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  5. Novelis, Inc. Business Report FY ended Mar. 2015

Novelis, Inc. Business Report FY ended Mar. 2015

Financial Overview

(in million USD)
FY ended Mar. 31, 2015 FY ended Mar. 31, 2014 Rate of Change (%) Factors
Overall
Net Sales 11,147 9,767 14.1 1)
Net Income 148 104 42.3 -
Segment sales
North America 3,483 3,050 14.2 2)
Europe 3,783 3,280 15.3 3)
Asia 2,340 1,876 24.7 4)
South America 1,850 1,588 16.5 5)


Factors
1) Net Sales
-Net sales increased by 14.1%, reflecting higher average base aluminum prices, higher local market premiums, and higher industrial and automotive shipments. Shipments of automotive products are expected to continue to increase in the upcoming year, as a result of a customer's production of an aluminum intensive vehicle.

2) North America
-Net sales increased by 14.2%, due to higher average base aluminum prices, higher local market premiums and higher shipments of can, automotive and non-rolled products. An increase in demand and shipments of automotive products are expected to continue.

3) Europe
-Net sales increased by 15.3%, due to higher average base aluminum prices, higher local market premiums and higher shipments of can, automotive and non-rolled products. The Company continues to experience an increase in demand and shipments of our automotive products.

4) Asia
-Net sales increased by 24.7%, reflecting higher average aluminum prices and higher shipments of can and automotive products. The Company also increased intersegment shipments of automotive products to Novelis Europe. A portion of the increase in demand for automotive products was driven by customers in China.

5) South America
-Net sales increased by 16.5%, driven by higher average aluminum prices and higher shipments of can products. The increase in demand associated with the FIFA World Cup in Brazil in June 2014 contributed to an increase in shipments as compared to prior year.

New Plants

<China>
-The Company announced that it has opened its first plant dedicated to the production of heat-treated aluminum automotive sheet in China. The wholly-owned facility, located in the Changzhou National Hi-Tech District, represents a USD 100 million investment by Novelis. With an annual capacity of 120,000 metric tons, the new facility will provide customers in Asia and abroad with high-quality automotive sheet for use in lightweight vehicle structures and body panels such as hoods, doors, fenders and lift gates. Since 2011, the Company has invested more than USD 550 million globally to triple its automotive sheet capacity to 900,000 metric tons by 2015. (From a press release on October 20, 2014)

<Germany>
-The Company has held the ground-breaking ceremony for a new automotive aluminum sheet finishing line at its Nachterstedt, Germany, facility. The EUR 62 million expansion is in response to the steadily growing demand for aluminum automotive sheet for light-weight vehicle structures and body panels. The new line will add 120,000 metric tons of annual capacity to the Nachterstedt plant's automotive output. The expansion, which is scheduled to come on line in the second half of 2015, will create up to 120 new jobs and boost The Company's annual automotive production capacity for aluminum sheet in Europe to well over 350,000 metric tons. (From a press release on April 7, 2014)

Overseas Business

<Brazil>
-The Company announced that consistent with its corporate strategy it will focus its operations in Brazil on its core business of aluminum rolling and recycling. As a result, it will cease operations at its Ouro Preto, Minas Gerais, primary aluminum smelter at the end of 2014. The Company's Ouro Preto facility currently employs approximately 350 people and produces 18,000 metric tons of aluminum per year in the form of billets. (From a press release on October 16, 2014)

Contract

-The Company announced that it is the supplier of aluminum sheet for the recently launched Jaguar XE. This addition to the Jaguar lineup, launched in Europe this fall and arriving in North America in 2016, is the first vehicle in the mid-size segment to feature an aluminum-intensive body structure. The car's advanced design features Novelis Advanz 6000-series alloys developed specifically for automotive skin sheet and structural applications. The XE's construction makes it exceptionally strong and light, contributing to fuel efficiency gains and emissions of less than 100g/km. (From a press release on December 9, 2014)

R&D Expenditure

(in million USD)
FY ended Mar. 31, 2015 FY ended Mar. 31, 2014 FY ended Mar. 31, 2013
Overall 50 45 46



R&D Structure

-As of March 2015, the Company has approximately 310 employees dedicated to research and development.

R&D Facilities

-The Company has five satellite research and technology centers in the following locations:

  • Kennesaw, Georgia, US
  • Spokane, Washington, US
  • Goettingen, Germany
  • Sierre, Switzerland
  • Ulsan, Korea

Capital Expenditure

(in million USD)
FY ended Mar. 31, 2015 FY ended Mar. 31, 2014 FY ended Mar. 31, 2013
North America 122 147 183
Europe 257 241 80
Asia 85 198 251
South America 53 117 197
Eliminations and others 1 14 64
Total 518 717 775



Global Expansion Projects

Location Description of Expansion Estimated Capacity (at full capacity) Actual or estimated commission start date
Oswego, NY, U.S. Automotive sheet finishing capacity 240 kt July 2013
Oswego, NY, U.S. Automotive sheet finishing capacity 120 kt End CY2015
Nachterstedt, Germany Automotive sheet finishing expansion 120 kt End CY2015
Changzhou, China Automotive sheet finishing plant 120 kt July 2014