Chalco sees good year ahead
By Pan Xiaoyi |
March 30, 2010, Tuesday
|
Print Edition
Print Edition
ALUMINUM Corp of China, also known as Chalco, has returned to profit in the first two months of the year, reversing losses in 2009, and it will increase production to profit from expected higher metal prices, executives said yesterday.
"Sales revenue and profit will improve greatly this year," said Xiong Weiping, chairman and chief executive officer, said at a conference in Shanghai yesterday.
Chief Financial Officer Chen Jihua added that the improvement will mainly come from the restoration in production and recovering metal prices after the company slashed output by more than 30 percent in the first of half last year amid plunging prices.
But Chalco is still expected to be in the red in the first quarter, China's biggest aluminum producer said in a statement over the weekend. The likely red ink will follow the company's unexpected loss of 1.1 billion yuan (US$161 million) in the fourth quarter of 2009, which it blamed on the annual drop in metal prices. It caused the company to post an annual loss of 4.64 billion yuan last year.
Xiong estimated prices to rise to between US$2,000 and US$2,400 a ton in the global market and from 15,500 yuan to 18,000 yuan a ton in the domestic market, compared with last year's average US$1,939 per ton globally and 11,835 yuan domestically.
To benefit from recovering demand, Chalco plans to raise aluminum production by 15.12 percent this year and alumina output by 34.06 percent.
"The company will consider setting up major aluminum and alumina plants overseas to cut operating costs," said Xiong.
Chalco will also seek cooperation with Gansu, Qinghai and Yunnan provinces to explore coal and hydropower resources to establish a coal aluminum and hydro aluminum product line. But no projects have been finalized yet.
"Sales revenue and profit will improve greatly this year," said Xiong Weiping, chairman and chief executive officer, said at a conference in Shanghai yesterday.
Chief Financial Officer Chen Jihua added that the improvement will mainly come from the restoration in production and recovering metal prices after the company slashed output by more than 30 percent in the first of half last year amid plunging prices.
But Chalco is still expected to be in the red in the first quarter, China's biggest aluminum producer said in a statement over the weekend. The likely red ink will follow the company's unexpected loss of 1.1 billion yuan (US$161 million) in the fourth quarter of 2009, which it blamed on the annual drop in metal prices. It caused the company to post an annual loss of 4.64 billion yuan last year.
Xiong estimated prices to rise to between US$2,000 and US$2,400 a ton in the global market and from 15,500 yuan to 18,000 yuan a ton in the domestic market, compared with last year's average US$1,939 per ton globally and 11,835 yuan domestically.
To benefit from recovering demand, Chalco plans to raise aluminum production by 15.12 percent this year and alumina output by 34.06 percent.
"The company will consider setting up major aluminum and alumina plants overseas to cut operating costs," said Xiong.
Chalco will also seek cooperation with Gansu, Qinghai and Yunnan provinces to explore coal and hydropower resources to establish a coal aluminum and hydro aluminum product line. But no projects have been finalized yet.
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