Hindalco’s US-based subsidiary company, Novelis’ plant in New York, caught fire for the second time in two months. In an exchange filing, Hindalco said that the fire started at the Oswego, New York, facility on Thursday evening (IST).
The company said that all the employees working at the facility were evacuated safely. The company added that multiple local fire departments responded to the incident, and the fire is now under control.
September 16 fire incident
Earlier, on September 16, Novelis‘ aluminium smelting plant in Oswego caught fire. The company said that the fire was localised to the hot mill area, but other production centres were temporarily impacted due to various reasons.
On November 11, Novelis updated that major reconstruction at the plant has been completed, including the completion of all roof trusses, columns, roof decking, and ductwork. While operations to install X-bracing along the mill bay and sections of the hot mill fume exhaust were underway.
Financial cost of the fire incident
It remains unclear how much damage the latest fire has caused to the facility and what its operational costs will be. However, on November 5, Hindalo said that it estimates a negative free cash flow impact of $550-650 million due to the last fire incident. The company stated that the losses include an adjusted EBITDA impact of approximately $100-150 million.
At the time, the company stated that Novelis may also incur an additional $21 million in related charges for restoring operations at the plant. This is in addition to a significant impact on the revenue.