RUSAL 2011 net dives 92 percent on Norilsk valuation

Mon Mar 19, 2012 1:32am EDT
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By Alison Leung

HONG KONG (Reuters) - RUSAL, the world's top aluminum maker, posted a 92 percent fall in yearly net profit, hit by a write-down in the value of its stake in miner Norilsk Nickel as it grapples with a damaging boardroom row between two Russian billionaires.

RUSAL (0486.HK: Quote) RUAL.PA said fourth-quarter earnings before interest, tax, depreciation and amortization, stripping out Norilsk, fell 46 percent to $382 million, while its full year earnings were down slightly, both in line with expectations in a Reuters poll.

It forecast near-term pressure on aluminum prices, which fell sharply in late 2011, due to global volatility and excessive stock, but expected growth in developing countries to keep demand robust through 2012.

"We continue to believe that RUSAL is well-placed in the global aluminum industry due to its low-cost position. Hence it should be able to sustain better operating performance relative to its peers," RBS analyst Jeannette Sim said in a research report after the results were released.

"However, the boardroom disputes which have resulted in the resignation of its chairman are uncertainties that could weigh on the share price performance," she added.

RUSAL's shares added 1.4 percent in Hong Kong after tumbling 14 percent last week as its former chairman and Russian oligarch Viktor Vekselberg said the company was in "deep crisis".


RUSAL results graphic:   Continued...

A worker operates an electrolysis furnace, which produces aluminium from raw materials, at the electrolysis shop of the Rusal Krasnoyarsk aluminium smelter plant in the Siberian city of Krasnoyarsk in this February 3, 2010 file photo. REUTERS/Ilya Naymushin/Files