ALUMINIUM Bahrain (Alba) has announced it posted a net income of $212 million (BD79.8 million) for 2013 and increased the year’s total dividend by 28 per cent to $135 million.

The net income was down from $257 million in 2012, attributable primarily to an $85 million one-time gain from the Alcoa settlement reached in Q4 of 2012 and lower London Metal Exchange (LME) prices, the company said.

Net income for Q4 of 2013 stood at $36 million, down 74 per cent from $140 million driven by the one-time gain from the Alcoa settlement.

Sales for the full year of 2013 were $1.993 billion versus $1.978 billion in 2012. Q4 2013 sales were $488 million versus $502 million in Q4 2012, down by 3 per cent on the back of lower LME prices.

Volume-wise the company increased its sales by 3.3 per cent YoY to 919,722 tonnes while production rose by 2.5 per cent YoY to reach 912,700 tonnes. There was a 48 per cent increase in physical premiums while value-added products accounted for 66 per cent of total shipments versus 65 per cent in 2012. Another highlight of 2013 was the launch of Project Titan, a two-year programme aimed at improving cash cost by $150 per tonne.

The Alba plant, one of the region’s major aluminium producers

Total dividend proposed for fiscal year 2013 of $135 million compared with $105 million in the previous year. The board recommended a final dividend of $82 million in addition to the interim dividend already paid in September 2013 of $53 million.

Commenting on the 2013 results, the chairman of Alba’s board of directors, Mahmood Hashim Al Kooheji, said: “2013 proved to be another breakthrough year in the company’s history with Alba achieving record sales and production despite tough LME market conditions. Our focus to deliver value to our shareholders is evidenced by a 28 per cent increase in the 2013 dividend.”

Alba’s CEO Tim Murray added: “Alba continues to raise the bar by leveraging our operational excellence programme to exceed our targets. Our ability to generate cash during difficult economic times shows the commitment and ownership of all the employees in Alba. As we move into 2014 we believe the company is well positioned to excel to even higher levels.”

The company reiterated its priorities for the current year would be a continued focus on safety and training programmes, delivering on Project Titan, leveraging strong physical demand conditions with an emphasis on value-added sales and finalising the Line 6 Bankable Feasibility Study and long-term gas contract.

Billets produced at the Alba smelter

The company said Project Titan (February 2014 to January 2016) is expected to generate a significant amount of savings, majority of which will be invested in projects that will drive future growth in strategic areas of business.

Speaking on its implementation, Alba’s manager for operational excellence, Waleed Tamimi, said: “Alba remains committed to improving its efficiency without compromising safety, quality or effectiveness. Project Titan, through its cost initiatives in various areas of operations, aims to drive revenue growth as well as boost profitability, thus strengthening Alba’s position in the industry.”

The results of Project Titan will be measured against the baseline of 2013 actuals and not the budget and will be visible in the company’s financial statements.

Globally, aluminium demand remains healthy with world consumption up by 5.3 per cent year-on-year. Asian demand was up 7 per cent YoY supported by growths of 10 per cent in China and 6 per cent in the Mena region on the back of major investments in infrastructure. Steady demand was witnessed in North America (+2 per cent) mainly driven by automotive body sheets and aerospace production. Europe turned a corner with improved demand (+1 per cent) on the back of the construction and packaging sectors.

World production rose 4.3 per cent and is expected to rise with greenfield project ramp-ups set to lift output in the Middle East (Maaden and Emal 2) and China.

Other developments

Tamimi: Project Titan will strengthen Alba’s position

In other Alba news, the company reaffirmed its commitment to the safety culture with its plant-wide HSE Week held from January 26 to 31. Organised in cooperation with the Alba Labour Union, the HSE event’s theme – “Elevating Safety to Lightspeed” – symbolised Alba’s move to the next level on health, safety and the environment.

 Along with work safety, the HSE event focused significantly on spreading the safety culture beyond Alba to the families, especially children of all employees.

 The main highlight was the Kids Drawing Competition held under the theme home safety where Alba employees’ children participated by submitting a drawing/painting on their understanding of safety. The winners were selected and awarded by Murray. In addition, tours for employees’ families were also organised so that they could visit the plant and familiarise themselves with the company’s operations.

Alba is a gold sponsor for the University of Bahrain (UOB)’s 14th Careers Day, which will be held from March 5 to 7, 2014 at the university’s Sakhir campus.

Alba’s sponsorship support underlines its commitment to inspire and enable young Bahrainis to discover career advancement opportunities within the company and the aluminium industry.

Alba has been a regular participant of UOB’s Careers Day since its inception in 1999, and the company’s stand has always attracted a large number of students eager to know about the company and the career opportunities that it offers.  

“Alba remains committed to ensure that our employees benefit from a world-class work environment and are able to develop skills that match the very best in the world. Our support for UOB’s Careers Day is to enable young Bahraini students to gain an understanding of what it takes to work in a smelter that ranks amongst the world leaders, and how they can contribute in Alba’s continuing success story.”

Alba announced a three-year partnership renewal with Bahrain International Circuit (BIC). It will be allocated a special lounge at BIC’s Oasis Complex.

 The company will also have the opportunity to place its logo at strategic locations across the venue.