China Hongqiao Dives After Profit Warning on Debt, Metal PricesBloomberg News
Top aluminum maker says weak yuan means loss on dollar debt
Consolidated profit poised to drop 25-35% for 2015: Hongqiao
China Hongqiao Group Ltd., the world’s biggest aluminum producer, fell the most since September after warning its 2015 consolidated profit may drop more than a third as metals prices slumped and a weaker yuan made dollar debt more expensive.
The Shandong province, China-based company fell as much as 8.2 percent to HK$3.68 ($0.47) a share before trading at HK$3.79 at 11:00 a.m. local time.
Consolidated profit attributable to shareholders will fall between 25 and 35 percent in 2015, the company said in a statement after close of trading on Jan. 15. This was a result of foreign-exchange losses on dollar-denominated debt amid the yuan’s devaluation, and a significant decline in aluminum prices in the last quarter of the year, it said.
The yuan has lost almost 6 percent against the dollar since Aug. 11 last year. Aluminum prices fell 19 percent in 2015 on the London Metal Exchange.
Hongqiao is held by billionaire founder Zhang Shiping and passed United Co. Rusal in the first half of last year to become the world’s biggest maker of aluminum, used in everything from beverage cans to cars and window frames.
— With assistance by Martin Ritchie