Tribune News Network
Doha
Qatar Aluminum Manufacturing Company,a 50% joint venture partner in Qatar Aluminum Company (Qatalum), has reported a record net profit of QR614 million for the year ended 31 December 2024, with an earnings per share (EPS) of QR0.110.
Commenting on the financial and operational performance for the year ended 31 December 2024, Abdulrahman Ahmad Al-Shaibi, Chairman of the Board of Directors, QAMCO, said: “QAMCO JV has demonstrated continued resilience and delivered impressive financial performance during 2024, while maintaining our unwavering commitment to operational excellence, prudent cost management, safety, and sustainability initiatives. Our JV’s steadfast focus on prioritizing HSE has been evident throughout all verticals of its operations.
“Our dedication to sustainable practices, along with meeting health, environmental, and social responsibility targets and aligning with broader industry practices, is being reflected in these remarkable results. Moving forward, we remain dedicated to leveraging our robust and sustainable business model and consolidating our core competencies across the value chains to create long-term value for shareholders.”
The aluminum market demonstrated resilience during most of 2024 despite facing considerable macroeconomic variations.
In the first half of the year, demand for primary aluminum in key markets were constrained by persistent inflationary pressures and tightened monetary policies, which dampened activities in the global construction and automotive industries.
Meanwhile, challenges including trade restrictions, a global shortage of alumina supply, and geopolitical tensions disrupting supply chains continued to create uncertainties within the industry.
Despite these obstacles, major economies experienced recoveries mainly during the second half of 2024, on the back of easing of monetary policies, complemented by supportivegovernment fiscal measures, aimed at bolstering economic growth through infrastructure investments and other public spending programs.
This enabled major industrial nations to resume commodity-based growth which paved way for an overall improved industry and strengthening of the aluminium market. Consequently, these factors enabled LME prices to gradually increase by 3% by December 2024, compared to the beginning of the year.QAMCO’s net profit increased in 2024, reflecting an increase of 38% compared to 2023.
This improvement was driven by improved revenue, lowered operating costs, and favorable inventory changes. QAMCO’s share of JV’s revenue increased compared to 2023, while EBITDA increased by 15%, versus 2023.
Amidst a fluctuating macroeconomic environment during most part of the year, QAMCO demonstrated resilience with changes in average prices being the most critical determinant driver, alongside savings achieved through the joint venture’s cost-focused operations. QAMCO achieved a slight increase in production volumes, underpinned by stable current efficiency and improved amperage. The JV maintained a balanced production mix to respond to regional market demands, thereby sustaining sales across its various product range of foundry alloys, extrusion ingots, and standard ingots.
Furthermore, a significant reduction in the cost of goods sold, primarily due to lower raw material costs, positively contributed to the company’s bottom line, helping to mitigate the impact of higher finance costs resulting from increased interest rates.
As a result, QAMCO’s net profit increased by 38% year-over-year to QR 614 million for the year ended 31 December 2024, compared to QR 446 million in 2023.
The earnings per share (EPS) for the current year was QR 0.110, up from QR 0.080 last year.QAMCO’s net profit in the fourth quarter of 2024 marginally declined compared to the previous quarter, largely owing to increase in raw material costs, particularly related to Alumina.
Nevertheless, Q4-2024 net profit remained strong with net profit margins unchanged compared to Q3-2024.QAMCO profitability increased significantly compared to the same quarter of last year, mainly driven by increase in average selling prices in 4Q-24 coupled with increase in sales volumes. QAMCO JV incurred lower finance costs owing to lower interest rates and prepayment of partial loan during the second half of 2024. This further contributed to the positive results, compared to the corresponding quarter.
QAMCO’s financial position remained steady as of December 31, 2024, with substantial cash and bank balances (includes QAMCO’s proportionate share of cash and bank balances from its JV). This strong position was maintained despite distributing 2023 dividend and interim dividends in 2024. During this period, QAMCO’s JV generated share of operating cash flows of QR 906 million during the period, with share of free cash flows amounting to QR 729 million.
QAMCO’s JV remains committed in maintaining high operational efficiency and competitiveness in production and operations. The continued emphasis on maintaining the highest standards for health and safety continues to be a core value. QAMCO JV’s commitment to health and safety measures reflects a dedication to ensuring asset reliability and achieving operational excellence.
The Board of Directors proposes a 2H-2024 dividend distribution of QR 279 million (equating to QR 0.05 per share), bringing the total annual dividend distribution for the year ended 31 December 2024 of QR 446 million.
