Constellium SE (CSTM) 23 Feb 222021 Q4 Earnings call transcript

Good day, and thank you for standing by, and welcome to the Constellium Fourth Quarter and Full Year 2021 Results. [Operator Instructions] I would now like to hand the conference over to your first speaker today, Jason Hershiser, Director, Investor Relations. Thank you. Please go ahead, sir.

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

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

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

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

to see the would presentation, the non-GAAP In addition, Jean-Marc. over of which Please I IFRS today’s presentation certain reconciliations our to now disclosures. measures. includes information measures hand financial today’s supplement attached regarding call financial like in slide non-GAAP

want look our extremely start and their I customers interest everyone, able in great to I our for achieve safety serving these morning, relentless XX,XXX of XXXX, am in and in focus the optimism. commitment to future we times. what proud by were with and thanking challenging Thank Constellium. thank you good of Good for afternoon, you, on their employees each your to I Jason. to

up metal to Now let’s increased quarter operate minimizes discuss fourth This compared our affected X% quarter Shipments we and risk. from turn to XX% tons, of business primarily Revenue were our Remember, prices. model, the to highlights the a Slide prices, X fourth that’s €X.X by performance. to XXX,XXX billion. exposure are pass-through in changes due to metal metal which was revenues our price higher while XXXX.

record implied compared end Our €XXX to and was fourth semiconductor cash fourth overcome XXXX packaging track across of million quarter. and very market a pleased consistent Strong better-than-expected million our in and income this the our customers of caused above the net cost million, quarter. with particularly performance €XX €XX execution in of flow income pressures We range. in helped by automotive of industrial from extended business. the demand, net with €X generation quarter I shortage weakness strong us am XXXX. continued guidance our Adjusted XX% free quarter our million inflationary the above of well EBITDA the and

to of a November. XXXX gross of redemption commitment with our $XXX demonstrated notes million we Lastly, our reduce in debt

per year was last worked full safety, Beginning our for rate results. our X Slide to turn recordable performance year. million close now very case X.XX record our So with to and hours

recordable quarter. area. years performance, I most than without and improvement remain case this to Changchun without case. best-in-class Decin recordable efforts specifically in more we Changchun more a X achieved recognize million is committed in X worked at a reached and this Decin While like continuous important the hours would fourth than to the

increased strong billion. metal were shipments end shipments. year-over-year tons, and our year, to prices higher up XXXX to XX% full growth. €X.X due was higher aerospace, X.X to the million XX% Revenue primarily except markets, as our all This compared showed For of

the Adjusted XXXX. to is a a compares We million that this ability maintain very with cash performance performance PARP and running total in company full and in in still I income flow million, This this given am above for automotive notably, improve aerospace remain in year. third million million future. X% and and a free our result record XX% our net of to the year last XXXX, €XXX Our XXXX particularly pre-COVID below the delivered with positive above €XXX and loss AS&I segment. €XX our EBITDA for €XXX are of fact pleased we was of net confident XXXX a and consecutive levels. our of record XXXX,

XXXX a multiyear end low. and of cash We than full leverage Peter down and am the year Overall, turn hand of solid strong the first year, on to Our of our the very quarter I and fourth will the X.Xx that, substantial to from more performance. quarter XXXX performance. adjusted declined our free With at financial deleveraging. EBITDA, a at generation proud over flow details for delivered I now full Peter? further call

everyone, turn thank today. Jean-Marc, to Thank you, now joining and #X. for Slide call you, Please the

to million EBITDA the to by For the million increased Holdings quarter quarter million million XX% decreased initiatives. adjusted €XX and EBITDA, €X Constellium the year, PARP last €X by cost €XX of €XX of fourth quarter the increase number year to €X to EBITDA of fourth corporate million EBITDA of by increased an of of million. €XXX quarter costs adjusted of adjusted increased one-off XXXX, of A&T fourth of million compared of million. AS&I compared achieved XXXX. adjusted a last in by and adjustments due reduction and €X €XX million Compared

adjusted EBITDA to a €XX by Holdings XXXX. €XX million fourth of million to increased €XXX of last year full compared a PARP year, million million €XXX of compared level. XXXX. million the also A&T the EBITDA corporate XXXX, full XX% EBITDA quarter For EBITDA, adjusted €XX adjusted the increased Compared record level. €XXX €XXX a year of million decreased million million by achieved of increase to to increased €X of to by costs adjusted and million, Constellium record AS&I and €X

holdings to million continue We run to expect at costs €XX annum. approximately corporate and per

products performance. on and increased Slide Now EBITDA to packaging Volume and flat in €XX and X% shipments XXXX. turn products. from continued quarter shortage. Adjusted semiconductor of were trend third roughly offset €X Costs increased Price quarter segment shipments fourth our maintenance and compared more X% were lower X, FX costs. than with of let’s the million million a a the PARP offset rolled was on shipments labor higher of stronger was rolled weaker specialty €X tailwind as the packaging to impacts automotive our a to focus of in demand. Packaging is XX% in on in continued by noncash, Automotive strong was lower shipments decreased on translation, This due shipments consistent which the €X U.S. a as XXXX. costs higher quarter and favorable dollar. mix automotive a headwind of share a was metal million mix. of of tailwind million experience

U.S. translation For pricing, €XX tailwind in €XX and to America of segment. of let’s solid XXXX. a to Volume year full were costs. both with and costs while a fourth Slide the in to A&T headwind a was million the aerospace automotive million. EBITDA million. million in million of increased of in Price tailwind strong TID were on XX% was mix in €X higher automotive. higher Europe, €XX on North XXXX, Price Turn of and costs, due tailwind million stronger €XXX FX quarter Adjusted now €XX was PARP headwind on XX, due including €X EBITDA products packaging, was tailwind a aerospace for headwind adjusted shipments due FX tailwind of million record cost of XXXX. of control the broad-based and and anticipation mix €XX shipments flat. dollar. Volume translation to while XXX% on labor mix a and million Costs packaging of a better favorable to compared weaker million mix TID U.S. were of increased focus rolled million additional to improved €X generated the shipments and compared dollar. a was a year €X demand both due of quarter was the a demand. costs and an weaker metal to specialty

for on of shipments in adjusted For with cost to strong €XX was lower headwind million. the XX% €XX by the EBITDA dollar. AS&I year weaker in €X Turn the due million a million, A&T shipments shipments lower XXXX. of a offsetting and demand was was million headwind as control shipments a generated partially compared translation and full shortage. the tailwind tailwind Volume offset aerospace focus million and now to TID Costs strong costs, while of broad-based a resulting fourth let’s the with due to a million reduced labor Adjusted decreased were FX segment. higher compared of €XXX semiconductor costs. was EBITDA year automotive aerospace on metal million mix to demand, XXXX, by to tailwind U.S. shipments. Price higher €X €XX Volume favorable to XX% of €XX quarter increased Slide industry XX% from XX, XXXX. of a due increased

actions. fourth and mix our other million with to experience to automotive was quarter. and labor, headwind industry was in in the due comments stronger Price energy PARP, similar million a our roughly offsetting was mix. €XX noted cost fixed that demand quarter on Cost of As the costs third tailwind a €X higher

compared were year and million both to to tailwind unit -- where higher the on adjusted the pressures in we on pressures in full I Costs solid in million inflationary were XX, labor, automotive update previous a Volume €XX the the looking transportation AS&I a that year. In shipments like significant inflationary was industry Turn give energy, better increased higher maintenance inflationary facing. business and Nonmetal with better mix update XXXX, an control. are generated bridges, industry. million. mix offset than automotive to €X to a want the more was last it environment experienced For due we and however, of clear €XXX current fourth of a In price Slide of I tailwind structures €XX EBITDA in quarter. pricing. costs than million to is and more tailwind Price at quarters. want now all quarter, cost

us combat focus continued quarter. to and cost discipline strong cost again, XXXX. increases should continued have on help control in cost performance in the delivered This businesses Our

XXXX, near we Looking to increase pressures term. expect at the in inflationary

materially As price to need our do the to discussed elements and the given we are aluminum, challenges We of the cost higher be third we business call on changes pass-through though the cost input. significant most significantly so alloying of you operate our some model, to exposed know, secure we of in supply. a not this year, expect quarter

to ability have so. We do in our made securing not supply XXXX and concerned our currently significant progress are about

but bigger We costs, are challenge far, in fact energy, thus across our the finding is With to strategy people experiencing higher and labor levels our are these gives hedging respect company. all manageable at in us Europe. on to energy forward we protection we basis, energy costs year, be given this up particularly the that on do materially buy a some expect costs energy but our

are working We inflationary pressures. these mitigate to hard

XXXX initiatives costs, Horizon and increased consumption. structural reduced input have Our reduced efficiency

of existing side, commercial inflators. PPI many the On as have contracts such our inflationary protections,

also new with pricing are protections. better We signing and contracts inflationary

for will significant will actions in The our manageable are by in it impact cost we and and inflation it guidance on offset it be taking included and XXXX, we to inflation are While control. is relentless our offset the improved be focus of that net XXXX. pricing believe largely

of let’s of this despite turn rebounded free build year the higher €XXX discuss as We cash CapEx. million shipments XX across free generated and Now our in working including flow. our million quarter. is €XX flow, significant capital number Slide cash to businesses a This and

bottom of to beginning can Since over see generate consistent, our left XXXX, have of flow. the strong have on factoring our you we of flow, million. also free commitment slide, generated we As while over deliver on €XXX €XXX the million cash by side to reducing continued cash free the balance

we in excess expect to million. Looking generate flow €XXX cash at of free XXXX,

to We €XXX be and expect €XXX million million. CapEx between

million, €XXX to taken gross have the which reflects actions expect a we company milestone cash for the significant We and cash represents approximately of interest and interest. debt reduce

cash of expect million to We €XX €XX taxes million.

of balance our slightly billion of Now of XXXX flow to position. sheet as the generation and and let’s At debt declined sheet of the free offset turn FX liquidity discuss by the end quarter, net our to was million Slide fourth and the compared partially €X translation our actions. balance end cash of €XX XX cost

to XXXX. Our We versus reached target. achieving at low leverage deleveraging our X.Xx of the multiyear or of the remain a fourth to of X.Xx end and end committed down the quarter X.Xx leverage

with our no In you we see in XXXX. our maturities notes November, debt, line X.XXX% summary, XXXX. due me, $XXX excuse redeemed reducing have of until -- As gross objective debt million of can senior in our we bond

noted, our XXXX by cash previously reduced As in €XX capital million expense interest per rate structure run annum. actions

proud of the building of the capital and in progress are we our we have are structure We financial made the company. on flexibility

Our liquidity million end at of of strong as the was €XXX quarter. fourth the

on calls, have gradually added to COVID-XX recent call reduce noted the now liquidity I will we the extra will the to with As continue during pandemic. back we And that, hand Jean-Marc. we

Thank you, Peter.

Slide we discuss generally outlooks. serve. market end and very XX current So the let’s markets Demand our turn in remains to strong

automotive in our our is XXXX. versus infinitely sustainable well recyclable is and our a fleet. for infinitely in with making alternatives packaging XX% circular lightweighting capture The beverage cans economy. The Starting cans packaging Packaging trends, from Constellium aluminum such aluminum benefiting Aluminum transportation cans, diverse revenue recyclable, to in strong by portfolio today the preference for the sustainability-driven is and in market this core North Constellium growth. electrification for the other the and and are represented and market are both container participant well-understood We secular growth with Europe. plastics. America of most as in underpinned preference consumer of growth is balanced demand positioned consumer such them packaging. as cans for

are can doing is demand meet in maker best medium our mid-single-digit customers. regions, our needs we the growth supported the of both to expect and term, We additions capacity in by which

of We packaging initiatives sheet across number increase are a this to our to continuing capacity to growing market. serve investigate can platform

our in the We operations expect this will additional be and achieved investments of future. through debottlenecking both

automotive aluminum Now extrusions is to and in and Constellium well which battery move meet automotive sheet let’s range logical of their auto of positioned the to Electric represented electrification from components Automotive to material and the crash be objectives, revenue systems, benefit secular fleet. in light automotive. for choice vehicles the in both management XXXX. of XX% the need aluminum to of sheet, to body structural enclosures. our makes shift

lightweighting internal societal to combustion stoppages meet for OEMs shortage. and the vehicles the We safety experienced increased focus regulation, the demand to term, semiconductor on demand also expect be continues improved continued production fourth performance. throughout engine of by automotive and Near sustainability hindered quarter.

in to and half. very end where From this and to and light second strong, improve market. market Dealer these for Constellium end in We believe continue remains of expect perspective, low, the are greater luxury the first exposure. we SUVs demand an half underlying consumer year however, trucks, we demand this remain positive has vehicles inventories especially on

recently, in now Aerospace aerospace our revenue turn products low to but XXXX. a of build the levels. in rate our be show largely to The to OEMs aerospace. still is and XXXX, major uncertain, Optimism timing our quarter. Let’s below supply increasing we appears XX% at revenue have the growth year-over-year well Remember, X% level in remained expect the in increases. More represented complete. aerospace of Demand quarters. the shipments in fourth chain in for destocking aerospace is historical coming announced used

Over that term, traffic growing remain new, the aerospace driving we the longer confident aircraft. greater fuel-efficient intact, remain demand more and including fundamentals for demand passenger

in XX% lastly represented other Turning specialties. to our revenue of XXXX. specialties Other

of markets. play is the very in on in are each impacting well. markets and core here general, many driven economies growth other the strategy our are It as range execute secular note health that our markets also products to upon We a In Europe much of North at continue of diversified the trends industrial of expanding America. dependent these sustainability of

For trucks, for moves. driving in applications increased that anything aluminum example, is lightweighting boats, rail,

energy products. both increased addition, extruded is in are Specialty investments In markets generally demand in America. North renewable and increasing for today our Europe strong

record XXXX. now many levels. adjusted our We entire and solid cost Turning of the control in our guidance performance messages we operational we despite XX, and very delivered strong €XXX strong achieved that XXXX to Constellium key I’m performance detail million very they as of challenges delivered surpassed proud Slide EBITDA faced. team XXXX. financial for

record Importantly, balance our we our generation free flow further and extended cash track of deleveraged sheet.

Constellium electrification. there significant are substantial for and Looking benefit opportunities are from around lightweighting forward, growth creating momentum which I sustainable packaging, sustainability-driven megatrends, to believe secular fleet

our closely We the to and with that reduce the work will economy. is value-added help Constellium customers footprint. part carbon continue deliver of in circular products their solution

recycling our expanding in XXX,XXX of As significant investment announced, footprint tons the we recycling with we capacity. European previously are center with

We as provider and a It a and for with more be are a recycling for customers triple future. contribute our win business, environment. us Constellium, the our it solutions is will about very sustainable increased excited for customers further help strengthen to this to investment our

this to to in see year we in year, remain year. of the Looking semiconductor deliver XXXX. Packaging of half aerospace. still with but shortages performance improve signs of strong second another and to is to the we the automotive and markets facing positioned well we year, issues Automotive industrial are in recovery expecting start starting the are strong, are to

While impacts we and ability highlighted, a confident inflationary focus most in improved our as these are significant control. to in cost facing on are XXXX, relentless pressures pricing we with offset of Peter

of very flow cost control, €XXX EBITDA we optimistic €XXX am We €XXX adjusted future. to creation. focused million are million. value the flow free XXXX, about of shareholder and operational cash million free on targeting in generation remain For and cash excess performance, I

Day everyone April I the open of Analyst session, remind X, Q&A XXXX. want to Before we our on upcoming

guidance, the the for our team. a the in session. strong Shoals, expect With the business, you the holding update long-term that we where now we’ll detail are to our at course, our strategy future, XXXX event of open establish Muscle plans presence in that, very Alabama, present and We facility, facility tour new our executive all operator, offer of sustainability a of Q&A on

the Gagliano Capital BMO [Operator Instructions] comes Your Markets. of from from first question David line

All outlook. And on right. congratulations Great. results the solid the and strong

positives when by big months to €XX the the million when I look compare X at results, of to were XXXX and in X% weakest the I And million. major Just about ago, the the despite versus fourth X look for especially typically annualized. EBITDA significant of Then be each that to result It’s you then each X% flagged to your implies that’s annualized. your is guidance guidance XQ -- implied at quarter number, positive growth if guidance, of XQ fact buckets Constellium’s owned that pretty it €XX quarter actual the in XXXX. I a

So my by beat of questions then what XXXX guidance? one, year the ago are, And terms caused XQ? X months implications so potential that to the changed in for much what Constellium two, number full in versus are upside

for congratulations. question the thanks Dave, and

So question, significant on first yes, beat. the part of was it a your

own our we We pleased, expectations. our in than we surpassed are and context in and even were That’s of very internal strong all clearly seeing stronger demand, execution the facilities. excellent

with So from quarter that really And level had be to to but we operations excellent performance, able of we an an we very pleased hope that. are maintain standpoint.

Now And looking us on think thing benefited, it his any escaped commented pressures. inflationary I forward, we one in remarks. hasn’t of that Peter is

had better than the kicked in of reset If Xst pricing only at partially the contracts in a because we our January. you for year lot But pricing, supplies only XXXX. and we at the in of on inflation of look end have ‘XX

but the have on So full of our inflation, a bit benefit of impact little we price had increases. we

going cost are prices due increases as have there. But know up is inflationary sorry, into forward compression And inflation. to compression well. to of the the next pressures, Going going year, full we are that the on our price impact we

our been input in add? output little what why guidance. to of anything So to good are bit you bit EBITDA increase what may past. ability we’ve We’ve a that our are And that’s that’s for put the our as side. the delivering be on the seeing Peter, the in side and going than on and you we’re want obviously, that’s a to on grow reflecting got more what prices both pretty visibility, year, to EBITDA, damper in modest a an

that’s I great. No, think That’s great.

Okay.

all that obviously, so multiple flagged in pass-throughs factors cost And in, call that the and the on you’ve times past. this

packaging there, a I recovery, level growth example, an your I’m frame mean there are assumptions to is seems automotive us side. -- know guess the just of I certain trying conservative aerospace it for of a way an me. what mid-single-digit to embedded pretty timing recovery. you So timing the to gave gauge I in on

Yes.

the So maybe can a the on and bit light shed I pass-throughs. more inflation

obviously, We customers. solutions that contracts, and relationships are contracts, discussed, negotiate work existing us for long-term And discuss and with we we customers. in we we look our our for for

There what the we be also on important all be that to will at through all January passing will in what’s a passed understand will not is passed So be ‘XX in X, is pressures not through through inflationary once ramp-up. right? And ‘XX.

at is we think how our kind to means that we need clearly, bleed to perspective the the And are over I So of pressures all pass cost but what work. will that long-term pass-throughs one. through And assumptions thereabout terms to have feeling, prior That’s related fully pre-COVID we look in compared here of in our back to or expecting be XXXX. same aerospace we recovery by expect the guidance, some we to every XXXX. the the into quarter aerospace quarter year. levels of to on Then expect we’re

a gradual increase. So it’s

€X that automotive, shortage This every the about if of the said chip second past it’s year. the quarter. we In half million terms resolved And is costing us gets of the we in year. remember, expect you

our mean, continue on QX of to So want. producing I that QX. packaging, here then customers QX, continuing is and we in And the and everything expect QX, drag challenge more that abate then in solid kind about our earnings

bit what’s that a as guidance. color So embedded I the to in gives you more hope

the Wolfe from Your comes Tanners from next Timna question Research. line of

then of the the and elaborate you also color understand any bit little and opportunities can mention about, to there? opportunity maybe just debottlenecking more more. a And you revision that talked of on on size investment wanted packaging, the contact expansion and of some those that a if I bit little

Certainly.

improve value So a multiyear into on make translates to journey and sure been bring and to our customers recognized prices. we’ve we it’s the higher

we’ve So marketplace. that’s our in made. we’re in better one of an sales pricing it environment inflationary actually And is with wind about progress happy good getting the terms of the that the puts things in very

it increases had continuing at ‘XX. nice and look journey, a price in we’ve as So

I think it’s well ‘XX. even up contracts that known more is in renewal there for come that

So they They’ve for up have a come the renewal. better, compared at improved renewed to been past. prices good,

quite So that making, with pleased that true We we progress is right? and gradual the of we’re have a are is as nice true and ramp-up in packaging, automotive, in pricing. well

our capacities America considering in at X is debottlenecking, the talk and We’ll you the we worldwide all in Regarding in that Shoals. our we fantastic have April Europe, capacity. But industry, there needs and and are capacity. further excited much Day U.S., about are meet time. options up investment the opportunity the is When substantial Muscle Europe how a market grow opportunities can in growing production Shoals, today, when an we’ve more growing the further have we Muscle future. the past And about them in say both very we customers. me in this in ramp we sheet on lines, Analyst we have more And to North need let think with grown needs, the new as to our for our of the the at sheet look can can

tuned April for X, until please. stay So --

do. Will it. Got

little pass-through to about first is So any the about the contracts, a is pure the question like give coming part to much us how it’s due are just can on think though, much how the of contracts or framework just because think of how much how you -- confusing. on

have about to of If how passing are the quantify but to inflation, some that. ability get I’m others that are to lagging. understanding an talk trying you through just

automotive, of duration. obviously don’t apply could also here specific specifically sensitive. I and X-year think commercially X contracts, about but Typically, want talking to I’m details it’s because we our more to And Sure. go packaging, right? But into

So would contracts, any your answer. than year, XX% more we’ve a said of be okay? the have And price on should bit of in year renew. renew environment. you contracts given been we is XX% So about that XXXX higher renewal, When a positive we

a se, contracts, don’t years. So that, supply we demand many step-up there driven was at negotiate in. them because these pricing as look it’s pricing. kick in inflation I over and pass-through all will in an That step-up and Per it by

we in So on December the full January December it renews the for negotiated X, for months negotiate XXXX, of and right? for what XXXX, We didn’t of X XXXX thereafter. in --

we’re ‘XX, on So the living inflation then. those in means kicking ‘XX large, what was protections very have much in, ‘XX, the which through. in and by price we much inflationary But is then very in which in that, picture inflation in step-up observed not and got is would in what basis contracts, there the a protection of you’ve inflation have been

that mechanism frankly, our the combination main And a inflation our the more pass-through. So I pricing segments. working bit you of is in X quite understand helps of of hope how power,

it. Got

is XXXX, lag effect, all into expansion margin So theoretically there’s sounds we’ll inflation a static if else see it like. equal here,

Yes.

‘XX in seeing a and that result are expansion in ‘XX. an as we of compression So

the of Your Sachs. comes Chieng line Emily next Goldman from question from

trending color on of there XXXX and some you’re just question rebound the for activity -- how in OEMs Peter, half. different versus first second expectations that’s is provide of from segment. perhaps sort levels? there in But my what you to ordering the Appreciate seeing difference is automotive and and more segment question the regions the between Jean-Marc that around my around the can color terms your meaningfully

Yes.

these to choppy. seeing. be at capacity of because disruptions So of by we are still very not end it’s And full all subdued And do compared levels. we to the the year XXXX we are expect

that and customers will shut they announce for then following very got pull they a the for week. down You’ve a month, heavily month

XX just mean, plant Bowling in that so the out days right? Green, a to mean I So we’ve XX quarter. you for days where North in choppy. down, give really we in think America, were I example, I is quarter, been the quite it’s So XX in the disruptions, an idle of down had few

sometimes and a -- notice. that’s very short So it’s

is underlying very still trucks, they make can strong. it And But whenever will. is choppy. the or demand they So cars

helpful. remind is when Can the there? just remind the on and footprint. expansion? my around hit the That’s improvement update recycling anticipated here it. margin center Got European timing us additional volume that recycling the us should of is second And you the question latest of And what

Yes. Sure.

So making good all needs permitting we investment. a progress. It’s It that. significant are and

quickly, should time the the of the we XXX%. So per capacity, capacity rate, it working to that right? very hurdle said expenditures half our XX €X,XXX are installed and we’re start expansion, Margin production of per capital frame of rate expect XX second you plus of start, a of So it XX I nominal But capacity. build is at is meet about want a capital XXXX. ramps of -- investment and of XX% in we to full all And with ton is think way it’s XX% internal return. is €X,XXX of and ton into up

So of EBITDA go-forward basis. has it contribution what to that an a idea gives on you

of next question The Sullivan the Your line Josh Benchmark from comes from Co.

the happens look there And How back a does with to new then would Just by in to that nature ramp features what expectations that the the separately, comment restocking new than we that at and be structure pre-COVID of are your contemplate historically on differently cycle? of if contract Airbus XXXX. contract? new aerospace levels it, any long-term

difficult sensitivity nature and of to good and because that’s question answer it. of Yes, a commercial

I it’s say back expect we’ve better levels, pre-COVID XXXX our at to be to in we been the we when with And customers successful markets. them. serving think think I

a earn that, do we can better to little for we but have maybe So it. bit

In it -- we value on relationship very would supplier and there being mean us, our think. very maybe little rewards important a them, And believe us They good I with to we to answer feature, to Airbus. be bit I are and grow can needs. that we the very want faster are their I much for some that best that’s would So a good. we should

customers? having of you is prices, be to concerns going it. do eventually higher supply a with absorb on just which And needs, then it. have alloys? Or the agent just of to passed on actually it the alloying to Got matter the getting are just Got

And Yes. it’s of quarter feel hard now pretty of supply. that the last alloys there clearly, QX, we’re right. worked about concern. I most in resolved. kind Josh, that have around -- mean, kind the we And that seeing I it’s the get now the been over the the was think We really to -- this of supply at disruptions point, really good pricing. were a

the of materials But prices remained supplied or flow the stubbornly have high. stubbornly So coming.

as first as we’re these contracts quarter start standing experience we -- this. there But aside, so are when effect. starting Jean-Marc And the take taking an going in to to said, just that, just not we’re

we kind We’re there can recycled to obviously lot increasing the because content alloys. purchase some on need effectively can where we working a of displace

on working conservation. We’re

of too. we’re things So last on working a our to the guidance maybe and blow. number And -- to in the this That’s it’s lessen is make. point

from Woodworth from next of Suisse. the Credit question Your line comes Curt

still to the operating wanted questions. the to annualizing in year the as in of circle business noted in fourth you’re pressure To of back look cost kind this lot and EBITDA the you some inflation and seasonality, the initial yet some million, when I degree, to recapture inherent €XXX and one So just ability of said. have at business a you some quarter, you clearly you of leverage

of year. your what be seasonally adjusted be you’d just it rate seems low curious So see as you exit next as a basis, on you’d of kind the of end like just above takes this for and I’m year, the puts from -- guide kind

So million by EBITDA of upper out the which the takes of segment, and in and low to of would are to the or you helpful. what puts you can €XX be grow ability just on yes, parse then slower faster frame terms point growth help maybe segments the think kind going

QX. maybe way is Curt, to focus a help to this frame So on

understand like that to give we’ll do that kind about this instance, we’re you of near some the help audience this of talk you to in And what So quarterly pressures, in do But term. not context the will we performance. I’ll cost seeing typically that. maybe remind

extraordinary. we million right? there a back at million out we quarter XXXX, if €XX was And had the also first So just of €XXX we called go look and EBITDA, of

first of kind So of quarter that, for you’re million for ‘XX. if you €XXX the at adjust

to ‘XX sequential €XXX pressures, As be the we see hard quarter able so we just of some but time definitely the the should a have quarter, first of the we shaping the beat given beating we million, up, will that million €XXX did.

of And run going some play might that the we’re of so pressures of hopefully, what the out that of given the expecting gives guidance in some how year. cost it are the on through for and kind you quarter kind sense a to first range

forward the what and kind was In shipments through go And from, we we terms in incremental on remunerative are aerospace what highly every quarter year. in and based the where an we remarks, are EBITDA prepared expecting, remember, uptick as tons. of comes are in of expecting said saying the we looking Jean-Marc those

running should expecting, that nice would And if EBITDA. in terms as But know we we’re should also is a forth, you as bump that pretty packaging. the the and I we’re get side so benefit of I benefit some John-Marc, work So us running for anything? continue too. then on we’ll Automotive, -- on packaging second be for benefit packaging that we’re you’d nice don’t say to if on full in know, get costs half, a if there add us. the which be we --

is And packaging, So going inflationary I’ll inflation, times, that than timing the how Maybe pass also lagging got we bit think element. just about we’re add XXXX. this frame right? a through as help more we’ve automotive Yes. to we that can in

the of here. to historically, maybe per lower the spreads, are automotive packaging, a inflationary beverage companies benefit dynamics evident widened in mix year. the quarters spread going packaging pressures. this part, can of scrap of would widening? in Obviously, great. ton there’s give of packaging But you the and terms costs you talked say EBITDA up. you somewhat kind you regard heavy been about color couple reset been have conversion dramatically to could it’s I’d widening in pretty which then be believe can performance I either know this I from year of sheet fairly about effect can any scrap your And terms But last to some maybe talk with Okay. the benefit specifically of year obviously, more in talking have about significant but pretty

Yes. right? And I’m relates assuming you’re talking it scrap, specifically as to

Correct.

Okay. Yes.

on to rewind bit just to you maybe a So scrap. remind little

of scrap So then the first others. than to to convert not So usable form last obviously things for I’d into us. of have some at of couple equal, so America also to do discount mind. just a cost that in it we or a -- And keep a stronger North the is created footprint And in right? Europe, there’s discount it note to thing is And then all recycling right? all, today, bigger comes than scrap a in sorry, we

that at pressures it. a that, no you quarter. Now having a some this the this about But in basket facing. way contributor was and scrap part, putting or looking we’re costs. we’re this in we’re on said we favorable against again, it’s definitely inflationary Recycling comments definitely in part profit of us our these benefits it contributor, recycling, noted noted a of helped metal that question was and the of The is

we helped it the at to it’s say PARP, -- put the I of of where not the kind us around and it. we maybe story levels going it way is to changing continue yes, guess, roughly kind So is it’s expect wouldn’t of today. But

that and was to said, the be of do part maybe, big about right, Peter not energy compared And spreads to ‘XX. But ‘XX, a benefit, anticipate Peter widen which it higher. But Curt, talking going what scrap to that. costs, was anticipate to are add forward, we we in all to Yes. do a conversion costs

net little impact ‘XX in had so that bit ‘XX. a say, So scrap profit, may to we less of in be the than

Okay. on next is you can if And, or year, maybe sheet repricing can much how year comment possible? your this

Yes.

I less one would and questions just think I and of I’ll be said more XX% the good a ballpark. in earlier XX%, than than

from line Blanchard Your Equity. Corinne next question of from comes the

back of question. I some the think the one on comment to of go first

a expect You you seasonality? Would second regular different? still the seasonality half year. seen bit expect we’ve or do little auto to XQ view the recover the you in like of that How in

Corinne, half well, second assumption, more assumption is means next year you QX better definite a the we than QX in QX, is be in typically, And half. than The an prognostic, QX, which that know expect to would year. first recovery that than it’s stronger right? auto the a this

at So XXXX. balanced look for the way maybe I a more it year is

mentioned Okay. Constellium? the expecting it go And to your more aerospace to an believe I Is on you back level. comment? to it just another industry comment. back XXXX XXXX question specific like is Or

more It’s an comment. industry

Okay.

margin? that’s So EBITDA industry believe impact one aerospace highest the would is term -- right? comment, on what’s you an view Constellium if on like margin your of contributor, of in I your

yes. Yes, Sure.

thereabout, the So we would line, €XXX, be trend kind should back €XXX that €XXX we per or we think we So said able we in XXXX margins to of said be maybe ton to replicate right? €XXX to had the…

For A&T overall.

in overall overall, guidepost be of margins A&T for A&T. the kind For that yes, would

if Okay. on I can last, one actually That’s A&T. just helpful. And

mix year volume in well? that of expect you to you like have as this improvement and maybe think I term for seen continue and like XXXX pricing significant Do TID.

Yes.

reached assets objective And level. grows the we’ve a assets same produce to that. think of that aerospace is putting that TID if on or type if puts sudden, it our now TID. pressure I all So produce aerospace. It’s also because different pressure grows the a are nice And a that of very gradually maintain on performance system the

is accommodate for now maintain aerospace. TID the the at and objective our where levels try they’re So growth of and

Societe Generale. Christian the of from Your next comes from Georges question line

kind over On cash is then million the you low down hardly €XXX of like level. net year, like a right? your And debt €XX did is free again which more flow, this million, than conversion

a €X.XX at that debt consensus, of debt net €XXX suggests or to high mean next the to expect If net debt conversion of level is you at year? million into about you end billion reduction net really look year I realistic that reduction. Bloomberg have next

in debt against against associated what Well, translation And until generate kind therefore, €XXX some get as with perspective, to and a free again, looking absolute cash guidance can. flow reduction. with kind number. I’d say, and, we to very But from debt refinancings free we that the we’ll reduction reduction did some that is at Everything target. the into as that well debt -- confident to And first cash leverage also worked guidance, that of call the worked did of happened going we better in our costs to of put or have of we the going And we’re some all, than debt flow are that we FX reduction. €XXX remember million our greater million. do just of out Christian, XXXX. we’re have assume we X.Xx ‘XX, We that --

as So challenge would or is realistic? the a judge billion, something you €X.X

but we’re Well, of low as I’m to is guidance try going telling as to can, kind our possibly we you or €XXX get million better.

we where €XXX for off should take million, and that’s So, be. million [ph] about that, €X,XXX of

mean what XX,XXX, be per on XXXX, I business. by right? X XX With peak, the in QX that we’ve are second top suppose, I in at is about would XX,XXX running roof. realistic be the ‘XX. mean would that like running years, you half? second If go a quarter. this makes other back things since XXXX, of going we’re second have I because for sense. That So demand incredibly automotive, normal if quarter? amount per Say a half I given the Okay. at And back past be you rolled my XX,XXX buoyant the were saying right, hand been this cars for through tons subdued question Jean-Marc, level? tons automotive Is

obviously, need shipping in guidance, year, any maximum our But quite right? never buffer. the that’s our tons a faster. markets included get possible there, which not right? Christian, is consequence. that So You in little if given and XXX,XXX means is up of So enrolled strongly as And a to automotive be products, you XX upside bit would capacity a quarter recover

Okay.

but automotive. full So talk know packaging your type going mean in April, XX of to I to capacity, -- quarter months, on your pretty I you’re at on, per products, on XXX,XXX like us much is right? you’re tons XX within rolled

Yes.

we’ve we’re why think leverage And about are be expansions. in Upmarket, times. and context good downmarket, I can mean any demonstrated medium to capacity, model remain meaningful of flow and will we going that target talking about that the require target, free us for again, in all delever through medium-term this capacity company we’ll that We some opportunities that. continue It’s I times capital want growth want think that we plenty economic it’s X.Xx investments to are that at attractive time. term. investment, the about leverage to more a to talking pretty recovery, situation, and actually pandemic, not maintain much very it the be even happen those in at a going long-term the generate right? that maintain cash target. level We of because to capital is we we’ll it’s And and bad but market a make to there all time around stay crisis, and want that’s

of from from Sachs. Karl Your next Blunden question comes Goldman line the

Just maybe for a question Peter. more

borrowing. teen you €XXX XXXX that growth the induced €XXX is you to On pandemic have to reducing the I level, your some but know right say you was for Would run million post been liquidity ambitions. with? million the the side, liquidity level the that company have

with associated needs You also supply potentially have some cap uncertainty. working chain

think you how the about is level what going wondering forward? just So right

But in at said I that. go type to in level. likely past, that’s at as comfortable be comfortable comfortably the interim. the than lower We’d very And think the company levels think the that we’d very we’ve we be at could I of I Yes. think even And run that we level. place very

versus what Okay. as you That’s as year, really lead about guidance. could the that helpful regard your just most this debt inflation variation with for to think at reduction. we are the And to look variables

models? So should through as mind we our work we on have what our

everyone to that. there. metal pricing Well, we’ve in on I a just is of remind to lot of remember Alloys, locked so a the pass-through kind -- think -- again,

our But not, we So that, thus is cost. biggest be of risk benefit cost from we’re And but hopeful is second we’re that -- we’re labor know going to there’s -- there. labor, some favorably. far, for which today -- obviously move we our still have Labor, has some price we and our labor on that to it increment contracts to is buy, ‘XX. where going but

energy. So should be in we And reasonably there. then good shape on

So energy, we forward. remember, buy

costs the is there. of energy given one We significant guidance are going some around say world built and we of that then than turn way our geopolitically, costs energy some have the would what’s if energy with increases year slightly maybe have transition place challenges the of just the in the on I things just higher into up curve some we with the could that and way. shaped needs the there going wrong to have that, some this see kind

energy, in So do in see you basically on the today? strip what build you prices, market just

Well, that have we were -- well, no, -- I we have we contracted. costs mean actual

So we what would for then is And outstanding, the we whatever in more something along build line those costs. in you’re factor is would saying.

Right, for the volumes. uncontracted

Okay.

this Constellium. at There CEO question over Jean-Marc will of it time. Germain, no to are further hand back I

all XXXX. updating can with you Thank everyone. Well, April very Muscle forward modern you otherwise, you on talk come and I the be good much, X, you we’ll thank hope to you to so to today, options. to on long-term Great much a and new have very establishing future available technology our and day. We Shoals, our much, look guidance

you call. conference participating. Thank today’s concludes for This

now may disconnect. You