Aluminum Corp. of China Ltd., also known as Chalco, reported a year-on-year profit surge of 8,511% to 3 billion yuan ($463 million) in the first half of 2021, on the back of rising market prices for the metal and increased output.
The company, whose primary shareholder is state-owned Chinalco, also posted a 43.6% jump in revenue to 120.7 billion yuan, according to its earnings report filed to the Shanghai Stock Exchange on Tuesday. Operating cash flow reached 9.5 billion, which the company said was the strongest first half on record.
The jump in profit was attributable to an increase in trading income and in the market prices of its main products including alumina, the Hong Kong and New York-listed metal producer said. Production of alumina, electrolytic aluminum, and refined alumina was up 14.3%, 5.5% and 3.2%, respectively, year-on-year.
The year-on-year surge also comes after the coronavirus epidemic disrupted production in the first half of 2020.
The background: Global demand for base metals has rebounded rapidly post Covid-19, following a period in which production and investment stalled, the report said, adding that this has resulted in a phased gap in supply and a sharp rise in commodity prices.
For the six months through June, the average prices of aluminum on the Shanghai Futures Exchange increased 24.8% year-on-year to 17,378 yuan per ton, Chalco noted, while average prices of aluminum futures at the London Metal Exchange stood at $2,269 per ton, representing a 37.4% year-on-year increase.
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Author: Kelsey Cheng, Caixin Global