Alumina has reported a net loss for 2009 and missed market expectations as it was hit by a slump in aluminium demand but reinstated its dividend as its outlook improves.
Alumina was forced to scrap its dividend a year ago to conserve cash as the industry suffered a severe downturn, but with the recovery underway it said it would pay out 2 cents a share for 2009 and expected better dividends this year.
Alumina shares, though, fell in early trading, dropping as much as 6.5 cents, or 4.1 per cent, to $1.535.
The net loss of $26 million follows Alumina’s $168 million net profit in 2008 during a commodities boom.
Underlying losses after tax for 2009 were $2 million, compared to an underlying profit of $202 million the previous year.
But Alumina chief John Bevan says the outlook for improved returns for shareholders has strengthened.
‘‘The 2009 result reflects the worst of the impact of the global financial crisis on aluminium and alumina prices,’’ Mr Bevan said in a statement. ‘‘The AWAC global bauxite and alumina business remained profitable throughout the downturn and the smelters returned to profitability in the final quarter.’’
Alumina is the 40 per cent partner of the Alcoa World Alumina & Chemicals (AWAC) group, an international network of alumina refineries, bauxite mines and chemical plants.
The US-based Alcoa is the operator of AWAC with a 60 per cent stake.
Alumina production during 2009 dipped to 13.5 million tonnes, compared to 14.4 million tonnes the previous year.
Mr Bevan said production capacity was increased 15 per cent during the year due to the commissioning of the expanded Brazilian operations and the acquisition of the remaining 45 per cent in the Suralco refinery, in Suriname.
He said aluminium prices were about 55 per cent higher than at the beginning of 2009, but were well below the average price in 2008.
AWAC alumina production was forecast to increase by about 2 million tonnes in 2010 on increased customer demand, while production costs were likely to remain the same, the company said.
‘‘These factors create an environment for Alumina Ltd to expect to receive an improved dividend flow from AWAC in 2010,’’ the company said.
The company said that at December 31, it had total cash and cash equivalents of $340.6 million, up from $66.8 million a year earlier.
Reuters, AAP
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