Aluminium smelters across Ghana record huge losses

Metal manufacturing firms in Ghana, which include small to medium sized aluminium smelters, continue to record losses in their operations due to a host of factors including the hostile exchange rate market and the poor power situation in the country.

According to the industry sources, the rolling power outage has had a devastating effect on firms’ administrative and operating expenses as well as their cost of sales.

This is evident in the negative growth of the manufacturing sector for the first half of 2015, according to the Ghana Statistical Service.

Aluminium smelter, Aluworks is one of the latest firms to register losses in their third quarter financials.

Aluworks registered a loss of GH¢9.6 million at the end of September 2015, compared with a loss of GH¢2.4 million the same period last year. Its revenue was however marginally higher at GH¢61.9 million during the first nine months of 2015 as against GH¢58.9 million September 2014.

The aluminium smelter had GH¢18.5 million in inventory at the end of the third quarter of this year as against GH¢14.9 million the same period last year. Mining firms have also not been spared.

Meanwhile, figures from the Tema District Council of Labour indicate that thousands of workers have been laid off since January 1, 2015. Though the figures have not been made available the workers are mainly from the heavy manufacturing sector with some coming from the light industry.

The situation is unlikely to improve in the next few quarters as commodity market doldrums seem to be persisting longer than it was expected initially.