GlobeNewswire Inc | Oct 27, 2021 06:00AM EDT

October 27, 2021

PARIS, Oct. 27, 2021 (GLOBE NEWSWIRE) -- Constellium SE (NYSE: CSTM) today reported results for the third quarter ended September 30, 2021.

Third quarter 2021 highlights:

-- Shipments of 395 thousand metric tons, up 12% compared to Q3 2020 -- Revenue of 1.6 billion, up 35% compared to Q3 2020 -- Net income of 99 million compared to a net income of 20 million in Q3 2020 -- Adjusted EBITDA of 143 million, up 14% compared to Q3 2020 -- Cash from Operations of 91 million and Free Cash Flow of 40 million -- Investigating an increase in total planned European recycling center capacity to ~130kt -- Redeeming $200 million of 5.875% Senior Notes due 2026 in November

Nine months ended September 30, 2021 highlights:

-- Shipments of 1.2 million metric tons, up 12% compared to YTD 2020 -- Revenue of 4.4 billion, up 22% compared to YTD 2020 -- Net income of 255 million compared to a net loss of 43 million in YTD 2020 -- Adjusted EBITDA of 434 million, up 23% compared to YTD 2020 -- Cash from Operations of 239 million and Free Cash Flow of 121 million -- Net debt / LTM Adjusted EBITDA of 3.6x at September 30, 2021

Jean-Marc Germain, Constelliums Chief Executive Officer said, Constellium delivered solid results in the third quarter. Demand remained strong across our packaging and industrial end markets, while automotive demand continued to be hindered by the semiconductor shortage and aerospace demand remained subdued as expected. P&ARP matched the record Adjusted EBITDA of the second quarter supported by strong operational performance. A&T benefited from robust TID shipments and continued to demonstrate good cost control. AS&I also performed well with strong Industry shipments and solid cost control, which mitigated much of the weakness in automotive demand. Importantly, we continued to generate Free Cash Flow and further reduced our leverage in the third quarter."

"I want to commend the entire Constellium team for maintaining its focus especially in the face of continuing supply chain challenges and increasing inflationary pressures. This focus on execution leaves us well positioned to deliver long-term Adjusted EBITDA growth and meet our balance sheet leverage target. I remain confident in our trajectory and the substantial shareholder value creation opportunity in front of us," Mr. Germain continued.

Mr. Germain concluded, "We expect recent demand trends in our markets to continue through the remainder of 2021. Based on our current outlook, we now expect Adjusted EBITDA of 550 million to 560 million and Free Cash Flow in excess of 125 million in 2021.

Group Summary

Q3 Q3 Var. YTD YTD Var. 2021 2020 2021 2020Shipments (k metric tons) 395 354 12 % 1,186 1,057 12 %Revenue (? millions) 1,587 1,172 35 % 4,446 3,640 22 %Net income / (loss) (? millions) 99 20 n.m. 255 (43 ) n.m. Adjusted EBITDA (? millions) 143 126 14 % 434 354 23 %Adjusted EBITDA per metric ton (?) 362 355 2 % 366 335 9 %

The difference between the sum of reported segment revenue and total group revenue includes revenue from certain non-core activities and inter-segment eliminations. The difference between the sum of reported segment Adjusted EBITDA and the Group Adjusted EBITDA is related to Holdings and Corporate.

For the third quarter of 2021, shipments of 395 thousand metric tons increased 12% compared to the third quarter of 2020 due to higher shipments in each of our segments. Revenue of 1.6 billion increased 35% compared to the third quarter of the prior year primarily due to higher metal prices and higher shipments, partially offset by weaker mix. Net income of 99 million increased 79 million compared to net income of 20 million in the third quarter of 2020. Adjusted EBITDA of 143 million increased 14% compared to the third quarter of last year due to stronger results in our Aerospace & Transportation and Packaging & Automotive Rolled Product segments.

For the first nine months of 2021, shipments of 1.2 million metric tons increased 12% compared to the first nine months of 2020 on higher shipments in each of our segments. Revenue of 4.4 billion increased 22% compared to the first nine months of 2020 primarily due to higher metal prices and higher shipments, partially offset by weaker mix. Net income of 255 million compares to a net loss of 43 million in the first nine months of 2020. Adjusted EBITDA of 434 million increased 23% compared to the first nine months of 2020 on stronger results in our Packaging & Automotive Rolled Products and Automotive Structures & Industry segments, partially offset by weaker results in our Aerospace & Transportation segment.

Results by Segment

Packaging & Automotive Rolled Products (P&ARP)

Q3 Q3 Var. YTD YTD Var. 2021 2020 2021 2020Shipments (k metric tons) 281 258 9 % 832 748 11 %Revenue (? millions) 988 672 47 % 2,661 1,989 34 %Adjusted EBITDA (? millions) 94 85 10 % 256 209 22 %Adjusted EBITDA per metric ton (?) 335 332 1 % 308 280 10 %

For the third quarter of 2021, Adjusted EBITDA increased 10% compared to the third quarter of 2020 primarily due to higher shipments and favorable metal costs, partially offset by unfavorable mix. Shipments of 281 thousand metric tons increased 9% compared to the third quarter of last year on higher shipments of packaging and specialty rolled products. Revenue of 988 million increased 47% compared to the third quarter of 2020 primarily due to higher metal prices and higher shipments.

For the first nine months of 2021, Adjusted EBITDA of 256 million increased 22% compared to the first nine months of 2020 primarily due to higher shipments, solid cost control, and favorable metal costs, partially offset by unfavorable foreign exchange translation. Shipments of 832 thousand metric tons increased 11% compared to the first nine months of 2020 on higher shipments of packaging, automotive, and specialty rolled products. Revenue of 2.7 billion increased 34% compared to the first nine months of 2020 primarily due to higher metal prices and higher shipments.

Aerospace & Transportation (A&T)

Q3 Q3 Var. YTD YTD Var. 2021 2020 2021 2020Shipments (k metric tons) 52 36 45 % 153 140 9 %Revenue (? millions) 289 202 43 % 821 811 1 %Adjusted EBITDA (? millions) 20 10 91 % 81 93 (14 )%Adjusted EBITDA per metric ton (?) 362 275 32 % 525 666 (21 )%

For the third quarter of 2021, Adjusted EBITDA increased 91% compared to the third quarter of 2020 primarily due to higher shipments on strong TID demand and solid cost control, partially offset by weaker mix from lower aerospace shipments. Shipments of 52 thousand metric tons increased 45% compared to the third quarter of 2020 as higher transportation, industry and defense rolled product shipments more than offset lower aerospace rolled product shipments. Revenue of 289 million increased 43% compared to the third quarter of 2020 on higher shipments and higher metal prices, partially offset by weaker mix.

For the first nine months of 2021, Adjusted EBITDA of 81 million decreased 14% compared to the first nine months of 2020 primarily due to weaker mix from lower aerospace shipments, partially offset by strong cost control and higher transportation, industry, and defense shipments. Shipments of 153 thousand metric tons increased 9% compared to the first nine months of 2020 as higher shipments of transportation, industry, and defense rolled products more than offset lower shipments of aerospace rolled products. Revenue of 821 million increased 1% compared to the first nine months of 2020 primarily due to higher metal prices and higher shipments, partially offset by weaker mix.

Automotive Structures & Industry (AS&I)

Q3 Q3 Var. YTD YTD Var. 2021 2020 2021 2020Shipments (k metric tons) 62 60 4 % 201 169 19 %Revenue (? millions) 326 304 7 % 1,021 868 18 %Adjusted EBITDA (? millions) 32 33 (0 )% 111 66 69 %Adjusted EBITDA per metric ton (?) 528 551 (4 )% 553 389 42 %

For the third quarter of 2021, Adjusted EBITDA decreased by 1 million compared to the third quarter of 2020 primarily due to higher shipments and solid cost control, partially offset by weaker mix. Shipments of 62 thousand metric tons increased 4% compared to the third quarter of 2020 on higher shipments of other extruded products, partially offset by lower shipments of automotive extruded products. Revenue of 326 million increased 7% compared to the third quarter of 2020 primarily due to higher metal prices, partially offset by weaker mix.

For the first nine months of 2021, Adjusted EBITDA of 111 million increased 69% compared to the first nine months of 2020 primarily due to higher shipments, improved price and mix, and solid cost control. Shipments of 201 thousand metric tons increased 19% compared to the first nine months of 2020 on higher shipments of automotive and other extruded products. Revenue of 1.0 billion increased 18% compared to the first nine months of 2020 primarily due to higher shipments and higher metal prices, partially offset by weaker price and mix.

Net Income

For the third quarter of 2021, net income of 99 million compares to a net income of 20 million in the third quarter of the prior year. The change in net income is primarily related to higher gross profit and a favorable change in gains and losses on derivatives related to our metal hedging positions, partially offset by a change in income tax expense.

For the first nine months of 2021, net income of 255 million compares to a net loss of 43 million in the first nine months of the prior year. The change in net income is primarily related to higher gross profit and a favorable change in gains and losses on derivatives related to our metal hedging positions, partially offset by a change in income tax expense.

Cash Flow

Free Cash Flow was 121 million in the first nine months of 2021 compared to 129 million in the first nine months of the prior year. The change was primarily due to an unfavorable change in working capital, partially offset by stronger Adjusted EBITDA and lower interest paid.

Cash flows from operating activities were 239 million for the first nine months of 2021 compared to cash flows from operating activities of 263 million in the first nine months of the prior year. Constellium decreased derecognized factored receivables by 30 million for the first nine months of 2021 compared to a decrease of 76 million in the first nine months of the prior year.

Cash flows used in investing activities were 118 million for the first nine months of 2021 compared to cash flows used in investing activities of 133 million in the first nine months of the prior year.

Cash flows used in financing activities were 241 million for the first nine months of 2021 compared to cash flows from financing activities of 122 million in the first nine months of the prior year. In the first nine months of 2021, Constellium issued $500 million of 3.75% Sustainability-Linked Senior Notes due 2029 and 300 million of 3.125% Sustainability-Linked Senior Notes due 2029 and used the proceeds and cash on the balance sheet to redeem the $650 million of 6.625% Senior Notes due 2025 and the $400 million of 5.75% Senior Notes due 2024. In the first nine months of 2020, Constellium raised $325 million of 5.625% Senior Notes due 2028 and used a portion of the proceeds to redeem the remaining balance of the 4.625% Senior Notes due 2021. In the same period, Constellium entered into a 180 million loan partially guaranteed by the French State and a CHF 20 million facility partially guaranteed by the Swiss Government.

Liquidity and Net Debt

Liquidity at September 30, 2021 was 900 million, comprised of 323 million of cash and cash equivalents and 577 million available under our committed lending facilities and factoring arrangements.

Net debt was 1,964 million at September 30, 2021 compared to 1,994 million at December 31, 2020.

Outlook

Based on our current outlook, we expect Adjusted EBITDA in a range of 550 million to 560 million in 2021.

We are not able to provide a reconciliation of this Adjusted EBITDA guidance to net income, the comparable GAAP measure, because certain items that are excluded from Adjusted EBITDA cannot be reasonably predicted or are not in our control. In particular, we are unable to forecast the timing or magnitude of realized and unrealized gains and losses on derivative instruments, metal lag, impairment or restructuring charges, or taxes without unreasonable efforts, and these items could significantly impact, either individually or in the aggregate, net income in the future.

Recent Developments

On October 26, 2021, Constellium announced the intention to redeem $200 million of the 5.875% Senior Notes due 2026. This transaction is consistent with our targets of reducing gross debt and lowering interest cost.

Forward-looking statements

Certain statements contained in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. This press release may contain forward-looking statements with respect to our business, results of operations and financial condition, and our expectations or beliefs concerning future events and conditions. You can identify forward-looking statements because they contain words such as, but not limited to, believes, expects, may, should, approximately, anticipates, estimates, intends, plans, targets, likely, will, would, could and similar expressions (or the negative of these terminologies or expressions). All forward-looking statements involve risks and uncertainties. Many risks and uncertainties are inherent in our industry and markets, while others are more specific to our business and operations. These risks and uncertainties include, but are not limited to: market competition; economic downturn; disruption to business operations, including the length and magnitude of disruption resulting from the global COVID-19 pandemic; the inability to meet customer demand and quality requirements; the loss of key customers, suppliers or other business relationships; the capacity and effectiveness of our hedging policy activities; the loss of key employees; levels of indebtedness which could limit our operating flexibility and opportunities; and other risk factors set forth under the heading Risk Factors in our Annual Report on Form 20-F, and as described from time to time in subsequent reports filed with the U.S. Securities and Exchange Commission. The occurrence of the events described and the achievement of the expected results depend on many events, some or all of which are not predictable or within our control. Consequently, actual results may differ materially from the forward-looking statements contained in this press release. We undertake no obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by law.

About Constellium

Constellium (NYSE: CSTM) is a global sector leader that develops innovative, value added aluminium products for a broad scope of markets and applications, including packaging, automotive and aerospace. Constellium generated 4.9 billion of revenue in 2020.

Constelliums earnings materials for the third quarter ended September 30, 2021, are also available on the companys website (www.constellium.com).

Ryan Wentling? Investor Relations Delphine Dahan-Kocher? CommunicationsPhone: +1 (443) 988-0600 Phone: +1 (443) 420 7860investor-relations@constellium.com delphine.dahan-kocher@constellium.com

CONSOLIDATED INCOME STATEMENT (UNAUDITED)

Three months ended Nine months ended September 30, September 30,(in millions of Euros) 2021 2020 2021 2020 Revenue 1,587 1,172 4,446 3,640 Cost of sales (1,419 ) (1,043 ) (3,937 ) (3,284 )Gross profit 168 129 509 356 Selling and (60 ) (55 ) (187 ) (178 )administrative expensesResearch and development (10 ) (9 ) (30 ) (29 )expensesOther gains and losses - 55 (1 ) 142 (80 )netIncome from operations 153 64 434 69 Finance costs - net (34 ) (37 ) (126 ) (124 )Income / (loss) before 119 27 308 (55 )taxIncome tax (expense) / (20 ) (7 ) (53 ) 12 benefitNet income / (loss) 99 20 255 (43 )Net income attributable to:Equity holders of 97 19 250 (45 )ConstelliumNon-controlling 2 1 5 2 interestsNet income / (loss) 99 20 255 (43 )

Earnings per share attributableto the equity holders of Constellium, (in Euros)Basic 0.68 0.13 1.77 (0.33 )Diluted 0.65 0.13 1.69 (0.33 ) Weighted average number of sharesBasic 141,677 139,209 140,765 139,032 Diluted 147,148 143,002 147,148 139,032

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME / (LOSS) (UNAUDITED)

Three months ended Nine months ended September 30, September 30,(in millions of Euros) 2021 2020 2021 2020 Net income / (loss) 99 20 255 (43 )Other comprehensive income / (loss) Items that will not be reclassifiedsubsequently to the interim income statementRemeasurement on post-employment 5 (12 ) 94 (53 )benefit obligationsIncome tax on remeasurement on (3 ) 3 (14 ) 12 post-employment benefit obligationsItems that may be reclassifiedsubsequently to the interim income statementCash flow hedges (6 ) 12 (14 ) 12 Income tax on hedges 1 (4 ) 3 (4 )Currency translation differences 10 (8 ) 22 (10 )Other comprehensive income / (loss) 7 (9 ) 91 (43 )Total comprehensive income / (loss) 106 11 346 (86 )Attributable to: Equity holders of Constellium 104 10 340 (88 )Non-controlling interests 2 1 6 2 Total comprehensive income / (loss) 106 11 346 (86 )

CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)

At September 30, At December(in millions of Euros) 2021 31, 2020 Assets Current assets Cash and cash equivalents 323 439 Trade receivables and other 689 406 Inventories 935 582 Other financial assets 88 39 2,035 1,466 Non-current assets Property, plant and equipment 1,897 1,906 Goodwill 441 417 Intangible assets 62 61 Deferred tax assets 150 193 Trade receivables and other 71 68 Other financial assets 15 18 2,636 2,663 Total Assets 4,671 4,129 Liabilities Current liabilities Trade payables and other 1,332 905 Borrowings 262 92 Other financial liabilities 27 46 Income tax payable 26 20 Provisions 19 23 1,666 1,086 Non-current liabilities Trade payables and other 35 32 Borrowings 2,020 2,299 Other financial liabilities 8 41 Pension and other post-employment benefit 579 664 obligationsProvisions 96 98 Deferred tax liabilities 13 10 2,751 3,144 Total Liabilities 4,417 4,230 Equity Share capital 3 3 Share premium 420 420 Retained deficit and other reserves (187 ) (538 )Equity attributable to equity holders of 236 (115 )ConstelliumNon-controlling interests 18 14 Total Equity 254 (101 ) Total Equity and Liabilities 4,671 4,129

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

Cash Foreign Non-(in millions of Share Share Re- flow currency Other Retained Total controlling TotalEuros) capital premium measurement hedges translation reserves losses interests equity reserveAt January 1, 3 420 (192 ) 9 (13 ) 68 (410 ) (115 ) 14 (101 )2021Net income ? ? ? ? ? ? 250 250 5 255 Othercomprehensive ? ? 80 (11 ) 21 ? ? 90 1 91 income / (loss)Totalcomprehensive ? ? 80 (11 ) 21 ? 250 340 6 346 income / (loss)Share-based ? ? ? ? ? 11 ? 11 ? 11 compensationTransactionswith ? ? ? ? ? ? ? ? (2 ) (2 )non-controllinginterestsAt September 3 420 (112 ) (2 ) 8 79 (160 ) 236 18 254 30, 2021 Cash Foreign Non-(in millions of Share Share Re- flow currency Other Retained Total controlling TotalEuros) capital premium measurement hedges translation reserves losses interests equity reserveAt January 1, 3 420 (177 ) (10 ) 4 53 (389 ) (96 ) 11 (85 )2020Net (loss) / ? ? ? ? ? ? (45 ) (45 ) 2 (43 )incomeOthercomprehensive ? ? (41 ) 8 (10 ) ? ? (43 ) ? (43 )(loss) / incomeTotalcomprehensive ? ? (41 ) 8 (10 ) ? (45 ) (88 ) 2 (86 )(loss) / incomeShare-based ? ? ? ? ? 11 ? 11 ? 11 compensationTransactionswith ? ? ? ? ? ? ? ? ? ? non-controllinginterestsAt September 3 420 (218 ) (2 ) (6 ) 64 (434 ) (173 ) 13 (160 )30, 2020

CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

Three months Nine months ended September ended September 30, 30,(in millions of Euros) 2021 2020 2021 2020 Net income / (loss) 99 20 255 (43 )Adjustments Depreciation and amortization 67 64 195 196 Impairment of assets ? 9 ? 14 Pension and other post-employment 8 9 25 26 benefits service costsFinance costs - net 34 37 126 124 Income tax expense / (benefit) 20 7 53 (12 )Unrealized gains on derivatives - net andfrom remeasurement of monetary assets and (23 ) (13 ) (68 ) (2 )liabilities - netLosses on disposal 1 2 1 2 Other - net 3 3 8 16 Change in working capital Inventories (122 ) 15 (334 ) 50 Trade receivables (23 ) (19 ) (257 ) (12 )Trade payables 56 38 356 20 Other 15 8 15 23 Change in provisions (3 ) (2 ) (7 ) 3 Pension and other post-employment (13 ) (15 ) (34 ) (35 )benefits paidInterest paid (27 ) (45 ) (99 ) (118 )Income tax (paid) / refunded (1 ) (7 ) 4 11 Net cash flows from operating activities 91 111 239 263 Purchases of property, plant and (54 ) (38 ) (128 ) (138 )equipmentProperty, plant and equipment grants 3 2 10 4 receivedProceeds from disposals, net of cash ? ? ? 1 Net cash flows used in investing (51 ) (36 ) (118 ) (133 )activities Proceeds from issuance of Senior Notes ? ? 712 290 Repayments of Senior Notes ? ? (863 ) (200 )Repayments from U.S. revolving credit ? ? ? (129 )facilitiesProceeds from other borrowings ? (5 ) 2 202 Repayments from other borrowings (1 ) (3 ) (10 ) (7 )Lease repayments (8 ) (8 ) (25 ) (25 )Payment of financing costs and redemption (2 ) ? (28 ) (9 )feesTransactions with non-controlling ? ? (2 ) ? interestsOther financing activities 2 (2 ) (27 ) ? Net cash flows (used in) / from financing (9 ) (18 ) (241 ) 122 activities Net increase / (decrease) in cash and 31 57 (120 ) 252 cash equivalentCash and cash equivalents - beginning of 290 378 439 184 yearEffect of exchange rate changes on cash 2 (3 ) 4 (4 )and cash equivalentsCash and cash equivalents - end of period 323 432 323 432

SEGMENT ADJUSTED EBITDA

Three months ended September Nine months ended 30, September 30,(in millions of 2021 2020 2021 2020 Euros)P&ARP 94 85 256 209 A&T 20 10 81 93 AS&I 32 33 111 66 Holdings and (3 ) (2 ) (14 ) (14 )CorporateTotal 143 126 434 354

SHIPMENTS AND REVENUE BY PRODUCT LINE

Three months ended Nine months ended September 30, September 30,(in k metric tons) 2021 2020 2021 2020 Packaging rolled products 215 192 622 584 Automotive rolled products 55 60 177 145 Specialty and other thin-rolled 11 6 33 19 productsAerospace rolled products 13 15 39 64 Transportation, industry,defense and other rolled 39 21 114 76 productsAutomotive extruded products 26 31 89 77 Other extruded products 36 29 112 92 Total shipments 395 354 1,186 1,057 (in millions of Euros) Packaging rolled products 730 463 1,897 1,443 Automotive rolled products 216 185 637 466 Specialty and other thin-rolled 42 24 127 80 productsAerospace rolled products 92 110 279 475 Transportation, industry,defense and other rolled 197 92 542 336 productsAutomotive extruded products 167 187 544 482 Other extruded products 159 117 477 386 Other and inter-segment (16 ) (6 ) (57 ) (28 )eliminationsTotal revenue 1,587 1,172 4,446 3,640

NON-GAAP MEASURES

Reconciliation of net income to Adjusted EBITDA (a non-GAAP measure)

Three months Nine months ended September ended September 30, 30,(in millions of Euros) 2021 2020 2021 2020 Net income / (loss) 99 20 255 (43 )Income tax expense / (benefit) 20 7 53 (12 )Income / (loss) before tax 119 27 308 (55 )Finance costs - net 34 37 126 124 Income from operations 153 64 434 69 Depreciation and amortization 67 64 195 196 Impairment of assets ? 9 ? 14 Restructuring costs ? 2 3 13 Unrealized (gains) / losses on (23 ) (9 ) (67 ) 1 derivativesUnrealized exchange gains from theremeasurement of monetary assets and ? (2 ) (1 ) (1 )liabilities ? netLosses on pension plan amendments ? ? 2 2 Share based compensation costs 4 3 11 11 Metal price lag (A) (59 ) (7 ) (144 ) 33 Start-up and development costs (B) ? 1 ? 5 Losses on disposal 1 2 1 2 Other (C) ? (1 ) ? 9 Adjusted EBITDA 143 126 434 354

Metal price lag represents the financial impact of the timing difference between when aluminium prices included within Constellium's Revenue are established and when aluminium purchase prices included in Cost of sales are established. The Group accounts for inventory using a weighted average price basis and this adjustment aims to remove the effect of volatility in(A) LME prices. The calculation of the Group metal price lag adjustment is based on an internal standardized methodology calculated at each of Constellium?s manufacturing sites and is primarily calculated as the average value of product recorded in inventory, which approximates the spot price in the market, less the average value transferred out of inventory, which is the weighted average of the metal element of cost of sales, based on the quantity sold in the year.(B) Start-up and development costs, for the nine months ended September 30, 2020 were related to new projects in our AS&I operating segment. Other, for the nine months ended September 30, 2020, included ?4 million of procurement penalties and termination fees incurred because of the Group's(C) inability to fulfill certain commitments due to the COVID-19 pandemic and a ?5 million loss resulting from the discontinuation of hedge accounting for certain forecasted sales that were determined to be no longer expected to occur in light of the COVID-19 pandemic effects.

Reconciliation of net cash flows from operating activities to Free Cash Flow (a non-GAAP measure)

Three months ended Nine months ended September 30, September 30,(in millions of Euros) 2021 2020 2021 2020 Net cash flows from 91 111 239 263 operating activitiesPurchases of property, plant (54 ) (38 ) (128 ) (138 )and equipmentProperty, plant and 3 2 10 4 equipment grants receivedFree Cash Flow 40 75 121 129

Reconciliation of borrowings to Net debt (a non-GAAP measure)

(in millions of Euros) At September 30, At December 31, 2021 2020Borrowings 2,282 2,391 Fair value of net debt derivatives, net 5 42 of margin callsCash and cash equivalents (323 ) (439 )Net debt 1,964 1,994

Non-GAAP measures

In addition to the results reported in accordance with International Financial Reporting Standards (IFRS), this press release includes information regarding certain financial measures which are not prepared in accordance with IFRS (non-GAAP measures). The non-GAAP measures used in this press release are: Adjusted EBITDA, Adjusted EBITDA per metric ton, Free Cash Flow and Net debt. Reconciliations to the most directly comparable IFRS financial measures are presented in the schedules to this press release. We believe these non-GAAP measures are important supplemental measures of our operating and financial performance. By providing these measures, together with the reconciliations, we believe we are enhancing investors understanding of our business, our results of operations and our financial position, as well as assisting investors in evaluating the extent to which we are executing our strategic initiatives. However, these non-GAAP financial measures supplement our IFRS disclosures and should not be considered an alternative to the IFRS measures and may not be comparable to similarly titled measures of other companies.

In considering the financial performance of the business, management and our chief operational decision maker, as defined by IFRS, analyze the primary financial performance measure of Adjusted EBITDA in all of our business segments. The most directly comparable IFRS measure to Adjusted EBITDA is our net income or loss for the period. We believe Adjusted EBITDA, as defined below, is useful to investors and is used by our management for measuring profitability because it excludes the impact of certain non-cash charges, such as depreciation, amortization, impairment and unrealized gains and losses on derivatives as well as items that do not impact the day-to-day operations and that management in many cases does not directly control or influence. Therefore, such adjustments eliminate items which have less bearing on our core operating performance.

Adjusted EBITDA measures are frequently used by securities analysts, investors and other interested parties in their evaluation of Constellium and in comparison to other companies, many of which present an Adjusted EBITDA-related performance measure when reporting their results.

Adjusted EBITDA is defined as income / (loss) from continuing operations before income taxes, results from joint ventures, net finance costs, other expenses and depreciation and amortization as adjusted to exclude restructuring costs, impairment charges, unrealized gains or losses on derivatives and on foreign exchange differences on transactions which do not qualify for hedge accounting, metal price lag, share based compensation expense, effects of certain purchase accounting adjustments, start-up and development costs or acquisition, integration and separation costs, certain incremental costs and other exceptional, unusual or generally non-recurring items.

Adjusted EBITDA is the measure of performance used by management in evaluating our operating performance, in preparing internal forecasts and budgets necessary for managing our business and, specifically in relation to the exclusion of the effect of favorable or unfavorable metal price lag, this measure allows management and the investor to assess operating results and trends without the impact of our accounting for inventories. We use the weighted average cost method in accordance with IFRS which leads to the purchase price paid for metal impacting our cost of goods sold and therefore profitability in the period subsequent to when the related sales price impacts our revenues. Management believes this measure also provides additional information used by our lending facilities providers with respect to the ongoing performance of our underlying business activities. Historically, we have used Adjusted EBITDA in calculating our compliance with financial covenants under certain of our loan facilities.

Adjusted EBITDA is not a presentation made in accordance with IFRS, is not a measure of financial condition, liquidity or profitability and should not be considered as an alternative to profit or loss for the period, revenues or operating cash flows determined in accordance with IFRS.

Free Cash Flow is defined as net cash flow from operating activities less capital expenditure, equity contributions and loans to joint ventures and other investing activities. Management believes that Free Cash Flow is a useful measure of the net cash flow generated or used by the business as it takes into account both the cash generated or consumed by operating activities, including working capital, and the capital expenditure requirements of the business. However, Free Cash Flow is not a presentation made in accordance with IFRS and should not be considered as an alternative to operating cash flows determined in accordance with IFRS. Free Cash Flow has certain inherent limitations, including the fact that it does not represent residual cash flows available for discretionary spending, notably because it does not reflect principal repayments required in connection with our debt or capital lease obligations.

Net debt is defined as borrowings plus or minus the fair value of cross currency basis swaps net of margin calls less cash and cash equivalents and cash pledged for the issuance of guarantees. Management believes that Net debt is a useful measure of indebtedness because it takes into account the cash and cash equivalent balances held by the Company as well as the total external debt of the Company. Net debt is not a presentation made in accordance with IFRS, and should not be considered as an alternative to borrowings determined in accordance with IFRS.