Russian Federation aluminium titan UC Rusal released financial and production results for the first half of 2020 yesterday. Though production was steady, lower prices and lower sales volumes conspired to dent financial numbers in the period.
For the opening half of 2020, Rusal smelted 1,867 thousand metric tons of primary aluminium, level on the year with last year’s total. Rusal refined 4,022 thousand metric tons of alumina in the year’s first six months, up by 4.5 percent from last year. The year’s first half saw Rusal mine 7,469 thousand wet metric tons of bauxite ore, off by 7.5 percent on the year.
Rusal sold 1,890 thousand metric tons of primary aluminium and aluminium alloys, down by 4.4 percent from the prior year. Revenue for the period totaled US$4,015 million, down 15.2 percent from last year’s opening-half revenue of US$4,736 million. The firm credits the drop to a decrease in price per metric ton of 10.4 percent, which was itself the result of a fall in prices at the London Metal Exchange. A 4.4-percent decline in sales volumes also hurt revenue in the period.
Gross profit for the firm fell by 38.5 percent, from US$805 million to US$495 million, while adjusted EBITDA dropped by 58.5 percent to US$219 million in the first half. Rusal reversed course in the first half on profit, switching from a gain of US$625 million to a loss of US$124 million. Adjusted net loss improved however, rising from US$98 million to US$63 million in the period.
“Despite the industry slowly starting to recover from the unprecedented blow caused by the pandemic, we are proud to say that Rusal’s resilience was down to the robust business model long before COVID-19,” said Rusal’s CEO Evgenii Nikitin. “Solid ties with our clients, uninterrupted production cycle, self-sufficiency in proper raw materials, investments in environmental and efficient technology, continuous expansion of the product portfolio, the development of proper technological applications and a long-term focus on sustainability – all these assets have placed our business among the leaders of the industry.”
“Unfortunately, challenges caused by the pandemic are not the only ones that the world is facing today. The importance of protecting the environment and impact of climate change requires businesses be more receptive and subsequently, the investment community and market needs the corporate sector to respond in accordance with the current threats facing us. In the post-pandemic times the urgency and need for lowering carbon emissions is likely to remain a priority.”
“We believe that our agile approach coupled with the focus on sustainability will help us go through these challenging times,” concluded Nikitin.