Aluminum roller and recycler, Novelis, has announced net income of $14 million for the first quarter of fiscal 2014.
Excluding certain tax-effected items, net income for first quarter of fiscal 2014 was $21 million, the company says.
“We continued to execute extremely well on multiple expansions across the globe, reaching important milestones in commission new capacity in our Asia, North America and South America regions,” said Phil Martens, president and CEO for Novelis in an August 12, 2013 statement to media.
Adjusted EBITDA for the first quarter of fiscal 2014 was $204 million, compared to $259 million reported for the same period a year ago. The quarter's results included a non-recurring $14 million amendment to the Company's employee Long-Term Incentive Plan.
In addition, Novelis faced continued pricing headwinds and softer than expected demand for beverage can sheet partially driven by unfavorable weather conditions.
"Despite the challenges we faced in the first quarter, we maintained financial discipline through good cost control and will continue this focus on cost containment going forward," adds Martens. "In addition, our global strategic expansions and favorable demand trends supported by the 2014 World Cup in Brazil and automotive material substitution towards aluminum sheet will also help drive our business forward in the second half of this fiscal year."
Shipments of aluminum rolled products totaled 708 kilotonnes for the first quarter of fiscal 2014, down two percent compared to shipments of 722 kilotonnes for the same period last year.
Net sales for the first quarter of fiscal 2014 were $2.4 billion compared to $2.6 billion reported for the first quarter of fiscal 2013.
This decrease was primarily due to a seven percent decline in average aluminum prices, lower shipments, and lower conversion premiums.
Fiscal 2014 is a transitional year for Novelis as it begins the commissioning process of several strategic global expansions to support future demand for premium products in can, automotive and specialty markets.
- In July, the Company began the commissioning process at both its new hot and cold mills in Korea. This largely completes the $400 million investment in Korea to add approximately 350 kilotonnes of incremental rolling capacity, and 265 kilotonnes of recycling capacity that came online late last year.
- Novelis also began the commissioning process at its two new automotive finishing lines in North America last month. The commissioning process for this approximately 240 kilotonne expansion will ramp up through the remainder of this fiscal year.
- In addition, the Company's rolling expansion in Brazil continues to successfully accelerate production as expected with customer qualification largely complete.