Nemak reports lower 4Q 2019 sales and earnings

Nemak reports lower 4Q 2019 sales and earnings
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Monterrey, Mexico-based Nemak S.A.B. de C.V. has announced financial results for the fourth quarter and full year of 2019 that point to a significant slowdown in the fourth quarter.

Nemak, which buys and melts scrap metal to make extruded aluminum and aluminum components largely for the global automotive industry, says it sold 10.2 million equivalent units (MEU) during the further quarter of 2019. The company says that figure is down by 11.2 percent compared to the fourth quarter of 2018.

Nemak cites the “effects of light-vehicle production cuts among certain North American and European [auto makers]—in particular, General Motors, which saw effects of a strike in the United States during October.”

Revenue in the quarter dropped by an even higher percentage, 12.7 percent, “on lower volume and aluminum prices,” says the firm.

For the entire year, Nemak says 2019 volumes and revenue “were affected by the same factors as quarterly figures,” with volume down 11.5 percent and revenue decreasing by 14.6 percent compared to 2018.

The company did maintain a profit margin, reporting fourth quarter 2019 EBITDA (earnings before interest, taxes, depreciation and amortization) of $133 million. That income was down by 22.2 percent compared to 2018’s fourth quarter.

For the full year of 2019, the company says it experienced a 15.4 percent drop in EBITDA. “The company continued investing to ramp up production associated with new contracts,” adds Nemak about its 2019 operations and finances.

“Despite facing softer-than-expected industry conditions in most of our markets, we successfully leveraged efficiency initiatives to meet our guidance for the year,” states Armando Tamez, CEO of Nemak. “In the fourth quarter alone, we won new contracts worth approximately $360 million in annual revenue across our product lines, bringing the total value of secured business for 2019 to just over $1 billion.”

Continues Tamez, “In 2020, we anticipate that evolving industry and macroeconomic conditions may continue to generate volatility in the markets we serve. To address such risks, we will remain focused on optimizing costs and maintaining discipline in capital allocation through increased reuse of existing assets, while at the same time tapping into higher value-added opportunities linked to accelerating lightweighting and electrification trends in our industry.”

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Source: Recycling Today
Nemak reports lower 4Q 2019 sales and earnings
<![CDATA[Monterrey, Mexico-based Nemak S.A.B. de C.V. has announced financial results for the fourth quarter and full year of 2019 that point to a significant slowdown in the fourth quarter.Nemak, which buys and melts scrap metal to make extruded aluminum and aluminum components largely for the global automotive industry, says it sold 10.2 million equivalent units (MEU) during the further quarter of 2019. The company says that figure is down by 11.2 percent compared to the fourth quarter of 2018. Nemak cites the “effects of light-vehicle production cuts among certain North American and European [auto makers]—in particular, General Motors, which saw effects of a strike in the United States during October.”Revenue in the quarter dropped by an even higher percentage, 12.7 percent, “on lower volume and aluminum prices,” says the firm.For the entire year, Nemak says 2019 volumes and revenue “were affected by the same factors as quarterly figures,” with volume down 11.5 percent and revenue decreasing by 14.6 percent compared to 2018.The company did maintain a profit margin, reporting fourth quarter 2019 EBITDA (earnings before interest, taxes, depreciation and amortization) of $133 million. That income was down by 22.2 percent compared to 2018’s fourth quarter.For the full year of 2019,…