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Sheikh Daij presiding over a meeting of the Alba board of directors

Sheikh Daij presiding over a meeting of the Alba board of directors



Alba upbeat after strong results

March 2015

ALBA was upbeat following strong results it achieved in terms of sales and net income for 2014.

Presenting its financial results, the company reported that net income reached $257 million, a 21 per cent surge over the previous year, and total sales were up10 per cent to reach BD821.7 million ($2.18 billion).

Q4 2014 sales were $591 million, an increase of 21 per cent on the back of higher LME prices and physical premiums. Net income for Q4 was $92 million against $36 million for the corresponding period in 2013.

Volume-wise, the company increased its sales by 1.3 per cent to 931,526 tonnes while production rose 2.1 per cent to reach 931.427 tonnes.

There was a 33 per cent increase in physical premiums YoY and value-added products accounted for 66 per cent of total shipments.

The company proposed a total dividend for fiscal year 2014 of $101 million versus $135 million in the previous year. The board recommended a final 2014 dividend of $56 million, which is in addition to the interim dividend already paid in September of $45 million.

Demand for aluminium remained healthy in 2014 with world consumption advancing 8 per cent YoY and Asian demand up 10 per cent supported by robust growth in China (plus 13 per cent) on the back of government stimulus and infrastructure investment. Both North America and the Mena region also had healthy demand growth.

Alba, meanwhile, has been notified that the natural gas price will increase to $2.5 per million metric British thermal units (MMBTU) effective April 1, thereafter escalating at $0.25 cents per ear until it reaches $4.000 per MMBTU in April 2021.

The highlights of 2014, as cited by Alba, included continued improvement in safety performance and winning the 2014 Gulf Aluminium Council Health and Safety Award.

About priorities for 20155, Alba listed a continuous focus on safety and training programmes, delivering on Project Titan, leveraging strong physical demand conditions and Line 6.  Project Titan is a two-year efficiency programme initiated in February 2014 with the aim of reducing cash cost by $150 per tonne by the end of January 2016).

“2014 was a year of tremendous accomplishments in safety and production with Alba achieving 931,437 tonnes, the highest in its 43 year history. Looking ahead, the company plans to focus on growth and the Line 6 expansion project,” said chairman of the board Sheikh Daij bin Salman Al Khalifa.

CEO Tim Murray remarked: “Alba continued to make improvements in safety performance which had a direct positive impact on the bottom line. With Alba’s dedicated workforce and focus on continuous improvement, I am confident 2015 will be another great year.”

 

An overview of Alba’s production facilities

An overview of Alba’s production facilities

ACTING CMO
Meanwhile, Khalid Abdul Latif has taken over as acting chief marketing officer from Jean Baptiste Lucas who had been Alba’s CMO since 2011. Lucas will continue with Alba to help with this transition as well as support the company’s strategy for downstream development.

Latif, a Bahraini, joined Alba as an apprentice in 1989 and worked in various operational areas including power, potlines and carbon. Swiftly moving up the ranks, he first became supervisor, then superintendent and in 2012 manager of engineering. In his most recent role, he was Alba’s marketing manager for customer service and market operations.

Latif holds a Bachelor of Electrical Engineering degree from Gulf University in Bahrain as well as a diploma in mechatronics from Abertay University, Dundee, UK. He recently completed his Master’s in Business Administration (MBA) from the French Arabian Business School/Essec in Bahrain. He has also completed an executive education programme in strategic sales management from the University of Chicago, USA.

Congratulating Latif, Murray said: “Khalid is a great example of Alba’s commitment to developing Bahraini nationals from within the company into high level management positions.” With a total workforce of approximately 3,000 people, Alba boasts of a Bahrainisation rate of almost 87 per cent.

 

OTHER NEWS
Recent Alba-related developments include the signing of a Service Level Agreement with APM Terminals Bahrain which will help its outbound supply chain (See Shipping & Logistics).

The company announced it has successfully completed the integration of an additional Line 5 rectiformer (R50). The rectiformer is a critical piece of power equipment used in the smelting process and R50 will further enhance Alba’s ability to meet future creep capacity objectives as well as provide added back up protection.

The entire project – managed by Alba Power Department – was achieved with a remarkable 223,000 man-hours of work without a single LTI. The project was successful executed in 22 months without impacting metal production.

The director for Power, Amin Sultan, commented: “Alba is committed to remaining a globally competitive smelter, and continually focuses on lean management and operational efficiency. Completion of this project is a very good example of coordinated efforts of interdepartmental teams and I applaud their efforts for the emphasis placed on safety.”

Alba announced it has successfully completed four million manhours without a lost time injury. It said the achievement was a testimony to the company’s commitment to a safe working environment.

Latif: the acting CMO

Latif: the acting CMO

Murray remarked: “Alba’s main objective is to bring a change in the belief and behaviour of the employees, making them the owners of safety. At all times, we ensure the implementation of accredited international guidelines and highest standards of occupational health and safety, thus creating an environment that is safe for everyone.”

The company was also acknowledged as the Best Company for Investor Relations (IR) 2014 at the at the Middle East Investor Relations Society (ME-IR) Annual Conference and Awards 2014, which took place at the DIFC Conference Centre in Dubai, UAE. 

The awards, carried out in collaboration with Thomson Reuters Extel, recognise the efforts of regional companies and IR professionals who play a critical role in developing IR.

This is the fourth time in a row that Alba’s Investor Relations department – under the guidance of Eline Hilal – was recognised for its excellent investor relations and initiatives.

Murray commented: “Winning this prestigious award is an endorsement of Alba’s transparent corporate governance policies. Alba’s IR team is committed to developing and maintaining investor relations’ best practices, regionally and internationally, and I congratulate them on this success.”

The ME-IR Annual Conference and Awards event is the largest IR conference taking place in the region and brings together listed and unlisted firms, family offices, investors, analysts, advisors, participants of the buy and sell side communities, and representatives from regional governments, exchanges and regulatory bodies.

Alba opened its first plant-wide Safety, Health and Environment (SHE) Week of 2015 in mid-February. Organised in coordination with the Alba Labour Union, the five-day event helped reinforce the company’s principles of safety and promote awareness of the importance of different safety, health and environment issues.

The week’s theme was “Safety Breeze” and each day focused on a different topic – waste generation and segregation; work-related musculoskeletal disorders; home fire; vehicles and pedestrian safety and behavioural safety.

Alba was a prominent participant at Gulf Industry Fair that took place in Bahrain the first week of last month (See Events). The company was a sponsor of the Aluminium Village segment of the show and had a visit by the Prime Minister of Bahrain, HH Prince Khalifa bin Salman.

The company also provided sponsorship support for the second Bahrain International Corporate Social Responsibility (CSR) conference and exhibition held last month. The event took place under the patronage of Dr Abdul Hussain bin Ali Mirza, Bahrain’s Minister of Energy.

Support for the event was in line with the company’s consistent track record of contributing to society. Alba’s stand at the exhibition highlighted the various CSR projects that the company is involved in.

Chief executive Murray recounted that Alba has been in the forefront of CSR initiatives which he said stemmed from the desire to contribute positively to society. “We are proud to be associated with this significant event, which will further strengthen our 40-year legacy as a company that cares,” he added.

The event was a unique platform for government authorities, the private sector, agencies, experts and the general public to meet and discuss the latest CSR trends worldwide. It also showcased organisations’ completed or ongoing CSR projects.




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