Alba posts solid output growth

MANAMA: Aluminium Bahrain (Alba), soon to be the world’s largest aluminium smelter with Line 6 expansion, has registered double-digit growth in its sales and production volumes during the third quarter of 2019.

Announcing the results, Alba said the sale surged by 51 per cent to hit 376,025 tonnes year-on-year while the production volumes topped 385,396 tonnes, registering a 53pc jump over the previous year.

The aluminium giant said its top-line and bottom-line for the third quarter was primarily impacted by lower LME price ($1,761/tonnes vs. $2,056/tonnes – a drop of 14pc year-over-year (YoY) in Q3; $1,804/tonnes vs $2,158/tonnes – a drop of 16pc YoY for the nine-months), lower premiums and offset by higher sales’ volume.

The company generated a profit and total comprehensive income of BD10.7 million ($28.5m) in Q3 versus BD14.3m ($38.1m) for the same period in 2018, down by 25pc YoY.

The company posted a gross profit of BD29.2m ($77.6m) versus BD19m ($50.6m) in Q3 2018, up by 53pc YoY.

With regards to total sales/revenues, Alba reported BD287.1m ($763.6m) in Q3 2019, up by 22pc YoY, compared with BD234.5m ($623.8m) in Q3 2018. Earnings per share (EPS) in this quarter were 8 fils versus 10 fils for the same period in 2018, it stated.

According to senior officials, aluminium demand has lost momentum in most global markets: world market consumption almost flat, first decline since 2009, due to weak economic conditions, slow global manufacturing and increased use of scrap metal.

A slowdown in the US market has led to a drop of 3pc YoY in aluminium consumption, while Europe consumption was down by 1pc YoY owing to lower vehicle demand.

Consumption in Mena region rose by 4pc YoY driven by infrastructure spending in the UAE and Saudi Arabia, said the statement.

With regards to the nine-month period of 2019, Alba reported a loss and total comprehensive loss of BD8.4m ($22.4m), down by 111pc YoY, compared with a profit and total comprehensive income of BD77.2m ($205.6m) for the same period in 2018.

The company also posted a gross profit of BD45.4m ($120.9m) versus BD93.3m ($248.3m) for the nine-month period in 2018, down by 51pc YoY.

Chairman of Alba’s board of directors Shaikh Daij bin Salman Al Khalifa said: “Despite downbeat economic and market sentiments, we were able to lock in positive profitability in Q3 thanks to the progressive ramp-up of Line 6.”

“We look positively into the future as we stand at the threshold of becoming the world’s largest aluminium smelter with Line 6 fully going on stream soon,” he added.

Total sales/revenues reached BD735.7m ($1,956.6m), up by 5pc YoY, compared with BD699.7m ($1.86 billion) for the first nine months of 2018. Earnings/ (Loss) per share were 6 fils versus 55 fils for the same period in 2018.

Alba’s total assets as of September 30, 2019 stood at BD2.43bn ($6.45bn) versus BD2.21bn ($5.9bn) as of December 31, 2018, up by 10pc YoY.

Total shareholders’ equity for the period stood at BD1.06bn ($2.83bn), down by 1pc YoY, versus BD1.07bn ($2.85bn) as of December 31, 2018.

Acting chief executive Ali Al Baqali said: “Due to depressed LME prices and overall industry outlook, 2019, no doubt, has been a difficult year for the aluminium market.”

“However, we aim to finish 2019 strong by achieving for the first time a production of 1.35m tonnes and exceeding 15m working hours without LTI – another first in Alba’s history,” he added.

Source: http://www.gdnonline.com/Details/635241