Alumina H1 profit down 26% on price slump

Alumina’s first-half profit has fallen by 26 per cent on lower alumina prices, with the company also cutting its interim dividend in half.

Net profit fell to $US210 million ($A310.6 million) for the six months to June 30, down from $US286.4 million a year ago, with earnings and cash flows affected by a 12 per cent decline in alumina prices.

The average realised price per tonne dropped to $US375, offset somewhat by a 3.0 per cent reduction in production cost per tonne to $US218.

The ASX-listed mining investor cut its interim dividend to 4.4 US cents per share, fully franked, from 8.6 cents per share a year ago.

Shares in the company were trading 0.46 per cent lower at $2.17 at 1040 AEST.

Chief executive officer Mike Ferraro said the tight Western world alumina market conditions of 2018 had subsided, with curtailed supply back on stream and new refineries ramping up.

“We expect a modest alumina surplus for the rest of 2019,” Mr Ferraro said on Friday.

“Aluminium demand is expected to grow consistent with longer-term trends and this will help support the alumina price in the future.”

Alumina invests worldwide in bauxite mining, alumina refining and selected aluminium smelting operations through its 40 per cent ownership of Alcoa World Alumina and Chemical.

AAP

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