July 26, 2019 / 12:02 PM / a month ago

Russia's Rusal says aluminum sales up 21% q/q

MOSCOW (Reuters) - United Company Rusal on Friday reported a 21% rise in second quarter aluminum sales compared to the previous quarter, as the Russian aluminum giant’s recovery from 10 months under U.S. sanctions accelerated.

FILE PHOTO: Aluminium ingots are seen stored at the foundry shop of the Rusal Krasnoyarsk aluminium smelter in Krasnoyarsk, Russia October 3, 2018. Picture taken October 3, 2018. REUTERS/Ilya Naymushin

Hong-Kong listed Rusal, the world’s largest aluminum producer outside China, has been restoring operations after U.S. sanctions - first imposed on Rusal and its co-owner Oleg Deripaska in April 2018 - were lifted in January this year.

Second quarter aluminum sales totaled 1.08 million tonnes, while production rose 1% to 938,000 tonnes.

The rise in sales, which outstripped production, was due in part to Rusal’s sell down of aluminum accumulated while under U.S. Office of Foreign Assets Control (OFAC) sanctions, the company said.

Sales of high value-added products rose 60% to make up 38% of total sales, compared with 29% in the previous quarter.

This “indicates a stabilization of relations with long-term counterparties,” analysts at Sberbank said.

The results are in stark contrast to the company’s reported output three months ago. In April, Rusal reported a fall in total sales and a 44% year-on-year decline in value-added product sales due to the lingering effect of the sanctions, which had constrained the company’s ability to sign contracts.

Analysts at VTB Capital said the second-quarter sales increase exceeded expectations, adding that implied marginal upside to their second-quarter forecasts.

They said they expected core earnings to rise more than 40% quarter-on-quarter as the business recovered from sanctions.

Rusal, however, said it expected trade tensions between China and the United States to cause uncertainty in the market and suppress economic growth.

“We are concerned that (the) overall macroeconomic situation will negatively affect aluminum demand in the second half of 2019,” Rusal said.

Reporting by Polina Ivanova; Editing by Kirsten Donovan

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below