REG - Aluminium Bahrain - 1st Quarter Results

Aluminium Bahrain BSCAnnouncement

13/05/2025 14:30

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RNS Number : 5020I  Aluminium Bahrain B.S.C.  13 May 2025

Media Release - Tuesday 13 May 2025

 

Alba Reports its Financial Results for the First Quarter of 2025

http://www.rns-pdf.londonstockexchange.com/rns/5020I_1-2025-5-13.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/5020I_1-2025-5-13.pdf)

Q1 2025 Financial Performance

Aluminium Bahrain B.S.C. (Alba) (Ticker Code: ALBH), the world's largest
aluminium smelter on one site, has reported a Profit of BD18.1 million
(US$48.2 million) for the first quarter of 2025, a drop of 25.9%
Year-over-Year (YoY), versus a Profit of BD24.5 million (US$65 million) for
the same period in 2024. The Company reported Basic and Diluted Earnings Per
Share of fils 13 for Q1 2025 versus fils 17 for the same period in 2024.

Total Comprehensive Income for Q1 2025 stood at BD16.8 million (US$44.7
million) versus BD27.7 million (US$73.6 million) for the same period in 2024 -
a drop of 39.4% YoY. Gross Profit for Q1 2025 was BD50.8 million (US$135.1
million) versus BD 57.3 million (US$152.3 million) for the same period in 2024
- down by 11.3% YoY.

With regards to the Revenue from contracts with customers, Alba generated
BD408.9 million (US$1,087.6 million) versus BD334.6 million (US$889.8 million)
in Q1 2024 - up by 22.2% YoY.

Total Equity as of 31 March 2025 stood at BD1,902.7 million (US$5,060.4
million), down by 1.1%, versus BD1,923.9 million (US$5,116.9 million), as of
31 December 2024. Alba's Total Assets as of 31 March 2025 were BD2,706.9
million (US$7,199.2 million) versus BD2,673.4 million (US$7,110 million) as of
31 December 2024 - up by 1.25%.

Higher LME Price (+20% YoY) and higher premiums (+38% YoY) drove strong
top-line performance, increased production costs significantly compressed
EBITDA resulting in lower bottom-line.

 

 

 

Market Fundamentals [Based on Market Intelligence]

Global Market Demand (+2% YoY)

o  Global Economy: Started the year with positive momentum, showing continued
growth in commodity demand and signs of easing inflation across major
economies. However, the future impact of tariffs on commodity markets remains
uncertain.

o  Tariffs: Increased market uncertainty has significantly affected both
London Metal Exchange (LME) prices and physical premiums. If trade tensions
ease, this could be good for the market.

o  North America: The US economy demonstrated good performance in Q1 driven
by consumer spending and a recovering housing market. This domestic
performance contributed to a 1% YoY increase in demand.

o  China: Recognising global uncertainties, Chinese policymakers announced
measures to facilitate a transition from exports to domestic consumption. As a
result, the property sector stabilised with improved new home sales and a
reduction in inventory. This internal focus translated into tangible results
with aluminium consumption showing 1% year-over-year (YoY) increase.

o  Middle East: Demand grew by 3% YoY, primarily driven by higher consumption
in Saudi Arabia (+4% YoY) and Bahrain & UAE (+3% YoY).

o  Europe: Despite a slight easing in inflation, overall consumption remained
flat.

Global Market Supply (+1% YoY)

o  Global aluminium supply market growth was very limited. While some
smelters were ramping-up production, these increases were largely offset by
the impact of closures that took place at the end of last year.

o  China: Supply rose by a modest 1% YoY as it's nearing its self-imposed
production capacity ceiling of 45 million metric tonnes, making any
significant net supply growth from China unlikely.

o  Europe: Production saw a marginal increase of 1% YoY driven by gradual
return to full operations of German smelters.

o  North America: Production contracted by 3% YoY primarily due to a 2% YoY
decline from Canadian smelters

o  Middle East: Supply down by 1% YoY.

o  Market Balance: As Chinese production is growing at a slower pace than
consumption (China continues to hold to its 45 million tonnes annual target),
the global market shows a surplus when including China (+253,000 MT) and a
deficit when excluding China (-265,000 MT).

 

LME Price & Premiums

o  LME Price averaged US$2,629/t in Q1 2025 (+20% YoY) and was supported by
low global inventories of 459,000 MT (down by 17% YoY) and modest supply
growth. However, towards the end of Q1, LME prices started to decline given
changes in trade policies.

o  Premiums: Following the implementation of tariffs in the US, regional
premiums surged by 77% YoY. DDP Rotterdam and MJP premiums up by 17% and 153%
YoY respectively mainly due to depletion of inventories and geopolitical
factors.

Alba Celebrates ESG Achievements and Plans Future Course

§ Safety First. Safety Always

o  Alba wins six National Safety Council Awards for 2025.

o  Honoured with Prestigious RoSPA Life President Award for Unparalleled
Safety Excellence.

o  Launched plant-wide Safety and Health Campaign 'Be an Albawee in Ramadan'.

§ Empowering People

o  56 national employees completed Alba's 'Al Jisr' training &
development programme.

o  Promoted 3 Bahraini talent to key managerial positions.

o  Celebrated promotion of 2,082 Bahraini employees over the past 5 years and
87% Bahrainisation rate.

o  15 exceptional employees, including 7 women, were recognised with the
'Inspirational Employee of the Year' Award.

§ Sustainability & Environmental Stewardship

o  Embarked on a pilot programme for an electric, battery-powered Aluminium
Fluoride (AlF3) feeding vehicle in potlines.

o  Joined Sea Cargo Charter as its Newest Signatory, Reinforcing Sustainable
Shipping Commitment.

o  Recognised top-performing contracting companies for their top performance
in Safety and well-being of workers in Alba.

§ Community Impact

o  Joined Tamkeen's Open Innovation Program to obtain innovative solutions
from Bahraini startups and SMEs - first company in Bahrain to join the
Program.

Alba's Operational Highlights

o  Despite market challenges, sales volume reached a healthy 374,809 MT, up
by 3% YoY.

o  Net Finished Production dipped slightly by 2% YoY to reach 396,866 MT.

o  Value Added Sales (VAP) averaged 71% of total shipments, marking an
increase of 5% YoY [VAP: 265,657 MT in Q1'25 versus 252,772 MT in Q1'24].

o  Achieved savings for e-Al Hassalah at US$30.9 million against 2025 Target
of US$60 million.

 

Aluminium Market: Trade Turbulence Casts Shadow Over Short-Term Outlook [Based
on Market Intelligence]

o  Market Uncertainty Persists: LME prices dropped rapidly by Q1-end 2025 due
to strengthening US dollar and growing concerns about near-term economic
activity as trade tensions escalated. Trump's tariffs and the US dollar were
key drivers of aluminium price movements, and market sentiment remains fragile
due to volatile US trade policies.

o  Demand Outlook: High tariffs threaten demand despite initial positive
indicators. While extreme US tariffs, especially on China, are likely to
persist, they will likely cause global inflationary pressure.

o  Supply Conditions: Modest growth in Chinese aluminium output expected due
to smelters' restarts and ramp-ups. Production outside China will also likely
increase with capacity expansions in India and Russia.

o  Premium Outlook: MJP Q2 settled at US$182/t (down by US$46/t from Q1).
European premiums declines are due to anticipated redirection of US-bound
metal. Midwest premium is expected to eventually increase to attract more
metal to the US.

o  LME Price Forecast: Near-term LME prices are projected to range between
US$2,300/t and US$2,450/t.

Alba: Safe, Sustainable, Successful

§ Leading the Way: Safety First, Sustainability Always

o  Aligned with Bahrain's 2060 vision of net-zero emissions, Alba embeds
sustainability from raw material sourcing to product delivery, minimising
environmental footprint.

§ Operational Excellence and Growth

o  Exceed 2024 Net Finished Production of 1,622,261 MT.

o  Achieve e-Al Hassalah 2025 Target of US$60 million, progressing towards
2026 Target of US$150 million.

§ Capacity Expansion and Efficiency Enhancement

o  Leverage its industry-leading certifications such as Aluminium Stewardship
Initiative (ASI), EcoVadis and Low-Carbon Aluminium EternAlTM to penetrate new
markets & boost Value Added Sales (VAP) sales.

o  Complete Solar Farm (+6 MW) to enhance green energy utilisation.

o  Establish Alba Daiki Sustainable Solutions (ADSS) for aluminium dross
processing by September 2026.

o  Complete Feasibility Study for the New Replacement Line which will replace
Reduction Lines 1-3.

Commenting on the Company's performance for the first quarter of 2025, the
Chairman of Alba's Board of Directors, Khalid Al Rumaihi stated:

"Alba's Q1 2025 results underscore the fundamental strength and operational
efficiency of our business.

While our reported Profit reflects the significant impact of higher alumina
prices, it's important to recognise that had these prices remained at previous
levels, Alba would have undoubtedly achieved an unparalleled financial
performance, demonstrating our inherent earnings potential."

Alba's Chief Executive Officer, Ali Al Baqali, added: "Despite the prevailing
global geopolitical tensions, Q1 2025 was a landmark period for Alba marked by
many firsts: we recorded the highest sales volume, achieved a record Value
Added Sales percentage and most importantly, delivered our best safety
performance ever in the Company's history.

These firsts are a direct result of the commitment and operational excellence
exhibited by the entire Alba team."

Alba Management will hold a conference call on Wednesday 14 May 2025 at 4PM
Bahrain Time to discuss the Company's financial and operational performance
for Q1 2025 and outline its strategic priorities moving forward.

ENDS

Alba's Board Meeting in Q1 2025

 

About Aluminium Bahrain B.S.C. (Alba)

[Ticker: ALBH]

 

A Global Aluminium Leader: At plus-1.62 million metric tonnes per annum (mtpa)
(2024), Alba is a world-leading aluminium smelter with a proud 50-year legacy
in operational excellence, safety, environmental responsibility, and community
development.

 

Trusted Partner: A cornerstone of the Bahrain's economy, Alba produces
high-quality aluminium, including standard and value-added products, which are
exported to over 280 customers globally. With sales' offices in Europe
(Zurich), Asia (Singapore), and a subsidiary in the U.S., Alba is a reliable
partner on the world stage. Alba is dually listed on Bahrain Bourse and London
Stock Exchange and its shareholders are Bahrain Mumtalakat Holding Company
B.S.C. © (69.38%), Saudi Arabian Mining Company (Ma'aden) (20.62%) and
General Public (10%). Alba prioritises the highest quality standards,
reflected in its certifications: ISO 9001 (quality), ISO 14001 (environment),
ISO 27001 (information security), ISO 45001 (occupational health and safety),
and ISO 18788 (security operations management). Additionally, Alba
demonstrates its commitment to responsible manufacturing through
certifications like IATF 16949 (automotive quality), ISO 22301 (business
continuity), and ASI Performance and Chain of Custody Standards. This
dedication is further underscored by their top 1% Ecovadis Platinum rating for
sustainability.

 

Pioneering Sustainability: As the first aluminium smelter in the Middle East,
Alba is central to Bahrain's thriving downstream aluminium sector,
contributing significantly to the Kingdom's GDP. Committed to social
responsibility, Alba employs a workforce that is 87% Bahrainis (2024) and
invests heavily in employee training and development. Alba also plays a
crucial role in the Aluminium Downstream Park, therefore increasing the
contribution of non-oil sectors to the GDP of Bahrain. Alba has been
recognised for its initiatives to produce Aluminium responsibly through awards
such as Top ESG performer in Bahrain by ESG Invest, Safeguard Label from
Bureau Veritas and Best Corporate Governance Award by Ethical Boardroom.

 

Recognised for its environmental practices, social contributions, and
corporate governance, Alba launched a comprehensive ESG Roadmap in 2022
focusing on 6 priority areas: (1) Decarbonisation, (2) Green Energy &
Aluminium, (3) Circular Economy & Secondary Aluminium, (4) Employee
Welfare, (5) Collaboration & Partnership and (6) Transparency,
Communications & Due Diligence. Since its inception, Alba has invested
into numerous environment, sustainable and socio-economic development projects
that have had a positive impact on the society. Alba's first-of-its-kind
US$37.5 million zero-waste Spent Pot Lining Treatment Plant, Power Station 5
Block 4 Project, and the upcoming +6 MW Solar Farm Project are tangible
initiatives aligned with Bahrain's Net Zero Carbon Targets by 2060 led by HRH
the Crown Prince and Prime Minister of Bahrain. Specifically, Alba's PS5 Block
4 is a new 680.9-megawatt (MW) combined-cycle power plant that expands the
existing PS5 facility. Block 4 will increase the nameplate capacity of PS5
Complex from 1,800 MW to 2,481 MW and reduce the Company's overall GHG
emissions intensity ratio by 0.5 tonnes of CO(2) per 1 tonne of aluminium
produced.

 

In a significant step towards its ESG goals, particularly its commitment to a
circular economy and secondary aluminium, Alba introduced EternAl(TM), its new
line of low-carbon aluminium products. Launched in May 2024, EternAl offers
two initial variants: EternAl-30 and EternAl-15, containing 30% and 15%
recycled content respectively.

 

Safety First, Always: Guided by the motto "Safety First, Safety Always," Alba
prioritises the well-being of its employees and contractors. The Company
achieved a record-breaking 35 million safe working hours without a lost-time
injury in May 2025. The Company has been recognised internationally for its
excellent Safety and Health track record with awards such as the RoSPA
President's Award for winning RoSPA Gold Medal Award 10 years in a row, the
British Safety Council's International Safety Award with Merit along with
4-Star Audit Rating, as well as numerous awards from the National Safety
Council (NSC).

 

Alba Stakeholder Engagement Plan

Alba prioritises open communication with all its stakeholders, including the
community, environmental and social groups. Through its Stakeholder Engagement
Plan, the Company proactively addresses environmental and social impacts of
its operations, outlining clear mitigation controls. Alba also maintains an
external Grievance Mechanism accessible through the Code of Conduct, allowing
stakeholders and the public to voice concerns and raise issues.

Scan the above to Alba's Stakeholder Engagement Plan

Alba's External Grievance Mechanism

Alba prioritises ethical conduct and environmental responsibility.
Stakeholders, employees, contractors, and the community can confidentially
report any potential breaches of Alba's Code of Conduct or raise concerns
about environmental and social impacts through the Alba Integrity Line
(https://www.albasmelter.com/en/category/code-of-conduct) . This independent,
multilingual hotline operates 24/7 and is accessible via a toll-free phone
number, the company intranet, or the website at www.albasmelter.com
(https://www.albasmelter.com) .

Scan the above to Alba's Code of Conduct
 

For further details, please contact:

Eline Hilal

Director, Investor Relations, Insurance & Corporate Secretary

Investor Relations Department

Tel:          (973) 1783 5100

E-mail:      eline.hilal@alba.com.bh (mailto:eline.hilal@alba.com.bh)

Website: www.albasmelter.com (https://www.albasmelter.com)

 

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