Gränges’ interim report January–March 2021

22 Apr 2021 | GROUP RELEASE, Regulatory - MAR

New record for sales volume and earnings in first quarter

First quarter 2021

  • Sales volume increased by 41.0 per cent to 126.7 ktonnes (89.9) and net sales to SEK 4,043 million (3,063). Excluding acquisitions sales volume increased by 14.3 per cent to 102.8 ktonnes and net sales was SEK 3,365 million.
  • Adjusted operating profit increased to SEK 342 million (210) and adjusted operating profit per tonne was 2.7 kSEK (2.3). Excluding acquisitions, adjusted operating profit increased to SEK 293 million.
  • Profit for the period increased to SEK 239 million (133) and includes items affecting comparability of SEK –16 million (–6).
  • Diluted earnings per share increased to SEK 2.24 (1.56).
  • Cash flow before financing activities adjusted for expansion investments and acquisitions was SEK –55 million (329).
  • Net debt increased to SEK 3,690 million at 31 March 2021 (SEK 3,292 million at 31 December 2020), corresponding to 2.4 times adjusted EBITDA1,2 (2.2 times at 31 December 2020).
  • Two new Business areas, Gränges Eurasia and Gränges Americas, have been established during the quarter.
  • Selected sustainability targets to 2025 have been upgraded to reflect that the development of the sustainability performance has been strong during the recent years.

1 Includes adjusted EBITDA for acquisitions as a part of Gränges Group for 12 months, see alternative performance measures page 23 for further information.
2 Adjusted for items affecting comparability, see Note 5 for further information.


Comments by Gränges’ CEO Johan Menckel:

Strong start of the year with growing demand and good cost performance

Strong market demand
We experienced a strong market in the first quarter of 2021. The sales volume in the first quarter reached 126.7 ktonnes, which is the highest sales volume in an individual quarter so far and represents a 41 per cent growth over the same period last year. Excluding the acquired sales volume from Gränges Konin, the first quarter sales volume was up 14 per cent compared with the same period last year and 16 per cent compared to the sales volume in the fourth quarter 2020. The adjusted operating profit increased by 63 per cent to a new record level of SEK 342 million largely driven by the higher sales volume supported by continued good cost performance. Gränges Konin contributed to the operating profit with SEK 49 million while exchange rate fluctuations had a negative impact on adjusted operating profit of SEK 62 million. The increase in the market price for aluminium is by contract passed on to the customer and has not had a material impact on the earnings in the quarter. The higher aluminium price does, however, increase the value of our working capital which reduced the cash flow from operations in the first quarter.

The market development in the first quarter was particularly strong in the Automotive business, where increased light vehicle production and continued restocking activities at customer level contributed to a 22 per cent increase in sales volume compared to last year. The semiconductor shortage currently experienced in the automotive industry did not have a material impact on the sales in the first quarter. Including the acquired growth from Gränges Konin the sales volume to Automotive customers increased 43 per cent in the quarter. For the HVAC business we continued to see a positive development with a 12 per cent year over year growth fueled by positive underlying market demand and a continued market share increase. Demand for Speciality packaging material remained stable in the quarter. The market conditions are currently expected to remain stable from the first to the second quarter.

Executing on our strategy
At the end of March, the upgrade of the final of the rolling mills in Newport, Arkansas, was completed and the first aluminium coil was successfully rolled on April 20. Commissioning of the mill will take place during the second quarter and commercial volumes are expected to start to ramp-up as of the third quarter. This means that both the investments undertaken to increase the rolling capacity in Newport and Huntingdon Tennessee, have now been successfully completed. To meet the continuously increasing demand from North American customers we have during the first quarter taken a decision to invest USD 33 million to expand our aluminium casting operations in Huntingdon. When completed in less than two years, this investment will enable us to increase the capacity utilization of our rolling and slitting operations even further. Finally, I am also happy that the integration of Gränges Konin progresses according to plan.

Raising our sustainability ambitions
Sustainability is a strong driver and enabler of our long-term competitiveness and value creation. In March 2019, we launched sustainability targets to 2025 and since then good progress has been achieved towards many of these. To reflect the stronger than anticipated development in the sustainability performance as well as the increased interest and expectations from customers and other stakeholders, we are now upgrading selected sustainability targets. We have for example raised the target to have third-party verified sustainability information on our products, from 80 per cent to 100 per cent. Already today we can offer third-party verified sustainability information for all products produced at the site in Finspång. We have also increased the target for sourced recycled aluminium, from 20 per cent to 30 per cent. Moreover, we have quantified the emission reduction target for sourced metal inputs (GHG Protocol: Scope 3) to 30 per cent versus 2017 baseline. I’m very proud that we have achieved good progress on our sustainability priorities and that we are now further raising our ambition level. A full summary of the upgraded targets can be found on page 8.

Although the COVID-19 pandemic is still ongoing, some of the uncertainty has been reduced and the market demand is currently expected to remain on a healthy level in the coming quarter. For the second quarter 2021, Gränges currently expects a similar sales volume as in the first quarter. Still, uncertainty related to the semiconductor shortage within the automotive industry pose a downside risk to the second quarter outlook. The development of foreign exchange rates is expected to have a negative net impact on profitability when comparing the second quarter to the first quarter.

Looking further ahead, I strongly believe that we will be able to capitalize on the strong platform we have established for Gränges. With a strong commitment to sustainability, innovation, digitalization, and continuous improvement, Gränges is well positioned to deliver sustainable and profitable growth for the coming years.

Johan Menckel, CEO

Webcasted telephone conference
CEO Johan Menckel and CFO Oskar Hellström will present Gränges’ interim report for January–March 2021 at a webcasted conference call at 10.00 CEST, Thursday 22 April, 2021.

The webcast is available on To participate in the conference call, please call +46 8 5664 2651 (Sweden), +44 3333 000 804 (United Kingdom) or +1 631 913 1422 (United States). PIN code: 6978 8601#. Please call a few minutes before the conference call starts. The presentation will be in English.

For additional information, please contact:
Johan Dufvenmark, VP Group Treasury & Investor Relations
Telephone: +46 705 97 43 75

The information in this report is such that Gränges must disclose pursuant to the EU Market Abuse Regulation and the Swedish Securities Market Act. The information was submitted for publication, through the agency of the contact person set out above, on Thursday 22 April, 2021 at 07.30 CEST.

About Gränges
Gränges is an aluminium technology company who drives the development of lighter, smarter and more sustainable aluminium products and solutions. The company develops, produces and markets advanced materials that enhance efficiency in the customers’ manufacturing process and the performance of the final products. Gränges’ innovative engineering has transformed the industry for more than 125 years, and the company holds leading positions in rolled products for thermal management systems, speciality packaging and selected niche applications. Gränges’ geographical markets are Asia, Europe and Americas with production facilities in all three regions and a total annual production capacity of 560 ktonnes. Gränges has 2,400 employees and the share is listed on Nasdaq Stockholm. More information on Gränges is available at