Hindalco reports consolidated second quarter FY2024 results
10 November 2023
Robust performance across all business segments
Novelis on recovery path: EBITDA per tonne crosses $500
All-time high Copper EBITDA at Rs.653 crore
Quarterly consolidated net profit at Rs.2,196 crore, flat YoY
Q2 FY24 Performance Highlights
- Net Profit at Rs.2,196 crore, flat YoY
- Consolidated EBITDA at Rs.6,096 crore, up 6 per cent YoY
- Novelis’ Adjusted EBITDA per ton at $519*, up 1 per cent YoY
- Highest ever Copper EBITDA at Rs.653 crore up 20 per cent YoY
- All-time high Copper metal sales at 134 Kt, up 20 per cent YoY
- Hindalco to invest Rs.8,000 crore in a 2 million-tonne greenfield alumina refinery in Odisha
- Hindalco selected Aluminium Industry Leader in the S&P Global Corporate Sustainability Assessment rankings 2023, for the 4th consecutive year
- Hindalco’s India Business pre-pays long-term debt of Rs.2,120 crore in August 2023
- Consolidated Net Debt to EBITDA at 1.66x at the end of September 30, 2023 (vs 1.73x as of June 30, 2023)
*As per US GAAP
Mumbai: Hindalco Industries Limited, the Aditya Birla Group metals flagship, reported a consolidated EBITDA of Rs.6,096 crore in Q2 FY24, an increase of 6 per cent YoY, and flat QoQ. Net Profit was Rs.2,196 crore, in line with the prior year quarter, and down 11 per cent QoQ mainly due to accounting adjustments arising out of conversion from US GAAP to Ind AS.
All the business segments experienced improved QoQ performance. The Copper Business achieved its highest quarterly EBITDA of Rs.653 crore, a 23 per cent rise QoQ, driven by highest-ever metal shipments. Novelis reported another quarter of sequential improvement in Adjusted EBITDA and EBITDA per ton backed by higher shipments, largely from beverage cans. In the Indian Aluminium segment, Upstream Business EBITDA was Rs.2,074 crore, up 7 per cent QoQ, and Downstream EBITDA was Rs.171 crore, an increase of 16per cent QoQ due to higher shipments.
The Company maintained a strong balance sheet and liquidity with a Net Debt to EBITDA ratio well below 2x, positioning it well for organic growth.
Consolidated financial highlights for the quarter and half year ended 30 September 2023
|Particulars||Q2 FY23||Q1 FY24||Q2 FY24||H1FY23||H1FY24|
|Revenue from Operations||56,176||52,991||54,169||1,14,194||1,07,160|
|Earning Before Interest, Tax, Depreciation & Amortisation (EBITDA)|
|Business Segment EBITDA||6,138||6,069||6,896||14,467||12,965|
|Inter Segment Profit/ (Loss) Elimination (Net)||437||(10)||(1)||371||(11)|
|Unallocable Income/ (Expense) – (Net) & GAAP Adjustments||(832)||50||(799)||(455)||(749)|
|Depreciation & Amortisation (including impairment)||1,766||1,790||1,864||3,515||3,654|
|Share in Profit/ (Loss) in Equity Accounted Investments (Net of Tax)||2||2||–||5||2|
|Profit before Exceptional Items and Tax||3,100||3,329||3,198||9,147||6,527|
|Exceptional Income/ (Expenses) (Net)||–||(12)||33||41||21|
|Profit Before Tax (After Exceptional Item)||3,100||3,317||3,231||9,188||6,548|
|Profit/ (Loss) After Tax||2,205||2,454||2,196||6,324||4,650|
*As per US GAAP
Commenting on the results, Mr. Satish Pai, Managing Director, Hindalco Industries, said,
“Hindalco continues to demonstrate Sustain-Ability, through a performance that is robust and consistent. We have maintained momentum driven by our focus on cost control and a solid performance by all our downstream segments.
Copper Business delivered its best-ever quarterly results backed by record metal sales. Aluminium India Upstream EBITDA rose by 7 per cent over the first quarter supported by higher volumes and lower input costs. Aluminium India Downstream Business EBITDA increased 16 per cent sequentially due to higher volumes. Novelis continued to show sequential improvement in EBITDA and EBITDA per ton, driven by higher volumes, particularly in can shipments which grew 12 per cent over Q1.
A noteworthy highlight is Hindalco’s recognition as the World’s Most Sustainable Aluminium Company for the fourth year in a row in the S&P Global Corporate Sustainability Assessment rankings 2023. This is a matter of organisational pride and it reflects our holistic approach to long-term ESG performance.”
Since 2020, Hindalco has continually been ranked at the top of the aluminium sector, for its sustainability-led performance. This year Hindalco scored 78 (out of 100) in the 2023 S&P Global Corporate Sustainability Assessment (CSA Score as of 27/10/2023). Hindalco achieved industry-best scores in various dimensions including Resource Efficiency and Circularity, Climate Strategy, Biodiversity, Customer Relationship Management, Supply Chain Management, Social Impacts on Communities, and more, reaffirming its position as an industry leader.
Consolidated results in Q2 FY24 (vs Q1 FY24)
Consolidated revenue for the first quarter stood at Rs.54,169 crore (vs Rs.52,991 crore in Q1 FY24), up 2 per cent QoQ due to higher shipments and lower input costs. Hindalco reported an EBITDA of Rs.6,096 crore in Q2 FY24 (vs Rs.6,109 crore in Q1 FY24), which was flat QoQ. Consolidated PAT in Q2 FY24 was Rs.2,196 crore compared to Rs.2,454 crore in Q1 FY24, down 11 per cent QoQ. Consolidated Net Debt to EBITDA stood at 1.66x as of 30 September 2023 vs 1.73x as of 30 June 2023.
Business segment performance in Q2 FY24 (vs Q1 FY24)
Total shipments of flat rolled products were at 933 Kt in Q2 FY24 vs 879 Kt in Q1 FY24, up 6 per cent QoQ contributed largely by sequential increase in can shipments of 12 per cent. Novelis’ revenue stood at $4.1 billion (vs $4.1 billion), flat QoQ, supported by higher shipments. Novelis reported an adjusted EBITDA of $484 million (vs $421 million), up 15 per cent QoQ due to higher shipments and better scrap utilisation. Novelis’ adjusted EBITDA per tonne at $519 was up 8 per cent QoQ.
Upstream revenue was Rs.7,878 crore in Q2 FY24 vs Rs.8,064 crore in the prior quarter. Aluminium Upstream EBITDA stood at Rs.2,074 crore in Q2 FY24, compared to Rs.1,935 crore in Q1 FY24, up 7 per cent QoQ driven by lower input costs. Upstream EBITDA margins were at 26.3 per cent and continue to be one of the best in the global industry.
Downstream second quarter revenue was Rs.2,629 crore vs Rs.2,435 crore in the prior quarter. Sales of Downstream Aluminium stood at 94 Kt vs 81 Kt in Q1 FY24, up 15 per cent QoQ. Downstream EBITDA was Rs.171 crore in Q2 FY24 compared to Rs.147 crore for Q1 FY24, up 16 per cent QoQ backed by higher shipments.
Revenue from the Copper Business stood at Rs.12,441 crore, up 8 per cent QoQ, driven by higher sales volumes. EBITDA for the Copper Business was at an all-time high of Rs.653 crore in Q2 FY24 compared to Rs.531 crore in Q1 FY24, up 23 per cent QoQ, on account of higher shipments. Copper metal sales were at a record 134 Kt (vs 118 Kt). Copper Continuous Cast Rod (CCR) sales were also at an all-time high of 100 Kt (vs 98 Kt), up 2 per cent QoQ in line with growing market demand for value-added products and increased utilisation of our rod mills.
Business Updates & Recognition
- Novelis signs long-term agreement with Ball North America for aluminum beverage packaging sheet
- Novelis signs contract extension with Airbus for aerospace plate, sheet and wingskins
- Hindalco signs MoU with Odisha Mining Corporation for the long-term supply of bauxite ore for its planned 2-million tonne greenfield alumina refinery and 150-MW captive power plant at Kansariguda in Rayagada District of Odisha. Hindalco to invest Rs.8,000 crore in the project in two phases.
- For the fourth consecutive year, Hindalco selected as World’s Most Sustainable Aluminium Company, in the 2023 S&P Global Corporate Sustainability Assessment (Score date: 27 October 2023)
- Hindalco recognised with the UNDP Mahatma Award 2023 for Biodiversity
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 50 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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