Alcoa’s Aussie partner posts loss after write-offs

ALCOA’S Australian partner Alumina has slumped to a full year loss due to restructuringrelated write-offs and lower prices and volumes.

The miner and metals producer made a loss of $US30.2 million ($A39.3 million), down from a $US88.3 million profit in 2015.

The result was attributed to its share of impairment char- ges related to shutting down capacity in its Alcoa World Alumina and Chemicals joint venture with Alcoa.

Alumina holds a 40 per cent stake in AWAC, and its share of charges was $US115 million, partially offset by gains on the sale of the Dampier-Bunbury gas pipeline.

“Net cash distributions from AWAC were higher than the previous year despite the tough market conditions in the first half,” chief executive Peter Wasow said.

“As a result of restructuring and productivity gains, AWAC continues to keep cost of production low and prices have recovered significantly.”

The AWAC joint venture also reported a fall in alumina margins because of lower prices in the first half of the year, and lower volumes after curtailing capacity across its refineries.

This was partly offset by increased sales of bauxite ore to third parties, a business that AWAC is looking to expand.

Alcoa in November completed a split of its global operations into two independent, publicly traded companies, with one focused on upstream mining and smelting and the other on aluminium products, as part of efforts to tackle the price and demand slump.

The company expected a steady improvement in alumina prices as demand and supply growth remained largely in balance. However, cost pressures were expected to continue, Mr Wasow said.