Russian aluminium giant Rusal swings to first-half loss as expenses surge
Rusal reported a first-half net loss on Friday, as rising costs, higher interest expenses and foreign exchange fluctuations weighed on the Russian aluminium producer's earnings.
The Hong Kong-listed company, the world's largest aluminium maker outside China, swung to a net loss of $87-million for the six-month period ended June 30, from a profit of $565-million last year.
Rusal has faced sustained pressure for more than three years from the fallout of Western sanctions on Russia over the war in Ukraine. While not directly sanctioned, the company has seen some Western buyers avoid new contracts for Russian metal.
Finance expenses surged by $408-million, reflecting higher interest on bank and company loans, bonds and other charges, while a foreign exchange loss added $181-million to the bottom-line hit.
Cost of sales jumped about 40% to $6.11-billion, driven by increased volumes of primary aluminium sales and higher alumina and raw material prices, as well as elevated electricity and transport costs.
Still, Rusal's revenue rose 32% to $7.52-billion due to higher sales of primary aluminium and alloys.
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