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ALRO
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Press Releases
Press Releases

Alro Reports an Adjusted Net Loss of 21 Million Lei in the First Nine Months of 2013

Thursday, 14/11/2013 - 10:30

Alro SA (BVB: ALR), one of the largest aluminum producers in Central and Eastern Europe, reported an adjusted net loss* of 21 million lei for the first nine months of 2013. This contrasts with the 83 million lei adjusted net profit* recorded during the same period in 2012. The company's revenue for the first nine months of 2013 was 1.55 billion lei, down from 1.74 billion lei in 2012, mainly due to a drop in aluminum prices on the London Metal Exchange (LME).

"Financial results continue to be heavily impacted by the ongoing crisis in the global aluminum market and local eco-taxes," said Marian Năstase, Chairman of Alro's Board of Directors. "Despite implementing all necessary measures to improve operational efficiency, external factors have had a negative influence on the company's performance. However, we will continue our long-term development strategy focused on high value-added products and remain prepared to take any necessary actions to protect our operations."

Key Financial and Operational Data:

  • Revenue of 1.55 billion lei compared to 1.74 billion lei (restated) for the first nine months of 2012, primarily due to the drop in aluminum prices on the LME.
  • A 10% increase in sales of processed aluminum products compared to the first nine months of 2012.
  • Increased production costs, mainly due to the significant rise in eco-taxes (green certificates and cogeneration tax).
  • Ongoing investments in the processed aluminum sector and the aluminum waste processing line.

Sales of primary aluminum remained steady at approximately 107,000 tons, while processed aluminum sales increased from 48,400 tons in 2012 to 53,400 tons in 2013. Despite this 10% growth in processed aluminum production, it did not translate into higher sales revenue due to the significant drop in aluminum prices. The average aluminum price on the LME fell to 1,871 USD/ton in the first nine months of 2013, compared to 2,025 USD/ton in the same period of 2012.

In addition to the low aluminum price, Alro also faced adverse local factors, including excessive compensation for the renewable energy sector. As a result, the cost of sales increased by 23.8 million lei compared to the same period in 2012, mainly due to the rise in energy taxes (green certificates and cogeneration tax). The annual quota for green certificates increased to 0.191 CV/MWh from 0.1188 CV/MWh in 2012.

Investment and Future Plans: Alro has continued to promote high value-added products in international markets and invested in competitiveness enhancements. The company focused its investments on long-term assets and developing the processed aluminum sector. Additionally, Alro continued investing in aluminum waste processing to reduce energy costs and mitigate the effects of rising energy taxes.

*Adjusted net profit/loss refers to the company's net profit/loss, plus/(minus) fixed asset depreciation, plus/(minus) derivative financial instrument losses/gains that do not qualify for hedge accounting, plus/(minus) deferred income tax.

For more information, please contact:

Florenta Ghita
Premium Communication
Bucharest
Phone: +40 (0) 21 411 01 52
Email: florenta.ghita@premiumpr.ro 

About Alro
Alro is a subsidiary of Vimetco N.V., a vertically integrated global producer of primary and processed aluminum. It is one of the largest aluminum producers in Central and Eastern Europe, with an installed production capacity of 265,000 tons per year. Alro’s main markets include the European Union (Hungary, Poland, Greece, Germany, and Romania), as well as exports to the USA and Asia. The company holds ISO 9001 quality management certification and NADCAP and EN 9001 certifications for aerospace production units. Alro’s products meet the quality standards of the London Metals Exchange (LME) and international standards for flat-rolled products.

Note: Content from the website www.alro.ro is incorporated and does not form part of this announcement.