Gränges survives slow economy and weak aluminium demand with a profit of SEK 570 million in H1 2023

Gränges, a leading supplier of rolled aluminium materials, announced its second quarter and first half results of 2023, which reflected a survival amidst an overall economic slowdown and narrow demand for the metal. As per the results published, Gränges’ sales volume in Q2 dropped by 1.7 per cent Q-o-Q to 1.205 million tonnes from 1.225 million tonnes, and net sales amount diminished by 12.6 per cent from SEK 6.875 million to SEK 6.008 million.

Sales volume in the first six months of 2023 also recorded a fall of 3.5 per cent Y-o-Y from 2.492 million tonnes to 2.406 million tonnes, and net sales plunged by 7.6 per cent from SEK 12.955 million to SEK 11.976 million.

But adjusted operating profit grew in Q2 as well as in H1 of 2023 from SEK 348 million to SEK 450 million and from SEK 678 million to SEK 851 million, respectively. Operating profit also grew from SEK 410 million to SEK 450 million in Q2 and from SEK 740 million to SEK 851 million in H1.

Gränges net profit in Q1 was SEK 316 million versus SEK 274 million in the previous quarter, and that in H1 was SEK 570 million compared to SEK 514 million a year earlier.

Gränges also revealed in its operational and financial results that total carbon emissions intensity in the June quarter was 8.5 tonnes CO2e/tonne, and in the first half was 8.8 tonnes CO2e/tonne.

The company’s diluted earnings per share increased to SEK 2.97 million in Q2 from SEK 2.58 million in Q1, and that in H2 grew from SEK 4.83 million to SEK 5.35 million.

The decline in sales volume in the first half of 2023 was due to a general economic slowdown and high downstream inventory levels that narrowed down demand among customer groups. The only exception was the automotive sector, which generated metal demand in Gränges Americas and Gränges Eurasia. Asia also saw a strong recovery in Q2 from the impacts of the COVID-19 lockdown. In both business areas, Gränges succeeded to partly offset demand fluctuations with flexibility in sales.

The company’s profit growth could be attributed to the positive timing effect of the global aluminium price surcharges and favourable currencies, according to Gränges’ CEO Jörgen Rosengren.

CEO Jörgen Rosengren said, “We are quite proud of this strong performance in a very challenging environment. It is also our best-ever quarterly result.”