In 2018, Alro observed an increase in sales of 9% YoY, a decrease in EBITDA of 14% and a decrease in net income of 40%.
Alro published their 2018 preliminary results. According to the report, in 2018, The Group recorded a 9% YoY increase in sales, amounting to RON 3bn. The increase could be observed mainly in the alumina and primary aluminium segments.
Note that in July 2018, Alro started an upgrading programme on one of its rolling mills. As a result, aluminium sales decreased by RON 17m and by 6% in terms of quantity. However, during this period the Group notes that they focused on other aluminium products production and sale, such as those in the primary aluminium range.
In 2018, the cost of goods sold amounted to RON 2.3bn, which represents an increase of 13%. The rise in COGS was mostly generated by the increase of the raw materials and utilities purchase prices, in line with the prices on the dedicated markets. As a result, the gross profit margin decreased by 3p.p. to 22%.
Furthermore, SG&A increased by 21%, amounting to RON 310.5m. The Group explains the increase as they were involved in a large number of projects aimed at improving the operational performances and the market image.
Higher expenses led to a decrease in EBITDA (-14%) which amounted to RON 487.4m
Going further down the P&L, Alro turned a net loss from derivative financial instruments of RON -1.1m to a net gain of RON 35.2m. On the other hand, the Group recorded a net foreign exchange loss of RON -19.6m which could be attributed to the reevaluation of the loans and other liabilities of the Group in foreign currencies.
When observing the companies net income, it amounted to RON 232.7m, which represents a decrease of 40%. Note that the decrease in net income could also be attributed to a higher income tax by RON 62m (+306%).
Alro Performance (2015 – 2018) (RON m)
*Net loss in 2015 was RON -0.02m
Its worth mentioning that in December 2018, Vimteco N.V., the majority shareholder of Alro, together with the shareholder Conef S.A, carried out a private placement for 33.7% of Alro’s share capital. Note that Vimetco N.V., continues to hold 54.19% of Alro’s share capital.
