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Gränges Interim / Quarterly Report 2024
3055_10-q_2024-04-25_81939518-605c-44f3-9d38-c388f0b89315.pdf
Interim / Quarterly Report
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Robust start to the year
Interim report Q1,2024
Highlights
First quarter 2024
- Sales volume increased by 1.5 percent to 122.0 ktonnes (120.2) and net sales decreased to SEK 5,428 million (5,968).
- Adjusted operating profit1 amounted to SEK 356 million (401).
- Adjusted operating profit per tonne amounted to 2.9 kSEK (3.3).
- Operating profit was SEK 356 million (401) and includes no items affecting comparability (-).
- Profit for the period amounted to SEK 237 million (254).
- Diluted earnings per share amounted to SEK 2.23 (2.38).
- Adjusted cash flow before financing activities2 was SEK 95 million (287).
- Financial net debt was SEK 2,964 million on March 31, 2024 (SEK 2,741 million on December 31, 2023), corresponding to 1.3 times adjusted EBITDA (1.1 times on December 31, 2023).
- Total carbon emissions intensity (scope 1+2+3)3 decreased to 7.4 tonnes CO2 e/tonne (8.9).
- The share of sourced recycled aluminium increased to 45.5 percent (37.5).
Strategy & long-term targets
Gränges has established a long-term plan for sustainable growth, Navigate, involving three steps: to restore profitability, to build a world-leading aluminium technology company, and
to invest in sustainable growth. The plan also targets continued fast progress toward net-zero by 2040. All this is based on Gränges' strong company culture and committed employees.
Profit growth
Average annual operating profit growth
10%
Profitability Return on capital employed
15%
Capital structure Financial net debt normally between
1–2x EBITDA
Dividend Percentage of profit for the year
30–50%
Climate
Scope 1+2+3 emissions by 2040
Circularity Recycled volume by 2030
| Summary | Q1 | 12 months rolling |
Full year | ||
|---|---|---|---|---|---|
| SEK million | 2024 | 2023 | Δ | Apr 2023– Mar 2024 |
2023 |
| Sales volume, ktonnes | 122.0 | 120.2 | 1.5% | 465.1 | 463.2 |
| Net sales | 5,428 | 5,968 | -9.0% | 21,978 | 22,518 |
| Adjusted operating profit¹ | 356 | 401 | -11.1% | 1,491 | 1,536 |
| Adjusted operating profit per tonne, kSEK | 2.9 | 3.3 | -0.4 | 3.2 | 3.3 |
| Operating profit | 356 | 401 | -11.1% | 1,531 | 1,576 |
| Profit for the period | 237 | 254 | -6.6% | 993 | 1,010 |
| Earnings per share diluted, SEK | 2.23 | 2.38 | -0.16 | 9.31 | 9.48 |
| Adjusted cash flow before financing activities² | 95 | 287 | -67.0% | 2,633 | 2,826 |
| Financial net debt | - | - | - | 2,964 | 2,741 |
| Financial net debt/Adjusted EBITDA¹ | - | - | - | 1.3 | 1.1 |
| Return on capital employed, % | - | - | - | 11.8 | 12.2 |
| Total carbon emissions intensity (scope 1+2+3), tonnes CO2 e/tonne³ |
7.4 | 8.9 | -16% | 8.1 | 8.4 |
| Share of sourced recycled aluminium, % | 45.5 | 37.5 | 7.9 ppt | 43.6 | 41.6 |
1 Adjusted for items affecting comparability, see Note 5 for further information.
3 GRÄNGES AB (PUBL) INTERIM REPORT Q1, 2024
2 Adjusted for expansion investments and acquisitions, see alternative performance measures for further information.
3 Carbon emissions (scope 1+2+3) are defined in accordance with the Greenhouse Gas Protocol, see Definitions for further information.
Gränges is a global leader in aluminium rolling and recycling in selected niches. We're committed to creating circular and sustainable aluminium solutions in partnership with our customers and suppliers - for a better future. Our solutions help customers grow and transition to climate neutrality. They are used for efficient climate control in transportation and buildings, electrification and battery components, recyclable packaging, and more.
Back to volume growth
In the first quarter 2024, market demand stabilized as downstream inventories gradually normalized in most sectors. Stable demand in automotive overall – and strong in Asia – and recovery in other markets compensated for lower-than-normal pre-season shipments to HVAC customers. Our strong focus on market share gains helped drive a return to growth, and sales volume increased by 2 percent. It is very encouraging to see these first results of our intensified sales efforts.
We also accelerated our productivity work to offset customer price pressure and wage inflation. Combined with sales volume growth, this yielded an operating profit of SEK 356 million, only slightly below the strong first quarter 2023 adjusted for energy cost compensation.
Continued progress on Navigate plan
In parallel with our focus on market share gain and productivity, we are systematically executing our Navigate plan for long-term sustainable growth.
An important part in Navigate is to increase circularity and decrease our carbon footprint to make good on our commitment to net-zero by 2040. In the first quarter, we achieved a 16 percent reduction of carbon intensity, and an impressive 45 percent recycling rate. We're quite proud of these new records.
Such improvements do not happen by chance but are the result of hard, systematic work on many fronts. Our investments over the past years in recycling capabilities in all parts of Gränges enable larger recycling volumes and higher efficiency. Our technical and operational experts optimize alloys and production methods for new, circular aluminium
The return to growth with good profitability in the first quarter strengthens our confidence that we're on the right way.
CEO COMMENT
solutions that maintain the high quality and performance required by our customers.
We are also building partnerships with customers and suppliers who share our sustainability ambition. In the quarter, we deepened cooperation with aluminium recyclers in Europe and Americas, secured 100 percent renewable electricity for our operations in Newport, and made good progress in our joint venture for low-carbon aluminium in China. I am convinced that these steps and others to come help build a strong competitive advantage for Gränges, today and in the future.
Second quarter outlook
End-customer markets remain hard to predict. However, a more normal downstream inventory situation is expected to contribute to somewhat stronger customer demand in the second quarter 2024 than in the same period 2023. We continue to focus on market share gain. In total, we currently expect sales volume for the second quarter to increase by a mid to high single-digit percentage year over year. We also aim to continue offsetting any further price pressure and continued wage inflation with productivity.
Clear direction for the year
Our focus on market share gain and productivity will remain unchanged throughout 2024. At the same time, we will continue our long-term work to build a world-leading aluminum rolling and recycling company. The return to growth with good profitability in the first quarter strengthens our confidence that we're on the right way. I would like to thank the whole Gränges team for once again showing that we can make it happen, together.
Jörgen Rosengren President and CEO
Coil storage at Gränges' production facility in Finspång.
An important part in Navigate is to increase circularity and decrease our carbon footprint to make good on our commitment to net-zero by 2040.
Gränges Group
- Challenging but stabilizing market conditions
- Improved cost productivity and good metal management
- Working capital management strengthened cash flow
Market development
Gränges is an aluminium technology company and a leading global supplier of rolled aluminium products and solutions for thermal management systems, speciality packaging and selected niche applications. Gränges' key end-customer markets are Automotive currently representing 43 percent, HVAC representing 18 percent, Speciality packaging and Other niches representing 17 percent and 21 percent respectively of sales volume for the last 12 months.
Short-term sales to the Automotive industry are primarily driven by the number of vehicles produced. Mediumand long-term, the increasing share of electric vehicles is expected to have a further positive impact on demand for Gränges' products. Sales to the HVAC industry are influenced in the short-term by consumer confidence and the general activity within building and construction. In the medium and long term increased requirements on energy efficiency of HVAC units are expected to have a further positive impact on the demand for Gränges' products. The demand for
materials for Speciality packaging tends to be relatively stable in its nature and sales to Other niche applications are largely driven by the general economic activity.
In the first quarter 2024, demand from Gränges' endcustomer markets showed a mixed development. Sales to automotive customers decreased by 1 percent compared with the same quarter last year. The positive development in Eurasia was offset by lower sales in Americas. Sales of HVAC materials decreased by 13 percent, due to lower than normal pre-season sales to HVAC customers. Sales of Speciality packaging materials increased by 6 percent in the first quarter, and sales to Other niches increased by 19 percent following a normalization of downstream inventory levels in Europe.
Sales development
Gränges' sales volume in the first quarter 2024 increased by 1.5 percent to 122.0 ktonnes (120.2) while net sales decreased by 9.0 percent to SEK 5,428 million (5,968) compared to the
External sales volume growth Q1, 2024
| End-customer | Automotive | HVAC | Speciality packaging |
Other niches | Total |
|---|---|---|---|---|---|
| Gränges Americas | -17% | -13% | 10% | -9% | -7% |
| Gränges Eurasia | 2% | - | -9% | 38% | 10% |
| Total | -1% | -13% | 6% | 20% | 2% |
| Share of total sales volume, rolling 12-months | 43% | 18% | 17% | 21% | 100% |
GRÄNGES GROUP
same quarter previous year. The decrease in net sales was primarily driven by a lower aluminium price and a lower average fabrication price. Changes in foreign exchange rates had a net positive effect of SEK 52 million.
For Gränges Americas, the external sales volume decreased by 6.8 percent to 56.0 ktonnes (60.1) and external net sales decreased to SEK 2,653 million (3,111) in the first quarter 2024. The decrease in sales volume was mainly due to lower demand from HVAC customers. Changes in foreign exchange rates had a net positive effect on net sales of SEK 15 million.
For Gränges Eurasia, the external sales volume increased by 9.9 percent to 66.0 ktonnes (60.0) and external net sales increased to SEK 2,775 million (2,857) in the first quarter 2024. The increase in sales volume was primarily driven by higher sales to Other niches due to normalization of inventory levels in Europe as well as by positive development of demand from Automotive in Asia. Changes in foreign exchange rates had a net positive effect on net sales of SEK 37 million.
Operating profit
Adjusted operating profit for the first quarter 2024 amounted to SEK 356 million (401), corresponding to adjusted operating profit per tonne of 2.9 kSEK (3.3). Lower average fabrication price and unfavorable geographical mix had a negative impact on the operating profit in the quarter. This was largely offset by improved cost productivity, good metal management, and by the new recycling and casting center in
Huntingdon, that contributed to reduced raw material costs. Changes in foreign exchange rates had a net negative impact of SEK 3 million in the quarter. Adjusted operating profit for the first quarter 2023 included SEK 32 million related to energy cost compensation in Poland. No energy cost compensation was received in the first quarter 2024.
Operating profit for the first quarter 2024 amounted to SEK 356 million (401) and includes no items affecting comparability (-).
Profit for the period and earnings per share
Profit before tax for the first quarter 2024 amounted to SEK 293 million (315). Finance income and costs was SEK -64 million (-86). Income tax for the first quarter 2024 was SEK -57 million (-62) which corresponds to an effective tax rate of 19 percent (20). In accordance with the OECD's guidelines mandating a global minimum tax rate of 15 percent, Gränges has accounted for a top-up tax of SEK 6 million in the first quarter. The profit for the period was SEK 237 million (254) and diluted earnings per share was SEK 2.23 (2.38).
Cash flow
Cash flow from operating activities was SEK 152 million (336) in the first quarter 2024. The seasonal working capital build-up was limited to SEK 378 million as a result of successful working capital reduction efforts. Cash flow from investing activities fully relates to capital expenditure and amounted to SEK -191 million (-252) in the quarter. Of this,
Sales volume Adjusted operating profit
GRÄNGES GROUP
SEK -57 million referred to investments to maintain and improve efficiency in current production facilities and SEK -134 million referred to investments related to expansion of the production facilities.
Cash flow before financing adjusted for expansion investments and acquisitions amounted to SEK 95 million (287) in the first quarter 2024. Cash flow from financing activities was SEK 244 million (-217) in the first quarter 2024 and included new loans of SEK 2,226 million and repayment of loans of SEK -1,918 million.
Cash and cash equivalents amounted to SEK 695 million on March 31, 2024 (SEK 461 million on December 31, 2023).
Financial position
Gränges' total assets amounted to SEK 18,027 million on March 31, 2024 (SEK 16,688 million on December 31, 2023). The equity to assets ratio was 52.2 percent on March 31, 2024 (52.8 percent on December 31, 2023).
Financial net debt was SEK 2,964 million on March 31, 2024 (SEK 2,741 million on December 31, 2023), corresponding to 1.3 times adjusted EBITDA (1.1 times on December 31, 2023).
Employees
The average number of employees was 2,755 (2,667) in the first quarter 2024.
Parent company
Gränges AB is the parent company of the Gränges Group. Its operations include Group Management and Group functions such as finance, treasury, sustainability and communication. In the first quarter 2024, net sales in the parent company amounted to SEK 30 million (31). Net result for the period was SEK -5 million (-4).
SEK million
SEK million, 12-months rolling
Profit for the period Financial net debt to EBITDA
x EBITDA 0,0 0,5 1,0 1,5 2,0 2,5 3,0 2022 2023 2024 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 3.02.5 2.01.51.0 0.5 0.0
Gränges Americas
- Weak market conditions in most end-customer markets
- Good metal management offset lower sales volume
- Positive profit impact from new recycling and casting centre
Gränges Americas experienced lower demand in most end-customer markets in the first quarter 2024. Sales to HVAC customers continued to decrease due to lower than normal pre-season sales. Sales of Speciality packaging materials increased due to a gradual normalization of downstream inventory levels. In total the sales volume in the first quarter decreased by 6.8 percent to 56.0 ktonnes (60.1) while net sales decreased to SEK 2,653 million (3,111). The decrease in net sales was primarily driven by the lower sales volume, a lower aluminium price and a lower average fabrication price.
Sales volume Adjusted operating profit
The adjusted operating profit for the first quarter 2024 amounted to SEK 267 million (269). This corresponds to an adjusted operating profit per tonne of 4.8 kSEK (4.5). The negative effect from lower sales volume and a lower average fabrication price was offset by good metal management. In addition, the new recycling and casting centre in Huntingdon continued to operate at full capacity during the first quarter and contributed to reduced raw material cost. Changes in foreign exchange rates had a net positive impact of SEK 2 million compared with the first quarter previous year. By March 31, 2024, the return on capital employed was 18.3 percent (15.0) on a rolling 12-months basis.
| Financial summary | Q1 | 12 months rolling |
Full year | ||
|---|---|---|---|---|---|
| SEK million | 2024 | 2023 | Apr 2023– Mar 2024 |
2023 | |
| Sales volume external, ktonnes | 56.0 | 60.1 | -6.8% | 216.5 | 220.6 |
| Sales volume internal, ktonnes | - | - | - | - | - |
| Total sales volume, ktonnes | 56.0 | 60.1 | -6.8% | 216.5 | 220.6 |
| Net sales, external | 2,653 | 3,111 | -14.7% | 10,869 | 11,326 |
| Net sales, internal | - | - | n/a | - | - |
| Total net sales | 2,653 | 3,111 | -14.7% | 10,869 | 11,326 |
| Adjusted operating profit | 267 | 269 | -0.7% | 1,027 | 1,029 |
| Adjusted operating profit per tonne, kSEK | 4.8 | 4.5 | 6.6% | 4.7 | 4.7 |
| Return on capital employed, % | - | - | - | 18.3 | 18.5 |
Gränges Eurasia
- Stable demand from Automotive
- Normalization of downstream inventory levels in Europe
- Improved cost productivity and good metal management
Gränges Eurasia experienced a mixed market development in the first quarter 2024. Sales to Other niche customers in Europe increased due to a normalization of downstream inventory levels. Demand from Automotive customers was stable on overall level but showed a continued good growth in Asia whereas Europe experienced a decline. Demand for Speciality packaging materials in Europe decreased compared to the same quarter last year but experienced a gradual normalization of inventory levels and stabilization of end customer demand. Sales volume in the first quarter increased by 8.0 percent to 71.6 ktonnes (66.3), while net sales decreased by 4.2 percent to SEK 3,049 million (3,184). The decrease in net sales was primarily driven by a lower aluminium price and a lower average fabrication price.
Sales volume Adjusted operating profit
Adjusted operating profit for the first quarter 2024 amounted to SEK 120 million (171), corresponding to an adjusted operating profit per tonne of 1.7 kSEK (2.6). Lower average fabrication price had a negative impact on adjusted operating profit in the quarter but was partly offset by improved cost productivity and good metal management. Changes in foreign exchange rates had a net negative impact of SEK 5 million in the first quarter 2024. Adjusted operating profit for the first quarter 2023 included SEK 32 million related to energy cost compensation in Poland. No energy cost compensation was received in the first quarter 2024. By March 31, 2024, the return on capital employed was 7.1 percent (6.3) on a rolling 12-months basis.
| Financial summary | Q1 | 12 months rolling |
Full year | |||
|---|---|---|---|---|---|---|
| SEK million | 2024 | 2023 | Apr 2023– Mar 2024 |
2023 | ||
| Sales volume external, ktonnes | 66.0 | 60.0 | 9.9% | 248.6 | 242.6 | |
| Sales volume internal, ktonnes | 5.6 | 6.2 | -10.2% | 21.0 | 21.7 | |
| Total sales volume, ktonnes | 71.6 | 66.3 | 8.0% | 269.6 | 264.3 | |
| Net sales, external | 2,775 | 2,857 | -2.9% | 11,110 | 11,192 | |
| Net sales, internal | 275 | 327 | -16.0% | 1,090 | 1,142 | |
| Total net sales | 3,049 | 3,184 | -4.2% | 12,199 | 12,334 | |
| Adjusted operating profit | 120 | 171 | -30.1% | 543 | 595 | |
| Adjusted operating profit per tonne, kSEK | 1.7 | 2.6 | -35.3% | 2.0 | 2.3 | |
| Return on capital employed, % | - | - | - | 7.1 | 7.8 |
Sustainability
- Record-low scope 3 intensity driven by continued recycling growth
- Increased scope 1+2 intensity due to lower share of renewable electricity
- Long-term partnership to secure recycled aluminium in the US
Emissions and climate impact
In the first quarter 2024, Gränges' total carbon emissions intensity (scope 1+2+3) decreased by 16 percent to record-low 7.4 tonnes CO2 e/tonne (8.9). Scope 1+2 intensity increased to 0.76 tonnes CO2 e/tonne (0.66) driven by higher recycling, which requires more energy, as well as lower renewable electricity in Gränges Eurasia. Scope 3 intensity decreased significantly by 19 percent to 6.7 tonnes CO2 e/tonne (8.2) as a result of increased recycling and a higher share of sourced low-carbon primary aluminium, mainly in Gränges Eurasia.
On March 31, 2024, the total carbon emissions intensity was 8.1 tonnes CO2 e/tonne (8.9) on a rolling 12-months basis, a reduction of 30 percent compared to baseline 2017.
Recycling and circularity
Gränges' continued focus on recycling and circularity resulted in all-time high recycling volumes and share in the first quarter 2024. The recycling volume increased by 11 ktonnes and reached 59 ktonnes (48) compared to the same quarter in previous year. This corresponds to 45 percent recycled aluminium (38) of total sourced metal inputs. Both business areas contributed to the strong performance through expanded scrap sourcing, increased recycling capacity and long-term partnerships for circularity.
On March 31, 2024, the total volume of sourced recycled aluminium reached a record level of 221 ktonnes (174) on a rolling 12-months basis, corresponding to 4.7 times the volume in baseline 2017.
Carbon emissions intensity1 Share of sourced recycled aluminium2
1 Quarterly data may be adjusted in the year-end report when annual emission factors have been confirmed. Scope 2 data is calculated with a market-based approach. Baseline 2017 is recalculated to include the production facility in Konin for carbon emissions intensity data. 2 Baseline 2017 does not include Gränges' production facility in Konin.
11 GRÄNGES AB (PUBL) INTERIM REPORT Q1, 2024
SUSTAINABILITY
| Sustainability performance | Q1 | 12 months Full year rolling |
Baseline | |||||
|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | Apr 2023– Mar 2024 |
2023 | 2017 | ||||
| Total carbon emissions intensity (scope 1+2+3), tonnes CO2 e/tonne1 |
7.4 | 8.9 | -16% | 8.1 | 8.4 | -4% | 11.4 | -30% |
| Carbon emissions intensity (scope 1+2), tonnes CO2 e/tonne1 |
0.76 | 0.66 | 15% | 0.68 | 0.66 | 3% | 1.0 | -29% |
| Carbon emissions intensity (scope 3), tonnes CO2 e/tonne1 |
6.7 | 8.2 | -19% | 7.4 | 7.8 | -5% | 10.5 | -30% |
| Sourced recycled aluminium, ktonnes | 59 | 48 | 24% | 221 | 210 | 5% | 47 | 374% |
| Sourced recycled aluminium, % | 45.5 | 37.5 | 7.9 ppt | 43.6 | 41.6 | 2 ppt | 11.5 | 32.2 ppt |
1 Quarterly data may be adjusted in the year-end report when annual emission factors have been confirmed. Scope 2 data is calculated with a market-based approach.
SUSTAINABILITY Gränges forms recycling partnership in the US
Gränges has formed a strategic, longterm partnership with the aluminium recycler Scepter, Inc. in the US. Through a ten-year agreement, Gränges Americas will source scrap-based aluminium ingots to its production of near-zero aluminium solutions. This is a key enabler for Gränges to offer circular and sustainable aluminium solutions to its customers and achieve its 2040 net-zero goal.
Gränges is committed to reducing the carbon footprint of our products and thereby also helping our customers on their decarbonization journey. This agreement is a significant step towards advancing our sustainability goals and providing low-carbon solutions for our customers.
Patrick Lawlor, President Gränges Americas
Significant events during the period
Gränges formed a strategic, long-term partnership with Scepter, Inc. for supply of scrap-based aluminium ingots to its rolling and recycling centers in the United States.
Significant events after the period
No significant events have occurred after the period.
The share and owners
The share capital in Gränges amounts to SEK 142 million split on 106,308,618 shares, each with a quota value of SEK 1.339775. Gränges has only one class of shares. The number of known shareholders in Gränges was 12,489 on March 31, 2024, according to Euroclear.
Largest shareholders in Gränges, March 31, 2024¹
| Shareholder | Number of shares |
Share of capital and votes % |
|---|---|---|
| Fjärde AP-fonden | 9,864,534 | 9.3 |
| Swedbank Robur Fonder | 7,223,392 | 6.8 |
| AFA Försäkring | 7,175,947 | 6.8 |
| KGH LTD | 5,520,000 | 5.2 |
| Dimensional Fund Advisors | 4,789,378 | 4.5 |
| Handelsbanken Fonder | 4,242,339 | 4.0 |
| Vanguard | 3,929,117 | 3.7 |
| Unionen | 3,369,999 | 3.2 |
| Norges Bank | 2,502,470 | 2.4 |
| Fidelity Investments (FMR) | 2,382,678 | 2.2 |
| Total 10 largest shareholders | 50,999,854 | 48.0 |
| Other | 55,308,764 | 52.0 |
| Total | 106,308,618 | 100.0 |
1 Source: Modular Finance
Annual General Meeting 2024
Gränges' 2024 Annual General Meeting (AGM) will be held on May 8, 2024, at 15.30 CEST at GT 30, Grev Turegatan 30, Stockholm. Information on registration to the Annual General Meeting and the Board of Directors proposals for decision points are available on www.granges.com.
Dividend
The Board of Directors proposes a dividend of SEK 3.00 (2.50) per share for the 2023 fiscal year, in total SEK 319 million (266), which corresponds to 32 percent (38) of the profit for the year 2023. It is proposed that the dividend is divided into two payments of SEK 1.50 per payment. The first record date is proposed to be May 13, 2024, and the second record date is proposed to be November 12, 2024. If the General Meeting resolves in accordance with the proposal, the dividend is expected to be distributed through Euroclear Sweden AB on May 16, 2024, and on November 15, 2024.
Risks and uncertainties
As a global group with operations in different parts of the world, Gränges is exposed to various risks and uncertainties such as raw material price risk, market risk, operational and legal risk, as well as financial risks related to foreign exchange rates, interest rates, liquidity and refinancing. Gränges' risk management process entails to identify, assess and reduce risks related to the Group's business and operations. More information about risk management is available on pages 56–64 in Gränges' 2023 Annual and Sustainability Report.
Seasonal variations
Gränges' customers are found in the automotive industry, the HVAC industry, the packaging industry, as well as in many other niche markets. Gränges' sales to the automotive industry are highly correlated with the production of light vehicles. Sales to the HVAC industry are impacted by factors such as construction investments, new regulations for energy efficiency and climate impact, and it is usually higher during the summer period driven by a seasonally higher demand for cooling systems. Sales to the packaging and other industries are fairly stable throughout the year. Major annual maintenance work in Gränges' production facilities mainly occurs in the fourth quarter. Overall, the fourth quarter is usually the weakest quarter and the second quarter usually the strongest quarter of the year.
Stockholm, April 25, 2024
Jörgen Rosengren CEO and President
FINANCIAL & SUSTAINABILITY STATEMENTS Financial & sustainability statements
14 GRÄNGES AB (PUBL) INTERIM REPORT Q1, 2024
Consolidated income statement (condensed)
| SEK million | Note | Jan-Mar 2024 |
Jan-Mar 2023 |
Jan-Dec 2023 |
|---|---|---|---|---|
| Net sales | 2 | 5,428 | 5,968 | 22,518 |
| Cost of materials | -3,512 | -4,044 | -14,730 | |
| Payroll and other operating expenses | -1,356 | -1,331 | -5,400 | |
| Depreciation, amortization and impairment charges | -204 | -192 | -853 | |
| Items affecting comparability | 5 | - | - | 40 |
| Operating profit | 356 | 401 | 1,576 | |
| Profit or loss from associates and joint ventures | 4 | 2 | 0 | 1 |
| Finance income and costs | -64 | -86 | -316 | |
| Profit before tax | 293 | 315 | 1,261 | |
| Income tax | -57 | -62 | -252 | |
| Profit for the period | 237 | 254 | 1,010 | |
| Profit for the period attributable to | ||||
| - owners of the parent company | 237 | 254 | 1,010 | |
| - non-controlling interests | 0 | 0 | 0 | |
| Earnings per share | ||||
| Earnings per share basic, SEK | 2.23 | 2.39 | 9.50 | |
| Earnings per share diluted, SEK | 2.23 | 2.38 | 9.48 |
Consolidated statement of comprehensive income (condensed)
| SEK million | Jan-Mar 2024 |
Jan-Mar 2023 |
Jan-Dec 2023 |
|---|---|---|---|
| Profit for the period | 237 | 254 | 1,010 |
| Items not to be reclassified to profit/loss in subsequent periods | |||
| Remeasurement of pensions after tax | - | - | -9 |
| Items to be reclassified to profit/loss in subsequent periods | |||
| Change in hedging reserve after tax | -79 | -43 | 1 |
| Translation effects | 440 | 1 | -195 |
| Comprehensive income for the period | 598 | 212 | 806 |
| Comprehensive income for the period attributable to | |||
| – owners of the parent company | 598 | 212 | 806 |
| – non-controlling interests | 0 | 0 | 0 |
Consolidated balance sheet (condensed)
| SEK million | Note | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
|---|---|---|---|---|
| ASSETS | ||||
| Intangible assets | 1,536 | 1,492 | 1,474 | |
| Property, plant and equipment | 8,030 | 7,351 | 7,642 | |
| Right-of-use assets | 220 | 241 | 220 | |
| Deferred tax assets | 45 | 40 | 38 | |
| Investments in associates and joint ventures | 4 | 238 | 19 | 226 |
| Other non-current receivables | 3 | 204 | 147 | 208 |
| Non-current assets | 10,274 | 9,290 | 9,808 | |
| Inventories | 3,839 | 4,207 | 3,744 | |
| Receivables | 3 | 3,217 | 3,497 | 2,656 |
| Interest-bearing receivables | 3 | 3 | 6 | 20 |
| Cash and cash equivalents | 695 | 752 | 461 | |
| Current assets | 7,754 | 8,463 | 6,880 | |
| TOTAL ASSETS | 18,027 | 17,753 | 16,688 | |
| EQUITY AND LIABILITIES | ||||
| Equity | 9,409 | 8,417 | 8,809 | |
| Interest-bearing liabilities | 3 | 2,504 | 2,852 | 2,403 |
| Provisions and other non-current liabilities | 3 | 1,031 | 972 | 992 |
| Non-current liabilities | 3,535 | 3,824 | 3,395 | |
| Interest-bearing liabilities | 3 | 1,397 | 2,060 | 1,055 |
| Provisions and other current liabilities | 3 | 3,686 | 3,451 | 3,428 |
| Current liabilities | 5,083 | 5,511 | 4,483 | |
| TOTAL EQUITY AND LIABILITIES | 18,027 | 17,753 | 16,688 |
Consolidated changes in equity (condensed)
| SEK million | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
|---|---|---|---|
| Opening balance | 8,808 | 8,204 | 8,204 |
| Profit for the period | 237 | 254 | 1,010 |
| Other comprehensive income for the period | 361 | -42 | -203 |
| Total comprehensive income for the period | 598 | 212 | 806 |
| Dividend | - | - | -266 |
| Share swap | 2 | - | 72 |
| Received option/warrant premiums | - | 0 | 9 |
| Exercise of call options | 0 | - | -18 |
| Total transactions with owners | 2 | 0 | -203 |
| Equity attributable to owners of the parent company | 9,408 | 8,416 | 8,808 |
| Equity attributable to non-controlling interests | 2 | 1 | 2 |
| Closing balance | 9,409 | 8,417 | 8,809 |
Consolidated statement of cash flows (condensed)
| SEK million Note |
Jan-Mar 2024 |
Jan-Mar 2023 |
Jan-Dec 2023 |
|---|---|---|---|
| Operating profit | 356 | 401 | 1,576 |
| Depreciation, amortization and impairment charges | 204 | 192 | 853 |
| Change in working capital etc. | -378 | -247 | 1,036 |
| Income taxes paid | -30 | -10 | -173 |
| Cash flow from operating activities | 152 | 336 | 3,291 |
| Investments in property, plant, equipment and intangible assets | -191 | -252 | -1,227 |
| Investments in associates and joint ventures | - | - | -223 |
| Divestments | - | - | 1 |
| Cash flow from investing activities | -191 | -252 | -1,449 |
| Cash flow before financing activities -39 |
84 | 1,842 | |
| Dividend | - | - | -266 |
| Share swap | 2 | - | 72 |
| Received option/warrant premiums | - | 0 | 9 |
| Exercise of call options | 0 | - | -18 |
| Interest paid and received | -65 | -91 | -316 |
| New loans | 2,226 | 1,831 | 6,723 |
| Repayment of loans | -1,918 | -1,957 | -8,454 |
| Cash flow from financing activities | 244 | -217 | -2,250 |
| Cash flow for the period | 205 | -133 | -408 |
| Cash and cash equivalents at beginning of period | 461 | 879 | 879 |
| Cash flow for the period | 205 | -133 | -408 |
| Exchange rate differences in cash and cash equivalents | 29 | 5 | -11 |
| Cash and cash equivalents at end of period | 695 | 752 | 461 |
Parent company income statement (condensed)
| SEK million | Jan-Mar 2024 |
Jan-Mar 2023 |
Jan-Dec 2023 |
|---|---|---|---|
| Net sales | 30 | 31 | 137 |
| Payroll and other operating expenses | -58 | -37 | -176 |
| Operating profit/loss | -28 | -6 | -39 |
| Dividends from subsidiaries | - | - | 1,243 |
| Finance income and costs | 29 | -3 | 18 |
| Profit/loss after financial items | 1 | -9 | 1,222 |
| Income tax | -6 | 4 | -40 |
| Profit/loss for the period | -5 | -4 | 1,182 |
Parent company balance sheet (condensed)
| SEK million Note |
31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
|---|---|---|---|
| ASSETS | |||
| Shares in Group companies | 3,767 | 2,986 | 3,767 |
| Deferred tax assets | 49 | 41 | 49 |
| Interest-bearing receivables | 6 | - | 0 |
| Receivables from Group companies | 1,150 | 1,472 | 1,106 |
| Other non-current receivables | 174 | 135 | 190 |
| Non-current assets | 5,146 | 4,634 | 5,112 |
| Receivables from Group companies | 2,604 | 3,429 | 2,390 |
| Other receivables | 109 | 103 | 171 |
| Cash and cash equivalents | 126 | 172 | 19 |
| Current assets | 2,840 | 3,704 | 2,580 |
| TOTAL ASSETS | 7,986 | 8,337 | 7,691 |
| EQUITY AND LIABILITIES | |||
| Equity | 4,163 | 3,183 | 4,166 |
| Interest-bearing liabilities | 2,330 | 2,664 | 2,242 |
| Provisions and other non-current liabilities | 49 | 48 | 46 |
| Non-current liabilities | 2,379 | 2,711 | 2,288 |
| Liabilities to Group companies | 345 | 431 | 273 |
| Interest-bearing liabilities | 939 | 1,893 | 797 |
| Provisions and other current liabilities | 161 | 119 | 166 |
| Current liabilities | 1,444 | 2,443 | 1,237 |
| TOTAL EQUITY AND LIABILITIES | 7,986 | 8,337 | 7,691 |
Notes
Note 1 Accounting principles
The Gränges Group applies International Financial Reporting Standards (IFRS) as endorsed by the EU. The accounting principles adopted are consistent with those described in the Annual Report for Gränges AB (publ) 2023. This interim report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act. The Parent Company applies the Swedish Annual Accounts Act and RFR 2 Reporting for Legal Entities.
New standards, amendments and interpretations effective from January 1, 2024, or later have not had any material impact on this financial report. Gränges is currently evaluating how the recently, by IASB, issued IFRS 18 Presentation and Disclosures in Financial Statements standard will impact the financial report. The standard will be applicable for reporting periods starting from January 1, 2027, and onwards.
The interim information on pages 2–21 is an integrated part of these Financial & Sustainability statements.
Note 2 Revenue from contracts with customers
Gränges' revenue is generated through sale of material that is produced for a certain customer and application. Revenue is recognized at the point in time when control is transferred to the customer. The transaction price for Gränges' products is based on the added value Gränges offers in terms of material properties and production complexity (fabrication price), and the price of the raw material, aluminium. The fabrication price is to a large extent pre-defined while the aluminium price is variable and based on metal price clauses connected to the market price. Other revenue for the full year 2023 includes an insurance compensation of SEK 106 million for a fire in the Konin facility.
The table below show Gränges' net sales by business area divided by type of revenue.
| SEK million | Jan-Mar 2024 |
Jan-Mar 2023 |
Jan-Dec 2023 |
|---|---|---|---|
| Net sales by business area | |||
| Gränges Americas | |||
| Fabrication revenue | 1,145 | 1,309 | 4,852 |
| Raw material and other revenue | 1,507 | 1,798 | 6,465 |
| Revenue from contracts with customers | 2,652 | 3,106 | 11,317 |
| Other revenue | 1 | 5 | 9 |
| Total net sales Gränges Americas | 2,653 | 3,111 | 11,326 |
| Gränges Eurasia | |||
| Fabrication revenue | 1,259 | 1,373 | 5,239 |
| Raw material and other revenue | 1,785 | 1,806 | 6,916 |
| Revenue from contracts with customers | 3,044 | 3,179 | 12,156 |
| Other revenue | 6 | 6 | 178 |
| Total net sales Gränges Eurasia | 3,049 | 3,184 | 12,334 |
| Other and eliminations | |||
| Fabrication revenue | -170 | -206 | -737 |
| Raw material and other revenue | -105 | -121 | -406 |
| Revenue from contracts with customers | -275 | -327 | -1,142 |
| Other revenue | - | - | - |
| Total net sales other and eliminations | -275 | -327 | -1,142 |
| Total fabrication revenue | 2,234 | 2,475 | 9,355 |
| Total raw material and other revenue | 3,187 | 3,482 | 12,976 |
| Total revenue from contracts with customers | 5,421 | 5,957 | 22,331 |
| Total other revenue | 7 | 10 | 188 |
| Total net sales | 5,428 | 5,968 | 22,518 |
Note 3 Financial instruments
The Group's financial assets consist of lending, accounts receivable, cash and cash equivalents as well as derivatives. The Group's financial liabilities consist of borrowings and accounts payable as well as derivatives. The table below shows the fair value of the derivatives (foreign exchange, aluminium and interest rate derivatives) included in the balance sheet.
| 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
|---|---|---|
| 194 | 135 | 197 |
| 128 | 169 | 226 |
| 70 | 28 | 55 |
| 220 | 126 | 175 |
All derivatives are measured at fair value and are classified according to level 2, i.e., all significant inputs required for measurement of the instruments are observable. Fair value of foreign exchange derivatives is calculated by discounting the difference between the contracted forward rate and the forward rate that can be contracted on the balance sheet date for the remaining contract period. Aluminium derivatives are measured at observable quoted prices on LME (London Metal Exchange) and SHFE (Shanghai Futures Exchange) for similar assets and liabilities. Interest rate derivatives are measured at forward rates from observable interest rate curves and discounting of contractual cash flows.
Gränges' interest-bearing liabilities consist of financing from banks, institutions, and the credit market. As per March 31, 2024, the amount of outstanding term loans from banks and institutions was USD 120 million and SEK 400 million, whereof USD 120 million and SEK 200 million have a sustainability-linked structure. Financing from banks and institutions also includes a sustainability-linked Revolving Credit Facility of SEK 3,500 million which was unutilized as per March 31, 2024. Financing from the credit market includes a sustainability-linked bond of SEK 600 million, issued under Gränges' MTN program, and commercial papers. As per March 31, 2024, the total volume of outstanding commercial papers was SEK 926 million. Other interest-bearing liabilities includes short-term working capital loans of CNY 275 million.
The loan facilities are subject to covenants, which are Net Debt/EBITDA and Interest coverage ratio.
| Year | |||||
|---|---|---|---|---|---|
| SEK million | Limit/Program | < 1 | 1 –2 | > 2 | Total |
| Term loans | |||||
| SEK | - | 200 | 200 | 400 | |
| USD | - | 1,281 | - | 1,281 | |
| Bonds in MTN program | 3,000 | - | - | 600 | 600 |
| Commercial papers | 2,000 | 926 | - | - | 926 |
| Revolving Credit Facilities | 3,500 | - | - | - | - |
| Lease liabilities | 49 | 36 | 153 | 239 | |
| Other interest-bearing liabilities | 422 | - | 34 | 455 | |
| Total interest-bearing liabilities | 1,397 | 1,518 | 987 | 3,901 |
Interest-bearing liabilities are measured at amortized cost and the carrying amount as of March 31, 2024, was SEK 3,901 million (SEK 3,459 million as of December 31, 2023). The fair value of interest-bearing liabilities amounted to SEK 3,910 million as of March 31, 2024 (SEK 3,469 million as of December 31, 2022). For other receivables and liabilities, which are shortterm, the carrying amount is considered to reflect the fair value.
FINANCIAL & SUSTAINABILITY STATEMENTS
Note 4 Related party transactions
No changes have been made to the Group or parent company in relations or transactions with related parties, compared to what is described in the 2023 Annual Report. During the period there have been no significant transactions with related parties.
Note 5 Items affecting comparability
| SEK million | Financial statement line | Jan-Mar 2024 |
Jan-Mar 2023 |
Jan-Dec 2023 |
|---|---|---|---|---|
| Insurance compensation | Items affecting comparability | - | - | 40 |
| Items affecting comparability | - | - | 40 |
In May 2022, a fire broke out at one of the rolling mills at Gränges' production facility in Konin, Poland. Insurance compensation, with a deductible, was accounted for as part of the adjusted operating result, while compensation beyond the coverage was treated as items affecting comparability. The insurance claim was finally settled during the third quarter of 2023 and resulted in revenue exceeding the cost of the fire by SEK 40 million, which was classified as an item affecting comparability in the period.
Consolidated quarterly data
| 2024 | 2023 | 2022 | ||||||
|---|---|---|---|---|---|---|---|---|
| SEK million | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 |
| Sales volume, ktonnes | 122.0 | 107.7 | 114.9 | 120.5 | 120.2 | 110.3 | 119.8 | 122.5 |
| Income statement | ||||||||
| Net sales | 5,428 | 4,967 | 5,575 | 6,008 | 5,968 | 5,366 | 6,172 | 6,875 |
| Adjusted EBITDA¹ | 560 | 451 | 690 | 655 | 593 | 344 | 583 | 636 |
| Adjusted operating profit¹ | 356 | 245 | 439 | 450 | 401 | 153 | 319 | 348 |
| Operating profit | 356 | 245 | 479 | 450 | 401 | 153 | 243 | 410 |
| Profit for the period | 237 | 108 | 332 | 316 | 254 | 51 | 135 | 274 |
| Adjusted EBITDA margin, % | 10.3 | 9.1 | 12.4 | 10.9 | 9.9 | 6.4 | 9.5 | 9.3 |
| Adjusted operating margin, % | 6.6 | 4.9 | 7.9 | 7.5 | 6.7 | 2.8 | 5.2 | 5.1 |
| Adjusted operating profit per tonne, kSEK |
2.9 | 2.3 | 3.8 | 3.7 | 3.3 | 1.4 | 2.7 | 2.8 |
| Operating margin, % | 6.6 | 4.9 | 8.6 | 7.5 | 6.7 | 2.8 | 3.9 | 6.0 |
| Net margin, % | 4.4 | 2.2 | 6.0 | 5.3 | 4.2 | 0.9 | 2.2 | 4.0 |
| Balance sheet | ||||||||
| Non-current assets | 10,274 | 9,808 | 9,626 | 9,806 | 9,290 | 9,249 | 9,233 | 8,926 |
| Current assets | 7,754 | 6,880 | 7,433 | 8,637 | 8,463 | 8,280 | 10,150 | 10,353 |
| Equity | 9,409 | 8,809 | 8,971 | 8,903 | 8,417 | 8,206 | 8,291 | 7,981 |
| Non-current liabilities | 3,535 | 3,395 | 3,915 | 4,020 | 3,824 | 3,783 | 3,865 | 4,027 |
| Current liabilities | 5,083 | 4,483 | 4,172 | 5,520 | 5,511 | 5,541 | 7,227 | 7,271 |
| Cash flow | ||||||||
| Operating activities | 152 | 925 | 1,199 | 830 | 336 | 919 | 530 | 793 |
| Investing activities | -191 | -774 | -227 | -197 | -252 | -403 | -218 | -218 |
| Before financing activities | -39 | 152 | 972 | 633 | 84 | 516 | 313 | 575 |
| Financing activities | 244 | -307 | -1,310 | -416 | -217 | -837 | -285 | -84 |
| Cash flow for the period | 205 | -155 | -338 | 218 | -133 | -321 | 28 | 491 |
| Capital structure | ||||||||
| Net debt | 3,462 | 3,233 | 3,401 | 4,360 | 4,388 | 4,377 | 4,894 | 4,917 |
| Equity to assets, % | 52.2 | 52.8 | 52.6 | 48.3 | 47.4 | 46.8 | 42.8 | 41.4 |
| Data per share, SEK² | ||||||||
| Earnings per share basic | 2.23 | 1.01 | 3.13 | 2.97 | 2.39 | 0.48 | 1.27 | 2.58 |
| Earnings per share diluted | 2.23 | 1.01 | 3.12 | 2.97 | 2.38 | 0.48 | 1.27 | 2.58 |
| Equity | 88.40 | 82.72 | 84.22 | 83.60 | 79.13 | 77.18 | 77.97 | 75.06 |
| Cash flow from operating activities | 1.43 | 8.69 | 11.26 | 7.80 | 3.16 | 8.64 | 4.99 | 7.46 |
| Share price at the end of the period | 115.80 | 116.00 | 103.00 | 102.90 | 98.75 | 85.30 | 71.70 | 76.50 |
| Weighted outstanding ordinary shares, basic in thousands |
106,308.6 | 106,308.6 | 106,308.6 | 106,308.6 | 106,308.6 | 106,308.6 | 106,308.6 | 106,308.6 |
| Weighted outstanding ordinary shares, diluted in thousands |
106,445.0 | 106,493.1 | 106,527.0 | 106,499.3 | 106,374.6 | 106,322.6 | 106,345.0 | 106,333.8 |
1 Adjusted for items affecting comparability, see Note 5 for further information.
2 Calculated on weighted outstanding ordinary shares, diluted.
Consolidated quarterly data
| 2024 | 2023 | 2022 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | ||
| Sales volume by business area, ktonnes |
|||||||||
| Gränges Americas | 56.0 | 46.6 | 57.3 | 56.5 | 60.1 | 57.7 | 63.5 | 63.8 | |
| Gränges Eurasia | 71.6 | 65.4 | 62.5 | 70.2 | 66.3 | 58.1 | 62.1 | 66.1 | |
| Other and eliminations | -5.6 | -4.3 | -4.9 | -6.2 | -6.2 | -5.5 | -5.8 | -7.4 | |
| Total | 122.0 | 107.7 | 114.9 | 120.5 | 120.2 | 110.3 | 119.8 | 122.5 | |
| Sales volume by end-customer, ktonnes |
|||||||||
| Automotive | 50.7 | 50.0 | 49.3 | 51.9 | 51.4 | 49.1 | 49.8 | 46.0 | |
| HVAC | 21.6 | 15.6 | 21.7 | 23.8 | 24.9 | 20.2 | 27.8 | 28.0 | |
| Speciality packaging | 22.2 | 19.1 | 20.9 | 19.1 | 20.9 | 22.4 | 21.0 | 21.3 | |
| Other niches | 27.5 | 22.9 | 22.9 | 25.7 | 23.0 | 18.6 | 21.2 | 27.2 | |
| Total | 122.0 | 107.7 | 114.9 | 120.5 | 120.2 | 110.3 | 119.8 | 122.5 | |
| Net sales by business area, SEK million |
|||||||||
| Gränges Americas | 2,653 | 2,253 | 2,916 | 3,046 | 3,111 | 2,834 | 3,397 | 3,692 | |
| Gränges Eurasia | 3,049 | 2,928 | 2,915 | 3,307 | 3,184 | 2,807 | 3,087 | 3,593 | |
| Other and eliminations | -275 | -214 | -256 | -345 | -327 | -274 | -312 | -410 | |
| Total | 5,428 | 4,967 | 5,575 | 6,008 | 5,968 | 5,366 | 6,172 | 6,875 | |
| Employees | |||||||||
| Average number of employees | 2,755 | 2,769 | 2,735 | 2,703 | 2,667 | 2,682 | 2,697 | 2,712 |
Sustainability¹
| Total carbon emissions intensity (scope 1+2+3), tonnes CO2 e/tonne |
7.4 | 8.5 | 8.0 | 8.4 | 8.9 | 8.9 | 9.7 | 8.1 |
|---|---|---|---|---|---|---|---|---|
| Carbon emissions intensity (scope 1+2), tonnes CO2 e/tonne |
0.76 | 0.65 | 0.67 | 0.64 | 0.66 | 0.82 | 0.80 | 0.80 |
| Carbon emissions intensity (scope 3), tonnes CO2 e/tonne |
6.7 | 7.8 | 7.3 | 7.7 | 8.2 | 8.1 | 8.9 | 7.3 |
| Sourced recycled aluminium, ktonnes |
59 | 55 | 55 | 52 | 48 | 40 | 40 | 46 |
| Sourced recycled aluminium, % | 45.5 | 43.6 | 44.4 | 41.1 | 37.5 | 33.5 | 31.1 | 35.4 |
1 Quarterly data may be adjusted in the year-end report when annual emission factors have been confirmed. Scope 2 data is calculated with a market-based approach.
| Automotive | HVAC | Speciality packaging | Other niches | Total | ||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Sales volume, ktonnes | Q1 2024 | Q1 2023 | Q1 2024 | Q1 2023 | Q1 2024 | Q1 2023 | Q1 2024 | Q1 2023 | Q1 2024 | Q1 2023 |
| Gränges Americas | 8.1 | 9.8 | 21.6 | 24.9 | 18.2 | 16.6 | 8.1 | 8.9 | 56.0 | 60.1 |
| Gränges Eurasia | 47.5 | 47.3 | 0.7 | 0.5 | 3.9 | 4.3 | 19.4 | 14.2 | 71.6 | 66.3 |
| Other and eliminations | -4.9 | -5.6 | -0.7 | -0.5 | - | - | - | -0.1 | -5.6 | -6.2 |
| Total | 50.7 | 51.4 | 21.6 | 24.9 | 22.2 | 20.9 | 27.5 | 23.0 | 122.0 | 120.2 |
Consolidated 12-months rolling data
| SEK million | Apr 2023- Mar 2024 |
Jan 2023- Dec 2023 |
Oct 2022- Sep 2023 |
Jul 2022- Jun 2023 |
Apr 2022- Mar 2023 |
Jan 2022- Dec 2022 |
Oct 2021- Sep 2022 |
Jul 2021- Jun 2022 |
|---|---|---|---|---|---|---|---|---|
| Sales volume, ktonnes | 465.1 | 463.2 | 465.8 | 470.7 | 472.7 | 479.3 | 481.3 | 480.0 |
| Income statement | ||||||||
| Net sales | 21,978 | 22,518 | 22,917 | 23,513 | 24,380 | 24,492 | 23,984 | 22,433 |
| Adjusted EBITDA¹ | 2,356 | 2,389 | 2,281 | 2,175 | 2,156 | 2,064 | 2,020 | 1,856 |
| Adjusted operating profit¹ | 1,491 | 1,536 | 1,443 | 1,322 | 1,220 | 1,150 | 1,136 | 1,036 |
| Operating profit | 1,531 | 1,576 | 1,483 | 1,246 | 1,206 | 1,136 | 962 | 938 |
| Adjusted EBITDA margin, % | 10.7 | 10.6 | 10.0 | 9.3 | 8.8 | 8.4 | 8.4 | 8.3 |
| Adjusted operating margin, % | 6.8 | 6.8 | 6.3 | 5.6 | 5.0 | 4.7 | 4.7 | 4.6 |
| Adjusted operating profit per tonne, kSEK |
3.2 | 3.3 | 3.1 | 2.8 | 2.6 | 2.4 | 2.4 | 2.2 |
| Operating margin, % | 7.0 | 7.0 | 6.5 | 5.3 | 4.9 | 4.6 | 4.0 | 4.2 |
| Capital structure and return indicators |
||||||||
| Capital employed | 12,671 | 12,613 | 12,842 | 12,947 | 12,738 | 12,292 | 11,886 | 11,265 |
| Return on capital employed, % | 11.8 | 12.2 | 11.2 | 10.2 | 9.6 | 9.4 | 9.6 | 9.2 |
| Equity | 8,900 | 8,660 | 8,556 | 8,358 | 8,023 | 7,725 | 7,433 | 7,084 |
| Return on equity, % | 11.2 | 11.7 | 11.1 | 9.0 | 8.9 | 9.1 | 8.4 | 9.1 |
| Financial net debt/Adjusted EBITDA | 1.3 | 1.1 | 1.3 | 1.8 | 1.8 | 1.9 | 2.1 | 2.4 |
1 Adjusted for items affecting comparability, see Note 5 for further information.
Sustainability²
| Total carbon emissions intensity (scope 1+2+3), tonnes CO2 e/tonne |
8.1 | 8.4 | 8.5 | 8.9 | 8.9 | 8.9 | 9.1 | 8.9 |
|---|---|---|---|---|---|---|---|---|
| Carbon emissions intensity (scope 1+2), tonnes CO2 e/tonne |
0.68 | 0.66 | 0.69 | 0.73 | 0.77 | 0.82 | 0.85 | 0.87 |
| Carbon emissions intensity (scope 3), tonnes CO2 e/tonne |
7.4 | 7.8 | 7.8 | 8.2 | 8.1 | 8.1 | 8.3 | 8.1 |
| Sourced recycled aluminium, ktonnes |
221 | 210 | 195 | 180 | 174 | 169 | 170 | 166 |
| Sourced recycled aluminium, % | 43.6 | 41.6 | 39.2 | 35.8 | 34.4 | 32.7 | 32.6 | 32.0 |
2 Consolidated 12-months rolling data may be adjusted in the year-end report when annual emission factors have been confirmed. Scope 2 data is calculated with a market-based approach.
Financials per business area
| Jan–Mar 2024 | ||||||||
|---|---|---|---|---|---|---|---|---|
| SEK million | Gränges Americas |
Gränges Eurasia |
Other and eliminations |
Total | Gränges Americas |
Gränges Eurasia |
Other and eliminations |
Total |
| Sales volume external, ktonnes | 56.0 | 66.0 | - | 122.0 | 60.1 | 60.0 | - | 120.2 |
| Sales volume internal, ktonnes | - | 5.6 | -5.6 | 0 | - | 6.2 | -6.2 | 0 |
| Total sales volume | 56.0 | 71.6 | -5.6 | 122.0 | 60.1 | 66.3 | -6.2 | 120.2 |
| Income statement | ||||||||
| Net sales, external | 2,653 | 2,775 | - | 5,428 | 3,111 | 2,857 | - | 5,968 |
| Net sales, internal | - | 275 | -275 | 0 | - | 327 | -327 | 0 |
| Total net sales | 2,653 | 3,049 | -275 | 5,428 | 3,111 | 3,184 | -327 | 5,968 |
| Adjusted operating profit¹ | 267 | 120 | -30 | 356 | 269 | 171 | -39 | 401 |
| Adjusted operating profit per tonne, kSEK |
4.8 | 1.7 | n/a | 2.9 | 4.5 | 2.6 | n/a | 3.3 |
| Capital structure and return indicators |
||||||||
| Capital employed² | 5,774 | 7,723 | -627 | 12,871 | 5,673 | 7,718 | -585 | 12,805 |
| Return on capital employed, %³ | 18.3 | 7.1 | n/a | 11.8 | 15.0 | 6.3 | n/a | 9.6 |
1 Adjusted for items affecting comparability, see Note 5 for further information.
2 Closing balance at end of the period.
3 Calculated on the average capital employed during the past 12-months period.
Financials per business area
| Gränges Americas | 2024 | 2023 | 2022 | |||||
|---|---|---|---|---|---|---|---|---|
| SEK million | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 |
| Sales volume external, ktonnes | 56.0 | 46.6 | 57.3 | 56.5 | 60.1 | 57.7 | 63.5 | 63.8 |
| Sales volume internal, ktonnes | - | - | - | - | - | - | - | - |
| Total sales volume, ktonnes | 56.0 | 46.6 | 57.3 | 56.5 | 60.1 | 57.7 | 63.5 | 63.8 |
| Income statement | ||||||||
| Net sales, external | 2,653 | 2,253 | 2,916 | 3,046 | 3,111 | 2,842 | 3,391 | 3,698 |
| Net sales, internal | - | - | - | - | - | -8 | 6 | -6 |
| Total net sales | 2,653 | 2,253 | 2,916 | 3,046 | 3,111 | 2,834 | 3,397 | 3,692 |
| Adjusted operating profit¹ | 267 | 166 | 302 | 292 | 269 | 99 | 227 | 244 |
| Adjusted operating profit per tonne, kSEK |
4.8 | 3.6 | 5.3 | 5.2 | 4.5 | 1.7 | 3.6 | 3.8 |
| Capital structure and return indicators |
||||||||
| Capital employed² | 5,774 | 5,139 | 5,519 | 5,885 | 5,673 | 5,528 | 6,124 | 5,579 |
| Return on capital employed, %³ | 18.3 | 18.5 | 16.7 | 15.4 | 15.0 | 15.1 | 15.5 | 15.9 |
| Gränges Eurasia | 2024 | 2023 | 2022 | |||||
|---|---|---|---|---|---|---|---|---|
| SEK million | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 |
| Sales volume external, ktonnes | 66.0 | 61.1 | 57.6 | 63.9 | 60.0 | 52.6 | 56.3 | 58.7 |
| Sales volume internal, ktonnes | 5.6 | 4.3 | 4.9 | 6.2 | 6.2 | 5.5 | 5.8 | 7.4 |
| Total sales volume, ktonnes | 71.6 | 65.4 | 62.5 | 70.2 | 66.3 | 58.1 | 62.1 | 66.1 |
| Income statement | ||||||||
| Net sales, external | 2,775 | 2,714 | 2,659 | 2,962 | 2,857 | 2,524 | 2,780 | 3,177 |
| Net sales, internal | 275 | 214 | 256 | 345 | 327 | 283 | 306 | 416 |
| Total net sales | 3,049 | 2,928 | 2,915 | 3,307 | 3,184 | 2,807 | 3,087 | 3,593 |
| Adjusted operating profit¹ | 120 | 103 | 122 | 199 | 171 | 55 | 87 | 172 |
| Adjusted operating profit per tonne, kSEK |
1.7 | 1.6 | 1.9 | 2.8 | 2.6 | 0.9 | 1.4 | 2.6 |
| Capital structure and return indicators |
||||||||
| Capital employed² | 7,723 | 7,477 | 7,379 | 8,021 | 7,718 | 7,527 | 7,609 | 7,841 |
| Return on capital employed, %³ | 7.1 | 7.8 | 7.1 | 6.6 | 6.3 | 6.0 | 6.0 | 5.9 |
1 Adjusted for items affecting comparability, see Note 5 for further information.
2 Closing balance at end of the period.
3 Calculated on the average capital employed during the past 12-months period.
Alternative performance measures
Gränges makes use of the alternative performance measures Return on capital employed, Financial net debt, Equity to assets ratio and Cash conversion. Gränges believes that these performance measures are useful for readers of the financial reports as a complement to other performance measures when assessing the possibility of dividends, the implementation of strategic investments, and the Group's ability to meet
financial commitments. Further, Gränges uses the alternative performance measures Adjusted operating profit, Adjusted operating profit per tonne and Adjusted EBITDA, which are measures that Gränges considers to be relevant for investors who want to understand the profit generation excluding items affecting comparability. For definitions of the measures, see page 29.
| Q1 | 12 months rolling Apr 2023 – Mar 2024 |
Full year 2023 |
||
|---|---|---|---|---|
| SEK million | 2024 | 2023 | ||
| Adjusted operating profit | ||||
| Operating profit | 356 | 401 | 1,531 | 1,576 |
| Items affecting comparability | - | - | -40 | -40 |
| Adjusted operating profit | 356 | 401 | 1,491 | 1,536 |
| Adjusted operating profit per tonne | ||||
| Adjusted operating profit | 356 | 401 | 1,491 | 1,536 |
| Sales volume, ktonnes | 122.0 | 120.2 | 465.1 | 463.2 |
| Adjusted operating profit per tonne, kSEK | 2.9 | 3.3 | 3.2 | 3.3 |
| Adjusted EBITDA | ||||
| Adjusted operating profit | 356 | 401 | 1,491 | 1,536 |
| Depreciation, amortization and impairment charges | 204 | 192 | 865 | 853 |
| Adjusted EBITDA | 560 | 593 | 2,356 | 2,389 |
| Return on capital employed | ||||
| Total assets less cash and cash equivalents and interest-bearing receivables, rolling 12 months average |
- | - | 16,878 | 16,735 |
| Non-interest-bearing liabilities, rolling 12 months average | - | - | -4,446 | -4,355 |
| Pensions, rolling 12 months average | - | - | 239 | 234 |
| Capital employed | - | - | 12,671 | 12,613 |
| Adjusted operating profit | - | - | 1,491 | 1,536 |
| Return on capital employed, % | - | - | 11.8 | 12.2 |
| Financial net debt/Adjusted EBITDA | ||||
| Cash and cash equivalents and interest–bearing receivables | -698 | -758 | -6981 | -480 |
| Interest-bearing liabilities | 3,901 | 4,913 | 3,9011 | 3,459 |
| Lease liabilities | -239 | -257 | -2391 | -237 |
| Financial net debt | 2,964 | 3,897 | 2,9641 | 2,741 |
| Adjusted EBITDA, rolling 12 months | - | - | 2,356 | 2,389 |
| Financial net debt/Adjusted EBITDA | - | 1.3 | 1.1 |
Continues on the next page…
FINANCIAL & SUSTAINABILITY STATEMENTS
| …continued from previous page. | Q1 | 12 months rolling |
Full year | ||
|---|---|---|---|---|---|
| SEK million | 2024 | 2023 | Apr 2023 – Mar 2024 |
2023 | |
| Equity to assets | |||||
| Equity | 9,409 | 8,417 | 9,4091 | 8,809 | |
| Total assets | 18,027 | 17,753 | 18,0271 | 16,688 | |
| Equity to assets, % | 52.2 | 47.4 | 52.21 | 52.8 | |
| Adjusted cash flow before financing activities | |||||
| Cash flow before financing activities | -39 | 84 | 1,719 | 1,842 | |
| Cash flow from expansion investments | 134 | 203 | 691 | 761 | |
| Cash flow from investments in associates and joint ventures | - | 223 | 223 | ||
| Adjusted cash flow before financing activities | 287 | 2,633 | 2,826 | ||
| Cash conversion | |||||
| Adjusted cash flow before financing activities | 95 | 287 | 2,633 | 2,826 | |
| Adjusted operating profit | 356 | 401 | 1,491 | 1,536 | |
| Cash conversion, % | 72 | 177 | 184 |
1 Closing balance at the end of the period.
DEFINITIONS & GLOSSARY
Definitions
Adjusted EBITDA
Adjusted operating profit before depreciation and impairment charges
Adjusted cash flow before financing activities
Cash flow before financing activities excluding cash flow from non-maintenance investments and acquisitions
Adjusted operating profit
Operating profit excluding items affecting comparability
Adjusted operating profit per tonne
Adjusted operating profit divided by sales volume
Average number of employees
The average number of employees converted to full-time positions
Capital employed
Total assets less cash and cash equivalents and interest-bearing receivables, minus noninterest-bearing liabilities, excluding pensions
Carbon emissions scope 1+2
Direct emissions from Gränges' operations and indirect emissions from purchased electricity, heat and steam consumed by Gränges
Carbon emissions scope 3
Emissions from extraction, production and processing of main purchased materials, fuel and energy related activities (not included in scope 1 or scope 2), upstream and downstream goods transportation as well as business travel
Carbon emissions intensity
Total emissions of greenhouse gases [tonnes CO2e] divided by the total packed products [tonnes]
Cash conversion
Adjusted cash flow before financing activities divided by adjusted operating profit
Cash flow before financing activities
Cash flow from operating activities plus cash flow from investing activities
Earnings per share
Profit for the period divided by the total number of shares
Equity to Assets Equity divided by total assets
Financial net debt
Cash and cash equivalents and interest-bearing receivables minus interest-bearing liabilities, excluding lease liabilities
Financial net debt/Adjusted EBITDA
Financial net debt divided by adjusted 12-months rolling EBITDA
Items affecting comparability Non-recurring income and expenses
ktonnes Volume expressed in thousands of metric tonnes
Operating profit Profit before net financial items and tax
Return on capital employed
Adjusted operating profit divided by average capital employed during the past 12-months period
Return on equity
Profit for the period divided by average equity during the past 12-months period
Sales volume Volumes sold in metric tonnes
SEK Swedish Krona
Share of sourced recycled aluminium
Sourced recycled aluminium used as input materials [tonnes] divided by total sourced metal input materials [tonnes]
Glossary
Alloy
Material composed of one metal with additions of other metals and/or elements
Aluminium strip Rolled aluminium in coil form
Brazing Joining of metals through melting and solidification
Cladding
A layer of metal bonded to a dissimilar metal or alloy Heat exchanger A device for transferring heat from one medium to another
HVAC Heating, Ventilation and Air Conditioning systems including heat exchangers
LME London Metal Exchange
Navigate Gränges' strategy for long-term sustainable growth
Rolled aluminium Aluminium that has been hot and/or cold rolled to desired gauge
SHFE Shanghai Futures Exchange
Slab Input material to the rolling process that is produced by casting
Contact
Sara Lander Hyléen VP Communications & Investor Relations [email protected], +46 709 16 16 41
Lukas Östman Investor Relations Manager [email protected], +46 722 24 39 87
Webcasted presentation
CEO Jörgen Rosengren and CFO Oskar Hellström will present Gränges' Interim report Q1, 2024 at a webcasted conference call at 10.00 CEST, Thursday April 25, 2024. Live webcast:
FINANCIAL & SUSTAINABILITY STATEMENTS
https://granges.videosync.fi/2024-04-25-q1-report Conference call:
https://service.flikmedia.se/teleconference/?id=100406
Calendar
| Annual General Meeting | May 8, 2024 | ||
|---|---|---|---|
| Half-year report, Q2 | July 12, 2024 | ||
| Interim report, Q3 | October 24, 2024 | ||
| Year-end report 2024 | January 30, 2025 |
Important information
This interim report may contain forward-looking statements which are based on the company's best assessment at the time the report was written. As is the case with all assessments of the future, such assumptions are subject to both known and unknown risks and uncertainties, which may mean that the actual outcome differs from the anticipated result.
This information is information that Gränges AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, on Thursday 25 April 2024 at 07.30 CEST.
30 GRÄNGES AB (PUBL) INTERIM REPORT Q1, 2024
Head office
Gränges AB (publ) Box 5505 SE-114 85 Stockholm Sweden
Visiting address Linnégatan 18 114 47 Stockholm Sweden
Tel: +46 8 459 59 00 www.granges.com Reg. no. 556001-6122