Constellium Beats Street Earnings And Revenue Projections In Strong Third Quarter

Constellium Beats Street Earnings And Revenue Projections In Strong Third Quarter

Amsterdam rolled and extruded aluminium leader Constellium N.V. released results for the third quarter and first nine months of 2018 yesterday. The firm’s quarterly numbers beat market projections thanks to increased operational efficiency and higher shipments.

In the just-ended quarter, Constellium shipped 379 thousand metric tons of product, up by 1 percent on the year. Revenue rose to €1.4 billion, a 12-percent bump above last year’s third-quarter number. Net income jumped from €21 million in the third quarter last year to €217 million in the just-ended quarter, while adjusted EBITDA rose by 2 percent year on year to €114 million.

Over the first nine months of 2018, Constellium’s shipments rose by 3 percent on the year to 1.2 million metric tons. Revenue rose by 8 percent to €4.3 billion, and net income spiked to €248 million, well above last year’s first-nine-month total of €49 million. Adjusted EBITDA for the period rose by 15 percent to €382 million, while net debt/LTM Adj. EBITDA came in at 3.8x, down by 1x from the end of September 2017. The company achieved its Project 2019 run-rate cost savings of €38 million as of the final day of the period.

Jean-Marc Germain, Constellium’s Chief Executive Officer, lauded the progress made to date, adding a promise that it was but a prelude to continued improved results.

“Constellium delivered solid results in the third quarter. Our improvement compared to last year was driven by continued operational performance, steady end market demand and Project 2019 cost savings, which were partially offset by higher planned maintenance and other costs. We continue to expect Adjusted EBITDA growth of 11% to 13% in 2018.”

“I am pleased with the progress the team is making on executing our strategy, including delivering on our growth projects and on Project 2019,” he went on. “Our focus remains on delivering on our guidance of over €500 million of Adjusted EBITDA and positive Free Cash Flow in 2019. We are committed to driving increased shareholder value.”

Constellium, based in Amsterdam, was founded 1855 as Henri Merle et Compagnie and subsequently renamed Pechiney in 1950. Pechiney was purchased by Alcan in 2003, which was purchased by Rio Tinto in 2007. In 2011 Rio Tinto sold Alcan Engineered Products to Apollo Management (51%) and FSI (10%). The firm produces rolled and extruded aluminium products from various alloys. The firm brought in €5.2 billion of revenue in 2017.