Novelis Inc (NVL) saw its loss widen to $89 million in the quarter ended compared with $13 million a year ago.

Revenue during the quarter dropped 4.88 percent to $2,361 million from $2,482 million in the previous year period. Gross margin for the quarter expanded 643 basis points over the previous year period to 16.14 percent. Total expenses were 92.84 percent of quarterly revenues, down from 98.59 percent for the same period last year. This has led to an improvement of 575 basis points in operating margin to 7.16 percent.

However, the adjusted EBITDA for the quarter stood at $256 million compared with $182 million in the prior year period. At the same time, adjusted EBITDA margin improved 351 basis points in the quarter to 10.84 percent from 7.33 percent in the last year period.

"We continued driving the positive momentum achieved over the last several quarters into the second quarter," said Steve Fisher, president and chief executive officer for Novelis. "Our recurring strong EBITDA performance is a result of strategic investments in new capacity, driving positive portfolio mix and efficiency gains through metal input optimization. We are confident this strategy, coupled with plant productivity and asset efficiency, will continue to drive enhanced operational performance and a stronger product portfolio."

The company has spent $87 million cash to meet investing activities during the first six months as against cash outgo of $221 million in the last year period. It has incurred net capital expenditure of $89 million on net basis during the first six months, down 56.16 percent or $114 million from year ago period.

Cash flow from financing activities was $19 million for the first six months, down 83.33 percent or $95 million, when compared with the last year period.

Cash and cash equivalents stood at $473 million as on Sep. 30, 2016, up 2.38 percent or $11 million from $462 million on Sep. 30, 2015.
 

Working capital increases sharply
Novelis Inc has recorded an increase in the working capital over the last year. It stood at $367 million as at Sep. 30, 2016, up 948.57 percent or $332 million from $35 million on Sep. 30, 2015. Current ratio was at 1.13 as on Sep. 30, 2016, up from 1.01 on Sep. 30, 2015.

Cash conversion cycle (CCC) has decreased to 4 days for the quarter from 42 days for the last year period. Days sales outstanding went up to 52 days for the quarter compared with 50 days for the same period last year.

Days inventory outstanding has decreased to 30 days for the quarter compared with 59 days for the previous year period. At the same time, days payable outstanding went up to 78 days for the quarter from 67 for the same period last year.