Finance
Constellium SE (NYSE: CSTM) ("Constellium" or the "Company") today reported results for the third quarter ended September 30, 2024.
As a reminder of the press release issued on February 21, 2024 and following the SEC comment letter review process, Constellium will no longer report Value-Added Revenue (VAR), a Non-GAAP financial measure. In addition, the Company has revised its definition of consolidated Adjusted EBITDA, a Non-GAAP financial measure, to no longer exclude the non-cash impact of metal price lag from its consolidated Adjusted EBITDA. Constellium will continue to exclude the non-cash impact of metal price lag from its Segment Adjusted EBITDA, which it uses for evaluating the performance of its operating segments. Following the revision of its definition, consolidated Adjusted EBITDA, less the non-cash impact of metal price lag, is equal to consolidated Adjusted EBITDA prior to the revision of its definition. Constellium will continue to provide its investors and other stakeholders with the necessary information to explain the non-cash impact of metal price lag on its reported results.
Third quarter 2024 highlights:
- Shipments of 352 thousand metric tons, down 5% compared to Q3 2023
- Revenue of €1.6 billion, down 5% compared to Q3 2023
- Net income of €3 million compared to net income of €64 million in Q3 2023
- Adjusted EBITDA of €110 million
- Includes negative €17 million impact at Valais as a result of the flood
- Includes negative non-cash metal price lag impact of €3 million
- Segment Adjusted EBITDA of €61 million at P&ARP, €47 million at A&T, €10 million at AS&I, and €(4) million at H&C
- A&T and AS&I results include impact at Valais as a result of the flood
- Cash from Operations of €86 million and Free Cash Flow of €(10) million
- Includes negative €6 million impact at Valais as a result of the flood
- Repurchased 1.2 million shares of the Company stock for $21 million
Nine months ended September 30, 2024 highlights:
- Shipments of 1.1 million metric tons, down 4% compared to YTD 2023
- Revenue of €5.2 billion, down 8% compared to YTD 2023
- Net income of €91 million compared to net income of €118 million in YTD 2023
- Adjusted EBITDA of €461 million
- Includes negative €17 million impact at Valais as a result of the flood
- Includes positive non-cash metal price lag impact of €26 million
- Segment Adjusted EBITDA of €168 million at P&ARP, €210 million at A&T, €75 million at AS&I, and €(17) million at H&C
- A&T and AS&I results include impact at Valais as a result of the flood
- Cash from Operations of €292 million and Free Cash Flow of €57 million
- Includes negative €6 million impact at Valais as a result of the flood
- Repurchased 3.1 million shares of the Company stock for $60.4 million
- Leverage of 2.8x at September 30, 2024
Jean-Marc Germain, Constellium’s Chief Executive Officer said, “Our team faced significant challenges in the third quarter, including increased demand weakness across several of our end markets, and the ongoing impact from the flood that occurred back in late June at our facilities in the Valais region in Switzerland. I am pleased to report that the clean-up and restoration is well underway and earlier this week we were able to partially restart some of our operations. I am proud of our entire team on the ground in the Valais region and wanted to thank them for their incredible resolve and courage during this very difficult time.”
“Looking more at our end markets, packaging demand remained healthy during the quarter. Aerospace demand has started to slow down as commercial aerospace OEMs are dealing with supply chain challenges and continue to struggle to increase build rates. Automotive demand during the quarter started to soften in North America, while weakness accelerated during the quarter in automotive markets in Europe. We experienced a sharp decline in demand in North America in most industrial markets, and further weakness in most industrial and specialties markets in Europe. Free Cash Flow was negative €10 million in the quarter, which includes a €6 million impact at Valais as a result of the flood, and we ended the quarter with leverage at 2.8x. Also in the quarter, we repurchased 1.2 million shares for $21 million," Mr. Germain continued.
Mr. Germain concluded, "We continue to face uncertainties on the macroeconomic and geopolitical fronts, and we have a demand environment that has continued to weaken throughout the year, which accelerated during the third quarter and has now spread to most of our end markets. Based on our current outlook, in 2024 we expect Adjusted EBITDA to be in the range of €580 million to €600 million, excluding an estimated one-time impact of €30 million to €40 million from the flood in Switzerland, and excluding the non-cash impact of metal price lag. Given the softness we are experiencing today across most of our end markets with no signs of recovery in the near-term, we are also more cautious as we head into 2025. At this stage, our Adjusted EBITDA target of over €800 million, excluding the non-cash impact of metal price lag, is delayed pending market recovery. Overall, we like our end market positioning and remain confident in the long-term fundamentals driving the demand for our products. Our focus remains on executing our strategy and increasing shareholder value.”