Kaiser Aluminum Reports Strong Financial Growth

By Bobby Samwell • Friday, February 23 09:58 • Permanent Link

Kaiser Aluminum Corporation has just released its 10-K report. The company engages in the manufacture and sale of semi-fabricated specialty aluminum mill products in the United States and internationally, offering rolled, extruded, and drawn aluminum products used for aerospace and defense, aluminum beverage and food packaging, automotive, and general engineering products.

Financial Metrics and Business Changes Reported: The company faced challenges due to force majeure declarations from primary magnesium supplier and operational challenges at the smelter, impacting Warrick's operating efficiency and financial performance. Kaiser Aluminum's supply base is now diversified, not reliant on any single supplier or geographical region. * Despite challenges, the company believes it ended 2023 in a solid position and has ample financial resources, including $599.1 million in liquidity as of December 31, 2023, and a strong capital expenditures budget, to implement growth initiatives.

Outlook: Kaiser Aluminum expects demand to continue improving across key markets throughout 2024, with strong momentum in Aero/HS Products and modest recovery in Automotive Extrusions demand. Conversion revenue for the full year 2024 is expected to improve by 2% - 3%, with adjusted EBITDA margins to improve by 70 - 170 basis points over 2023.

Results of Operations for Fiscal 2023: Net income for 2023 was $47.2 million, and adjusted EBITDA increased by 48% to approximately $210 million compared to 2022. Net sales for 2023 were $3,087.0 million, reflecting a 5% decrease in shipment volume and a 5% decrease in average realized sales price per pound. Cost of goods sold (COGS) for 2023 totaled $2,754.9 million, representing 89% of net sales, compared to $3,180.2 million, or 93% of net sales, in 2022. Depreciation and amortization for 2023 was $108.6 million, compared to $106.9 million for 2022. Selling, general, administrative, research and development (SG&A and R&D) expense totaled $122.7 million in 2023, compared to $110.9 million in 2022. The income tax provision for 2023 was $9.1 million, resulting in an effective tax rate of 16.2%.

For more information, read the company's full 10-K submission here.

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