Operating Segment Information (Tables)

12 Months Ended

Dec. 31, 2018

Summary of Operating Segment Information

4.1 Segment Revenue


	Year ended December 31, 2018							Year ended December 31, 2017							Year ended December 31, 2016
*(in millions of Euros)*	Segment revenue		Inter segment elimination			External revenue		Segment revenue		Inter segment elimination			External revenue		Segment revenue			Inter segment elimination			External revenue
P&ARP		3,059		(9	)		3,050		2,812		(7	)		2,805		2,498			(16	)		2,482
A&T		1,389		(50	)		1,339		1,335		(34	)		1,301		1,302			(23	)		1,279
AS&I		1,290		(3	)		1,287		1,123		(5	)		1,118		1,002			(9	)		993
Holdings & Corporate^(A)		10		—			10		13		—			13		(11	)		—			(11	)

Total		5,748		(62	)		5,686		5,283		(46	)		5,237		4,791			(48	)		4,743

(A)

For the years ended December 31, 2018, 2017 and 2016, Holdings & Corporate segment includes revenues from supplying metal to third parties. For the year ended December 31, 2016, Holdings & Corporate segment includes a €20 million one-time payment related to the re-negotiation of a contract with one of Wise’s customers.

Summary of Segment adjusted EBITDA and reconciliation of Adjusted EBITDA to Net Income

4.2 Segment Adjusted EBITDA and reconciliation of Adjusted EBITDA to Net Income


*(in millions of Euros)*	Notes	Year ended December 31, 2018			Year ended December 31, 2017			Year ended December 31, 2016
P&ARP			243			204			204
A&T			152			146			118
AS&I			125			120			104
Holdings & Corporate			(22	)		(22	)		(28	)

Adjusted EBITDA			498			448			398

Metal price lag^(A)			—			22			4
Start-up and development costs^(B)			(21	)		(17	)		(25	)
Manufacturing system and process transformation costs			—			(2	)		(5	)
Wise integration and acquisition costs			—			—			(2	)
Wise one-time costs^(C)			—			—			(20	)
Wise purchase price adjustment^(D)			—			—			20
Share-based compensation costs			(12	)		(8	)		(6	)
Gains on pension plan amendments^(E)	24		36			20			—
Depreciation and amortization	16, 17		(197	)		(171	)		(155	)
Restructuring costs			(1	)		(4	)		(5	)
Unrealized (losses) / gains on derivatives	8		(84	)		57			71
Unrealized exchange (losses) / gains from the remeasurement of monetary assets and liabilities—net	8		—			(4	)		3
Gains / (losses) on disposals^(F)	8		186			(3	)		(10	)
Other^(G)			(1	)		—			(1	)

Income from operations			404			338			267

Finance costs—net	10		(149	)		(260	)		(188	)
Share of loss of joint-ventures	18		(33	)		(29	)		(14	)

Income before income tax			222			49			65

Income tax expense	11		(32	)		(80	)		(69	)

Net income			190			(31	)		(4	)

(A)

Metal price lag represents the financial impact of the timing difference between when aluminium prices included within Constellium Revenues 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 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)

For the years ended December 31, 2018 and 2017, start-up and development costs include respectively €21 million and €16 million related to new projects in our AS&I operating segment. For the year ended December 31, 2016, start-up and development costs include €20 million related to Automotive Body Sheet growth projects.

(C)

For the year ended December 31, 2016, Wise one-time costs related to a one-time payment of €20 million, recorded as a reduction of revenues, in relation to the re-negotiation of payment terms, pass through of Midwest premium amounts and other pricing mechanisms in a contract with one of Wise’s customers. We entered into the re-negotiation of these terms in order to align the terms of this contract, acquired during the acquisition of Wise, with Constellium’s normal business terms.

(D)	The contractual price adjustment relating to the acquisition of Wise Metals Intermediate Holdings was finalized in 2016. We received a cash payment of €21 million and recorded a €20 million gain net of costs.

(E)	For the year ended December 31, 2018, the Group amended one of its OPEB plans in the US, which resulted in a €36 million gain. For the year ended December 31, 2017, amendments to certain Swiss pension plans, US pension plans and OPEB resulted in a €20 million gain.

(F)

In July 2018, Constellium completed the sale of the North Building assets of its Sierre plant in Switzerland to Novelis and contributed the Sierre site shared infrastructure to a joint-venture with Novelis, in exchange for cash consideration of €200 million. This transaction also resulted in the termination of the existing lease agreement for the North Building assets which had been leased and operated by Novelis since 2005. For the year ended December 31, 2018, the transaction generated a €190 million net gain (See NOTE 31 – Subsidiaries and operating segments).

(G)	For the year ended December 31, 2017, other includes €3 million of legal fees and lump-sum payments in connection with the renegotiation of a new 5-year collective bargaining agreement offset by accrual reversals of unused provisions related to one-time loss contingencies.

Summary of Segment Capital Expenditures

4.3 Segment capital expenditures


*(in millions of Euros)*	Year ended December 31, 2018			Year ended December 31, 2017			Year ended December 31, 2016
P&ARP		(97	)		(115	)		(166	)
A&T		(70	)		(73	)		(96	)
AS&I		(105	)		(83	)		(84	)
Holdings & Corporate		(5	)		(5	)		(9	)

Capital expenditures		(277	)		(276	)		(355	)

Summary of Segment Assets

4.4 Segment assets

Segment assets are comprised of total assets of Constellium by segment, less deferred income tax assets, cash and cash equivalents and other financial assets.


*(in millions of Euros)*	At December 31, 2018		At December 31, 2017
P&ARP		1,791		1,629
A&T		831		769
AS&I		544		449
Holdings & Corporate		304		252

Segment assets		3,470		3,099

Unallocated:
Deferred income tax assets		163		164
Cash and cash equivalents		164		269
Other financial assets		104		179

Total Assets		3,901		3,711