Rusal Reports Decline in Profits Amidst Global Market Shifts
Financial Decline:
Rusal, a key player in the global aluminum market, has reported a stark decrease in both revenue and net profit for the January to September period of 2023. The revenue fell to approximately 836 million rubles ($9.2 million USD), a substantial drop from the previous year's 71.31 billion rubles ($785.41 million USD). Net profit also experienced a dramatic reduction to 2.47 billion rubles ($27.17 million USD), down from last year's 71.52 billion rubles ($787.72 million USD).
Company Capitalization:
The statutory capital of Rusal remains at 9.97 billion rubles ($109.67 million USD), with an undistributed profit reported at 257 billion rubles ($2.83 billion USD).
Strategic Shipping Terminal:
Rusal is redirecting its logistical strategies to better align with market opportunities, particularly by constructing a port terminal in the Russian Far East, intended to facilitate the movement of up to 1.5 million tonnes annually. The project is expected to have a financial footprint of around 12 billion rubles ($132 million USD) and may take three years to complete.
International Expansion:
In a move to secure its supply chain, Rusal has acquired a 30% stake in the Chinese steelmaker Hebei Wenfeng New Materials for a sum equivalent to 267 million rubles ($2.94 million USD).
Navigating Sanctions:
Rusal has been circumventing the loss of approximately 4 million tonnes per annum of alumina supplies, post-sanctions. Despite no direct sanctions on Rusal itself, its owner, Oleg Deripaska, has faced sanctions from the EU and UK in 2022.
China's Rising Production:
In the backdrop of China's rapid aluminum capacity expansion, which saw more than 10 million tonnes added in 2022, Rusal is adjusting its global strategy. The firm accounts for 5.6% of the world’s aluminum production and 4.5% in alumina.
Diversified Alumina Imports:
To combat supply chain hurdles, Rusal has diversified its alumina sources, increasing imports from India and Kazakhstan, as China's internal demand surges due to its growing aluminum production capacity.
In case you have missed: "Weekly Metals News Digest (Oct 23–27)"
