Constellium SE (CSTM) 26 Apr 232023 Q1 Earnings call transcript

Hello and welcome to the Constellium First Quarter 2023 Results Conference Call. My name is Alex. I will be coordinating the call today. [Operator Instructions] I will now hand over to your host, Jason Hershiser, Director of Investor Relations. Please go ahead.

Alex. you, Thank to earnings like to first our I welcome XXXX call. quarter would everyone

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

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

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

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

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

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

performance. recordable I like without X performance the on priority. and number delivered from employees safety for priority. sites start In per of to years critical want Slide we our to to a congratulate first on is But I case safety X safety the had our begin all focused and rate of with of never to number first accidents quarter up worked. a million the journey milestones best-in-class achieve X.X with quarter, highlights this hours recordable results. first remain would this quarter anniversaries the Let’s safety our we one excellent in a We need case. several all with on complete discuss

While was our accidents the performance and focused we our quarter have performance on we excellent, and in happen. always are safety maintaining still improving

first decreased last Turning financial to offset shipments we in quarter are XXXX our price was prices. year X% a to and exposure than in were due to mix more Remember while lower operate by metal changes by risk. tons, PARP. mainly X% improved model, which the compared prices, compared as XXX,XXX minimizes billion revenues our business lower €X results, metal price pass-through metal of down affected to shipments our to of Revenue

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

Our quarter net quarter million in compares first €XXX million in the the of of to income €XX XXXX.

below PARP to a record million slightly is decreased AS&I see million million, right, new quarter A&T EBITDA and EBITDA a EBITDA first of adjusted bridge the €XX million adjusted first last increased year, quarter. compared last new versus adjusted €X €XX year. while in EBITDA and the was can top record you the was the in on adjusted As increased quarter €XXX XXXX. quarterly

adjustments in versus end across and the chain year. with was up last shipments quarter Looking supply to XX% to our up rolled shipments quarter, were double-digits products the and end compared in Automotive shipments markets, very down aerospace last extruded demand. lower were strong, over across due Packaging demand in year. both the inventory

our protections, improved team inflationary more we But pricing execution by detail. in which thanks the quite power, discuss and significant to face our managing pressures well. to are will current contractual environment continue solid We Jack mix

Moving now to cash free flow.

expectations. quarter cash in the flow million, was which our with line free was in €XX negative Our

positive We and committed continue free generate to generating to greater cash than flow million. to €XXX deleveraging. free expect positive cash this flows of We remain year

right see can of quarter the end the slide, X.Xx down you X.Xx end on of As the our at year. from quarter bottom first was first leverage the the of or the last

first I Overall, of our very proud am performance. quarter

and remainder cash are we €XXX fronts, are geopolitical outlook, to macroeconomic range our we end-market in are current of there and while and optimistic and for forward, year EBITDA Looking about adjusted beyond. of positioning current million prospects the Based in and like €XXX on uncertainties performance the our excess our XXXX. free flow million the expect of million in we this raising our guidance our €XXX on and

remain to long-term our confident our of EBITDA target XXXX. over ability adjusted million also deliver We €XXX in on in

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

turn Please Value-added Thank Slide XX% last €XXX in thank Jean-Marc X. first everyone quarter you, was joining VAR or to now the the quarter, for up and revenue year. compared call million same to today. the you

quarter, mix our increase was Volume a segments. Looking each improved was headwind of in in PARP. €XXX million to to of shipments million of at this first lower €XX due the price due and

input the of performance period hardeners last same compared headwind as well in to metal as alloying Finally, quarter due impacts as such the to million and on a cost, €XX elements year. scrap weaker were inflation

balance to this There stronger the important dollar. FX from two tied The takeaways a U.S. of favorable are due change slide. was to translation

increment is and and variance by last second, XX% the power. price offset First, continue our pricing biggest revenue we And we us inflationary year pressures. year-over-year helped and to our have value-added compared grew specifically of to Price mix

Slide and was XX% X Adjusted million by million performance. compared of in of and on more and Packaging the than and as higher focus to XXXX. offset platforms in North PARP segment EBITDA year last packaging lower shipments year XX% Europe to up versus across €XX let’s chain with versus the quarter America due rolled decreased a to turn decreased supply €XX quarter our demand. of the quarter and Now last in first continue to headwind the automotive shipments shipments stronger. shipments increased specialty lower Volume new ramp Automotive inventory in adjustments products. appear generally XX% in both demand

was contract including and €XX Price a improved Muscle operating and headwind inflation pass-throughs. tailwind million mix price, result were higher our operating related due a Costs inflation, on to Shoals costs. of a favorable primarily of million challenges at €XX as of metal costs

of Shoals dedicated due translation, U.S new As hires, which has a quarter time. stronger million to in the recruit some last FX Muscle are quarter, will tailwind this non-cash, was we hard discussed and working highly is dollar. take we entry to been our but €X a

were Aerospace the Now quarter the the tailwind and increased of a Adjusted EBITDA a €X partially of XX% year Volume was contract Price the other including like pass-throughs there improved was a A&T to a dollar. with costs Costs stronger offsetting FX €X defense. versus of of and with million as million mix was million inflation tailwind last shipments by tailwind markets XXXX. lower in shipments. let’s X U.S turn industrial Slide million reflecting were in in were due aerospace. year €XX than higher certain markets a compared million €XX TID markets TID up continues. higher stronger of shipments strong aerospace quarter focus to versus recovery €XX in XX% a pricing, more production result of as a XX% to of in on slowdown on operating due last a aerospace and headwind Shipments inflation-related over to translation, and increases. mix offset first more segment. down demand

turn versus a EBITDA with and XXXX, improvement more shipments level. shipments tailwind €X €XX to Now as million Costs pricing, and Industry shipments tailwind related compared to of to to due higher offsetting industry million last year €XX improved the in quarter focus on inflation. to were primarily let’s XX% million inflation with in on we a the automotive Slide million the the were activity costs, AS&I X% in year. operating in increased segment. Price increased XX pass-throughs. €XX versus than lower due down of volume including XX% headwind was a experience shipments. higher last quarter contract of mainly mix Automotive quarter first Adjusted continue

want Now update we experienced an to these inflationary control to quarter, the are we Slide In offset business. facing environment as across where inflationary to give and and first current cost the on expected, turn XX, on pricing broad-based I significant pressures. pressures our focused are and and

it materially confident business so supply does some and largest model, security said, higher know, are market not remains the while supply, of of a to the are a we aluminum, we our As price cost. changes we alloy And other metal of about That cost in exposed input. come today. pass-through at tight you operate

higher costs energy. this will In particularly year, other and addition, be labor non-metal European also

As purchase basis, energy of the us has in of helped to previously and energy steep smooth costs. noted, helped pressures we to which forward a some rolling out on us the mitigate multiyear increases cost some

secured gas well today, XXXX energy higher average electricity energy Both still averages. their largely above but costs XXXX peaks, forward down have historical are Europe by the of As remain in our and prices. prices come from

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

initiative. on increase continue strong expensive Across Division XXXX, of cost our company, our efficiency, reduce consumption We focus inputs demonstrated will working execution relentless to years and continued in announced our past costs. the in have fixed XX lower we’re performance the including our previously and our

and of we as previously surcharge mechanisms, PPI our not. existing protections, where inflator addition, inflationary have many they do were as such noted, In contracts

to include coming pricing with We’re signing them, of new contracts, working we’re range protections. where inflationary customers our and with better a they’re

good of very all end our markets. made have We across progress

of increment As the in with the pressures. first pricing price year, on you the were being quarter the and right, successful mix, see largest very bridge we can offsetting in inflationary this

we €XXX cost As to XXXX. we pressure close run last in inflationary million expect quarter, mentioned to

of XXXX other be We including believe that our increases offset inflation actions relentless and of to periods. pressure to we are that guidance The know cost will we in impact the in of focus tools this most XXXX. and combination With offset able cost on net them rest taking the were a to in control. future the for cost continue our

discuss turn our free Now XX flow. Slide to and cash let’s

reflects mainly €XX in flow Our first and increased negative quarter in a with expenditures The working million line expectations. capital strong our EBITDA in result capital. the by adjusted which free offset the higher was was cash quarter

full generate cash €XXX flow at second expect the half. we more expect million for of the in to XXXX, to excess Looking free towards continue year, weighted which we to be

last the and half second use working based of the expect a for capital cash noted of roughly As the and in current in quarter, on we be full year, neutral year. the first cash source we to half a of forecast

in line our taxes cash EapEx, and expect with previous We cash interest guidance.

to turn cash to Slide of balance the XXXX discuss let’s Now slightly end the given At net free quarter, liquidity our of flow the €X.X end of billion debt position. first sheet compared XX. And quarter. our the in increased the

Our of XXXX. X.Xx quarter leverage end target the X.Xx X.Xx of range first at of We average remain maintaining achieving at the leverage end versus of our of our X.Xx target quarter, the we’re to and first long-term X.Xx. down the remained committed to

debt we our our maturities see remains the end first until as no can summary, liquidity you million XXXX. €XXX And of strong bond the of have quarter. as As

the progress have we structure very capital flexibility made and we’re of of building. the We’re our proud financial

hand will Jean-Marc. call now the back to I

Jack. you, Thank

continued in on our packaging, Let’s and both packaging, the with XX supply and across market current chain Europe. America outlook. adjustments discuss Slide do the in inventory end North Starting

of see We a following during in result lack COVID. growth weakness promotional are rapid some as a a environment, activity signs of inflationary of both of and regions to period demand current the multi-year starting

and We in investments in end given North Europe. are capacity grow market, preference and aluminium long-term in both this expect the America can. low beverage regions consumer announcements confident both markets Longer the makers here of sustainable North for digits term, we in America for growing additions packaging mid-single though recent to the outlook can Greenfield to

in Day both in regions this Analyst participate announced will last our year. We as growth at

highly is we Shoals take challenges company on so market As in we have the been America. that operating Jack the North dynamics Muscle experiencing the of at stabilizing focused noted, end advantage can

over recently seen in encouraged and have plans course and very XXXX. remained performance the ability the restore profitability Muscle to confident We’re by of performance Shoals, the improved we our at

continuing in numbers Turning at low levels, to books. automotive. production base a now are sales and pre-COVID still uncertainty order OEM compared to with globally the

drive and market increase demand products. continue very for and inventories will sustainability high, However, in PARP reason demand low, of will to trends for gives vehicle consumer use remain electrification positive AS&I in and and aluminium optimism. us lightweighting demand this remains are Automotive and

the for pre new, in increases up the year, build The driving the quarter, Major over demand and those short-term shipments Let’s that remain XX% turn last remain OEMs for now passenger to traffic levels. in still continued rate We in aerospace desire growing have below with fundamentals versus announced aerospace greater aerospace. in increases demand including long-term the recovery intact, further more the medium-term. fuel-efficient aircraft. and confident COVID

is and the markets, Defense demand in regional markets. jet and addition, strong In business the Space and

it As left XX the the past, each page months fundamentals our options a markets us. affords we the three in XX% of our on said like and of chart like have I core highlights as side hand the in end revenue. the last these We and represents

lastly other Turning specialties. to

has these many still an markets summary, specialties play that rail. dependent plate for In for specialties markets health in North Demand other and rolled in and in markets sectors much region. In supporting of serve. and industry believe continue here While remains general, more the see In the the resilient weakness well. is than strongly are North like America. transportation like markets company. demand on as of also economies the we industrial markets and the solid in in other In It in we at in very the And solar extrusions our do products, of like in prospects our engineering like demand general in many end we Europe. of is core markets. strong remains note strong each are is demand growth construction, TRD of been in in and sustainability diversification America building some our segments end that we trends to asset defense

Let’s tremendous trends turn highlight I us want to that we market several see for to favorable our future. Slide XX, opportunities where

benefiting the part driven you serving sustainability markets the the see growth. secular and of of can from As on table in slide, majority currently our is left today the portfolio durable

takeaway secular that important catalyst the is here The is aluminium behind a growth.

infinitely and lose recyclable, Given does its its is attributes, recycled. aluminium when not sustainable properties

result, the electrification a in of be driver packaging. As critical a circular and sustainable will in play growth will and a role lightweighting economy aluminium

and XXXX. As up is we mentioned capabilities. at in grow we’re before, building underway and recycling ramp our on recycling continuing track [indiscernible] started to are we well invest for center The we

growth We supports environment current regulatory our also of believe further the long-term the products.

billboard. Europe more recyclable electric and packaging, vehicles, is aluminium America easier For of the The is beverage the provides store profit. at aluminium increased focus example, recycling. consider the in than container the cans as adoption superior today, can currently a a provides legislation the in shelf both better recycled tool plastic It supports both consumers and using cans choice. and on transport North as a glass increased of is be In and brand It it to can marketing utilization and lightweight, and stores. owners

inventory a chains, to and Aluminium we inflation. signs across glass. substrates weakness in reducing demand in and corrections as of also in Even across result like end multiple where extend packaging continue cans range vehicles cans also of engines and battery Lightweighting internal today’s some critical seen have Automotive outperform are other markets recession vehicles. combustion environment, lightweighting opportunities significant plastic Aluminium to resilient. to with is the emissions for supply electric creates

in a aluminium as have uniquely amount SUVs, average growth sheet like sustainability. legislation internal as and the engine and Xx aluminium and vehicles than America and growth and electric positioned opportunities highest our solutions. both capture aluminium of with well to result, today combustion more in by fleet share and exposure On both positioned More secular rolled to accelerates Constellium well customer of automotive. traditional opportunities all battery to greater counterparts. extrusions premium to incentive. automotive Aluminium Europe, is their continuing which extrusion-based of electric for vehicles content, portfolio more is to tend used and gain diverse going by the X in and the is is balanced the with in Constellium as which Electrification is trucks North fueled supported

key team, XX, achieved first inflationary challenges, Slide as proud despite of performance operational solid cost pressures. to performance we detail of Constellium I’m quarter. very the a strong control including strong we now and and financial in entire have delivered guidance. Turning our messages number significant our

be year, will we XXXX challenging another European forward Looking inflationary the given on pressures extraordinary facing, particularly energy are costs.

experienced our and remain Jack to we we inflationary confident rest and those in in to our comparable XXXX. million. future €XXX we million these noted, now XXXX, in raising costs periods. of EBITDA in expect excess in of guidance XXXX million As are XXXX, on flow in currently are through ability pass most to and €XXX outlook, the current of cash But expecting for €XXX free we Based range in pressures our the adjusted

reiterate on adjusted of I million let of €XXX today. to energy prices of XXXX. higher I’ll by target our these current X.Xx. based is And EBITDA also add me of guidance X.X energy want And our including positions, to range long-term as of leverage guidance in form excess

As we we emerge believe even inflationary subside, will stronger pressures an company.

remained the of Our portfolio. demonstrated grow end cans consumer aluminium ESG generating infinitely execute on enhance value performance, different flow, operational substantial confident And range we automotive our for with diversified provides on focused recycling. success. strong The sustainability ability a will growth conditions. our I its Constellium business foundation And free to of to across preference, strategy, has trends, believe We achieving in our to increased will business a creation. cash as market market we am have electrification enable of focus and shareholder recyclable do fleet, profitability model team lightweighting the and And and opportunities long-term objective us and driven positioning driving transportation, to or returns and the our a take secular so. continue we executing advantage such resilience

In Alex, about please. very conclusion, we our With will future. optimistic Q&A that session I remain open the now

Thank Please Goldman go line ahead. you. today from Our question your [Operator Sachs. from Instructions] Emily, comes Chieng open. first Emily is now for

about morning, with little wanted Good start know talked cycle. thank you Jean-Marc I to I the you’ve destocking and markets. for bit the a packaging Jack, update today. the

But risk in quarter, for you Where think what of you is this the still I seeing in Constellium in at internal year, this there last and contractual mentioned any your specifically, customers, in targets packaging point, also thresholds a given view confident volume place. stand you’re were you meeting to does destocking cycle? that have there?

morning, Thanks for the good Yes, question. Emily.

is So clearly no pricing we end we targets. as low income confident of strong I within end in One And been four because due remain But our is only disposable you where, they not for see ability the them, is our weakness on squeezes the – are weaker. And packaging, of in late, very consumers. that beverage stocking, inflation, but beverages some that’s mentioned, promotional the I are activity that to cans, But arrangements the general. to our with in variance the factors. seeing towards two customers more results achieve internal think companies there’s demand. of importantly, allowed volume these is for contractual in and but

our will place believe this the the bit lower and a expectations, wise. I where challenge So year the a is of of in of we’re our be little towards But expectation be market volume will think end growing still over we medium-term. a

the labor were asset And maybe was see any better but weakness, issues profitability? other or to just some you I posit inefficiencies asset. mentioned should that there question, just Shoals labor second the time a we shifting little over there driving know gears Muscle expect that were operational inefficiencies will Understood. as a

to we to we maintenance yes, since we guess, of well. since year, few on people, have by so as be less the earning train recovered the as are schools, open are are the I we and time positions, of fall, a the the takes Yes, making expect mentioned, progress, assets on end lot I spending the it recruit

that automotive, solid year. PARP financial operating setting we dashboard, versus the of look sheet instance, us and that that’s for of can when mentioned, variance this is of take performance But you we’re as our weak, return the at The performance when And terms the even plant. indicators, green that to is well, beauties So we’re at will lights and of of the our plenty last in markets to a year, a is in the seizing. performance if opportunities other and I quarter think foundation – there’s in we look so our where, end in signs model we of allows that’s that though, opportunities by other versus the on headwind last well, there’s one not market performance one doing more diversified cost more seeing year. can encouraging for

I’m I I’m quite seeing before will end the very saying typically, financial what performance be but – by improves think operational And good place. truly So a performance year, but encouraged in improves. the of

you. thank Great,

Thank you.

question comes a Our of Suisse. next from Woodworth Credit Curt

is now ahead. open. line go Your Please

Jack. Great, Jean-Marc and morning, thanks. Good

Hi. around. the is it’s guess to around question guidance. First changes I

like a seeing €XXX perspective, it seems you from million still are target. So cost

You decline. the did I’m seem strong to for this you then more getting it very towards of were just like the we changed cost, meaningful quarter of respect gave And does kind with update price from guidance. the end last maybe has year, price curious what raise mix XXX. looking you’re

pretty run a intimated that’s So this be But year. would that cost you rate. seems you like still it price strong negative

give what the color any also guidance. net So embedded could wondering in I’m us if think price just you you is on

Yes, thank you Curt.

your So give little first let with here. That question. you color will me bit a start

the of favorable we’re expect, and, of really likely the we continue into And the of used the to that, kind we industrial are demand, the as some we other as than seeing. expected, and some the of of kind just aerospace trends finished will automotive aerospace of QX, as second segments stock trends, sub and into for also in well better to think, was should could to it continue where It perform, what quarter the automotive not this kind a do had markets. given little I quarter, markets visibility can some last lower within

cost remember, well you pressure from inflation, aerospace have continued and and also the from businesses. given our the activities, Ravenswood So, as of automotive as strengthening

we really we explains kind the year. changing guidance. that of views then of fundamentally on the to why think, that’s existing did are your not out, And the second I inflation, confident So, to ability call we’re the outlooks half and let’s, we expect And side, power our that for, on to cost we some levels should pricing second of question, have. into about one our €XXX the quarter as high of the million, kind see as has of are well that, but in with cost we we to,

think, what negotiating that with months our I would nearly have kind enough of we wave wave job or if six back, we Curt, big year, And our what are assessment much because would less thinking see better And we customers we months to pass that supportive. last inflationary late And that’s be we we’ve we three of through, to in going we teams pressures, I been we customers, got at And step are quick when be have we a through. were it can ago. months see significant I ago than excellent of is why very a there can pass job but pinch. prudent, as no through, in that passing on the through which it done we where, question at are mind in we outcome, thought a pace pass place an impact think it in six and our do that can this XXXX big after of seeing

Okay. as And one me then well. follow-up packaging on for

and you incremental So, I Day to of I that talked up tons were sheet years. contracts extending to estimated think of X by these can ‘XX years XXX,XXX Analyst duration X about, being at the ultimately think

comfortable contracted still comment in XXX you in can have that, been you number do around that, XXX some you of capacity, time, that beverage I the outs CapEx push can quoted? So, point much you, in on the how Thank obviously, then side there the feel think guys. and at to this you have

Yes.

year Day, sheet. XXX additional last communicate can volumes of did we Analyst So, the at in tons

rate because Now, the a because that’s in that’s ramped run a number, But up. of it’s ‘XX ‘XX.

XX% to are on We XX% those. contracted

in there some within you the As so bit know, lower, lower, commitments, contractual can a not weakness but persists. come if little we is variance meaningfully

capital automotive products the we use about the the very feel have. line, So, And that comfortable going plans lines the finishing you see automotive. as the for are after we deployment these lines this same to market, remember –

So, that we and to of in in use decide versatility terms optionality terms have capacity. where we

So, we are very contract. about to And close the XX% essentially outlook. we feel good

much. very Thanks Okay.

you. Thank

Thank you.

Wolfe Timna Tanners next Our question comes from of Research.

Your line Please is open. now go ahead.

Hey. morning. Good

Just a few you percentage follow-ups the on with your pressures think you that of tonnage cost on. regard to pass-through can

periods, alluded is a XX%, of XX%, pass-through I spillage further talked to past, about that into XX% you you the of reference? have XX% still given think time in costs you know could good in a year. frame some I And

Yes.

presentation. to And directional, the are XX you good. it’s it’s we on you can think I variance see Page as chart, but on referring see the the that, of

XXX. in the booming inflation an aerospace all a bringing see people price only, variance price. so XXX, see you it’s demand. XXX. You of There is in of other in we in not because There element factors are more of it’s cost an of and And is transportation instance, a And mix mix like, there, and right. variance for the

most show it sure the our spending We inflation pass-through numbers the I to as more ability are period. that’s, of make we overall of But on and the facilities to for think it ready following the maintenance rest future. happens, yes, our are in the in

can of those to would laid again, it you be the with talked an you across I of expansion can sheet board initiatives initiatives the you know growth And Investor about, us update helpful and for thought some some broad Great. that had Curt, addressed that Day back other give Okay. I the then just with you to, but go out us?

Sure.

So, those we for €XXX for initiatives the of EBITDA the guidance are XXXX. million over foundation give really

seen by different XXXX, elements would look the I there, year, can we for roughly talked sheets, at it’s tons, so if XXX,XXX maybe So, that right. be market, about the

markets For I may would that how XX% And essentially. the go. mentioned, are of That’s But expenditures that, variable. and ready most as get to there money spending depending for why bit maintenance XXXX, be good capital that’s very that. of contracted a on the And about. lot little something we feel we be on variance that’s – I feel think of year is a we

good about feel we So, it.

lining is in you is, there we the cans because bit little weakness two is overall, behind packaging given things. think silver One situation market materials much than I down get other are. cans. the a of here are But current more the the beverages, think I

So, that for consumers brands are that and preferred. cans that shows the the

The recycling, the the legislation or there to they but recycle more, on a is, be know not plastic for as package with cost the more because don’t. other waste, and – And focus means recycle, packages. recycle also to have preferred there are more will less other they and only other aspect that and to push used cans cans more than beverage we will need its that recycling what aluminium lining glass we pays is for is increased silver more

beyond and strong, could long tail So, fundamentals the are it very horizon. I have well think the very a here XXXX

behind to after good can for I our bit targets very feel there come little and meet we think we now, even They think are though is that. sheets. XXXX, a are I we So, in more will

how couple budget, on that’s above recycling construction a was we are just it’s big it is excited Now, I amazing exciting. ground, now moving started it’s going so It’s months on initiative about visiting that the very be ago. time, have to the we we other of quickly above very it. is centre, ground, have

end the it. it we recycling start up announced be And see And up ramp again, to better more tremendously being of attractive Europe, financial terms in mandated we to We very going quickly. ‘XX we it at returns I will us. likely and of think be will when what opportunity in thought a it’s than for that’s

so growth continue Biden strong essentially on pool effect market, mean the positions I are Airbus I aluminium, going vehicles we the that. And of administration continued few Boeing see market. electric got we a and going think if by accelerating the an ahead the every the to demand. I years. So, markets for Then seeing has end automotive, next recent good on which to for the very are in about other OEM And at the of look the when in and turbocharging, announcements that’s look And at good have that’s we aerospace we adoption us. with up

gains. So, best you are ahead. winning and we aerospace are – awards I we consulting from makers seeing market Are numerous plane think these is this are share in supplier we as

a about answer, we think and place. we long feel And my I our know but… your question good so don’t very we why comfortable that’s we if – answered XXXX in are So, I in Timna, guidance.

an Yes. I very wanted great. you just update, much. that’s so Thank

you. Thank Okay.

you. Thank

of Blanchard from question Bank. Our next comes Deutsche Corinne

Please Your line is open. go now ahead.

expect that and Hey. XQ. Would Good this packaging to morning intermediate am team. or that Jean-Marc just to expect higher be the going have still normally seasonality seasonality do through? back and are you muted and seeing. you to year, I XQ coming you go the in see relatively trend We on

heard the mean half of Corinne given seasonality business. I But yes, the the sure question in first not I am strong exactly. typically, the you stock can I So, have

right, year lower phenomenon have that’s do this we happening, Now, demand destocking and that’s and continuing. factor this

bit We are we the QX, going volume. to are a seeing going on second into in have But that’s of little hopeful, come back it impact so to that’s half. continue to

run was drive paying that. used is I for I I store which it the will to at am what and is think local day, €X, whether it now. promotions get other unknown companies I what’s going to €X for still beverage really, on the my

the some were are spur used will I from think I So, demand, if not, more see. standpoint seasonality we think promotions, there that’s environment If more to they change. be going are that’s much what a than a to muted

Can I It then wait segments follow-up a Steel was Dynamics, like you like do competition, announcing you think or been makes sense. comment maybe? expected. for maybe have which in on than coming expansion sooner and the maybe you, further And or market any see capacity

Yes.

don’t you the are an more are in as we believe know we as what capacity. industry the Dynamics. you I North Steel mentioning a our supply-demand of mentioning America need So, specifics projections, But announcements about

do and customers and needed provide competitive, of to because automotive substantial believe capacity makers in can can the that So, we are levels good share a the or growth both see not we is that would which imports service very our of need.

that needed. we So, is capacity believe

it comes contracted Now, XX% when XXXX. than sooner are if it that I be a through more problem. we is exactly could needed But mentioned, than as

through And good feel XXXX. we contracts that very run place. So, have we are in got we a

like we good a we So, in are very place. feel

Great. you. Thank

comes ahead. Sullivan Please Benchmark now [Operator The your Josh question Our line Instructions] go Company. from next open. Josh, is of

Hey. Good morning.

morning Good Josh.

far aerospace there about customers, products based talk the than faster your mean might Airframers We results? Just demand, record some for driving broad that lithium Does stocking across near-term products? material seen the AXXX. have that accelerating the any is as as inventory other suppliers particular other be and aluminium platform is

rates. a growth. back So, see just key come driver the with substantial driver may increase yet. AXXX still It’s Josh, – as for we build may narrowbody not as

I broad We COVID, shipments, XX% XX%. the demand. production based, by only will remind by through that, our are when really build much our down down more you seeing rates went went we went when it’s

going of how is seeing difficult is element happen. what to through to product. long am needs there that about, the an chain very we think is I It out it’s So, are run I restock. to to restocking supply know take going to worried being But not everybody of

what this time, So, below accelerating needed But growth the are are that still the announced rates by same is at is that to we the needed. OEMs. meet shipping the is build really

for ‘XX. like passive is there for longer opportunity us feel a ‘XX, So, we

due should just And the catch to think to up full shutdowns SAR growth recent relative In the one Constellium then kind the of we relative how versus automotive production chain just year various inventory of of that and organic side. restarting plant for supply on XXXX, strength expectations? of number issues, the some automotive to

North And and X%. a of kind the factors, into X%, play. that’s is think here SAR one come aluminium. result Europe is something penetration And which both year – gap of number continuing I is see what digits. to expectations And that the are, America further but a full so, And of of important we we are double growing

ability And sold we So, we yet. pretty feel just are maximize the good out assets. to of not our automotive fully about use our

we So, going next some nice into is there upside think year there as well.

Got it. Thank you for the time.

you. Thank

Thank you.

Constellium. next of line question Our Please go Wondrack Sean open. now from Sean, comes ahead. your is

Hi, you Jean-Marc and Thank for taking my… Jack.

know DB, still way. the are at you by We

there. Less

sort looking what the of you that versus gave increased your just you outlook that today, it’s changed prior see guidance, to So, has great us?

Yes.

there like and feel still around in some still – increases. really older to geopolitical uncertainties So, The months around our aero uncertainty short, of and the see I strength us pass-through not be price – in auto, nine the first of books in we for our right. guidance, more quarter there we are but think the our we to earlier, lot a as beat to the comfortable, Jack mentioned We go, for enough whilst But our be are segments packaging. the environment. tend this clearly is helps changing instance, ability

to promotions going have are summer. in not We or the

upside yet nine about good are it the real next very but guidance, we our increased not months. feel we to So, calling

easing fact trends the a lower inflationary be think – might you do packaging little? that be the their to guys might some And seeing prices pack willingness inflationary Great. increasing

Possibly. hope Yes, I so.

across just the some other then cost… And of Great.

if would I be sorry. am I it happened. was upside an saying that

inflation but has other any And in buckets? know, sense. I other Great. areas? within then been of That seen up, or makes labor maybe freight cost just have easing you you your have mentioned any

Yes.

it’s no, Europe. I mean side the So, on energy in

it’s prices, right. broad down bit, really look at that’s it it’s big base, still above the of really but And a come inflation, think well you historical spot little did a If kind averages. I and category,

etcetera, tremendous So, labor, seeing other still like buckets, coatings, so. alloy, on are we pressure

then Okay. cash apply or ahead. you Thank have flow to it’s you outlook. that you see cash great think to forward, cash flow go allocate are it? What going sort build kept free going plans Sorry, you. of your And to free your do would that just

think mean, so And the this priorities a has little nothing allocation bit, us, goes capital Well, I for into I right. changed.

priority. And We still is take priority remains to our the spending leverage than the generate to returns more for that remains to But additional X.Xx. shareholders. on were down Our cutbacks deleveraging priority. X.Xx, our less returns,

past flavor. So in we pay-down, couple and is different from that ways. the One gives that comes a and growth, secondly, earnings a so debt from in deleveraging of mentioned you

you very for Thank Okay. much my taking Great. questions.

you. Thank

Thank you.

Jancic comes question from next Our from Katja Capital BMO Markets.

ahead. go Please open. now is line Your

taking question. you Thank for my Hi.

be ton, either quarter. to A&T over this the very quarters? how quarter, ton, the the think on I we margins, And about somewhere strong that you few forward should per between going quickly Just should €XXX think business or mentioned €XXX was last offered margins segment, next it

this to So, stellar achievement. obviously, A&T a had of have the and stellar proud performance continued performance, quarter very

aerospace I favorable, and really TID is continued strong. the up also that mix holding TID, if quarter more pull more margin pretty aero, think makes part portfolio, reflects from first aero within the customers, and sense of also business so as but aerospace

quite cycle, down flex the kind that So, benefits fully – time I But this in the the not in the of has all it that’s of cost a in the business up, margin stay and remember in beneficial last environment business caught saw year, was today, strong. we for are that up-cycling remember – expect one in like some quarter and COVID, up-cycling year, obviously, environment throughout over do the for Katja, think We unit, that’s to bit continuing still actually during and last of of terms cost to year. of up but margins. is fourth very this should business we catch

division, for will XXX the is And in are aerospace XXX be range. aerospace Katja, seeing market and I of the we now. what that up going kind strong across above a words, think transportation to cycles an other very average that’s in So,

through to cycle. this expect we the above XXX to So, be XXX, year for average would the

Thank much. so Okay. you

you. Thank

you. Thank

you. Thank

We further remarks. And Jean-Marc have for Germain I questions. to no any further back hand will

Well. Alex for Thank and everybody you participating thank you, today.

delighted are the quarter. performance our first We with in

for foundation better you I think it’s everybody expected a good and strong stay Goodbye. and a XXXX. Thank safe. than

for you joining Thank today’s call.

lines. You may now disconnect your