Alba reports Q1 profit

TDT | Manama                                                       

The Daily Tribune – www.newsofbahrain.com

Aluminium Bahrain reported a profitable first quarter of 2023, thanks to exceptional performance on both operational and financial fronts, despite being negatively impacted by lower LME prices and premiums.

Alba highlighted that despite the rebound in economic activity in China, there has not yet been a corresponding recovery in the consumption of aluminium, which remains down by 3% compared to the previous year.

Demand in the Middle East was also down by 6% YoY due to lower consumption in Bahrain (-9% YoY), UAE & KSA, respectively (-6% YoY). Looking ahead, Alba said it expects market uncertainty to continue to cloud the Aluminium market and LME prices.

Alba also said smelters’ cuts in Europe are likely to keep the market in deficit in 2023. The Eurozone economy to be challenged by weak manufacturing activities and higher inflation.

Q1 results

First quarter profit of the company was BD47.5 million (US$126.2 m), down 68% from BD146.8 m (US$390.4 m) in the year-earlier quarter.

Earnings Per Share was fils 34 versus fils 104 in the year-ago quarter. Quarterly total comprehensive income stood at BD45.4 m (US$120.7 m) versus BD156 m (US$415 m) for the same quarter in 2022 – a drop by 71% YoY. Gross profit was BD79.9 m (US$212.4 m) versus BD 178 m (US$473.4 m) for the same period in 2022—a drop by 55% YoY.

Alba said it generated BD370 m (US$984 m) through revenue from contracts with customers against BD455 m (US$1,210 m) in Q1 2022 – a drop by 19% YoY. The top-line and bottom-line were driven by lower LME prices (27% YoY) and premiums (27% YoY).

Sales’ volume topped 359,677 metric tonnes (MT), up by 2% YoY while Production reached 398,252 MT, up by 2% YoY. Chairman, Shaikh Daij Bin Salman Bin Daij Al Khalifa stated: “Despite lower LME prices and weak investor sentiment, we have managed to voyage the first quarter of 2023 by achieving an exceptional performance on the operational and financial fronts.

As we journey amidst the market challenges, we remain committed to execute our strategic priorities – progressing Line 7’s Feasibility Study and accelerating Power Station 5 Block 4 construction – in line with our ESG roadmap.”

Adding further, Chief Executive Officer, Ali Al Baqali, said: “In this bearish economic backdrop, we remain focused on what we can really control: Safety, Efficient Operations and Lean Cost Structure while we collectively navigate with our team -- employees and contractors’ personnel -- the waves to get better at what we do.”