Rusal Q4 net profit plunged as US sanctions bit

Hong Kong (AFP) –


Russian aluminium giant Rusal suffered a net loss in the fourth quarter, it said on Thursday, citing the "serious" impact of US sanctions and global trade disputes.

The world's largest aluminium maker outside of China was hit by sanctions in April following a diplomatic crisis sparked by the poisoning of former double agent Sergei Skripal in Britain.

The sanctions targeted oligarchs close to President Vladimir Putin including Rusal founder Oleg Deripaska.

He resigned his seat on the board and divested as the company worked to escape the sanctions, which were eventually lifted in January.

But the blacklisting hit the bottom line of the Hong Kong-listed company, which released its annual results on Thursday.

The company recorded an adjusted net loss of $17 million in the last three months of 2018. That compares with a $338 million profit in July-September and a $350 million profit in the fourth quarter of 2017.

Adjusted net loss for the full year was down 20.5 percent at $856 million.

"The aluminium market in 2018 was seriously affected by the... sanctions as well as by trade wars and imposed import duties that caused significant growth of premiums and prices," the company said in a statement.

Rusal said it expected a more positive outlook for 2019 now that sanctions have been lifted.

Deripaska is one of several oligarchs sanctioned last year in retaliation for what the US called "the Russian government's ongoing and increasingly brazen pattern of malign activity across the world", including its interference in Syria and its seizure of Crimea.

The tycoon is known to be friendly with Putin and had business ties with Donald Trump's former campaign chairman Paul Manafort, who has been convicted of tax crimes and bank fraud following a probe by Special Counsel Robert Mueller into Russian meddling in the 2016 election.

The firm's shares were down more than four percent by the break in Kong Kong, though they have soared nearly 50 percent this year thanks to the lifting of the sanctions.

The company said recurring net profit for 2018 rose eight percent to $1.7 billion.

Looking to the year ahead, "we expect aluminium demand to recover after the trade wars and supply shocks of late 2018", said chief executive officer Evgenii Nikitin in a statement.