Novelis' topline declines amid "less favourable" aluminium recycling benefits

Novelis, the world leader in aluminum recycling, reported a net loss of $13 million for second quarter of fiscal year 2016, while its adjusted EBITDA, excluding the impact of metal price lag in both periods was $236, up seven percent compared to $221 million in the prior year.

The increase was driven by higher shipments of premium automotive and beverage can sheet, partially offset by less favorable recycling benefits due to lower aluminum prices as compared to the prior year. Current year results also reflect higher costs associated with the start-up and support of new automotive finishing and recycling capacity.

However, the company has made good progress reducing new asset start-up costs on a sequential basis. Adjusted EBITDA excluding metal price lag increased eleven percent in the second quarter of fiscal 2016 from $212 million reported in the first quarter of fiscal 2016, primarily driven by higher shipments, better product mix and lower start-up costs.

Steve Fisher, President and Chief Executive Officer for Novelis said, the company will focus on managing costs and reducing working capital in delivering results apart from concentrating on growing premium can, automotive and high-end specialty shipments.

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