OREANDA-NEWS. May 28, 2012. Novelis Inc., the world’s leading producer of aluminum rolled products, today reported net income attributable to its common shareholder of USD 63 million for fiscal 2012. Excluding tax-effected items such as the loss on assets held for sale, extinguishment of debt and restructuring charges in fiscal 2012 and 2011, net income for fiscal 2012 was USD 218 million, representing a 6 per cent increase when compared to fiscal 2011.

 "Despite economic uncertainty driving slightly lower shipments in fiscal 2012, our solid business model, good cost management and focus on premium products allowed us to report a record EBITDA per tonne of USD 371 for the year,” said Phil Martens, President and Chief Executive Officer, Novelis.

“Our operations generated a record USD 600 million in cash that we used to invest in the business,” said Martens.  “This is an exciting time for us. All of our major strategic expansions in Brazil, South Korea and the United States are progressing well. In addition, we recently announced our entry into China with a plant that will initially focus on automotive sheet finishing capabilities, solidifying our global automotive leadership position.”

“Throughout the year, we also invested significantly in global recycling facilities, with recycling investments in South America, Europe and a future state-of-the-art fully-integrated recycling system in Germany. Not only will these facilities ensure metal supply but they will also reduce our overall cost base and ensure significant progress towards our goal of achieving 80 per cent recycled content in our products by 2020.”

 The company noted a number of significant accomplishments in fiscal 2012:

Record free cash flow before capex of USD 614 million.

Record investment in the business of USD 516 million, primarily geared at major global expansion projects and key product segments of can, automotive, electronics and high-end specialties.

Continued optimisation of the company’s footprint, which will improve its competitive position, including the divesture of three foil plants in Europe and closure of an aluminum sheet mill in Canada.

Invested in major recycling initiatives in all four operating regions, including advanced equipment and technology to process diversified scrap inputs, which will enable the company to achieve recycled content of 50 per cent in its products by 2015.

Committed USD 100 million to build a plant in China, geared initially at automotive sheet finishing capabilities. The company continues to expect strong aluminum rolled products demand in Asia, driven primarily by China, over the next five years.

Shipments of aluminum rolled products totalled 2,838 kilotonnes for fiscal 2012 as compared to shipments of 2,969 kilotonnes for fiscal 2011. The decrease in shipments was primarily a result of customer destocking due to economic uncertainty and continued weakness in the company’s electronics business. Shipments of aluminum rolled products totalled 703 kilotonnes for the fourth quarter of fiscal 2012 compared to shipments of 771 kilotonnes in the fourth quarter of the previous year.

 Net sales for fiscal 2012 were USD 11.1 billion, a 5 per cent increase compared to the USD 10.6 billion reported in the same period a year ago, mainly the result of favourable conversion premiums across all regions and an increase in average aluminum prices compared to the same period last year. Net sales for the fourth quarter of fiscal 2012 were USD 2.6 billion, a decrease of 12 per cent compared to the USD 3.0 billion reported in the same period a year ago, mainly the result of lower volumes and average aluminum prices compared to the same period last year.

 Adjusted EBITDA for fiscal 2012 was USD 1,053 million, a 2 per cent decrease compared to a record USD 1,072 million in fiscal 2011. Adjusted EBITDA for the fourth quarter of fiscal 2012 was USD 233 million, compared with USD 280 million reported in the same period of the previous year. The decrease in EBITDA for the year and quarter were primarily driven by weaker demand, partially offset by higher conversion premiums. “As expected we saw demand recovery from the third quarter and expect this trend to continue into fiscal 2013,” said Steve Fisher, Chief Financial Officer, Novelis.