Alba announces 127% jump in net profit for 1H2022 despite flat sales volume, thanks to higher LME prices

Aluminium Bahrain B.S.C. (Alba), the world’s largest aluminium smelter outside China, announced its Q2 and H1 2022 fiscal results on Thursday, August 11, reporting a 97 per cent surge in net profit to BD181.9 million versus BD92.7 million during the corresponding period of the previous year. Gross profit for Q2 was BD208 million, compared to BD123.7 million a year ago.

The total comprehensive income for Q2 also elevated by 123 per cent year-on-year from BD90.7 million to BD201.9 million, and the revenue grew by 41 per cent from BD370 million to BD520.4 million.

In the first half of 2022, Alba’s net profit registered a hike of 127 per cent Y-o-Y to stand at BD328.7 million versus BD144.8 million for the same period in 2021. Gross profit escalated by 89 per cent from BD204.2 million to BD386 million.

As per the results published by Alba, the company earned revenue of BD975.3 million in H1 2022 - 45 per cent more than BD672.7 million in H1 2021. Comprehensive income in the first six months of the year totalled BD357.9 million, compared to BD149.1 million during the same period last year.

Total equity at the end of June 30, 2022, amounted to BD1,770.6 million, and total assets stood at BD2,717.3 million.

Alba’s financial achievements till June 30, 2022, were primarily driven by higher LME prices, which stood up by 20 per cent Y-o-Y during 2Q2022 and 37 per cent Y-o-Y during 1H2022. 

In terms of operational performances, Alba reported sales volume of 742,658 tonnes for H1 2022, almost flat compared to the same period last year, while production reached 787,592 tonnes, up by 1.7 per cent on the year.

Aluminium value added product sales averaged 67 per cent of the total shipments in six months, the highest in history, versus 64 per cent last year. Alba also mentioned in its results that it secured a 10-year Offtake Agreement with South32 for the supply of alumina.

Some of Alba's top priorities for 2022 include delivery on newly-launched ESG roadmap in line with Bahrain’s net zero emissions goal by 2060, exceed production target of 1.56 million tonnes, capitalise on ASI and Ecovadis certifications to penetrate new markets, and increase VAP sales beyond 70 per cent of shipments.

Commenting on the results, Shaikh Daij Bin Salman Bin Daij Al Khalifa, Chairman of Alba’s Board of Directors, said: “We have had an unmatched financial performance as we set new benchmarks in the last 3 quarters (Q4 2021, Q1 and Q2 2022) and on many fronts. This strong performance has enabled us to distribute an interim dividend of US$120 million to our shareholders. As we progress into the rest of 2022, we remain committed to build sustainable returns while also delivering further value to our shareholders.”

Ali Al Baqali, Alba’s Chief Executive Officer, said: “Our exhibit profitability was backed by improved product mix towards Value Added Products’ Sales and sound cost savings. Despite the logistics’ challenges in the market, we have been able to deliver another strong quarter by capitalising on higher LME price and that has allowed us to service our loans and reduce our overall debt profile.”