Novelis Inc.

Novelis — Q2 FY2023 Earnings Presentation

19 slides from Novelis's earnings presentation, Nov 8, 2022

  1. Slide 1: Novelis Q2 Fiscal Year 2023 Earnings Conference Call

    NOVELIS Q2 FISCAL YEAR 2023 EARNINGS CONFERENCE CALL November 8, 2022 Steve Fisher President and Chief Executive Officer Dev Ahuja Executive Vice President and Chief Financial Officer © 2022 Novelis

  2. Slide 2: Safe Harbor Statement

    SAFE HARBOR STATEMENT Forward-looking statements Statements made in this presentation which describe Novelis' intentions, expectations, beliefs or predictions may be forward-looking within the meaning of securities laws. Forward-looking statements include statements preceded by, followed by, or incl

  3. Slide 3: Highlights

    HIGHLIGHTS  Strong Q2 production and shipments, Quarterly Shipments trend (kilotonnes) supported by diverse geographic & product 983 987 984 973 968 962 portfolio 923 933 930  Higher automotive and aerospace shipments, as COVID and supply chain challenges ease 774  Resilient and stable beverage c

  4. Slide 4: Capital Projects Update

    CAPITAL PROJECTS UPDATE  Novelis remains committed to its transformational organic growth journey to further strengthen its industry leading position  Identified more than $4.5 billion of potential investment opportunities  Approximately $3.4 billion of planned capital investments underway US Deb

  5. Slide 5: Bay Minette: A Plant of the Future

    BAY MINETTE: A PLANT OF THE FUTURE  Launched construction of first new US aluminum plant in over 40 years  Highly automated, fully integrated, low-carbon plant utilizing state-of-the-art production technology  Investment supported by macro trends in sustainability and customer demand for flat- ro

  6. Slide 6: Financial Highlights

    FINANCIAL HIGHLIGHTS © 2022 Novelis

  7. Slide 7: Q2 Fiscal 2023 Financial Highlights

    Q2 FISCAL 2023 FINANCIAL HIGHLIGHTS Q2FY23 vs Q2FY22 Quarterly Shipments trend (kilotonnes) 968 987 984  Net Income from Continuing Operations 930 962 down 23% to $184 million  Excluding tax-effected special items*, net income from continuing ops down 17% to $203 million  Sales up 17% to $4.8 bil

  8. Slide 8: Q2 Adjusted EBITDA Bridge

    Q2 ADJUSTED EBITDA BRIDGE $ Millions • Inflation, mainly energy • Less favorable metal benefits 175 • Factoring (higher interest rates) • Employment/inflation 553 18 (164) 506 (54) (22) Q2FY22 Volume Price/Mix Operating Cost SG&A/R&D and FX Q2FY23 Other © 2022 Novelis 8

  9. Slide 9: Q2 Segment Results: North America and Europe

    Q2 SEGMENT RESULTS Adjusted EBITDA Shipments ($ millions) (kts) North America $300 400 Q2 Shipments +3%, Adjusted EBITDA -16% 350  Higher automotive shipments with improving $250 $227 300 semiconductor supply to industry $191 $200 250  Higher product pricing and favorable product mix $150 200  Hi

  10. Slide 10: Q2 Segment Results: Asia and South America

    Q2 SEGMENT RESULTS Adjusted EBITDA Shipments ($ millions) (kts) Q2 Shipments +6%, Adjusted EBITDA +23% $150  Record shipments and Adjusted EBITDA 200 $125 $113  Higher can shipments on strong demand and Asia $100 $92 150 support to North America, and improving $75 aerospace demand 100  Higher pro

  11. Slide 11: Adjusted Free Cash Flow and Net Leverage

    ADJUSTED FREE CASH FLOW AND NET LEVERAGE YTD YTD $ Millions FY23 FY22 Net Leverage ratio (Net debt/TTM Adjusted EBITDA) Adjusted EBITDA 1,067 1,108 Interest paid (118) (124) 5.0 Taxes paid (108) (117) 4.0 3.8 3.7 Capital expenditures (284) (194) 3.3 Metal price lag (21) 113 2.9 3.0 2.5 2.4 Working c

  12. Slide 12: Outlook & Summary

    OUTLOOK & SUMMARY © 2022 Novelis

  13. Slide 13: End Market Outlook

    END MARKET OUTLOOK Beverage Can  Broadly stable demand for recession-resistant beverage can sheet  Some near-term customer inventory adjustments  Long-term demand fundamentals remain intact, driven by package mix shift driven by preference for sustainable beverage packaging options Automotive  H

  14. Slide 14: Summary

    SUMMARY  Broadly stable demand across our diverse product portfolio; long term fundamentals intact  Navigating intensifying energy and other cost inflation  Maintaining a strong balance sheet and prudent liquidity levels  Disciplined approach to capital investment plan to grow with our customers

  15. Slide 15: Thank You

    THANK YOU QUESTIONS? © 2022 Novelis

  16. Slide 16: Appendix

    APPENDIX © 2022 Novelis

  17. Slide 17: Net Income Reconciliation to Adjusted EBITDA

    NET INCOME RECONCILIATION TO ADJUSTED EBITDA Q1 Q2 (in $ m) Q1 Q2 Q3 Q4 FY22 FY23 FY23 Net income attributable to our common shareholder 240 237 262 215 954 307 183 - Noncontrolling interests - - - 1 1 (1) - - Income tax provision 108 79 89 5 281 87 65 - Interest, net 56 59 52 51 218 54 61 - Depreci

  18. Slide 18: Adjusted Free Cash Flow

    ADJUSTED FREE CASH FLOW Q1 Q2 (in $ m) Q1 Q2 Q3 Q4 FY22 FY23 FY23 Cash provided by (used in) operating activities – continuing operations 65 274 164 629 1,132 44 152 Cash provided by (used in) investing activities – continuing operations (94) (87) (96) (196) (473) (120) (170) Plus: Cash used in Acqu

  19. Slide 19: Net Debt and Liquidity

    NET DEBT AND LIQUIDITY Q1 Q2 (in $ m) Q1 Q2 Q3 Q4 FY22 FY23 FY23 Long-term debt, net of current portion 4,960 4,942 4,984 4,967 4,967 4,894 4,850 Current portion of long-term debt 541 443 340 26 26 59 63 Short-term borrowings 359 247 373 529 529 603 858 Cash and cash equivalents (872) (659) (808) (1

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