RUSAL Hit by Drastically Declining LME Aluminum Prices

SEATTLE (Scrap Monster): RUSAL’s net profits were impacted by sharp decline in London Metal Exchange (LME) aluminum price during the initial half of the current year. It must be noted that LME aluminum price dropped by 17.3% during this period, upon comparison with the previous year.

The company’s total revenue recorded a decline by 5.2% in the first six months of 2019 to total $4,736 million. This compares with $4,997 million of revenue reported for the same period of 2018. The aluminum sales volume surged higher by 13.2% to 1.978 million tonnes. Revenue from sales of alumina was down sharply by almost 24% year-on-year to $340 million. The total cost of sales increased by 9.1% to $3,931 million. The adjusted EBITDA plunged by 53% to $528 million. The company’s net profit slumped by over 41% from $952 million in the first half of 2018 to $558 million from January to June in 2019.

Evgenii Nikitin, CEO of RUSAL said that the market environment remained unfavorable for the aluminum industry in H1 2019. The sharp 17% decline in prices impacted the company’s overall performance and financial results. Looking ahead into future plans, Nikitin said that RUSAL will work hard to improve its value-added product capacity, which in turn could help the company to reaffirm its position as one of the leading low carbon aluminum producers.

RUSAL expects 2% jump in global primary aluminum demand to total 67.5 million tonnes during the current year.