Alro Slatina, the largest aluminium producers in Continental Europe (except for Russia and Scandinavia), registered an adjusted net profit of RON 41 million, compared to RON 23 million in Q1 2015, according to its financial results, for three months ended on 31 March 2016, a press release informs. The company’s turnover was of RON 564 million, from RON 598 million in the similar period of 2015.
“The financial results for the first quarter demonstrate once again that the aluminium market is volatile and only strong investment programmes such as the ones we implement can help us maintain our position at local and global level”, Marian Nastase, President of Alro’s Board of Directors said, adding: “The beginning of this year was characterized by a significant decrease on the international markets, as well as of the selling margins, with impact on the turnover of the company that decreased compared to last year. This decrease in quotations was, partially, compensated by the sales of high added value products, which were bigger in volume, as well as by the depreciation of the Romanian leu in Q1 2016, compared to Q1 2015. Thus, despite the difficult market conditions, Alro registers operational profit and generates positive cash flow from operational activity”.
Alro’s net profit increased from RON 6 million, in Q1 2015, to RON 27 million, in Q1 2016, a significant impact having the exchange differences related to the re-evaluation of the foreign currency denominated loans.
During the analysed period, Alro increased its sales of aluminium, both in primary, and in the processed sector. In primary aluminium sector, Alro registered higher sales by 23 percent, mostly as a result of higher shipments for wire rod and billets that were up 4,500 tonnes, and 2,500 tonnes respectively. For processed aluminium, the company registered sales up by 4 percent, as a result of higher shipments for thin sheets and coils that were up 1,000 tonnes compared to Q1 2015.
In spite of the higher shipments, the company registered a lower EBIT that stood at RON 23 million, in Q1 2016, from RON 96 million, in Q1 2015, as a result of lower spot aluminium quotations on the London Metal Exchange (LME), from an average of 1,800 USD/tonne in Q1 2015, to an average of 1,500 USD/tonne during the first quarter of this year.
The company budgeted investments of USD 53 million, for 2016, most of the financing being already ensured.