8-K: Current report filing
Published on November 10, 2010
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 10, 2010
NOVELIS INC.
Canada | 001-32312 | 98-0442987 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (I.R.S. Employer Identification No.) |
3560 Lenox Road, Suite 2000, Atlanta, GA | 30326 | |
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code (404) 814-4200
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
The following information is furnished pursuant to Item 2.02, Results of Operations and Financial
Condition. Consequently, it is not deemed filed for purposes of Section 18 of the Securities
Exchange Act of 1934, or otherwise subject to the liabilities of that section. It may only be
incorporated by reference in another filing under the Securities Exchange Act of 1934 or Securities
Act of 1933 if such subsequent filing specifically references this Form 8-K.
On November 10, 2010, Novelis Inc. issued a press release reporting the companys financial results
for its quarterly period ended September 30, 2010. A copy of the press release is attached hereto
as Exhibit 99.1 and is incorporated by reference herein in its entirety. A copy of investor
presentation materials relating to such financial results is attached hereto as Exhibit 99.2 and is
incorporated by reference herein in its entirety. The presentation materials use the following
non-GAAP financial measures: EBITDA, Adjusted EBITDA, Adjusted Pre-Tax Income (Loss) Excluding
Certain Items, Free Cash Flow and Total Liquidity.
EBITDA and Adjusted EBITDA. EBITDA consists of earnings before interest, taxes, depreciation and
amortization. Adjusted EBITDA further adjusts EBITDA for unrealized (gains) losses on change in
fair value of derivative instruments, impairment of goodwill, adjustment to eliminate proportional
consolidation, restructuring charges and certain other costs. EBITDA and Adjusted EBITDA are
measures commonly used in the companys industry, and the company presents EBITDA and Adjusted
EBITDA to enhance investors understanding of the companys operating performance. Novelis believes
that EBITDA and Adjusted EBITDA are operating performance measures, and not liquidity measures,
that provide investors and analysts with a measure of operating results unaffected by differences
in capital structures, capital investment cycles and ages of related assets among otherwise
comparable companies. However, EBITDA and Adjusted EBITDA are not measurements of financial
performance under GAAP, and the companys EBITDA and Adjusted EBITDA may not be comparable to
similarly titled measures of other companies. EBITDA and Adjusted EBITDA have important limitations
as an analytical tool, and investors should not consider them in isolation, or as a substitute for
analysis of the companys results as reported under GAAP. For example, EBITDA and Adjusted EBITDA:
| do not reflect the companys cash expenditures or requirements for capital expenditures or capital commitments; | ||
| do not reflect changes in, or cash requirements for, the companys working capital needs; and | ||
| do not reflect any costs related to the current or future replacement of assets being depreciated and amortized. |
Additionally, a form of adjusted EBITDA, defined in the companys senior secured credit facilities,
7.25% senior notes and 11.5% senior notes, is used for debt covenant compliance purposes, which has
additional adjustments to Adjusted EBITDA which may decrease or increase adjusted EBITDA for
purposes of these financial covenants.
Free Cash Flow. Free Cash Flow consists of: (a) net cash provided by (used in) operating
activities; (b) plus net cash provided by (used in) investing activities and (c) less proceeds from
sales of assets. Management believes that Free Cash Flow is relevant to investors as it provides a
measure of the cash generated internally that is available for debt service and other value
creation opportunities. However, Free Cash Flow is not a measurement of financial performance or
liquidity under GAAP and does not necessarily represent cash available for discretionary
activities, as certain debt service obligations must be funded out of Free Cash Flow. In addition,
the companys method of calculating Free Cash Flow may not be consistent with that of other
companies.
Adjusted Pre-Tax Income (Loss) Excluding Certain Items. Adjusted Pre-Tax Income (Loss) Excluding
Certain Items adjusts income before income taxes for restructuring charges, unrealized gains
(losses) on change in fair value of derivative instruments, charges related to the settlement of
tax litigation in Brazil and impairment of goodwill. Novelis believes that Pre-Tax Income (Loss)
Excluding Certain Items enhances the overall understanding of the
companys current financial performance. Specifically, management believes this non-GAAP financial
measure
provides useful information to investors by excluding or adjusting certain items, which
impact the comparability of the companys core operating results. With respect to unrealized gains
(losses) on change in fair value of derivative instruments, management adjusts pre-tax income to
eliminate the volatility created between periods due to changes in the fair value of derivative
instruments before the derivative instruments are settled. With respect to restructuring charges,
our charge related to the Brazilian tax settlement and impairment of goodwill, management believes
these excluded items are not reflective of fixed costs that the company believes it will incur over
the long term. This financial measure should be considered in addition to, and not as a substitute
for or superior to, results prepared in accordance with GAAP.
Total Liquidity. Total Liquidity consists of: (a) cash and cash equivalents; (b) less overdrafts;
(c) plus gross availability under the ABL facility and (d) less borrowing availability limitation
under the ABL facility due to fixed charge coverage ratio. In addition to presenting available cash
and cash equivalents, management believes that presenting Total Estimated Liquidity enhances
investors understanding of the liquidity that is actually available to the company. This financial
measure should be considered in addition to, and not as a substitute for or superior to, results
prepared in accordance with GAAP.
All information in the news release and the presentation materials speak as of the date thereof,
and Novelis does not assume any obligation to update said information in the future.
Item 9.01. Financial Statements and Exhibits.
(d) | Exhibits. |
99.1 | Press release, dated November 10, 2010 (furnished to the Commission as a part of this Form 8-K). | |
99.2 | Presentation materials, dated November 10, 2010 (furnished to the Commission as a part of this Form 8-K). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
NOVELIS INC. |
||||
Date: November 10, 2010 | By: | /s/ Leslie J. Parrette | ||
Leslie J. Parrette, Jr. | ||||
General Counsel, Corporate Secretary and Compliance Officer |
EXHIBIT INDEX
Exhibit | ||
Number | Description | |
99.1
|
Press release, dated November 10, 2010 (furnished to the Commission as a part of this Form 8-K). | |
99.2
|
Presentation materials, dated November 10, 2010 (furnished to the Commission as a part of this Form 8-K). |