CSTM - Earnings call 4 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Hello, and welcome to the Constellium Fourth Quarter and Full Year 2023. My name is Elliot, and I'll be coordinating your call today. [Operator Instructions]. I would now like to hand over to Jason Hershiser, Director of Investor Relations. The floor is yours. ahead. go Please

Jason Hershiser

I fourth Elliot. to everyone welcome Thank and would full our quarter call. year to you, like XXXX earnings

call recorded. we available website today's the will slide our on have a Q&A and our Officer, today, for copy Officer, is have Guo. call the of A Jack presentation, Germain; Financial our and today's Chief the at . After presentation constellium.com, session. Jean-Marc being Chief On Executive we call is

may Private Such everyone financial encourage involve filings. statements to unknown Securities the we include risks begin, to Before company's XXXX. future look of anticipated recent of like and and website our the forward-looking Reform Litigation meaning a Today's include operating statements and visit events known and take Act the I'd company's and uncertainties. regarding may the statements at performance, within expectations and call

All For undertake forward-looking information of XX-F. update the a differ Factors risk those to specific heading Form the annual from expressed in that please results cause events Risk obligation otherwise, our statements, report presentation factors in could summary revise presented the a or no under as forward-looking except any statements to required of new the presentation. information, on as by in law. date refer result of the of materially factors this future as We or is to

measures. today's reconciliations Please IFRS In addition, slide our the today's supplement attached information presentation which disclosures. see includes financial non-GAAP non-GAAP presentation, financial certain of regarding measures in

call now Jean-Marc. like to would hand the over I to

Jean-Marc Germain

interest in everyone. afternoon, Thank your Constellium. for morning, you, Jason, good good you and Thank

each and to XX,XXX on want our relentless of our commitment priority. for Let's begin employees on Slide I #X start safety, focus their by X. thanking

continue than rate case X.XX deliver million slightly this report I safety was pleased to worked higher year, recordable but am year that to per last best-in-class we Our hours performance. of

priority every remain need to case committed fully rate day. target is to critical X.X on and We safety we recordable achieving focused journey XXXX. this complete, never our all our remain by safety to Our reduce to

Now highlights due XXX,XXX and each tons, discuss the lower let's fourth of segments. of XXXX our shipments performance. turn X% to Slide our compared in fourth X to Shipments quarter quarter to and the were down from

Revenue XX% of EUR X.X our risk. price business prices, mix we to pass-through minimizes are billion shipments and lower offset model, year metal which improved in more changes price our affected prices. by metal while compared last a than Remember, decreased and as to was by lower revenues operate exposure metal

sales, million, period metal revenue, the value-added compared which year. to EUR of our excluding was cost XXX same reflects Our down X% last the

the income to compares of EUR income million in of the fourth XX EUR net quarter Our of quarter XX year. last million net in

was right, results combination EBITDA EUR with more prior you later the As million in the improved which compared up on flow generation year the will pricing guidance. bridge see solid execution strong top our team mix extended XX with detail. adjusted quarter, we in by in and consistent the of XXX The discuss free quarter. track the cash in record power, XX% in drove line our our of million EUR quarter, Also, last in to can and Jack

year Now highlights. turn X the for Slide full to

in XX% by prices. For was offset than segments and the EUR of full million billion mix XXXX. year, compared X.X price shipments shipments each and Revenue as down to our improved were of tons down lower or X.X X% lower was metal more

million income compared to XXX XXX in Our net of of net XXXX. EUR million EUR income

unrecognized. assets a of that were last to As year recognition reminder, EUR included the million tax related previously XXX deferred

year segment. X% in free year. a record A&T fifth with for We company a the up performance of XXX a was compared consecutive This EUR million for record XXX million cash EBITDA EUR total our of to last Adjusted XXXX. delivered positive flow and is our or

which basis in achieved capital XX.X% of up is invested XX on points adjusted year. compared return We XXXX, to last

As slide, end XXXX finished the or leverage turn of you X.Xx X.X from of the right can we down bottom with of XXXX. see the on

our to Overall, and to that today pricing expires performance. I has am full authorized also I repurchase in again, strong very of our delivering proud fourth adjusted share XXXX power, flow demonstrated in EBITDA XXXX. and a Board our that December $XXX of am We million announce program quarter year up by XXXX. cash record pleased free

to the program half in expect the begin We year. first of this

an will range, help we look is important that our value capital drive part quarter. each returning leverage strategy to within you Now forward, on forward our creation. updating our shareholder to our of shareholders moving and progress were target it believe We

that, With hand Jack now the will financial call for further to on our performance. details I over

Jack Guo

XXXX, Thank last down quarter same you, Slide to X% Value-added the XXX now Jean-Marc, to for the today. and joining of quarter X. compared million year. thank fourth was you, call turn Please in the everyone, revenue EUR

Looking at shipments period headwind a of to lower tailwind segments. and the year. last was XX each our million mix to Volume due of the quarter, EUR Price a XX EUR same fourth of compared was in million

were metal headwind million. EUR impacts While a of XX

and the FX The balance due of of sale to our largely translation. was German business the unfavorable change extrusion

similar. VAR outs slide. are For ] drivers important the the take There X full this year from XXXX, [ were

full continue grew and be mix to to year increment and significant compared revenue specifically price helped value-added pricing variance year-over-year us XXXX, of Price our have X% the pressures. to First, and the biggest by second, continues for offset And power. our XXXX. we inflationary we

with performance. than million on XX% quarter last the our headwind to rolled fourth XX. Slide million And compared increased more year. a of Adjusted by packaging was of higher and products. EUR Volume EBITDA XX in Now XX EUR turn lower focus in automotive, segment specialty shipments P&ARP to shipments let's offset

in last some versus year. [indiscernible] last the versus of shipments more UAW increased lower shipments slightly quarter Within Packaging shipments end quarter the in than X% strike despite the quarter in the in early but quarter. from year, by packaging, stock Automotive packaging the X% offset impact were up specialty decreased shipments in Europe.

pricing, XX were X period. operating EUR a grants energy-related as a costs in primarily inflation including government higher was the mix more million EUR contract Costs costs, improved million, on of offset than favorable of tailwind metal pass-throughs. and tailwind inflation-related Price

FX translation, a is noncash, which was headwind quarter. X EUR the of in million

earlier to costs For of of Shoals pressures the The of EUR EUR were decrease in were challenges the at headwind XXX favorable including adjusted with a generated which year facility in Muscle compared to the period. P&ARP performance exception all costs, significant the full fourth inflationary XXXX, year million, metal XXXX. faced quarter operating our EBITDA XXX a of similar million, of the drivers and XX% those full

of more Slide Now fourth EUR XX million in by were TID as EUR the million XX, shipments compared focus to side. the lower Adjusted XX A&T on turn last aerospace to EBITDA increased headwind quarter higher year. Volume than XX% and shipments was of let's quarter. a offset the

shipments last versus recovery continues. XX% were markets were Aerospace as aerospace XX% Shipments markets. reflecting in down TID year around up most versus in in a year, industrial the slowdown last

aerospace. inflation of primarily and improved EUR a tailwind XX stronger with Costs headwind operating was result billion, more mix costs. were including as XX pricing, contract on a EUR relied pass-throughs a of [ a and higher of ] million mix Price

FX quarter. the and X other was a in tailwind of billion EUR

compared EUR million, XXX full XXXX. adjusted of EBITDA fourth were an record XX% performance The year of year those the A&T XXXX, the to of similar in For increase generated to the drivers full quarter.

the strike extrusion program from XX% timing switches sale compared headwind business. German were Now year let's XX% X in quarter, EUR was result our stable the the to million of to focus segment. industry. impact result the last XX down in shipments of shipments quarter of early a market as million the and last Adjusted despite as of a in certain decreased UAW our I'll Slide quarter versus the Industry EBITDA lower year. Volume year German weaker Europe EUR XX, in business. Automotive impact last and versus conditions turn of quarter and shipments the some AS&I on the fourth sale were in extrusion the between a

and X by operating costs was inflation. on offset tailwind contract due EUR inflation-related were pass-throughs. improved primarily Costs X mix million a including a than more lower EUR pricing, of Price million to headwind

was EUR other quarter. in million headwind and the X FX a of

generated drivers of the The EBITDA to of year similar the performance XXX adjusted full EUR XXXX, AS&I to quarter. million. XXXX. full the were XX% compared fourth For year in of A decrease those

is It wanted Holdings with on but to I some not comments the conclude quick corporate. and slide on here,

the EUR holdings at increase with run to IT million spending our holdings XXXX, primarily expense ERP currently year upgrade EUR corporate and full our and corporate XX the million. additional system. XXXX with in expect XX was the of We by approximately driven expense For

to Throughout want of pressure pricing update I to current our pressures, on some environment fourth cost although and facing we're to Now to broad-based categories in the most XX, quarter. we where turn began the with Slide and these offset an on -- inflationary the control and faced significant pressures. were give in focus XXXX, inflationary

nonmetal higher. pass-through to of changes costs cost be market know, other to we're exposed you price input. a in we continue and operate materially As so model, business the Labor aluminum, not largest our

moderately above Energy, our energy secured For to historical are energy more XXXX, costs levels averages. favorable and at well prices XXXX largely remain compared although

our their of we these across on a pressures, Given number cost results. continue mitigate work to fronts to impact

we and continue strong We relentless performance will focus. the years, our past have cost demonstrated in

As working existing of do and our customers we we're noted, contracts have include where protection with mechanisms they our not, previously them. many inflationary to

we all good you seen results, As end our our across progress have markets. very have demonstrated of

right, in again XXXX largest the see and the bridge priced with pressures inflationary cost offsetting As headwinds. price increment we demand you successful mix, in and can were on the very in being

to categories levels. We expect continue in but pressures XXXX, moderated inflationary more in some at

in of ability with our line top and offset a We year the focus our cost an relentless are this control. impact to substantial portion improved confident on

quarter. free the Now EUR XX and free in EUR of Slide to XX flow. turn discuss strong XXX generated We our in million cash flow including XXXX, fourth million cash let's

generate the have cash of commitment flow. the slide, As you to see strong can bottom free left continued our deliver we on to consistent,

the have million XXX Since we cash XXXX, of flow. EUR free generated of beginning

Looking the similar of million and business. in expect year, excess the though the to cash first negative towards to this flow be quarter generate year, of at given XXXX, year we the in to our seasonality we in more XXX free the half second last weighted for expect EUR full

includes on to return-seeking projects, CapEx and facility recycling this is million this in on budget the up around time expect in on The Neuf-Brisach. be center spending and our casting start as XXX year, quarter EUR year. We fourth which to such higher expected

interest from impact which XXX approximately We expect million higher cash includes rates. the of EUR interest

EUR cash million. taxes approximately XX of We expect

and capital to working the full be modest for a expect cash we of Lastly, other use year.

million, XXX intend mentioned. a large cash EUR the expected begin to flow as to of half over we free flow shares With the cash first free starting generation of repurchasing the portion Jean-Marc of use the in year,

limited shareholder at our General We repurchases we the shareholder one have near share the year announced including year. fully approval To the rely program, approval. execute of in term second will ability each the without the begin we the quarter size in on today Annual Meeting, to this

Now XXXX. the let's of end sheet our discuss XX the balance of to the debt liquidity Slide our and compared XXX end to and down million X.X of over net fourth billion turn EUR was quarter, EUR position. At

leverage to reached of a and committed the down leverage target the maintaining within of end our our X.Xx X.Xx were at X.Xx. versus We XXXX end leverage range. of target low X.X remain to Our of range multiyear XXXX

no XXXX end shareholders. million of have ability Including XXXX. As financial remains and we to maturities strong our returning our to progress in capital and as our flexibility at you We're built. made the we've of have on the summary, bond can extremely liquidity XXX of we begin our debt structure capital EUR see of the proud until the

reflected Jean-Marc, I with Slide measures. The quarter a results. measures. Before had of related discuss wanted to certain The on in minute presentation changes to the first the for non-GAAP XXXX lag, to spend the will based on noncash turning specifically discussions changes the which we we to be call XX financial back price to staff is our report when certain and non-GAAP the metal changes of financial adjustment SEC are

be longer For revenue. the no our first will value-added change, moving forward, we reporting

the considers financial no revising the non-GAAP change, metal impact will compliance we with inconsistent the which to second lag, measures. interpretations in definition noncash staff question exclude of the of the disclosure EBITDA of For be adjusted guidance be price longer to and XXX.XX our on

for segment remove from evaluating While the we the our of to adjusted EBITDA disclosure adjusted we no price lag going-forward will our lag, consolidated exclude will operating metal metal Which longer performance EBITDA. use segments. continue price of

metal consolidated following a less lag reminder, EBITDA revision. as EBITDA equal to And consolidated is the revision, prior adjusted to price adjusted the

investors stakeholders on to understand results with continue to quarter. and impact metal necessary of information price lag will the provide all We other the reported noncash each our

For the old on and XX comparability, definition. tables have show definition under the adjusted provided a XX EBITDA new of prior Slide reconciliation we to period to

Moving to guidance. price adjusted guidance provide company continue will metal lag. EBITDA The to excluding

company defined net In the divided calculated by will hope adjusted addition, all clear. leverage EBITDA, as price as debt by metal to continue excluding lag. I that's be

that, I like to back With the to would hand now call Jean-Marc.

Jean-Marc Germain

Thank you, Jack.

critical aluminum, role. and currently our end The benefiting and durable outlook. from current light portfolio majority material in discuss secular of Let's market our markets a serving turn to recyclable end today Slide infinitely growth, a sustainability-driven which XX plays is

in America Can is still quarters, the multiyear the of of inventory growth current a packaging. Can relatively given promotional environment, during inflationary us stabilized both low Turning activity demand demand first stock adjustments in has North COVID. behind recent appear Europe. period largely following and and though to lack stock rapid

Even like investments here to and plastics be in regions to makers glass. consumer and favorable The cans, share beverage end cans sustainable broadcast outperform environment, North capacity win the ongoing continue market plans, for outlook America. by substrates as against today's growth this both growing greenfield evidenced in [ for continues other preference the in and the ] long-term aluminum aluminum

mid-single continue our digits in We're America markets X ago. North to expecting in term, participate in regions return to both Europe. grow and to in to We'll at both Day longer low stock growth XXXX. in as this growth packaging announced expect can we And years Analyst

am our mentioned. as on at on center I and underway that pleased to are is we casting facility building well and budget, and Neuf-Brisach report recycling time the both Jack

full extreme performance weather of quarter in The process up operational fourth the continued have now, impact during and back ramping will Last cold impacted first on shipments a our month, week. At quarter. the operations plant Shoals, and is improve snow Muscle the to though, for this though, the an results.

now last it of Turning second increased Demand the the decelerated automotive. healthy. of years, pre-Covid numbers but remained production sales levels. although OEM and couple have below Auto in remains to globally half XXXX,

strike automotive up Our North business early the America. the in some in was fourth the quarter impact in despite slightly from UAW quarter

drive light cars, will aluminum trends SUVs remains of Consumer lightweighting in steady. long electrification the and Vehicle sustainability for demand demand term. for the products use luxury and trucks and continue to

As market. on a result, we remain very positive this

traffic aero though and Let's turn now remains fuel-efficient to levels. driving more aerospace. defense The recovery the in aircraft. and in aerospace greater aerospace remains Including growing continued confident Demand and on demand and markets intact. below for jet long-term remain in the major remain demand aircraft. We business rates passenger increasing that quarter, the focused wide-body for narrow new, regional remain OEMs demand markets. space strong fundamentals and the build pre-Covid both

our Airware demand experience strong In family addition, for of continue to we products.

the represented of revenue of these XXXX. markets XX% the page As a side our X core left highlights, end chart in on

lastly to specialties. other Turning

most in economies expect general, as We expect health to and of industry demand in products markets do TID continue we the generally rolled region. these industrial through are the in today. these year. In in dependent markets on weakness and each markets, move extrusions, recovery some industrial is weak We the

diversification each in asset fundamentals like our summary, is of that markets we and In the for serve of we the believe the strongly an the company. markets end

we guidance. now XX, our Slide and turn Let's key messages detail to where financial

including million. EUR very free strong million performance strong adjusted XXX XXX EUR record achieved of flow cash XXXX, team EBITDA Our of and in

we performance, challenging also multiyear low range. balance I'm are a we within leverage X.Xx, now this of of and target in sheet to proud very deleveraged especially our our our further Importantly, environment.

our commented, look XXX EUR persist we and in price are of the beyond. as geopolitical EUR outlook, in EUR lag, about XXXX, million, As prospects EBITDA, XXX of million. flow range XXX on Based excess free ahead, million cash metal excluding noncash fronts, and impact Jack and to the our on for the of while adjusted targeting macroeconomic uncertainties current We're XXXX optimistic for we

not as adjusted do of in do operations some start be a Shoals cold period extreme on at expect the our guidance, We given the know, quarterly EBITDA to the softness impact in January, you result weather year. the but of and our end last markets quarter as give in to than Muscle weaker first we same XXXX the year of

like year full flow first provided. free due normal cash included we planning the to Also, our I quarter in in year negative seasonality. just of guidance expectations for are be These are, that last course, to

guidance want of in commitment metal to the excess of in XXXX our maintain long-term million X.Xx EBITDA, impact noncash our also reiterate X.Xx. lag of to EUR range adjusted XXX target of price our I to leverage excluding and

very about me again let results conclude, and our of To that our proud say excited I'm very future.

on long-term repurchase well for We and extremely our share positioned program. announced remain are we shareholder creation as by success, recently demonstrated value focused

call we open for With will that, the questions section. Q&A Elliot, now

Operator

Katja with Our comes Instructions] [Operator first Jancic Capital. question from BMO

Katja Jancic

Just that in held second quarter. Is be meeting May? in first general that is on to going the the

Jean-Marc Germain

Yes, of . at that's the beginning May.

Katja Jancic

dilution. much And due only, general guess, share buybacks, fair? Is meeting, on can that you until could then aggressive. be the you to after the more as And as the offset I

Jean-Marc Germain

. fair. Generally Yes.

Katja Jancic

XXX million will 'XX? 'XX what And 'XX, then EBITDA bridge you talk reaffirmed bit over you maybe and looking between to you target. the EUR a about Can

Jean-Marc Germain

Katja. Sure,

just excess million, increase take one, center EUR midpoint was minimum Neuf-Brisach large, saying, go is time. it somewhere startup the -- large is our of starting, a we October. on increase, million a large and number recycling are XXXX a starting expecting. budget, you you we're that beginning to it's that of our Jack A XX on in and a portion of it, of and XXX in does as by So of if very guidance so EUR portion of

create up So going EBITDA into and XXXX. quite to rapidly, lot ramp is going to of that a

is And 'XX. aspect in have XXXX, is be we The that good able us. to that. there second The of is produce everything coming. demand to our in visibility challenge is know for aerospace on us more We asked

the also You 'XX. levels pre-Covid XX%, that XX% will below are something in we at still noted have like moment

spending continues more So to we've some healthy be bit of that to a products. money debottleneck will produce operations our we of got ramp-up a aerospace

us help So as that's well. to going

know, we've Shoals And bridge you believe make, in 'XX. to from that improvements. still made we then EUR as exceed operating We deliver to can a some upon and few We quite we last the finally, year. XX experienced in Muscle than challenges will to have we total million 'XX need that more improvements

as these, And all fully you see, upon of are they visibility can control. got our and we've within

So we're a economy any the in in betting days rosy on wonderful not and future global XXXX.

Operator

We to Corinne Deutsche now turn Bank. with Blanchard

Corinne Blanchard

sitting you're talk much maybe you 'XX, extrusion about the [ [indiscernible] we dormant Could come back? ] once about Thinking industrial on. 'XX. how Are business, EBITDA maybe maybe talking

to trying could potential to added the -- be that see So number the there? -- what like

Jean-Marc Germain

Okay.

broke how about XXXX? think I the much of but specialties you're question, asking So in down beginning you of the in your at up a is general drag

Corinne Blanchard

[indiscernible] actually Well,

Jean-Marc Germain

yes, can. I we Yes, think. Yes.

respectively, a extrusions of has the and it a margin or below the because So less S&I, or average so moment. volumes look an margin both at segment the this and lower if than if TID specialty the multiply in extrusions, that we run the margin of in than is TID what margin lower a make the I that than AS&I of that's rate you average average A&T the you be in well in are to the mid-cycle good think A&T idea available where where producing historical kind think to in is. today mid-cycle got , gap us. that of and That an to the you in we think gives between And is is do of in what as at the times mid-cycle you you've volume a a by assumption are segment, you

less assets. because we've in that of -- Knowing any not German we will some sale we the future of we more because the volumes the that have have sold got German the make assets,

it anyway, guidance to nice really. to a would be it contribution, line, would needed be So is not bottom our XXXX get it

Corinne Blanchard

what been Okay. talk were XXXX. be. for business, A&T And I And maybe we you just it actually about forward? how think for about the people can should thinking has Because would going the the think margin it in quite second strong question, above

you should looking per 'XX provided still should So ago? Or year and we base ton X,XXX at consider like we EUR that back 'XX the more 'XX? a guidance

Jean-Marc Germain

Yes, than it per EUR the which mid-cycle factors XXXX buoyant lower not as aerospace $XXXX a is A&T. number, today stronger, a in being ton and more little margin, is being a right, TID as -- which right, bit has

we in always fair strong crisis midpoint believe have, market At the shot have us than the to visibility believe in very XXXX conditions, in that in commented, I the at should actuals 'XX. visibility you can closer mean aerospace. do that good current to it's add moment, 'XX, any have the yet. the want to that end we we towards to current exceptional you a at I is good very We be happen. being say higher Jack, on be margin. anything? of expect the as to the Barring strong we going But

Jack Guo

thing would the bit from point business eating to year, little only expect TID this as I last Yes. consider. the margin to the little a margin year the relative just add to there, Corinne, recover mean a I bit to a to so

Operator

with from Peterson Bill comes JPMorgan. Our question next

William Peterson

would the way that's shipment just And I'm loss, for to of not it. about right sort year-on-year the guess single-digit think in the drivers of And of guess that of understand commented imply end also demand is comparison? Shoals. week, I some the guess, but think weather down I high if about can you the impacting first if just impact trying of latter, [indiscernible] quarter. sure we remain the you a maybe quarter-on-quarter but for a then kind for soft, to conditions it mentioned I really markets -- about terms or the quantify near-term you Muscle type

us and including by region. help you can of even kind If by end market, what you're maybe commenting understand seeing

Jean-Marc Germain

Yes.

of the make on will think up and ground much the Bill, QX. depend on all it that. Shoals in depend all Muscle situation So impact, we all It can I will I mean, how

misshipment, the absolutely The is But it's quarter So still a at us. not in a right. think plant stand you're of I over. terms week. in for

So easily -- and week produce XXX . supposed it's [indiscernible] to where be you your the in a range.

market So right seeing the conditions we're now.

bit North So we're strong can seeing America, Europe, weak still in better but a in little than it been. has

North seeing and terms We slow the Europe very America a in point good are make are in we a that market America. rebound. there's auto, of on green finally, to make shoots need and a aerospace specialties, And to here extremely seeing there. QX. between we and see few we is divergence yet everything we're is And America don't But in Europe. challenged strong North the North to

tangible evidence the are customers turn we why think we -- that market seeing little it's massive but year, being are more bit may a this of really that's but yet. optimistic, Some not just

Did answer your I question?

William Peterson

No, very -- you of free flow look second guess I -- cash you in meeting want great a to the can helpful. you the that's announced Yes. opportunistic sort would define like if -- further. have and or buyback how leverage about to is this where and percentage it's the terms of think of half this course, in allocation, and a guess realizing you the to I capital see way of year Maybe May be But of the that of put this to think in ratio, payout would to beyond? and were a holistically, it

Jean-Marc Germain

Yes.

allocation So we allocation. capital capital a want fundamentally, the Bill, balanced I at look way the we think is

share building end balance repurchase numbers, as the in How basis. a if between the good in look that the returning balanced shareholders, XXXX. sure so I'm to invest it time, we run you from We want be do, We you we the every have are to X.Xx on at we you quarterly -- unfolds, $XXX on $XXX want free even to of see cash through update But determined. company, we to sorry, said, allocation you a to there's And capital to be flexibility. the of committed will though still business, exactly over delever. viewpoint -- We to million this don't returns make. money which program at to I it's think continuing -- -- flow it it to repurchase the the you company we we And that want the X.Xx buyback, -- continues range. share our a stay million certainly within financial will

So as time, will program do return we're that and -- building shareholder we flexibility continue. over we that, certainly

want Jack, to anything you add?

Jack Guo

from a Yes. I be only leverage be mean, like to terms share the program. are too -- off in want some per ratio It would the maintain [indiscernible] to Bill, we will perspective, want quite executing thing -- don't and want I time I buyback se, -- of I we execution of add program. the an flexibility. first will don't we the It's is prescriptive to a hands think we

William Peterson

sneak could in I If Okay. one more.

is think sufficient guess there X you the market there's Europe, -- new think in mills growing especially the supply you demand wondering, So I broader if about guess the we're rolling I meet U.S. needs, do ramping and in with to U.S? scrap the

Jean-Marc Germain

of Yes, ramping the should more more that you aluminum is also with know. There definitely. rate decade economy, going The circular one more -- and to therefore, focus being on a so expect are think the the is naturally. grow. in then up I recycle to And later being aluminum market continues the mills recycled The used, rolling as improve.

is scraps Europe the So waste. scrap. of And and significant way, amount yes, both to we today North believe a there America And ample supply if by of bit exists a a a more exporting scrap that's of are Asia, scrap is for is a countries. that problem and can of to we solution finding today, way profitable which find domestically, leakage obviously, recycle economical then the faraway addressing a this problem a to which

I yes, at decade good for shape least. think we're very So in this

Operator

Woodworth turn with . We now Curt to UBS.

Curtis Woodworth

P&ARP. on Question

XXX, that's EUR year. EBITDA in the all many if you've despite the look ton years volumes So at at highest that lowest had quarter we we've seen per being this

you kind of price guess, 'XX? comment expectation on, margin So going How business -- can forward? into you I see that net for

Jack Guo

I'll take this Curt, maybe Yes, one.

have -- will the moderated, per margin has look think tremendous when And absolute some which fourth I We markets year that's impacting as cost ton. weather in level I a Jean-Marc transition quarter, to the Shoals the So mean, event be with you've talked inflation price profile EUR all, market of profit in business the impacts over Muscle results. aluminum that remained we costs. a in substantial scrap has but first XXX start at of unit. our the aluminum eased slower in Yes, it first quarter XXXX, they achievement remains the terms shows terms would do I a labor say of low, of end a noted. And obviously that's about energy. continue in have

transition, profile some XXX I So be for margin to ton confident modeling year time. EUR probably in to to getting think over over similar expected but a we're -- look in per perspective we'll XXXX, the

Curtis Woodworth

then of how about of Airware the aerospace, volume continues terms to you strong. Okay. this expectations you a for come And your then talk can nominations be have in in? year And terms in little noted bit

better So profile should similar relative to your mix or that will be we expect 'XX in 'XX?

Jack Guo

be mix within continue It A&T, portfolio. within will aerospace micro favorable had to [indiscernible] Yes. favorable. We

do terms volume, volume in expect going then that And 'XX. we expect of 'XX XXXX. to to continue into be versus forward So higher in

Jean-Marc Germain

at yet . levels. not pre-COVID But

Curtis Woodworth

for in guidance, terms just what then the is this And of net Okay. maybe the price expectation the year? realization lastly,

Jean-Marc Germain

by do What mean price net realization cut? you Sorry.

Curtis Woodworth

price inflationary what price business? in so, to net extent? mix to the so offset if be your Do and will And you expect pressures favorable,

Jean-Marc Germain

I of I we into Curt. go detail, think to see. Well, want that don't level

very are we EUR with it. XXX our XXX. EUR of guidance moving think There's comfortable parts many I to to

less a be price with how to . of clearly, mix exactly So inflation, tell. there will pressure, out. pans less it with bit early cost less too benefit a It's

Operator

the Sullivan Company. question next comes Benchmark Our Josh from with

Joshua Sullivan

different in either aero visibility. Aerospace contract this the or given lines But production here, at within Just changes noticeable good the any the geographies segment, you one time from moving of in point? just OEMs are prices min/maxes there mentioned potential

Jean-Marc Germain

Boeing. Airbus Not exposed the we really, mean had and tail are I that MAX Josh. the to the deal before Boeing more case issues we of with. XXX and to issues was to all you as That has are know,

than ours. It exposed today are and so were important, grand to time. sell, another a on aircraft also very So we platforms, at continues many one the sells, even an that we OEMs. important doesn't customer less If the of are Boeing one so many things of in because we with are be aircraft. scheme to in we But

not seeing are and demand all set all, strong. is impact for So pricing contracts. an to be the essentially we us, our very continues our in multiyear through

So we visibility. good got very

Joshua Sullivan

maybe then on And just Airware.

you to capacity? increases, on wide-body here? plans of positioned enough decade Airware Are with production AXXX AXXX end kind where are As production you meet of

Jean-Marc Germain

be capacity So and we . are to quite segment. our expand that looking starting we be capacity, to tight at in will on ways

Joshua Sullivan

throughout projects any proposed Got engagement, it. the Constellium packaging And stable? then new have guess, just capacity at for customer some industry, more your some of in these seen one delays capacity is I just looking response given you just more,

Jean-Marc Germain

Yes.

some reflecting means a time, of expect 'XX there's market best should just that the to to our the you of making Investor allocation us realities market onwards, What to X we which we years the our little bit of and be the Josh, the the dollars at how sure to . we bit put lower possible. means the that a than yes, developing. what discussion, and ago. the that's little time to return capital the investments in back planning them a Day terms communicated of later we And will are to shift push CapEx it right for of is out make, So in is in

Operator

now We Deutsche [Operator Sean Instructions]. to Bank. turn Wondrack with

Sean-M Wondrack

The don't first think there. so, one housekeeping was here. QX? in UAW there to strike, I check just but any wanted The impact

Jean-Marc Germain

Yes.

of bit of it few impact, did So dollars an have in But the Sean. a EBITDA million QX.

Sean-M Wondrack

Okay. [indiscernible] Great. And what then

Jean-Marc Germain

in . essentially AS&I. And

Sean-M Wondrack

Got you.

if comment your U.S. in that you of peel seeing away strength Okay. about us, you're weakness in bit then a could interesting wondering little kind And Auto, more it thought was how in and the for please? Europe. I I if comment was

Jean-Marc Germain

Yes.

bit more the German Europe, and difficulties in being little weaker European -- cars OEMs market the we the overseas. also their think a I having selling see

weakness . driving in moment. the that's, what think, Europe is the So I at

Sean-M Wondrack

see the structure. Okay. And target obviously, you the It's leverage to you've with done within new nice a great range. job capital

clear repurchases about call. You were share the on

stool running terms point. how maybe of up something is, to kind X Just and about these to right another question tack in thinking to my this a have segments you you're on there that of your be of the leg or add saw M&A, now. maybe Could at here really Just segments? existing to well one if consideration curious the you deal

Jack Guo

good Yes. It's question. a really

-- cash flexibility So keeping I back share of maintaining intention a of and of strategically. to flow think our And and capital the allocation repurchase, potentially some flexibility free returning both to balanced large towards while maintaining back goes but sort approach. that a portion and financially going

for know, when think make I conservative. We to right is sure M&A, as the comes it to our we want our you deals approach do quite shareholders.

acquisition great these So we'll be highly so would selective. tuck-in opportunities -- value ] we at[ But consider

Sean-M Wondrack

Right. No, guess lot about be that we that, just to important one. then is it last time? there And with we that game facilities? Are this makes sense. smoother opportunities additional when recycling I further manufacturing And your to one early in about think just or to think how a as first marry of facilities

Jean-Marc Germain

Yes.

that footprint domain. And operations, in, clearly ours recycling there primary. is a metal that recycling So Sean, increase opposed these will it M&A. increase in to to continue . But investments us mix investments content, to our to is of of organic make priority definitely comes recycling and is will we as be and And to opportunity be for our scrap could capacity. also a an that continue our

Operator

This concludes final Constellium back now CEO to remarks. of for Germain, Jean-Marc our I'll Q&A. hand

Jean-Marc Germain

Well, thank you very much.

We are proud progress. very with our

As markets improve, repurchase down -- evidenced on confident really the you you a good I on as forward that in a can future are we our very and profitability . program. April. to quite day. to by the the the Have we value continues -- progress of our much, look performance Thank share see, very everybody. announcement are in in updating that of our are demonstrates our you few focused context demonstrates this

Operator

today's for participation. concluded. now has like your We'd gentlemen, call to you and Ladies thank

now may You your disconnect lines.

Constellium SE (CSTM) 21 Feb 242023 Q4 Earnings call transcript