RUSAL 2011 net profit dives 92%
HONG KONG: RUSAL, the world’s top aluminium maker, posted a 92% fall in yearly net profit, hit by a writedown in the value of its stake in miner Norilsk Nickel as it grapples with a damaging boardroom row between two Russian billionaires.
RUSAL said fourth-quarter earnings before interest, tax, depreciation and amortisation, stripping out Norilsk, fell 46% to Us$382mil, while its full-year earnings were down slightly, both in line with expectations in a Reuters poll.
It forecast near-term pressure on aluminium prices, which fell sharply in late 2011, due to global volatility and excessive stock, but expected growth in developing countries to keep demand robust through 2012.
“We continue to believe that RUSAL is well-placed in the global aluminium industry due to its lowcost position. Hence it should be able to sustain better operating performance relative to its peers,” RBS analyst Jeannette Sim said in a research report after the results were released.
“However, the boardroom disputes which have resulted in the resignation of its chairman are uncertainties that could weigh on the share price performance,” she added.
RUSAL’S shares added 1.4% in Hong Kong after tumbling 14% last week as its former chairman and Russian oligarch Viktor Vekselberg said the company was in “deep crisis”.
The company on Sunday threatened to sue Vekselberg, saying his comments had damaged its reputation and shareholder value, and named Hong Kong Mercantile Exchange chairman Barry Cheung as its new chairman.
Vekselberg, who with a partner holds a 15.8% stake in the firm, quit as chairman last week in a row over strategy with Oleg Deripaska, the main shareholder and another Russian billionaire.
The boardroom row has highlighted a bitter dispute over how to relieve the company of an Us$11bil debt burden inherited from its Us$14bil purchase of a quarter of Norilsk Nickel at the top of the market in 2008. Vekselberg wants to sell the stake back to Norilsk but has been consistently overruled by Deripaska.