Russian aluminum giant Rusal said on Friday that it was affected by international sanctions, notably causing sluggish Russian demand, announcing a sharp decline in net profit in the first half.
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Net profit fell 16.7% in the first half year on year to $1.68 billion, according to figures released Friday in a statement.
Founded by oligarch Oleg Deripaska, the group points out that “growing geopolitical tensions since February 2022 have significantly increased volatility in commodity and currency markets”.
These tensions caused by the Russian offensive in Ukraine underway since February 24 and the international sanctions once morest Moscow that followed “have negatively affected the activities of Russian companies in different sectors of the economy, leading to a decline demand for aluminum in Russia,” the statement said.
Furthermore, Australia’s ban on the export of alumina, from which the aluminum is then extracted, as well as the suspension of production at the alumina refinery in Mykolaiv, Ukraine, “had a negative impact on the deliveries of raw materials for the production of aluminum and caused an increase in expenses”, he specifies.
The Russian group “is obliged to redo its chain of deliveries”, notes the press release.
For their part, “investment projects and modernization programs for production facilities might be postponed due to difficulties with the delivery of equipment”, he adds.
A very large number of Russian economic players are facing serious problems with the supply of equipment and spare parts, the sale of which to Russia has been banned.
They are also struggling to import or export, as international logistics and financial chains have been partially paralyzed by retaliatory measures imposed by Europe and the United States.
The turnover of the Russian aluminum giant – listed on the Hong Kong Stock Exchange – nevertheless increased by 31.3% in the first half year on year to 7.2 billion dollars.
