(Reuters) – First quarter net profit halved at United Company Rusal year-on-year as the lingering effects of U.S. sanctions and depressed global prices hit the Russian aluminum giant.
However the weak performance is likely to be a one-off event, analysts said, as Rusal continues on the road to recovery following 10 months under U.S. sanctions that severely limited its operations and sent shockwaves through global aluminum markets.
In late January Washington lifted the sanctions, imposed on Rusal and its co-owner Oleg Deripaska in April 2018, after intense negotiations and a series of organizational changes within Rusal.
Since then, investors have increasingly regained confidence in the company, the largest aluminum producer outside China. Before Tuesday’s announcement its stock had risen 21% this year on the Hong Kong exchange.
Tuesday’s results showed recurring net profits dropped to $300 million, from $531 million at the same time last year, sending Rusal’s Hong Kong-listed shares down by as much as 4.8% to HK$2.98.