delivery of low-carbon aluminium to global customers
• Additional 350 Kt expansion via debottlenecking at Utkal Alumina in progress
• Winner of the ‘KPMG India ESG Conclave and Awards 2023’ in the industrial manufacturing and automotive sector
• Winner of the ‘Best Annual Report Award FY22’ in the Mining and Metals sector by Free Press Journal and Grant Thornton Bharat LLP
• Among ‘India’s 40 Best Workplaces in Health and Wellness 2022’ by Great Places to Work® Institute (India)
• Hindalco-Novelis in the top 1% S&P Global ESG score in the aluminium industry in 2022 with a score of 83/100