European value-added aluminium firm Constellium NV released financial and production results for the year’s first quarter this week.
The first quarter saw Constellium ship 2 percent less product on the year, down to 385 thousand metric tons. Shipments fell in the quarter thanks in part to a fall in shipments to its automotive and transportation customers. Revenue also fell in Q1, sliding by 7 percent to €1.3 billion from 2020, due to a drop in both aluminium prices and shipments to its aerospace clients. Constellium reversed losses from last year however, turning a net loss of €31 million in 2020’s first quarter to a net income of €48 million.
Constellium reported a fall in adjusted EBITDA in the first quarter, dropping by 18 percent on the year to €121 million. The firm says a dip in business from its aerospace and transportation buyers overcame a rise in purchasing from automotive and packaging customers.
Jean-Marc Germain, Constellium’s Chief Executive Officer said there were still many bright spots in the results in a related press release.
“Our team delivered solid first quarter results. Better-than-expected market demand and excellent cost performance propelled us above the top end of our Adjusted EBITDA guidance range. P&ARP demonstrated strong cost control, which helped to offset the effects of several one-off events. A&T results continue to be negatively affected by weak aerospace demand; however, TID has been a bright spot, with improving demand in both the U.S. and Europe. AS&I reported record first quarter Adjusted EBITDA and returned to historical levels of profitability. Lastly, we continue to build on our track record of delivering consistent and significant Free Cash Flow with €46 million generated in the first quarter.
“I am optimistic about our prospects for the remainder of 2021, despite some lingering uncertainties,” he continued. “Our end markets, with the exception of aerospace, remain strong. We expect Adjusted EBITDA of €510 million to €530 million and Free Cash Flow in excess of €100 million in 2021. As a result, we expect our leverage to fall well below 4.0x by the end of the year. We continue to be focused on executing our strategy, driving operational performance, and generating Free Cash Flow.”
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%). Constellium produces rolled and extruded aluminium products from various alloys, bringing in €4.9 billion of revenue in 2020.