Constellium(CSTM)2025-02-28 12:44Financial Performance - Constellium reported a revenue of $7.3 billion for the year ended December 31, 2024, a decrease of 6% from $7.8 billion in 2023[227]. - Net income for 2024 was $60 million, down from $157 million in 2023, reflecting a decline in overall profitability[226]. - Total revenue for the year ended December 31, 2024, was $7,335 million, down from $7,826 million in 2023, indicating a continued downward trend in overall sales[260]. - For the year ended December 31, 2024, Segment Adjusted EBITDA decreased to $568 million, down 25% from $754 million in 2023[272]. - Adjusted EBITDA for the year ended December 31, 2024, was $623 million, compared to $662 million in 2023[321]. Shipment and Sales Volumes - Shipment volumes decreased by 4% to 1.4 million metric tons in 2024, down from 1.5 million metric tons in 2023[228]. - Sales volumes for the year ended December 31, 2023, decreased by 6% to 1,492 kt from 1,580 kt in 2022, with notable declines in A&T, P&ARP, and AS&I segments[244]. - For the year ended December 31, 2024, revenue in the A&T segment decreased by 3% to $1,816 million, with shipments down 4%[261]. - AS&I segment revenue decreased by 19% to $1,432 million in 2024, impacted by a 17% decline in shipments due to various operational challenges[265]. Cost and Expenses - Cost of sales decreased by 6% to $6.4 billion in 2024, primarily due to a 7% decrease in raw materials and consumables used[230]. - Research and development expenses decreased by 6% to $49 million in 2024, reflecting a reduction in non-labor costs[232]. - Restructuring costs in 2024 amounted to $11 million, related to cost improvement programs in the U.S. and Europe[236]. - Research and development expenses increased to $52 million in 2023, up from $46 million in 2022, reflecting a 13% increase in labor costs due to inflation[249]. Segment Performance - The aerospace segment represented 25% of total revenue and 50% of total Adjusted EBITDA for the year ended December 31, 2024[213]. - The P&ARP segment reported stable revenue of $4,196 million in 2024, compared to $4,214 million in 2023, with stable shipments and revenue per ton[263]. - A&T segment Adjusted EBITDA decreased 19% to $285 million in 2024 from $351 million in 2023, primarily due to unfavorable price and mix, lower shipments, and a $13 million flood impact[276]. - P&ARP segment Adjusted EBITDA decreased 21% to $242 million in 2024 from $305 million in 2023, mainly due to unfavorable metal costs and weather-related impacts[278]. - AS&I segment Adjusted EBITDA decreased 43% to $74 million in 2024 from $129 million in 2023, primarily due to unfavorable price and mix and a $20 million flood impact[280]. Cash Flow and Liquidity - Net cash flows from operating activities were $301 million in 2024, a decrease of $131 million from $432 million in 2023[295]. - Total liquidity at December 31, 2024, was $727 million, including $141 million in cash and cash equivalents[291]. - The company experienced a $65 million decrease in cash flows from operating activities before working capital in 2024[295]. - For the year ended December 31, 2024, net cash flows used in financing activities were $61 million, primarily due to share repurchases and refinancing activities[303]. Debt and Financing Activities - Constellium repurchased 4.6 million shares for $79 million during the year ended December 31, 2024[303]. - In August 2024, Constellium issued $350 million of 6.375% Senior Notes and €300 million of 5.375% Senior Notes, using proceeds to redeem portions of existing debt[303]. - For the year ended December 31, 2023, net cash flows used in financing activities were $177 million, reflecting a $50 million partial repayment of Senior Notes[304]. Market and Risk Exposure - The company is exposed to foreign exchange risks, particularly with the U.S. dollar/euro exchange rate, which significantly impacts income and equity[325][327]. - A 10% strengthening of the U.S. dollar against the euro would result in a total effect on income before tax of $(65) million[335]. - The company is exposed to market fluctuations in aluminum prices, which is its primary metal input, and also to variations in regional premiums and prices of zinc, natural gas, silver, and copper[342]. - A 10% increase in the market price of aluminum is estimated to result in a $34 million gain based on the aluminum derivatives held by the company as of December 31, 2024[349]. - The company aims to minimize exposure to aluminum price volatility by passing through aluminum price risk to customers and using derivatives where necessary[346]. Interest Rate and Energy Cost Risks - Interest rate risk arises from borrowings, with a 50 basis point increase or decrease in EURIBOR or SOFR interest rates estimated to impact income before income tax by approximately $2 million and $3 million for the years ended December 31, 2024, and 2023, respectively[350]. - The company purchases energy fixed price derivatives to lock in energy costs due to the risk of energy supply disruptions and rising energy costs from sustainability trends[348].