FINANCIAL INSTRUMENTS

12 Months Ended

Dec. 31, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

NOTE 16 - FINANCIAL INSTRUMENTS

16.1 Fair values of financial instruments

All derivatives are presented at fair value in the Consolidated Balance Sheets:


	At December 31,
	2024			2023
(in millions of U.S. dollar)	Non- current	Current	Total	Non- current	Current	Total

Derivatives that qualify for hedge accounting
Currency commercial derivatives	—	—	—	1	1	2
Derivatives that do not qualify for hedge accounting
Currency commercial derivatives	—	5	5	1	10	11
Currency net debt derivatives	—	1	1	—	2	2
Energy derivatives	1	—	1	—	—	—
Metal derivatives	1	18	19	1	20	21
Fair value of derivatives instruments - assets	2	24	26	3	33	36

Derivatives that qualify for hedge accounting
Currency commercial derivatives	13	9	22	2	7	9
Derivatives that do not qualify for hedge accounting
Currency commercial derivatives	7	17	24	2	9	11
Energy derivatives	—	2	2	4	9	13
Metal derivatives	1	5	6	1	12	13
Fair value of derivatives instruments - liabilities	21	33	54	9	37	46

The fair values of trade receivables, other financial assets and liabilities approximate their carrying values, as a result of

their liquidity or short maturity and the fair value of Senior Notes are disclosed in Note 15.2 Fair values of Senior Notes.

16.2 Valuation hierarchy

The following table provides an analysis of financial instruments measured at fair value, grouped into levels based on the

degree to which the fair value is observable:

•Level 1 is based on a quoted price (unadjusted) in active markets for identical financial instruments. Level 1

includes aluminum, copper and zinc futures that are traded on the LME.

•Level 2 is based on inputs other than quoted prices included within Level 1 that are observable for the assets or

liabilities, either directly (i.e. prices) or indirectly (i.e. derived from prices). Level 2 includes foreign exchange

derivatives, natural gas derivatives, silver derivatives and premium derivatives. The present value of future cash

flows based on the forward or on the spot exchange rates at the balance sheet date is used to value foreign

exchange derivatives.

•Level 3 is based on inputs for the asset or liability that are not based on observable market data (unobservable

inputs). Trade receivables are classified as a Level 3 measurement under the fair value hierarchy.


	At December 31,
	2024				2023
(in millions of U.S. dollar)	Level 1	Level 2	Level 3	Total	Level 1	Level 2	Level 3	Total
Fair value of derivatives instruments - assets	12	14	—	26	19	17	—	36
Fair value of derivatives instruments - liabilities	5	49	—	54	7	39	—	46

There was no material transfer of asset and liability categories into or out of Level 1, Level 2 or Level 3 during the years

ended December 31, 2024 and 2023.

16.3 Foreign exchange risk

Foreign exchange risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes

in foreign exchange rates.

Net assets, earnings and cash flows are influenced by multiple currencies due to the geographic diversity of sales and the

countries in which the Group operates.

Constellium has the following foreign exchange risk: i) transaction exposures, which include commercial transactions

related to forecasted sales and purchases and on-balance sheet receivables/payables resulting from such transactions and

financing transactions related to external and internal net debt, and ii) translation exposures, which relate to net investments in

foreign entities that are converted in U.S. dollar amounts in the Consolidated Financial Statements.

Foreign exchange impacts related to the translation of net investments in non-USD functional currency subsidiaries from

functional currency to U.S. dollar, and of the related revenue and expenses, are not hedged as the Group operates in these

various countries on a permanent basis except as described below.

i. Commercial transaction exposures

The Group policy is to hedge committed and highly probable forecasted foreign currency operational transactions. The

Group uses foreign exchange forwards and foreign exchange swaps for this purpose.

The following tables outline the nominal value (converted to millions of U.S. dollar at the closing rate) of forward

derivatives for Constellium’s most significant foreign exchange exposures at December 31, 2024.


Sold currencies	Maturity Year	Less than 1 year	Over 1 year
USD	2025-2029	441	447
CHF	2025-2027	56	2
CZK	2025	2	—
Other currencies	2025-2026	10	—


Purchased currencies	Maturity Year	Less than 1 year	Over 1 year
USD	2025-2026	131	5
CHF	2025-2028	102	16
CZK	2025-2026	88	32
Other currencies	2025	1	—

The Group has agreed to supply a major customer with fabricated metal products from a Euro functional currency entity

and invoices in U.S. dollar. These amounts are then consolidated in the financials in U.S. dollar. The Group has entered into

significant foreign exchange derivatives that matched related highly probable future conversion sales. The Group designates

these derivatives for hedge accounting, with a total nominal amount of $410 million and $209 million at December 31, 2024

and December 31, 2023 respectively, with maturities ranging from 2025 to 2029. Changes in the fair value of cash flow hedges

are reported by the Group as a component of Accumulated other comprehensive income, net of tax and reclassified into

earnings when the forecasted transaction affects earnings.

The table below details the effect of foreign currency derivatives in the Consolidated Income Statement, the Consolidated

Statement of Cash Flows and the Consolidated Statement of Comprehensive Income:


		Year ended December 31,
(in millions of U.S. dollar)	Notes	2024	2023	2022
Derivatives that do not qualify for hedge accounting
Included in Other gains and losses - net
Realized (losses) / gains on foreign currency derivatives - net (A)	5	(10)	18	(1)
Unrealized (losses) / gains on foreign currency derivatives - net (B)	5	(20)	(14)	8
Derivatives that qualify for hedge accounting
Included in Other comprehensive income
Unrealized (losses) / gains on foreign currency derivatives - net		(23)	1	(16)
Gains reclassified from cash flow hedge reserve to the Consolidated Income Statement		11	6	8
Included in Revenue (C)
Realized losses on foreign currency derivatives - net (A)	5	(10)	(7)	(8)
Unrealized (losses) / gains on foreign currency derivatives - net	5	(1)	1	—

(A)Commercial derivatives settled during the year are presented in net cash flows from operating activities in the Consolidated Statement

of Cash Flows.

(B)Gains or losses on the hedging instruments are expected to offset losses or gains on the underlying hedged forecasted sales that will be

reflected in future years when these sales are recognized.

(C)Changes in fair value of derivatives that qualify for hedge accounting are included in revenue when the related customer invoices are

issued.

ii. Financing transaction exposures

When the Group enters into intercompany loans and deposits, the financing is generally provided in the functional

currency of the subsidiary. The foreign currency exposure of the Group’s external funding and liquid assets is systematically

hedged either naturally through intercompany foreign currency loans and deposits or through foreign currency derivatives.

At December 31, 2024, the net hedged position related to long-term and short-term loans and deposits in U.S. dollar

included a forward sale of $201 million versus the Euro using simple foreign exchange forward contracts.


	Year ended December 31,
(in millions of U.S. dollar)	2024	2023	2022
Derivatives that do not qualify for hedge accounting
Included in Finance costs - net
Realized gains on foreign currency derivatives - net (A)	13	5	2
Unrealized (losses) / gains on foreign currency derivatives - net	(2)	2	(1)
Total	11	7	1

(A)Net debt derivatives settled during the year are presented in Other financing activities in the Consolidated Statement of Cash Flows.

Total realized and unrealized gains or losses on foreign currency derivatives are expected to partially offset the net

foreign exchange result related to financing activities, both included in Finance costs - net.

16.4 Commodity price risk

The Group is subject to the effects of market fluctuations in the price of aluminum, which is the Group’s primary metal

input and a significant component of its output. The Group is also exposed to variation in regional premiums and in the price of

zinc, natural gas, silver and copper, and other alloying metals, to a lesser extent.

The Group policy is to minimize exposure to aluminum price volatility by passing through the aluminum price risk to

customers and using derivatives where necessary. For most of its aluminum price exposure, sales and purchases of aluminum

are converted to be on the same floating basis and then the same quantities are bought and sold at the same market price.

Temporary increases in inventory, to the extent material, are sold forward to the expected sales date to ensure the price

paid for the metal will be redeemed when it is sold.

The Group also purchases copper, aluminum premium, silver and zinc derivatives to offset the commodity exposure

where sales contracts have embedded fixed price agreements for these commodities.

In addition, the Group purchases natural gas fixed price derivatives to lock in energy costs where a fixed price purchase

contract is not possible.

At December 31, 2024, the nominal amount of commodity derivatives is as follows:


(in millions of U.S. dollar)	Maturity	Less than 1 year	Over 1 year
Metal	2025-2027	415	31
Natural gas	2025-2027	12	18

The value of the contracts will fluctuate due to changes in market prices but our hedging strategy helps protect the

Group’s margin on future conversion and fabrication activities. At December 31, 2024, these contracts were directly entered

into with external counterparties.

The Group does not apply hedge accounting on commodity derivatives and therefore mark-to-market movements are

recognized in Other gains and losses - net.


	Year ended December 31,
(in millions of U.S. dollar)	2024	2023	2022
Derivatives that do not qualify for hedge accounting
Included in Other gains and losses - net
Realized gains / (losses) on commodities derivatives - net (A)	22	(68)	(7)
Unrealized gains / (losses) on commodities derivatives - net	19	11	(56)

(A)Commodity derivatives settled during the year are presented in net cash flows from operating activities in the Consolidated Statement

of Cash Flows.