6 Nov 2018 14:34

Rusal increases aluminum production 1% in Q3, sales up 34% due to low base

MOSCOW. Nov 6 (Interfax) - Rusal has increased production of primary aluminum by 1.7% year-on-year to 2.81 million tonnes in 9M 2018, the company said on Monday.


Siberian smelters accounted for 94% of total aluminum output. Smelters utilization remained at an average of 97%.

Rusal produced 940,000 tonnes of aluminum in Q3, a 1% year-on-year increase.

Alumina production increased 0.6% year-on-year totaling 5.816 million tonnes. Russian operations accounted for 36% of total output. Alumina production rose 1.8% year-on-year to 2 million tonnes in Q3.

For the nine months ended September 30, 2018, bauxite output totaled 10.128 million tonnes up 16.4% year-on-year. Bauxite production rose 40% to 3.848 million tonnes in Q3.

Sales of primary aluminum and alloys were down 5.4% to 2.794 million tonnes in 9M 2018 and sales of alumina - down 4.5% to 1.457 million tonnes. The company reported a 33.6% growth in volumes of primary aluminum and alloys sold in the third quarter of 2018 upon the extension of OFAC licenses, after a significant reduction in Q2. There was a one-off recovery of sales volumes in Q3 2018 due to a low base level, Rusal said.

Rusal's working capital increased 46.7% to $2.583 billion.

Rusal increased capex 6% year-on-year to $580 million.


Rusal's revenue rose 9.6% to $7.915 billion due to higher average aluminum sales price, premiums and alumina prices, up 12.3% to $2,304 per tonne. Revenue rose 18.6% its Q3 to $2.918 billion.

Sales and revenue rose by almost a third in Q3, driven by the significant drop in sales in Q2 that followed the announcement of sanctions on April 6 and the extension of the licenses, a company spokesperson said. Rusal continues to monitor the impact of sanctions on the company's business and considers it highly likely that the impact may be materially adverse to the business of the group.

Production cost per tonne of aluminum reached $1,658, up 12.3% in 9M 2018 as compared to the same period of 2017 as a result of significant increase in electricity, key raw materials prices and railway transportation tariffs.

Revenue from sales of primary aluminum and alloys increased 6.2% to $6.438 billion to 9M.

Revenue from sales of alumina increased by 34.1% to $719 million in 9M due to an increase in the average sales price by 40.5%, which was partially offset by a decrease in the sales volumes by 4.5%.

Adjusted EBITDA rose 17.3% to $1.8 billion in 9M.

Rusal had net debt of $7.468 billion as of September 30, down 2.4% compared to the start of the year.

The company recorded a profit of $1.549 billion in 9M, almost double the same period last year. Adjusted net profit (including net profit adjusted for the net effect of the company's investment in Norilsk Nickel , for the nine months of 2018, up 20.1% year-on-year. Rusal's net profit for the Q3 2018 increased 46.3% quarter-on-quarter to $597 million. Adjusted net profit rose 55% to $338 million.