Daily Brief ESG: Constellium – ESG Report – Lucror Analytics and more

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We view Constellium’s ESG as “Adequate”, in line with its Environmental and Social pillars, while the Governance pillar is “Strong”. Controversies are “Immaterial” and Disclosure is “Strong”.

• Even though OP Margin has been stagnant, NP Margin has improved due to the corporate tax rate cut, and the increased free cash flow has been less directed to investments.
• The fact that OP Margin didn’t rise much while personnel and R&D costs were curbed and there wasn’t much investment simply implies a lower gross margin in the core business.
• With ROE growth sluggish and cash accumulating, it’s reasonable that investors demand further shareholder returns. If asset turnover declines while OP Margin slows, there’s little reason to hold cross-held shares.