Hindalco reports consolidated first quarter FY2024 results
08 August 2023
Sustained performance on the back of recovery in Novelis and Aluminium India Downstream Business
Q1 FY24 Performance (vs Q4 FY23)
- Quarterly Consolidated PAT at Rs.2,454 crore, up 2 per cent sequentially
- Consolidated EBITDA at Rs.6,109 crore, up 5 per cent sequentially
- Novelis’ Adjusted EBITDA per ton at $479*, up 11 per cent sequentially
- All-time high Copper metal sales at 118 Kt, up 1 per cent sequentially
- Consolidated Net Debt to EBITDA at 1.73x at the end of June 30, 2023 (vs 1.39x as of March 31, 2023)
- Hindalco collaborates with Tata Motors to build the first-ever all-aluminium cargo body for the new generation Tata Ace EVs designed to enhance last mile deliveries
*As per US GAAP
Hindalco Industries Limited, the Aditya Birla Group metals flagship, reported a consolidated quarterly Net Profit of Rs.2,454 crore, a sequential growth of 2 per cent, driven by recovery in Novelis and Aluminium India Downstream Business, and backed by a steady performance by the Copper business.
Novelis reported a sequential improvement in quarterly Adjusted EBITDA and EBITDA per ton reflecting favourable product mix and record automotive shipments. Copper Business achieved highest-ever metal sales, at 118 Kt, up 1 per cent sequentially, supported by robust market demand..
Aluminium India Downstream EBITDA for the quarter was Rs.147 crore, up 31 per cent sequentially, due to enriched product mix. Aluminium Upstream reported higher quarterly shipments at 341 Kt, up by 5 per cent sequentially, driven mainly by higher demand in electrical and auto segments.
Despite macroeconomic headwinds, Hindalco maintained a strong balance sheet and liquidity position which helped the Company keep the Net Debt to EBITDA ratio below 2x.
Consolidated Financial Highlights for the Quarter ended June 30, 2023
|Particulars||Q1FY23||Q4 FY23||Q1 FY24|
|Revenue from Operations||58,018||55,857||52,991|
|Earning Before Interest, Tax, Depreciation & Amortisation (EBITDA)|
|Business Segment EBITDA||8,329||6,216||6,069|
|Inter Segment Profit/ (Loss) Elimination (Net)||(66)||(58)||(10)|
|Unallocable Income/ (Expense) – (Net) & GAAP Adjustments||377||(340)||50|
|Depreciation & Amortisation (including impairment)||1,749||1,995||1,790|
|Share in Profit/ (Loss) in Equity Accounted Investments (Net of Tax)||3||2||2|
|Profit before Exceptional Items and Tax||6,047||2,839||3,329|
|Exceptional Income/ (Expenses) (Net)||41||–||12|
|Profit Before Tax (After Exceptional Item)||6,088||2,839||3,317|
|Profit/ (Loss) After Tax||4,119||2,411||2,454|
Commenting on the results, Mr. Satish Pai, Managing Director, Hindalco Industries, said,
“FY24 has started on a promising note. Our focus on expanding our value-added portfolio and operational efficiencies has enabled us to deliver a sustained performance in the face of continued macroeconomic pressures. An enhanced product mix saw the Aluminium India Downstream Business generating higher value, with Q1 EBITDA increasing by 31 per cent QoQ. Despite significant market headwinds, Novelis continued to show sequential improvement in adjusted EBITDA and EBITDA per ton, backed by record sales of automotive aluminium sheets. The Copper Business achieved record metal sales and maintained its market share despite undergoing a planned shutdown.
We will continue to strongly position our Company for the future, by maintaining our focus on ESG, controlling costs, securitising resources, and driving downstream expansion.”
Consolidated Results in Q1 FY24 (vs Q4 FY23)
Consolidated revenue for the first quarter stood at Rs.52,991 crore (vs Rs.55,857 crore in Q4 FY23), down 5 per cent QoQ, on account of unfavorable macros and subdued volumes.
Hindalco reported an EBITDA of Rs.6,109 crore in Q1 FY24 (vs Rs.5,818 crore in Q4 FY23), up 5 per cent QoQ, supported by recovery in Novelis and India Downstream Business.
Consolidated PAT in Q1 FY24 was Rs.2,454 crore compared to Rs.2,411 crore in Q4 FY23, up 2 per cent QoQ. Consolidated Net Debt to EBITDA stood at 1.73x as of June 30th, 2023 vs 1.39x as of March 31st, 2023.
Business Segment Performance in Q1 FY24 (vs Q4 FY23)
Total shipments of flat rolled products were at 879 Kt in Q1 FY24 vs 936 Kt in Q4 FY23, down 6 per cent QoQ due to lower beverage can shipments and unfavourable economic conditions impacting some specialties markets mainly in building and construction, partially offset by record automotive shipments. Novelis’ revenue stood at $4.1 billion (vs $4.4 billion), down 7 per cent QoQ, impacted by lower average aluminium prices and subdued shipments. Novelis reported an adjusted EBITDA of $421 million (vs $403 million), up 4 per cent QoQ due to favourable product mix and better cost control. Novelis’ adjusted EBITDA per ton at $479 was up 11 per cent sequentially.
Upstream revenue was Rs.8,064 crore in Q1 FY24 vs Rs.8,050 crore in the prior quarter. Aluminium Upstream EBITDA stood at Rs.1,935 crore in Q1 FY24, compared to Rs.2,192 crore for Q4 FY23, down 12 per cent QoQ due to lower metal prices. Upstream EBITDA margins were at 24 per cent and continue to be one of the best in the global industry.
Downstream first quarter revenue was Rs.2,435 crore vs Rs.2,738 crore in the prior quarter. Sales of Downstream Aluminium stood at 81 Kt vs 90 Kt in Q4 FY23, down 9 per cent QoQ. Downstream EBITDA stood at Rs.147 crore in Q1 FY24 compared to Rs.112 crore for Q4 FY23, up 31 per cent QoQ due to better product mix.
Revenue from the Copper Business stood at Rs.11,502 crore, up 3 per cent QoQ, driven by higher sales volumes. EBITDA for the Copper Business was Rs.531 crore in Q1 FY24 compared to Rs.598 crore in Q4 FY22, down 11 per cent QoQ, impacted by planned maintenance shutdown. Copper metal sales were at a record 118 Kt (vs 117 Kt). Copper Continuous Cast Rod (CCR) sales were also at an all-time high of 98 Kt (vs 95 Kt), up 4 per cent QoQ in line with growing market demand for value-added products.
Business Updates & Recognition
- Hindalco has set up a dedicated facility to build the first all-aluminium cargo body for the new generation of Tata Ace EVs. These lightweight, durable aluminium containers enhance vehicle range by 15 per cent and lower carbon footprint. The new high-strength cargo body uses customised aluminium profiles that are leak-proof, corrosion-resistant and superior in quality.
- Novelis signs long-term agreement to supply aluminium beverage can sheet to The Coca-Cola company
- 34 Kt aluminium extrusions plant in Silvassa begins commercial production
- Additional 350 Kt expansion via debottlenecking at Utkal Alumina in progress
- Hindalco recognised for the second year in a row, as one of ‘India’s Best Employers Among Nation Builders – 2023’, by Great Place To Work® Institute (India)
About Hindalco Industries Limited
Hindalco Industries Limited is the metals flagship company of the Aditya Birla Group. A $28 billion metals powerhouse, Hindalco is the world’s largest aluminium company by revenues, and a major player in copper serving more than half of India’s copper requirement.
Hindalco operates across the value chain, from bauxite mining, alumina refining, coal mining, captive power plants and aluminium smelting to downstream rolling, extrusions, and foils. Along with its subsidiary Novelis, Hindalco is the global leader in flat rolled products and the world’s largest recycler of aluminium.
Hindalco’s copper facility in India comprises a world-class copper smelter, downstream facilities, and a captive jetty. The copper smelter is among the world’s largest custom smelters at a single location.
Hindalco’s global footprint spans 52 manufacturing units across 10 countries. Hindalco was named the world’s most sustainable aluminium company in the Dow Jones Sustainability Indices (DJSI) in 2020, 2021 and 2022.
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