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Dec 31, 2019
Kaiser Aluminum Q4 2019 Earnings Report
Kaiser Aluminum reported a net loss but adjusted earnings per share increased year-over-year, driven by strong aerospace demand and value added revenue pricing.
Key Takeaways
Kaiser Aluminum Corporation reported a net loss of $11 million for Q4 2019, which includes pre-tax charges of $45 million related to senior notes refinancing and goodwill impairment. However, adjusted net income was $29 million, or $1.79 per diluted share, compared to $30 million, or $1.77 per diluted share, for the prior year period. Value added revenue increased to $213 million, driven by strong aerospace demand.
Net Sales were $369 million.
Value Added Revenue was $213 million, up 1% year-over-year.
Net Loss was $11 million, or $0.66 per diluted share, including pre-tax charges of $45 million.
Adjusted Earnings per Diluted Share was $1.79.
Revenue by Segment
Forward Guidance
Kaiser Aluminum expects a low-single-digit year-over-year increase in both total shipments and value added revenue, with an EBITDA margin above 26% for the full year 2020.
Positive Outlook
- Increased defense spending and demand for the F35 Joint Strike Fighter and the F/A-18 Super Hornet will strengthen the aerospace order book.
- North American automotive build rates in 2020 are expected to be similar to 2019, with double-digit year-over-year growth in automotive shipments as new programs come on stream.
- General engineering demand is expected to be driven by strong semi-conductor demand and relief from supply chain destocking.
- A new $145 million heavy gauge plate stretcher will provide increased capacity, redundancy, efficiency, and operational security for a critical operation in the Company's process flow.
- The Company expects that the result will be pent-up long-term demand for commercial aerospace applications in addition to growing long-term demand for its heat treat plate products.
Challenges Ahead
- The impact of the Boeing 737 MAX situation is expected to affect aerospace shipments.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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