Romanian aluminum producer Alro Slatina widens losses in 2014

Romanian aluminum producer Alro ended 2014 with adjusted net losses of RON 141 million (EUR 31.7 million). The losses were 64% higher compared to 2013, according to the company’s preliminary results. The company’s turnover registered a slight year-on-year increase in 2014, to RON 2 billion (EUR 450 million). In 2013, the company posted a turnover of RON 1.95 billion (EUR 442 million) and adjusted losses of RON 86 million (EUR 19.5 million). “The energy taxes, the low aluminum prices on the international markets and the significant appreciation of the US dollar, during a very short period, in December, influenced our results. Thus we continued to report losses this year,” said Marian Nastase, president of Alro’s board. “We are confident however that the recent measures to decrease by up to 85% the green certificates quota for the industry, approved at the end of 2014, will have a positive impact on our activity,” he added. The costs with eco-taxes generated by the overcompensation scheme for the renewable energy sector also influenced the company’s results. Alro spent RON 550 million (some EUR 124 million) on green certificates and the cogeneration tax in the last four years. Only last year, the company paid RON 130 million (over EUR 29 million). Last year aluminum prices went down on the London Metal Exchange. In February 2014, the price of aluminum declined to USD 1,642 per ton, a minimum of the last five years. However, the average price for the financial period was USD 1,867 per ton, slightly higher than in 2013 (USD 1,845 per ton). Alro registered an EBIT of RON 51 million (EUR 11.4 million) in 2014, compared to a negative result of RON 211 million (EUR 47.8 million) the year before. Its total primary aluminum production amounted to 263,000 tons in 2014 while the processed aluminum production was of 78,000, with 7,000 tons higher than in 2013. Alro is a subsidiary of aluminum producer Vimetco N.V. Alro has an installed production capacity of 265,000 tons per year. Vimetco's owner is Russian businessman Vitaliy Machitski. Alro's shares are traded on the Bucharest Stock Exchange. The company currently has a market capitalization of EUR 183 million (as of February 16, 2015). Irina Popescu@romania-insider.com