Aluminum producer UC Rusal PLC said Wednesday it swung to a net profit last year thanks to a recovery in the metal’s price and a slide in the ruble’s value that helped boost its profit margins.
The Russian aluminum giant, which is listed in Hong Kong, said its net profit for 2014 was $293 million, a sharp recovery from a net loss of $3.32 billion in 2013. Rusal’s improved earnings came despite a 4.1% fall in revenue and a 6.6% drop in its aluminum output to 256,000 tons last year. That beat even the most positive expectations.
The company said “stringent” cost control and its decision to shut down inefficient smelters helped it return to profitability. Rusal’s earnings before interest, tax, depreciation and amortization surged to $1.5 billion compared with $870 million in 2013. Chief Executive Vladislav Soloviev told the Wall Street Journal the company “has no plans to restart any mothballed aluminum capacity.”
Following two days of increases on the LME, the cash price of primary aluminum dropped by 2.3% to end at $1,773 per metric ton on Tuesday, February 24. The 3-month price of aluminum saw a 2.0% decline on the LME to $1,793 per metric ton. The Indian aluminum cash price weakened by 0.7%, settling at INR 110.95 ($1.78) per kilogram.
Chinese aluminum prices closed flat for the day. The price of Chinese aluminum scrap saw essentially no change for the fifth day in a row, remaining around CNY 12,500 ($1,998) per metric ton. The price of Chinese aluminum billet held steady at CNY 12,940 ($2,068) per metric ton. The price of Chinese aluminum bar saw little movement at CNY 13,700 ($2,189) per metric ton. The Chinese aluminum cash price was unchanged at CNY 12,910 ($2,063) per metric ton.