Q4 Consolidated Business EBITDA up 33 per cent YoY
Q4 Consolidated PAT nearly tripled at ₹1,928 crore, up 189 per cent YoY
Hindalco Industries Ltd., the Aditya Birla Group metals flagship, announced consolidated results for the quarter and year ended March 31, 2021. The company reported its best quarterly performance with consolidated PAT up 189 per cent at ₹1,928 crore, a nearly three-fold increase YoY. The results were driven by a strong performance by Novelis and India Aluminium Business, supported by higher volumes and better product mix, lower input costs, stability in operations and cost saving actions. The Copper Business recorded a 33 per cent jump in EBITDA sequentially in Q4 FY21 versus Q3 FY21 on account of stable operations. Novelis reported an all-time high EBITDA, as a result of continued demand for innovative, sustainable aluminium solutions and outstanding operational performance across its expanded business.
Commenting on the results, Mr. Satish Pai, Managing Director, Hindalco Industries Ltd., said: “This past year, with all its volatility and uncertainty, has underscored Hindalco’s resilience and ability to deal with challenges. Our record Q4 results have strengthened our balance sheet even further, absorbing the Aleris acquisition and restoring consolidated net debt to EBITDA ratio to pre-acquisition levels. The Aleris business continues to positively impact the overall top line and EBITDA. Through Q4, our India business continued to rise with demand higher than pre-Covid levels. Across the entire Hindalco family, we acknowledge the commitment and resilience of our employees, our own Covid warriors. Looking ahead, although FY22 has started with a second Covid wave in India, Hindalco is confident that our inherent strengths and tenacity will support us through it.”
Business Segment Performance in Q4 FY21 (vs Q4 FY20)
Novelis (including Aleris)
Novelis recorded its best-ever quarterly adjusted EBITDA of $505 million (vs $383 million), up 32 per cent YoY, on the back of higher organic volume, favourable metal benefits, and a US$60 million EBITDA contribution from the acquired Aleris business. Adjusted EBITDA per ton was at $514 in Q4 FY21 (vs $472/ton), up 9 per cent YoY. Novelis’ Net Income (excluding tax-effected special items1) was at $172 million, up 12 per cent YoY, partially offset by higher depreciation and amortization associated with the acquisition of Aleris. Revenue was $3.6 billion (vs $2.7 billion), up 33 per cent YoY, due to higher shipments, global aluminium prices and market premiums. Total shipments of flat rolled products (FRPs) were at an all-time high of 983 Kt (vs 811Kt), up 21 per cent YoY, with the addition of the acquired Aleris business and strong demand across end-product markets.
EBITDA was at an all-time high of ₹1,610 crore in Q4 FY21, compared with ₹1,043 crore for Q4 FY20, an increase of 54 per cent YoY, primarily due to favourable macros, better operational efficiencies and lower input costs. EBITDA margin of 27 per cent was the highest in the last 12 quarters and continues to be amongst the best in the industry. Revenue was ₹5,969 crore in Q4 FY21 vs ₹5,299 crore in the prior year period. Aluminium India Business recorded metal production of 316 Kt (vs 327 Kt last year). Aluminium metal sales were higher by 5 per cent YoY at 329 Kt (vs 314 Kt in Q4 FY20). Aluminium VAP (excluding wire rods) sales volumes were at a record high of 92 Kt (vs 76 Kt), up 21 per cent YoY, driven by a sharp recovery in the domestic market. VAP sales as a percentage of total metal sales reached an all-time high of 28 per cent this quarter vs 24 per cent in the same quarter last year.
Copper Cathode production was at 97 Kt in Q4 FY21 (vs 75 Kt in Q4 FY20), higher by 29 per cent YoY on account of stable operations during the quarter. While overall copper metal sales were at 107Kt (vs 86 Kt in Q4 FY20), Copper Continuous Cast Rod (CCR) sales in Q4 FY21 were in line with the same quarter last year, at 73 Kt. EBITDA for the Business stood at ₹269 crore compared to ₹406 crore in Q4 FY20. Revenue from the Copper Business was ₹8,508 crore this quarter, up 80 per cent YoY, primarily due to higher global prices of copper.
Fourth Quarter Consolidated Results
Hindalco reported its best-ever quarterly financial performance in Q4 FY21 with EBITDA at ₹5,597 crore (vs ₹4,216 crore), up 33 per cent YoY. The record results were driven by an outstanding performance by Novelis as well as India Aluminium business, supported by a sharp recovery in all relevant markets. Consolidated Revenue for the fourth quarter stood at ₹40,507 crore (vs ₹29,318 crore), up 38 per cent YoY. Consolidated PAT was ₹1,928 crore, compared to ₹668 crore in Q4 FY20, a jump of 189 per cent YoY. Gross Debt declined by ₹18,187 crore and Net Debt fell by ₹14,883 crore as of March 31, 2021 from its peak on June 30, 2020. Consolidated net debt to EBITDA ratio improved significantly to 2.59x on March 31, 2020, from a peak of 3.83x on June 30, 2020.
With the onset of the second Covid wave in India, Hindalco has strengthened efforts to protect employees across the ranks and to support the community.
Employee care: Hindalco has facilitated 20,000+ vaccinations, with 80 per cent of eligible employees and families vaccinated, including contract workers. Hindalco has enhanced medical coverage to cover all hospitalisation expenses of not only employees and families, but contract workers, 3rd party employees and their families. Ex-gratia benefits are being provided to support families of deceased employees (including contractual) for housing, medical, schooling and other expenses for the next few years.
Oxygen support: Novelis has donated 1,000 oxygen concentrators which have been distributed across locations. Hindalco has procured 1,500 oxygen cylinders and accessories which are being distributed to various hospitals and Covid care centres around its plant locations.
Hindalco is supplying oxygen from its plant at Dahej to hospitals in Gujarat daily, with 1,600 tons delivered already. Hindalco has helped revive the defunct Karahiya oxygen plant in Uttar Pradesh resulting in 300 oxygen cylinders being supplied daily to hospitals in eastern parts of the State.