Rusal posts $17 million fourth-quarter net loss, sees demand recovery

　　Rusal’s adjusted net loss for the quarter of $17 million, compared with a $338 million profit in the previous quarter and a $350 million profit in the final quarter of 2017.

　　However, a lot has changed at the Hong Kong-listed company since the final quarter of last year, after the U.S. Treasury lifted sanctions that had been imposed on Rusal in April 2018.

　　The move meant investors no longer faced a deadline to divest from Rusal and from other companies in Russian tycoon Oleg Deripaska’s empire. It sent Rusal’s share price soaring.

　　The aluminum producer is now preparing to restore previous contracts with clients and is also talking to new clients, its chief executive was cited by Interfax as saying on Monday.

　　Rusal’s Hong Kong-listed shares have surged 48.7 percent so far this year, against a 52.7 percent fall in 2018.

　　In its fourth quarter results, the company said recurring net profit fell 83.8 percent from the previous three months, but rose 7.8 pecent year-on-year.

　　Recurring net profit is defined as adjusted net profit plus the company’s net effective share in results of Russian mining giant Norilsk Nickel.

　　Prices for aluminum were at $1,968 per tonne on the London Metal Exchange (LME) in the fourth quarter, down 6.3 percent year-on-year, Rusal said in its statement.

　　Rusal’s removal from the U.S. sanctions list in January depressed aluminum prices on concerns that global supply would rise.

　　But Rusal said last month it sees potential for prices to rise and expects demand for aluminum to grow this year.

　　“Looking ahead into 2019 and the year ahead, we expect aluminum demand to recover after the trade wars and supply shocks of late 2018,” chief executive officer Evgenii Nikitin said in a statement on Thursday.

　　“Alongside forecasting markets outside China to be in heavy deficit in 2019, we are confident that UC RUSAL is fully capable to leverage this trend,” Nikitin added.

　　Rusal said aluminum production was 943,000 tonnes in the fourth quarter, down 0.2 percent year-on-year, while primary aluminum and alloys sales fell 12.3 percent year-on-year to 877,000 tonnes.

　　The company, the world’s second-biggest producer after China’s Hongqiao, has previously said it expects its output to be at 3.8 million tonnes in 2019, Interfax reported.

　　Rusal said its fourth-quarter adjusted earnings before interest, tax, depreciation and amortization (EBITDA) fell 38.1 percent from the year ago period to $363 million, while revenue was down 13.8 percent year on year to $2.37 billion.

　　Rusal’s net debt stood at $7.44 billion at the end of December 2018 compared with $7.65 billion at the end of 2017.