Alumina swings back into black

ALUMINA has swung back into profitability but warned the aluminium market conditions will remain challenging in the year ahead.

In the year to December 31, Alumina posted a net profit of $US500,000, a sharp turnaround its $US55.6 million loss posted in 2012.

In the same period joint venture Alcoa World Alumina and Chemicals (AWAC) recorded total revenue of $US5.885 billion, slightly higher than $US5.815 billion in the previous year.

AWAC is the global alumina business that is a joint venture between Alumina (40 per cent owned) and Alcoa Inc (60 per cent owned).

Alumina declined to pay a final dividend.

Alumina chief executive officer Peter Wasow said the group’s net profit was a meaningful improvement on last year.

“Despite challenging market conditions, Alumina’s overall financial position improved over the year and its balance sheet strengthened,” he said.

“The AWAC joint venture delivered a sound operating performance due to strong cost control and ongoing net productivity gains and the strengthening US dollar, especially against the Australian dollar.”

Alumina said its net debt fell $US529 million to $US135 million while gearing reduced to 4.6 per cent in the year.

Earlier this week, Alcoa reported the closure of the Point Henry smelter, which will significantly affect 2014 earnings.

So far in 2014, Alumina said it had received $US34 million in capital repayments from AWAC.