RAVENSWOOD, WV - Constellium SE (NYSE: NYSE:CSTM), a global leader in the development of innovative aluminum products, has been selected by the U.S. Department of Energy (DOE) to enter award negotiations for a grant of up to $75 million. This funding, stemming from the Bipartisan Infrastructure Law and Inflation Reduction Act, is aimed at advancing low-to-no emissions technologies at the company's Ravenswood facility in West Virginia.
The investment is part of the DOE's Industrial Demonstrations Program (IDP) and will support the implementation of SmartMelt furnaces designed to reduce carbon emissions. These furnaces are capable of operating on various fuels, including clean hydrogen, setting the stage for a zero-carbon casthouse operation. The casthouse is noted as the most energy-intensive process at the facility.
In addition to environmental benefits, the project is expected to enhance the recycling capacity of scrap metal, improve worker safety through a hands-free casting process, and contribute to the local community. Plans include the construction of a new training and wellness center for employees, an onsite childcare facility, and the provision of resources to local educational institutions.
Jean-Marc Germain, CEO of Constellium, expressed gratitude to the DOE for supporting the company and the aluminum industry. Senator Joe Manchin highlighted the significance of the investment for the continued economic growth of West Virginia's aluminum industry and the broader community.
Brian E. McCallie, Vice-President of Constellium Rolled Products Ravenswood, stated the investment would bolster the facility's role as a key aerospace and defense industry supplier while positively impacting the surrounding community.
The specific terms of the investment, including operational milestones and the timeline for fund access, will be determined during the negotiation phase. The project is estimated to span approximately five years, with final details contingent upon these discussions.
Constellium's Ravenswood plant, established in 1957 and employing over 1,200 people, is one of the largest aluminum rolled product facilities in the world. The products manufactured there are used across various industries, including aerospace, defense, transportation, and marine.
This announcement is based on a press release statement.
InvestingPro Insights
Constellium SE (NYSE: CSTM) has recently been in the spotlight due to its strategic advancements in sustainable aluminum production and its latest selection by the U.S. Department of Energy for potential grant funding. As the company prepares to enhance its operations at the Ravenswood facility, here are some key insights from InvestingPro that could be of interest to investors and stakeholders.
InvestingPro Data shows that Constellium's market capitalization stands at $3.07 billion, reflecting the company's significant presence in the aluminum industry. Despite a challenging market, the company's revenue for the last twelve months as of Q4 2023 was reported to be $7.99 billion, although it experienced a revenue decline of 10.85% during the same period. The Gross Profit Margin in the same timeframe was 9.81%, which may be considered on the lower side, indicating room for improvement in cost efficiency.
In terms of performance, Constellium has demonstrated a strong return over the last year, with a price total return of 50.54%. This performance is further highlighted by the stock trading near its 52-week high, at 98.87% of this peak. Investors may find the company's recent price movements indicative of strong market confidence, particularly as Constellium is also expected to be profitable this year, according to analysts.
InvestingPro Tips suggest that the high shareholder yield is a noteworthy aspect for investors, as it implies a commitment to returning value. However, it's important to note that Constellium does not pay a dividend to shareholders, which may influence investment strategies depending on individual preferences for income-generating assets. Additionally, while the stock price movements have been quite volatile, the stock generally trades with low price volatility, which could be appealing to investors seeking stability.
For those looking to dive deeper into Constellium's financials and future prospects, there are additional InvestingPro Tips available on https://www.investing.com/pro/CSTM. Currently, there are 11 more tips that provide a comprehensive analysis of the company's financial health and market position.
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