Singapore 18/03/2016 - Aluminium Corp of China (Chalco) has posted a net profit of 206.32 million yuan ($32 million) in 2015, reversing a net loss of 16.21 billion yuan in the previous year, the company announced in its latest annual results on Thursday.
The profit was anticipated after Chalco said in January that it had expected to post a net profit of around the amount after it further reduced production costs, and closed certain loss-making productions resulting in a decrease in the production costs of alumina and electrolytic aluminium by around 13 percent and nine percent respectively.
The turnaround in earnings was also due to the company implementing various measures including revitalising idle assets and introducing strategic investors, while gaining profits by various ways including disposal of assets and equity interests.
Chalco’s revenue in the year fell 13.1 percent to 123.45 billion yuan last year.
Chinese aluminium prices have fallen sharply last year, particularly in the second half of last year in response to supply pressures, but following major production cuts in the domestic industry, aluminium prices had stabilised at the end of last year, said Chalco.
The price of the most active aluminium contract on the Shanghai Futures Exchange had fallen almost 30 percent since beginning 2015 to an all-time low of 9,555 yuan per tonne in late-November last year, before recovering to hit a near-five-month high of 11,635 yuan on March 4. It was last at 11,470 yuan on Friday, up 115 yuan from the previous day’s close.
China’s primary aluminium production was around 31 million tonnes, and consumption at 30.64 million tonnes last year, with operating capacity at 79.61 percent at end-2015, according to Chalco.