Alba profit hits US$1 bn for second year in a row

TDT | Manama                       

The Daily Tribune – www.newsofbahrain.com

Aluminium Bahrain (Alba) yesterday reported reaching a nine-month profit of US$1 billion profit, for the second year in a row, despite facing market challenges. “It didn’t take us 12 months to hit US$1 billion mark in our Profit (US$1.002 billion, up by 39% YoY),” said Shaikh Daij Bin Salman Bin Daij Al Khalifa, commenting on Alba’s sound financial performance for the 9 months of 2022.

He added: “With this strong performance, we have set a new benchmark amidst the market challenges. We are also committed more than ever to move forward with the Proposed Line 7 Project and invest in expanding Alba's production capacity to meet future market demand.”

Shaikh Daij also said that Alba remains optimistic to score new precedents in our operational and financial performance, “as we cruise towards closing 2022.” Alba said that its Q3 and ninemonth profits were driven by LME prices that dropped 11% in Q3 and rose 19% in for the 9 months, despite flat growth in sales volume.

The bottom line, Alba said was partially impacted by higher Cost and Distribution Expenses, despite recording higher topline. Alba also pointed out that outbreak of Ukraine-Russia war has led to a steep increase in energy prices with global inflation rising to unprecedented levels and interest rates up sharply.

“All of these have taken their toll on the Aluminium industry mainly in Europe and US as smelters have cut output against the background of high power prices and falling demand growth.” On the demand side, Middle East demand is up by 8% YoY supported by higher consumption in UAE (+17% YoY) & Bah[1]rain (+3% YoY).

However, China consumption was impacted by COVID-19 lockdowns and logistic challenges (+1% YoY). US Aluminium demand remains under pressure (+2% YoY), while slowing economic growth and higher inflation have led to a contraction in Aluminium demand (- 8% YoY) in Europe.

Quarterly results

Third quarter profit was BD48 million (US$127.6 m), down 62% from BD125.9 m (US$335 m) in the year-ago quarter. Earnings per Share were fils 34 compared to fils 89 in the year-earlier quarter.

Total Comprehensive Income dropped 54% to BD58.2 m (US$154.8 m) from BD126.4 m (US$336.1 m) in the same-quarter a year ago. Gross Profit was BD79 m (US$210.2 m) versus BD157.4 m (US$418.5 m) for the same period in 2021 – down by 49.8% YoY. Q3 revenue rose 3.7% to BD403.2 m (US$1,072.3 m) from BD388.9 m (US$1,034.2 m) in Q3 2021.

Nine-month results

Nine-month profit increased 39.2% to BD376.7 m (US$1,001.9 m) from BD270.7 m (US$720 m) in the same period a year ago. Earnings per Share was fils 266 versus fils 191 in 2021 period.

Total Comprehensive Income was BD416.1 m (US$1,106.6 m), up 51% from BD275.5 m (US$732.7 m) in the same period of 2021. Nine-month revenue rose 29.9% to BD1,378.5 m (US$3,666.2 m) from BD1,061.5 m (US$2,823.1 m) in the same period of 2021.

Commenting on the results, Alba’s Chief Executive Officer, Ali Al Baqali, said, “Alba’s strong foundation, thanks to Line 6 Expansion Project, has allowed us not only to address the challenges but also open new possibilities in terms of doing more for less. With the increased uncertainty and volatility, we remain committed to excel in what we control best: Safety, Production and Cost.”