RUSAL Announces 2020 Interim Results

RUSAL (SEHK: 486; Moscow Exchange: RUAL), a leading global aluminium producer, announces its results for the six months ended 30 June 2020.


Key highlights


  • The first months of 2020 have seen significant global market turmoil triggered by the outbreak of the coronavirus. Along with other factors, including a sharp decrease in the price of oil, this has resulted in high volatility on the stock market, with a considerable drop of indices, as well as a depreciation of the Russian ruble. As a result of the COVID-19 outbreak during 2020, aluminium prices continued to deteriorate. This factor had an adverse impact on the revenue and profitability of the Group, partially offset by ruble depreciation and decrease in cost of raw materials linked to the oil price;


  • In the first six months of 2020, the London Metal Exchange (LME) aluminium price fell by 12.83% to USD1,592 per tonne compared with USD1,826 per tonne for the same period in 2019. This was one of the key contributing factors to the decline in total revenue in the first six months of 2020 by 15.2% to USD4,015 million from USD4,736 million for the same period of 2019 and decrease of EBITDA to USD219 million from USD528 million in the mid of 2019;


  • Significant drop in LME aluminium price was partially offset by improvement of production cost per tonne in aluminium segment in the first half of 2020, which went down by 5.5% to USD1,564 per tonne, compared to USD1,655 per tonne in the same period of 2019. This was a result of effective cost management, supported by depreciation of the Russian ruble against US dollar and decrease in oil prices;


  • The Company confirmed compliance with the 2019 target levels of the sustainability key performance indicators (KPI) under the sustainability-linked pre-export finance facility for USD 1,085,000,000 signed in October 2019. The 2019 target levels are reached or exceeded and therefore the Company is entitled to a sustainability discount, which reduces the interest rate to 2.1% starting from August 2020.


Commenting on the interim 2020 results, Evgenii Nikitin, CEO of RUSAL, said:


“Despite the industry slowly starting to recover from the unprecedented blow caused by the pandemic, we are proud to say that RUSAL’s resilience was down to the robust business model long before COVID-19. Solid ties with our clients, uninterrupted production cycle, self-sufficiency in proper raw materials, investments in environmental and efficient technology, continuous expansion of the product portfolio, the development of proper technological applications and a long-term focus on sustainability – all these assets have placed our business among the leaders of the industry.


Unfortunately, challenges caused by the pandemic are not the only ones that the world is facing today. The importance of protecting the environment and impact of climate change requires businesses be more receptive and subsequently, the investment community and market needs the corporate sector to respond in accordance with the current threats facing us. In the post-pandemic times the urgency and need for lowering carbon emissions is likely to remain a priority.


There are numerous routes towards a low carbon future – one is through the investment in the research and development and substantial improvement of the technologies with bringing aboard breakthrough solutions and another is the production of materials through renewable energy sources. RUSAL has been at the forefront of combatting climate change through production of low carbon aluminium ALLOW with a carbon footprint lower than the market average coupled with the investment in the environmental technologies. We continuously strive to enhance our leadership through relentless development of proper innovative solutions, such as inert anode, and retrofitting of our smelters (including such substantial production sites as Krasnoyarsk aluminium smelter) using the Eco-Soderberg technology.


We believe that our agile approach coupled with the focus on sustainability will help us go through these challenging times.”

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