(Amending to show that Ambrian's trading and logistic business reported a first-half loss of $0.95 million while its parent company reported a loss of $3.58 million)
London 13/10/2016 - Ambrian plc is closing its metals trading business because of a continuously challenging trading environment, industry sources told Metal Bulletin.
Ambrian declined to comment.
Mark Homer, managing director of Ambrian Metals Ltd, will leave alongside all its metals traders in London, Shanghai and Taiwan, industry sources said.
At least 10 traders are affected, including Isabella Chou, Zhang Yun, Stella Lv, Martin Davies, Ben Smith and Leigh Crump, Metal Bulletin understands.
They will continue to work for Ambrian until some time in the first half of next year, sources added. No further details are known at this stage.
Ambrian plc reported a loss of $3.58 million before tax and impairment charges in the first half of this year, in from a year-ago loss of $8.78 million.
The loss reflected "a continuous challenging trading environment partly offset by the group's efforts to de-risk the trading and logistics business", it said late in September.
Ambrian's trading and logistic business reported a pretax loss of $0.95 million for the first half and expects to return to a small profit for the full year of 2016.
The firm implemented strategic changes at the end of 2015 after recording losses in the trading of semi-finished products and higher financing and warehousing costs associated with the build-up of inventories due to a poor copper market. It focussed on operating costs and inventory reduction, implemented wider marketing campaigns and signed exclusive agency agreements with producers, which helped cut losses in 2016.
"However we recognise that achieving a base load has been particularly challenging in the current economic environment and will adapt our structures accordingly," Ambrian said in its late-September results, adding that it would "continuously review its business model with a view to reduce its risk profile and earnings volatility".
Some metal markets such as zinc and nickel have benefited from a better balance of supply and demand in 2016 but the copper market, which remains a significant part of Ambrian's business, has continued to be negatively affected by forecasts for growing supply of product from mines and significant Chinese exports of refined metal.
At the end of the first half, copper premiums in China were down around 50% from the start of the year, with little or no trading interest from market participants, Ambrian noted in its earnings report.
It has moved outside its core copper business in the past few years to trade in other metals and concentrates. Ambrian Plc also invested in a concrete and cement plant, Cimentos da Beira (CDB), in Mozambique.
(Editing by Mark Shaw)