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Chalco posts best profit in almost 8 years on high aluminium prices

Chalco posts best profit in almost 8 years on high aluminium prices

FILE PHOTO: Aluminum Corp of China flag and the Chinese national flag flutter outside its headquarters in Beijing March 26, 2010. REUTERS/Christina Hu/File Photo

Aluminum Corp of China Ltd said on Tuesday its quarterly net profits in July-September jumped more than five-fold year on year, hitting their highest since late 2013 on buoyant aluminium and alumina prices.

The state-controlled company, known as Chalco, said third-quarter net income was 2.23 billion yuan (US$349 million), up around 430per cent from an adjusted 421.25 million yuan a year earlier.

Profits were also up almost 6per cent from a bumper second quarter and marked Chalco's best result since net income of 2.79 billion yuan in the fourth quarter of 2013, Refinitiv Eikon data show.

Third-quarter revenues meanwhile rose 51.3per cent year-on-year to 74.19 billion yuan as Shanghai aluminium prices soared to their highest since 2008. The rally came as electricity shortages saw power shortages imposed on Chinese smelters and took about 3 million tonnes of annual supply out of the market.

Chalco's own production was not greatly affected, however, its operational data showed. The company said it produced 2.92 million tonnes of primary aluminium in January-September, up 5.8per cent year on year. That implies third-quarter production of 960,000 tonnes, up around 6.7per cent on the year.

Shanghai aluminium has eased around 7per cent this month as China's government steps up efforts to tame high prices for coal, the main source of power for energy-intensive aluminium smelting.

Spot prices for alumina in China, as assessed by industry data provider SMM, are however still up some 76per cent year-to-date above 4,000 yuan a tonne, the highest in records going back to 2012.

Chalco, the world's biggest alumina producer, said it produced 12.17 million tonnes of alumina in the first nine months of 2021, up 13.3per cent year-on-year and implying 3.92 million tonnes for third quarter, up around 10.7per cent on the year.

(US$1 = 6.38178 Chinese yuan renminbi)

(Reporting by Tom Daly; Editing by Robert Birsel)

Source: Reuters

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