Russian aluminum producer United Co. Rusal PLC's shares slipped about 5% on the Hong Kong stock exchange as the company reported a massive drop in second-quarter net profit.
The company's net profit plummeted to US$285 million, from US$408 million a year ago, mainly due to higher cost of sales, it said Aug. 9.
Revenue increased to US$2.57 billion from US$2.25 billion, while the cost of sales climbed to US$2.13 billion from US$1.58 billion on a yearly basis.
Sales of primary aluminum and alloys increased to 1.1 million tonnes, from 783,000 tonnes a year ago, while the aluminum price dropped to US$1,793 per tonne from US$2,259/t.
Production of primary aluminum and alumina remained stable year over year at 939,000 tonnes and 1.9 million tonnes, respectively. Bauxite production increased to 4.2 Mt, from 3.3 Mt a year ago.
In the first half, profit dropped to US$558 million from US$952 million. The half-year included Rusal's share of profits from PJSC Norilsk Nickel Co., which came in at US$697 million.
Revenue in the six months fell 5.2% year over year to US$4.74 billion mainly due to a 17.3% drop in aluminum price to US$1,826/t. Half-year aluminum sales volume increased 13.2% year over year to 2.0 Mt.