Novelis to begin shipping from US Aluminium unit in June quarter

MUMBAI: Novelis Inc., the US-based subsidiary of Hindalco Industries, said it plans to start production of cast ingots at its Bay Minette facility in Alabama in the current quarter and of coils on the hot mill in the March quarter. The start of cast ingot production will mark a key step towards bringing the facility online.

The company is building a 600,000-tonne aluminium plant in the US for $5 billion. By the end of September, it had already spent $4.4 billion on the project.

The plant is currently being commissioned and is expected to begin shipments in the June quarter of the next fiscal year, Novelis said in its investor presentation on Thursday. The plant produced its first coil on the cold mill in September.


“We are excited about the opportunities ahead as Bay Minette moves closer to commercial production, increasing our ability to serve the undersupplied North American market,” chief executive officer Steve Fisher said in a statement.

The aluminium company’s profit rose 29% year-on-year in the September quarter to $210 million, while net sales increased by 25% to $5.9 billion. Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) rose 20% year-on-year to $508 million.

The increase in the bottomline was primarily due to insurance recoveries related to the fires at its Oswego plant in 2025, and the increase in EBITDA, Novelis said in a statement. The EBITDA, meanwhile, mainly grew due to the $39 million in insurance recovery for the Oswego business interruption, as well as favourable metal benefits, including both higher scrap consumption and lower scrap aluminium prices.

Adjusted free cash flow for the quarter was an outflow of $1.8 billion between April and September this year, as compared with an outflow of $499 million last year. This was mainly on account of lower operating cash flow and capital expenditures related to the facilities in the US.

“As Bay Minette transitions from construction to startup, reduced capital spending, continued cost discipline and solid underlying business conditions are expected to drive a return to positive free cash flow and mark the beginning of a deleveraging cycle toward the end of this fiscal year,” chief financial officer Dev Ahuja said.