Alro Slatina, the biggest producer of primary aluminium in Central and Eastern Europe, in the first quarter of this year derived net income worth 95 million RON (26.6 million euros), seven times bigger than the figure reported for the corresponding period of 2005.
Thus, the net income Alro posted in the first three months of this year accounts for over 80% of last year”s net income. The company”s turnover reached 575.6 million RON (161.8 million euros), up 75% compared to the first three months of last year, when Alro”s sales came to 342.6 million RON (92.3 million euros).
“Alro”s financial results are mirroring the spectacular evolution of the international aluminium market. There has been a shortage of aluminium and aluminium alloys and, compared with last year, prices have surged by 300 dollars per tonne. The impact of the rise in production costs was lessened as a result,” stated Marian Nastase, deputy chairman of Alro Slatina board. The price of aluminium on the international market at present stands at over 2,500 euros per tonne, but the market volatility is very high and prices can fluctuate by an additional 300 to 500 euros daily, per aluminium tonne.
However Alro representatives state that demand for aluminium stays high, sustaining the high prices on the market. “We do not foresee the market weakening. Despite the high volatility, I do not believe that a reversal to low price levels, of below 2,000 dollars per tonne, is sustainable. It has to be considered that the price of energy is staying high because of oil prices, and demand for aluminium prices is rising amid the closing down of some production facilities in Europe and China,” explained Nastase.
Last year, Alro derived turnover worth 446 million euros, about 28% higher compared with 2004. Net income in 2005 amounted to 32.6 million euros, up in euros but down in RON from the figure reported in 2004.
Alro”s policy targets increased deliveries of high value added products, such as aluminium wire and bars, which means higher profitability for the company. The company”s investment programmes are centred on this very segment of high value added products.
Alro is planning to invest 25 million dollars (about 21 million euros) this year, aimed at the retooling of some production lines, through the acquisition of new electrical equipment. Alro will also invest around 21 million euros in Alprom Slatina, a producer of aluminium plates and profiles, and will contribute around 90 million euros to the share capital increase of alumina producer Alum Tulcea, which it took over at the end of last year.
Over the past three years, Alro has invested 145 million dollars (around 120 million euros) mainly in the modernisation of the production lines and an increase in environment protection.
Alro Slatina
* The biggest producer of primary aluminium in Central and Eastern Europe
* Posted Q1 net income worth 95m RON (26.6m euros), 7 times higher compared with last year”s Q1
* Q1 turnover amounted to 575.6m RON (161.8m euros), 75% up from 2005 Q1 figure.
* Has budgeted investments worth 25m dollars (about 21m euros) for this year, to retool some production lines through the acquisition of new electrical equipment
* Over the past 3 years has invested 145m dollars in production line modernisation and environment protection