Alro reports Interim Results to End of June and posts Net Profit of RON 214 million

Thu, 08/14/2008 - 00:00
Slatina, 14 August, 2008 – Alro SA (BVB: ALR), the largest aluminium producer in Central and Eastern Europe, today announces its interim financial results for the half year ended 30 June 2008, in accordance with International Financial Reporting Standards (IFRS). The company reported a consolidated net profit of RON 214.7 million, a 3.7% increase compared to last year’s results for the same period and a consolidated turnover of over RON 1 billion. Cast aluminium production increased by 3.7% versus H1 of 2007 and output of processed products increased by 39% versus H1 2007.

Consolidated revenues decreased by 9.7% compared to the same period 2007, while costs decreased by 10% compared to H1 of 2007. Despite favourable price developments on the London Metal Exchange which reached an average of USD 2,835/t during the first half of this year, compared to an average of USD 2,781/t in the similar period of 2007, demand could not keep up with developments experienced during the record year 2007. Cost consciousness helped improve gross profit margins, from 31.9% in H1 2007 to 32.2% in H1 2008.

Alro reported capital expenditure for technological and environmental projects of over USD 61 million (approx. RON 150 million), at June 30 and the company has an investment budget of USD 63 million. The overall investments ensure sustainable operation and an increase in productivity and efficiency.

Between 2002 and 2007, Alro has invested over USD 210 million in technological and environmental projects. This year, the plant commissioned the Cold Rolling Mill, following a USD 4.8 million investment to modernise the unit.

Alro continues its Corporate and Social Responsibility program, having a budget of USD 2.5 million for specific projects, including health and safety, education and sports. In 2008, the company donated five fully equipped ambulances for the local Ambulance Service in Slatina.

Commenting on the results, Marian Nastase, Vice President of the Board of Directors of Alro SA, said:

“During the first half of this year, the cold rolling mill was closed down for two months, as a consequence of the upgrading. Subsequently the company temporarily reduced sheet and coil production, affecting sales revenues. Additional quality and service improvement projects have been implemented to better fulfil customers’ needs, the results of which should begin to benefit from the second half. Favourable aluminium price developments, a below average cost increase for raw materials led to financial results being in line with the approved budget for this year.”