Romanian aluminium maker expects 78% lower profit amid higher energy cost
Romania's only aluminium producer Alro Slatina (ALR) has projected 2% increase of its revenues to USD 673.7 million (EUR 600 million) this year, but it expects a 78% lower net profit than in 2018, namely USD 12.4 million (EUR 11.0 million).
Romania Insider · Journalist
· Updated · 1 min read
Romania's only aluminium producer Alro Slatina (ALR) has projected 2% increase of its revenues to USD 673.7 million (EUR 600 million) this year, but it expects a 78% lower net profit than in 2018, namely USD 12.4 million (EUR 11.0 million).
The forecast, part of a company’s budget planning, was revealed on the morning of March 28 and pushed the company’s shares down by 4.3% by mid-day.
The primary driver behind the expected plunge in the company’s profit is the electricity price, which is likely to rise for industrial consumers as a result of the regulations promoted by the Government. Alro is the largest electricity consumer in the country.
“Larger production of processed aluminum products is reflected in higher turnover. […] Higher costs, especially electricity and natural gas prices, are reflected in the gross margin and overall result,” the report said.
In 2018, the company's net profit decreased by about 28%, to RON 226 million (USD 49 million), also due to the increase in the prices of raw materials and utilities.
(Photo source: Alro.ro)
