Sunday 27 September 2020

EGA reports adjusted EBITDA of $693m for 2019

ABU DHABI, March 26, 2020

Emirates Global Aluminium (EGA), the largest industrial company in the UAE outside oil and gas and the world’s largest ‘premium aluminium’ producer, has reported adjusted earnings before interest, taxes, depreciation and amortisation (adjusted EBITDA) of Dh2.5 billion ($693 million) for 2019.
2019 was a challenging year for the global aluminium industry with lower prices for finished metal and proportionally much higher prices for raw materials in H1 including alumina driven by global supply shortage due to the curtailment of a major refinery in Brazil. This impacted margins and financial results across the sector. Despite these market conditions, EGA’s smelting EBITDA margin for 2019 was close to 14 per cent, ranking amongst the best globally, the company said.
EGA maintained its position as the world’s largest ‘premium aluminium’ producer by volume, with sales of value-added products of 2.3 million tonnes or 87.4 per cent of total sales, sold to more than 400 customers in over 50 countries. Value-added products attract higher premiums over benchmark prices than those achieved by standard aluminium and enable EGA to maximise the value of its primary aluminium production.
EGA sold 2.60 million tonnes of cast metal in total in 2019 compared to 2.64 million tonnes in 2018, but the company gained market share in many key markets and customers, it said.
Local sales, to the downstream aluminium sector that has grown around EGA into one of the UAE’s most significant industries, were 294,000 tonnes, an increase of seven per cent.
Cash generated from operating activities was Dh4.1 billion ($1.1 billion), delivered through improved operational efficiency. EGA continued to improve working capital, which was reduced by more than Dh1.5 billion ($400 million) in 2019 to generate additional cash.
Abdulnasser Bin Kalban, Chief Executive Officer of EGA, said: “2019 was a challenging year for the global aluminium industry and we took strong action at EGA to reduce our costs, improve our operational efficiency, and maximise cash generation. EGA’s key strengths, including our highly-efficient smelting technology and market leadership in value-added products, enabling us to achieve competitive EBITDA margins in the global aluminium industry.
“Market conditions last year further validated our strategy of controlling our own supply of bauxite and alumina and reducing our exposure to volatile raw materials prices. During 2019 we completed construction and made excellent production ramp-up progress at both our strategic upstream growth projects.”
Lower benchmark aluminium prices led to a reduction in revenue to Dh20.5 billion ($5.6 billion), compared to Dh23.5 billion ($6.4 billion) in 2018, partially offset by the higher volume of value-added products.
EGA’s Al Taweelah alumina refinery began production in April 2019, and produced 1.1 million tonnes in 2019.  EGA’s bauxite mining subsidiary, Guinea Alumina Corporation, began bauxite exports in August 2019, with total bauxite ore mined of 1.7 million tonnes in 2019.
EGA’s safety performance continued to compare favourably to global industry benchmarks in 2019. EGA’s Total Recordable Injury Frequency Rate in 2019 was 1.9 per million hours worked, compared to 1.27 in 2018. According to the International Aluminium Institute, the global average Total Recordable Injury Frequency Rate in the aluminium industry in 2018 (the latest year for which data is available) was 3.4 per million hours worked. Only one injury at EGA in 2019 required more than seven days off work. EGA achieved its long-standing goal of zero heat-related incidents during the hot summer months in 2019, the company said.
EGA finished 2019 with its highest-ever rate of Emiratisation, with some 39.8 per cent of in-focus roles at EGA held by UAE Nationals. More than 1,100 UAE Nationals work at EGA in total, and some 840 of these employees are under the age of 35. Some 17 per cent of supervisory roles at EGA are held by women.
In 2019, EGA made further progress in aligning its corporate sustainability approach to the performance standards developed specifically for the aluminium industry through the Aluminium Stewardship Initiative. In May, EGA’s Al Taweelah site became the first in the Middle East to secure certification to the ASI Performance Standards. - TradeArabia News Service


More Industry, Logistics & Shipping Stories

calendarCalendar of Events