Novelis Reports Remarkable Progress in Expansion Works at Brazilian Plant

SEATTLE (Scrap Monster): The $175 million capacity expansion project at the company’s Pinda, Brazil plant is progressing well, said Devinder Ahuja, Chief Financial Officer, Novelis, while announcing the financial results for the first quarter of fiscal 2020.

The capacity expansion includes a rail terminal to ensure easy access to the ports of Santos, Sao Paulo and Itaguaí, Rio de Janeiro. The expansion will boost the rolling capacity of the plant by additional 10,000 tonnes. Further, it will boost the recycling capacity of the plant by another 60,000 tonnes. The commissioning of the expanded facility is scheduled to take place during the fiscal year 2021.

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Commenting on Novelis’ aluminum capacity, Steve Fisher, CEO noted that the company is currently witnessing increased competition from subsidized aluminum imports from China for operations outside the U.S. The company’s global operations are nearing capacity constraints. Hence the company has decided to be selective in the markets and optimize its product portfolio by focusing more on high margin products, Fisher said.

Meantime, Novelis posted net income of $127 million for the first quarter fiscal 2020 ending June 30, 2019, as compared with $137 million in the corresponding quarter last year. The net sales witnessed a decline of 6% over the year to $2.9 billion. The shipments of flat rolled products surged higher by 4% over the previous year to 830 kilotonnes. The company reported negative $94 million of free cash flow.