Norwegian aluminium smelter Norsk Hydro ASA released results for the final quarter of 2019 on Friday. Falling demand and weak metals prices took its toll in the period, resulting in a tepid bottom line.
In the prior quarter, Hydro posted an underlying EBIT of NOK560 million. Underlying EBIT for Bauxite & Alumina fell on the year largely due to a drop in the realized sales price of alumina, while underlying EBIT for Primary Metal reversed from red to black thanks to lower costs in raw material and positive currency effects. Underlying EBIT for Rolled Products rose in the quarter, while that of both Extruded Solutions and Energy dropped off.
Hydro noted the significance of two events that took place in the quarter, namely the reopening of operations at Alunorte and the receipt of insurance proceeds for the cyber attack last spring. The firm said operations at Alunorte resumed to 90 percent of capacity in the quarter, and that the remaining tenth of the site’s 6.3 million metric tons per annum of alumina would come online by year’s end.
Meanwhile, Hydro said it received NOK187 million in insurance proceeds to cover for damages done by the cyber attack in March. The attack damaged the Extruded Solutions segment the most, totaling damages of between NOK650 million and NOK750 million.
President and CEO Hilde Merete Aasheim said the firm is making significant progress across several fronts, as reflected in accomplishments achieved during the prior quarter.
“We have taken firm measures in a weak market. Our improvement program as well as cash release ambition are ahead of plan. Our improvement efforts will continue with full force, in line with our agenda towards lifting profitability and driving sustainability.”
“The increasing pull for low-carbon products and solutions is an encouraging trend and we are well positioned for a low-carbon future,” she continued. “Since we launched CIRCAL one year ago, we have signed 60 new low-carbon building projects around the world.”
Norsk Hydro, which was founded in 1905, financed by the Swedish Wallenberg family and French banks, began its life named Norsk hydro-elektrisk Kvælstofaktieselskab (literally, “Norwegian hydro-electric nitrogen limited”) by Sam Eyde. The Norwegian government owns approximately 40% of the company at the present time. Norsk Hydro is one of the largest aluminium companies in the world, with plants in Rjukan, Raufoss, Vennesla, Karmøy, Høyanger, Årdal, Sunndalsøra, and Holmestrand. Norsk also has several plants abroad, including in Germany and Brazil.