United Co. Rusal (468), the world’s largest aluminum producer, narrowed its net loss in the first quarter on rising aluminum premiums and reduced costs.
The loss for the three months ended March 31 was $325 million compared with a loss of $2.7 billion in the December quarter, the Moscow-based company said in a statement today. Adjusted earnings before interest, taxes, depreciation and amortization rose 71 percent to $173 million from the previous quarter, missing the $187 million average estimate of five analysts surveyed by Bloomberg. Revenue was little changed at $2.1 billion.
“While it is too soon to say the aluminium market has fully turned the corner, we are seeing positive trends, such as robust consumption growth,” Chief Executive Officer Oleg Deripaska said in the statement.
While average aluminum futures on the London Metal Exchange were lower compared with the fourth quarter, the premium to the market price, which buyers pay for swift delivery, rose about 27 percent, helping producers to improve performance. Rusal also helped cut costs and reduce working capital by taking its most inefficient smelting plants off line in 2013.
Bank of America Corp. raised Rusal to a buy this month on the rise in premiums and as global aluminum supply excluding China switched to a deficit this year, ensuring higher demand and prices. Goldman Sachs Group Inc. and VTB Capital also raised the stock to a buy in April.
Rusal (486)’s net debt rose 2.3 percent to $10.3 billion, it said in the statement.
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