-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ho4mToBfzXGXS+t+nv+w1/kppeqjxF3gabT8ZZfYCG8uMGf3E+CRSNcwJk2CwwpC Cr2RpTqnoxJW2PlbT7agwA== 0000950123-98-009051.txt : 19981019 0000950123-98-009051.hdr.sgml : 19981019 ACCESSION NUMBER: 0000950123-98-009051 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19981014 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19981016 SROS: CSX SROS: NYSE SROS: PCX FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALCAN ALUMINIUM LTD /NEW CENTRAL INDEX KEY: 0000004285 STANDARD INDUSTRIAL CLASSIFICATION: PRIMARY PRODUCTION OF ALUMINUM [3334] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-03677 FILM NUMBER: 98727174 BUSINESS ADDRESS: STREET 1: 1188 SHERBROOKE ST WEST CITY: MONTREAL QUEBEC CANA STATE: A8 BUSINESS PHONE: 5148488000 8-K 1 ALCAN ALUMINIUM LIMITED 1 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 Date of Report (Date of earliest event reported) October 14, 1998 ALCAN ALUMINIUM LIMITED (Exact name of registrant as specified in its charter) Canada 1-3677 Inapplicable ------ ------ ------------ (state or other juris- (Commission (I.R.S. Employer diction of incorporation) File Number) (Identification No.) 1188 Sherbrooke Street West, Montreal, Quebec, Canada H3A 3G2 -------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (514) 848-8000 ------------- --------------------------------------------------------------------- (Former name or former address, if changed since last report) 2 Item 5. Other Events. The information set forth in the press releases issued by Alcan Aluminium Limited, attached hereto as Exhibit 99.1 and 99.2, is incorporated herein by reference. Item 7. Financial Statements, Pro Forma Financial Statements and Exhibits. (c) Exhibits. 99.1 Press release of Alcan Aluminium Limited, dated October 14, 1998. 99.2 Press release of Alcan Aluminium Limited, dated October 16, 1998. 99.3 Cautionary Statement for purposes of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. 3 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. ALCAN ALUMINIUM LIMITED /s/ DENIS G. O'BRIEN ------------------------ Denis G. O'Brien Controller Dated: October 16, 1998 4 EXHIBIT INDEX
Exhibit No. Description - ----------- ----------- 99.1 Press release of Alcan Aluminium Limited, dated October 14, 1998. 99.2 Press release of Alcan Aluminium Limited, dated October 16, 1998. 99.3 Cautionary Statement for purposes of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995.
EX-99.1 2 PRESS RELEASE DATED 10/14/98 1 EXHIBIT 99.1 PRESS RELEASE [LOGO] - -------------------------------------------------------------------------------- FOR IMMEDIATE RELEASE ALCAN ALUMINIUM LIMITED FILES ITS STATEMENT OF DEFENCE TO A NATIVE CLAIMS LEGAL ACTION IN BRITISH COLUMBIA, CANADA VANCOUVER, CANADA - October 14, 1998 -- Alcan has filed a statement of defence today in the Supreme Court of British Columbia in response to a suit filed against Canada, British Columbia and Alcan by the 100-member Cheslatta Nation Indian Band on 14 April 1998. Alcan believes that the Cheslatta claim is without merit and will not succeed in court. In their suit the plaintiffs seek a declaration that they be entitled to the exclusive occupancy or possession of certain claimed lands, to damages and to other relief. The Cheslatta claim appears to rely on the December 1997 decision of the Supreme Court of Canada in the DELGAMUUKW case which deals with issues of aboriginal rights and title. Specific aboriginal rights and titles will be determined by the courts on a case-by-cases basis. Alcan obtained its title to certain of its lands in the claimed territory under valid grants from the Government of Canada upon due payment to that Government. As evidenced by the statement of defence, Alcan will vigourously defend its rights and raise both substantive and procedural defences. It is understood that both Canada and British Columbia have filed appearances in the Cheslatta suit. Alcan expects that they will each file statements of defence in due course. Alcan believes that the hearings in the trial and on subsequent appeal are likely to extend over several years, during which time the day-to-day operations of Alcan's facilities in British Columbia will not be impeded. Alcan Aluminium Limited is a multinational company engaged in all aspects of the aluminum industry. With operations and sales offices in over 30 countries, the Alcan Group is one of the most international aluminum companies in the world. It is also a leading global producer and marketer of rolled aluminum products. - END - - -------------------------------------------------------------------www.alcan.com Alcan Aluminium Limited Media contact: Richard Prokopanko 1188 Sherbrooke Street West Tel.: 1 (604) 257-1400 Montreal (Quebec) H3A 3G2 Investor contact: Alan G. Brown Canada Tel.: 1 (514) 848-8368 EX-99.2 3 PRESS RELEASE DATED 10/16/98 1 EXHIBIT 99.2 PRESS RELEASE [LOGO] - -------------------------------------------------------------------------------- FOR IMMEDIATE RELEASE ALCAN REPORTS THIRD QUARTER EARNINGS -- REDUCES STAKE IN JAPANESE AFFILIATE, NIPPON LIGHT METAL -- MONTREAL, CANADA - October 16, 1998 - Alcan Aluminium Limited (Stock Symbol: AL) reports third quarter consolidated net income of $107 million compared to $80 million for the similar period of 1997. After preference share dividends, net income per common share for the quarter is 46 cents, compared to 34 cents a year earlier. The current year's third quarter includes an after-tax gain of $20 million (9 cents per share)for exchange revaluation of the Company's accumulated deferred tax liability and after-tax charges of $9 million (4 cents per share) for losses at the 45.6%-owned Nippon Light Metal Company, Ltd. (NLM) and of $7 million (3 cents per share) for rationalization costs in Europe. The 1997 period included a special charge of $30 million (13 cents per share) and operating losses of $7 million (3 cents per share) relating to NLM. Excluding these items, the net income for the quarter was $103 million (44 cents per share) compared to $117 million (50 cents per share) for the corresponding quarter of 1997. The rationalization costs relate to manpower reductions in Alcan's European fabricating operations as part of the cost reduction programme in that region. By the end of 1998 employee numbers will be reduced by about 500 in these operations. The Company also reports that it is reducing its 45.6% interest in NLM to below 20%. The cash proceeds of the sale of shares will be at least $145 million with a corresponding after-tax gain of approximately $90 million to be reflected in the fourth quarter results. The book value of the remaining investment will be some $40 million. With the reduction in Alcan's interest to below 20%, NLM will no longer be accounted for on an equity basis but will be treated as a portfolio investment. Commenting on the quarter, Jacques Bougie, President and Chief Executive Officer said, "We are pleased with the underlying performance of our core businesses in this period of very weak metal prices. We continue to see strong demand for our products in North and South America. However, we are anticipating slower growth in Europe." .../2 - -------------------------------------------------------------------www.alcan.com Alcan Aluminium Limited Media contact: Alain Bergeron 1188 Sherbrooke Street West Tel.: 1 (514) 848-8232 Montreal (Quebec) H3A 3G2 Investor contact: Alan G. Brown Canada Tel.: 1 (514) 848-8368 2 Page 2. "In line with our strategy of focussing on our upstream and large-scale fabricating businesses, we have reduced our shareholding in Nippon Light Metal in Japan. We remain committed to Asia as a region offering strong long-term growth and will continue our presence in Japan through our on- going links with NLM." said Bougie.
THIRD NINE SECOND QUARTER MONTHS QUARTER 1998 1997 1998 1997 1998 Sales and operating revenues (US$ millions) 1,950 1,949 5,889 5,830 1,986 Net income (US$ millions) 107 80 310 339 86 Shipments (thousands of tonnes) Ingot products* 213 215 622 643 207 Fabricated products 467 436 1,372 1,295 469 Fabrication of customer-owned metal 80 70 220 210 72 ----- ----- ------ ------ ----- Total volume 760 721 2,214 2,148 748 ===== ===== ====== ====== ===== Ingot product realizations (US$ per tonne) 1,482 1,733 1,580 1,733 1,591 Fabricated product realizations (US$ per tonne) 2,875 2,950 2,937 2,970 2,930
* Includes primary and secondary ingot and scrap Sales and operating revenues for the third quarter of 1998 were unchanged from a year earlier at $1,950 million reflecting lower prices offset by increased volume. Total fabricated product volumes, which include products fabricated from customer-owned metal, were 547 thousand tonnes (kt) in the third quarter, some 8% higher than a year earlier and slightly ahead of the second quarter of 1998. This reflects strong North American shipments, seasonally lower sales in Europe and the consolidation of shipments from Indian Aluminium Company, Limited (Indal). Average ingot product realizations declined $109/tonne from the second quarter and $251/tonne from the third quarter of 1997 compared to declines of $48 and $296 respectively in the LME 3-month price. .../3 3 Page 3. Fabricated product realizations declined $55/tonne from the second quarter level. For the nine months, average realizations are down just $33/tonne from the previous year, despite much lower metal prices, reflecting improved local currency prices and stronger currencies in Europe. PRODUCT SECTOR REVIEW
THIRD NINE SECOND QUARTER MONTHS QUARTER (US$ millions) 1998 1997 1998 1997 1998 Operating income Raw materials and chemicals 24 45 93 79 30 Primary metal 73 138 288 446 85 Fabricated products 85 85 249 240 88 Intersector and other items 31 (21) 87 (39) 37 ----- ----- ----- ----- ----- 213 247 717 726 240 Equity loss (9) (36) (48) (34) (23) Corporate offices (32) (29) (96) (89) (34) Interest (21) (26) (65) (77) (21) Income taxes (44) (76) (198) (187) (76) ----- ----- ----- ----- ----- Net income 107 80 310 339 86 ===== ===== ===== ===== =====
Operating profits from raw material and chemical operations declined from the year-ago quarter with lower selling prices partially offset by cost savings. Earnings declined from the second quarter as the effect of lower metal prices flowed through to alumina prices. The decline in earnings from primary metal operations compared to the second quarter of 1998 and the year-ago quarter results primarily from lower realizations for ingot. Fabricated products earnings were unchanged from the second quarter reflecting rationalization costs of $11 million in Europe offset by improved earnings from North America and the consolidation of Indal's earnings. "Intersector and other items" primarily reflects the realization or deferral of profits on intersector sales of metal. Profits were deferred in 1997 due to generally rising ingot prices. In the first nine months of 1998 previously deferred profits on intersector sales were realized as ingot prices decreased. Also included in this category is interest income. .../4 4 Page 4. Alcan recorded a loss from equity-accounted companies of $9 million for the third quarter primarily arising at NLM in Japan, where business conditions remain difficult. Following the reduction of Alcan's interest to below 20% in the fourth quarter, NLM will be cost-accounted and equity profits and losses will no longer arise. During the third quarter the Company increased its shareholding in Indal to majority ownership and, accordingly, that company is now consolidated as a subsidiary. Revaluation of the Company's cumulative deferred income tax liability to reflect current exchange rates, as required by new Canadian accounting standards, resulted in a write-back of $20 million. Each subsequent US$0.01 increase (decrease) in the value of the Canadian dollar will decrease (increase) the Company's net income by about $6 million, as a result of the revaluation of deferred income taxes. The debt:equity ratio at September 30, at 22:78 compared to the levels at June 30, 1998 of 21:79 and 23:77 a year ago. GEOGRAPHIC REVIEW
THIRD NINE SECOND QUARTER MONTHS QUARTER (US$ millions) 1998 1997 1998 1997 1998 Net income (Loss) Canada 45 58 126 189 34 United States 41 41 113 107 41 South America - 3 6 22 1 Europe 3 6 32 33 5 Asia and Pacific (5) (27) (28) (7) (17) Other (including eliminations) 23 (1) 61 (5) 22 ----- ----- ----- ----- ----- 107 80 310 339 86 ===== ===== ===== ===== =====
In Canada, operating net income declined from the second quarter and the prior year due to the effect of lower metal prices on primary metal operations. The quarter's results also include the deferred income tax revaluation referred to above. In the United States, net income from operations was unchanged reflecting strong fabricated product volumes, offset by lower realizations from smelter operations. .../5 5 Page 5. Operating results in South America were affected by lower raw material and primary metal prices. European results were lower reflecting lower prices for alumina and metal. Also, fabricated products results were affected by seasonally lower volumes and the $7 million after-tax cost of manpower reductions. Results in the Asia and Pacific region for the quarter reflect operating losses from Japan as well as lower alumina prices. The profit from "Other" in the quarter arises principally from the recognition of previously deferred profits on inter-regional sales of ingot. In 1997 this result was adverse as profits were deferred in a generally rising metal price environment. Statements made in this press release which describe the Company's intentions, expectations or predictions may be forward-looking statements within the meaning of securities laws. The Company cautions that, by their nature, forward-looking statements involve risk and uncertainty and that the Company's results could differ materially from those expressed or implied in such statements. Reference should be made to the most recent Form 10-Q for a summary of major risk factors. Alcan Aluminium Limited is a multinational company engaged in all aspects of the aluminum industry. With operations and sales offices in over 30 countries, the Alcan Group is one of the most international aluminum companies in the world. It is also a leading global producer and marketer of rolled aluminum products. The average number of common shares outstanding for the third quarter of 1998 was 227.6 million compared to 227.1 million in the comparable quarter of 1997. - END - NOTE: All dollar amounts are stated in U.S. dollars. All tonnages are stated in metric tonnes, equivalent to 2,204.6 pounds. All figures are unaudited. .../6 6 Page 6. ALCAN ALUMINIUM LIMITED INTERIM CONSOLIDATED STATEMENT OF INCOME (unaudited) Periods ended September 30 (in millions of US$, except per share amounts)
Third Quarter Nine Months 1998 1997 1998 1997 Revenues Sales and operating revenues $1,950 $1,949 $5,889 $5,830 Other income 10 16 47 63 ------ ------ ------ ------ 1,960 1,965 5,936 5,893 Costs and expenses Cost of sales and operating expenses 1,514 1,504 4,560 4,506 Depreciation 116 106 339 323 Selling, administrative and general expenses 108 106 325 324 Research and development expenses 17 16 51 50 Interest 21 26 65 77 Other expenses 23 11 41 40 ------ ------ ------ ------ 1,799 1,769 5,381 5,320 Income before income taxes and other items 161 196 555 573 Income taxes (note 1) Income taxes excluding revaluation 64 78 218 195 Revaluation of cumulative deferred income tax liability (20) - (20) - ------ ------ ------ ------ 44 78 198 195 Income before other items 117 118 357 378 Equity loss (9) (36) (48) (34) Minority interests (1) (2) 1 (5) ------ ------ ------ ------ Net income $ 107 $ 80 $ 310 $ 339 Dividends on preference shares 3 2 8 7 ------ ------ ------ ------ Net income attributable to common shareholders $ 104 $ 78 $ 302 $ 332
.../7 7 Page 7. ALCAN ALUMINIUM LIMITED INTERIM CONSOLIDATED STATEMENT OF INCOME (cont'd) (unaudited) Periods ended September 30 (in millions of US$, except per share amounts)
Third Quarter Nine Months 1998 1997 1998 1997 Net income per common share $ 0.46 $ 0.34 $ 1.33 $ 1.46 Dividends per common share $ 0.15 $ 0.15 $ 0.45 $ 0.45
Montreal, Canada October 16, 1998 .../8 8 Page 8. ALCAN ALUMINIUM LIMITED INTERIM CONSOLIDATED BALANCE SHEET (unaudited for 1998)
(in millions of US$) September 30 December 31 1998 1997 ASSETS Current assets Cash and time deposits $ 375 $ 608 Receivables 1,440 1,292 Inventories Aluminum 822 800 Raw materials 342 307 Other supplies 248 234 ------- ------- 1,412 1,341 ------- ------- Total current assets 3,227 3,241 Deferred charges and other assets 474 424 Investments 135 251 Property, plant and equipment Cost 12,600 11,715 Accumulated depreciation 6,700 6,257 ------- ------- 5,900 5,458 ------- ------- Total assets $ 9,736 $ 9,374
.../9 9 Page 9. ALCAN ALUMINIUM LIMITED INTERIM CONSOLIDATED BALANCE SHEET (cont'd) (unaudited for 1998)
(in millions of US$, September 30 December 31 except per share amounts) 1998 1997 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Payables $ 1,114 $ 1,052 Short-term borrowings 150 238 Income and other taxes 53 98 Debt maturing within one year 63 36 ------- ------- 1,380 1,424 ------- ------- Debt not maturing within one year 1,342 1,241 Deferred credits and other liabilities 616 623 Deferred income taxes 754 969 Minority interests 103 43 Shareholders' equity Redeemable non-retractable preference shares 160 203 Common shareholders' equity Common shares 1,259 1,251 Retained earnings 4,062 3,556 Deferred translation adjustments 60 64 ------- ------- 5,381 4,871 ------- ------- Total shareholders' equity 5,541 5,074 ------- ------- Total liabilities and shareholders' equity $ 9,736 $ 9,374 Common shareholders' equity per common share $ 23.64 $ 21.43 Ratio of total borrowings to equity 22:78 23:77
Montreal, Canada October 16, 1998 .../10 10 Page 10. ALCAN ALUMINIUM LIMITED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited)
Nine months ended September 30 (in millions of US$) 1998 1997 Operating activities Net income $ 310 $ 339 Adjustments to determine cash from operating activities: Depreciation 339 323 Deferred income taxes 33 16 Equity loss - net of dividends 53 40 Change in operating working capital (102) (243) Change in deferred charges, other assets, deferred credits and other liabilities - net (65) (69) Gain on sales of businesses - net (1) (13) Other - net 6 27 ------ ------ Cash from operating activities 573 420 Financing activities New debt 55 39 Debt repayments (50) (39) ------ ------ 5 - Short-term borrowings - net (107) 95 Common shares issued 8 13 Redemption of preference shares (43) - Dividends - Alcan shareholders (including preference) (110) (110) - Minority interests (1) (2) ------ ------ Cash used for financing activities (248) (4)
.../11 11 Page 11. ALCAN ALUMINIUM LIMITED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS (cont'd) (unaudited)
Nine months ended September 30 (in millions of US$) 1998 1997 Investment activities Property, plant and equipment (511) (372) Investments (72) - Net proceeds from disposal of businesses and other assets 4 49 ------ ------ Cash used for investment activities (579) (323) Effect of exchange rate changes on cash and time deposits 5 (7) ------ ------ Increase (decrease)in cash and time deposits (249) 86 Cash of companies consolidated (deconsolidated) 16 (11) Cash and time deposits - beginning of period 608 546 ------ ------ Cash and time deposits - end of period $ 375 $ 621
Montreal, Canada October 16, 1998 .../12 12 Page 12. ALCAN ALUMINIUM LIMITED (in millions of US$) Notes to Interim Consolidated Financial Statements 1. ACCOUNTING CHANGE In 1998, the Company adopted new recommendations of the Canadian Institute of Chartered Accountants dealing with accounting for income taxes. The principal change under the new recommendations is the requirement to revalue deferred income tax liabilities for all changes in tax rates and exchange rates. The Company has adopted the new recommendations retroactively without restating prior years. The cumulative effect of adopting the new recommendations at January 1, 1998 is to decrease Deferred income taxes by $285, to increase Retained earnings by $306 and to decrease Deferred translation adjustments by $21. For the first nine months of 1998, the impact of the revaluation of Deferred income taxes to reflect current exchange rates is to decrease the Company's income tax provision by $20. 2. ACQUISITION OF CONTROLLING INTEREST IN INDIAN ALUMINIUM COMPANY, LIMITED On July 3, 1998, the Company acquired an additional 17% of Indian Aluminium Company, Limited (Indal), and will acquire a further 3% on completion of certain formalities, for a total of $70 in cash. This will bring Alcan's ownership in Indal to 54.6%. The accounts of Indal are being consolidated with effect from July 1998. 3. PRIOR YEAR AMOUNTS Certain prior year amounts have been reclassified to conform with the 1998 presentation. Montreal, Canada October 16, l998 EX-99.3 4 CAUTIONARY STATEMENT 1 EXHIBIT NO. 99.3 CAUTIONARY STATEMENT FOR PURPOSES OF THE ''SAFE HARBOR'' PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 Written or oral statements made by Alcan or its representatives, including statements set forth in Alcan's press releases issued on October 14, 1998 and October 16, 1998, which describe the Company's or management's objectives, projections, estimates, expectations or predictions of the future may be ''forward-looking statements'' within the meaning of the United States Private Securities Litigation Reform Act of 1995, which can be identified by the use of forward-looking terminology such as ''believes,'' ''expects,'' ''may,'' ''will,''''should,'' ''estimates,'' ''anticipates'' or the negative thereof or other variations thereon. The Company cautions that, by their nature, forward-looking statements involve risk and uncertainty and that the Company's actual results could differ materially from those expressed or implied in such forward-looking statements or could affect the extent to which a particular projection is realized. Important factors which could cause the Company's actual performance to differ materially from projections or expectations included in forward-looking statements include global aluminum supply and demand conditions, aluminum ingot prices and changes in other raw materials costs and availability, cyclical demand and pricing within the principal markets for the Company's products, changes in government regulations, particularly those affecting environmental, health or safety compliance, economic developments and other factors within the countries in which the Company operates or sells its products and other factors relating to the Company's ongoing operations including, but not limited to, the outcome of litigation, labour negotiations and fiscal regimes. Copies of the Company's filings may be obtained by contacting the Company or the United States Securities and Exchange Commission. -----END PRIVACY-ENHANCED MESSAGE-----