Hindalco arm Novelis Q2 net income at USD 116 mn, down 62 pc

Novelis Inc, a wholly-owned subsidiary of Hindalco Industries, Friday posted 62 per cent decline in net income at USD 116 million in the September quarter.

The US-based company, which deals in aluminium rolled products, had reported a net income of USD 307 million in the same period last year, the company said in a statement.

"Novelis...net income attributable to its common shareholder of USD 116 million for the second quarter of fiscal year 2019, compared to USD 307 million in the prior year period," the statement said.

Net sales of Novelis during the September quarter increased 12.2 per cent to USD 3,136 million, driven by higher average aluminum prices, higher total shipments and a more favourable product mix.

Shipments of flat rolled products increased one per cent to a record high 807 kilo tonne, it said.

Novelis said that on Thursday it secured financing for the pending Aleris acquisition by entering into commitment letters with a group of banks to provide up to USD 775 million of an incremental term loan with a five-year maturity, and up to a USD 1.5 billion short-term bridge loan with a one-year maturity.

"We expect to replace the bridge loan with permanent financing soon after closing, depending on market conditions," it said.

Novelis is the global leader in aluminum rolled products and the world's largest recycler of aluminum.