Chinese Aluminum Giant Chinalco Says Profit Fell 14 Pct in 2007 on Lower Pricesadmin
Aluminum Corp. of China, the country’s biggest aluminum maker, said Tuesday that its net profit fell 13.7 percent in 2007 due to lower product prices.
The company, also known as Chinalco, said its 2007 net profit fell to 10.2 billion yuan ($1.4 billion) compared with net profit of 11.8 billion yuan in 2006, it said in an earnings release to the Shanghai Stock Exchange.
Prices for Chinalco’s major products fell last year amid a glut in supply. The average price for alumina was 2,912 yuan ($410.90) per ton in 2007, down 19 percent from 3,618 yuan per ton in 2006, the company said.
The price of aluminum, meanwhile, fell 3 percent to 16,914 yuan ($2,387) per ton in 2007, it said.
Meanwhile, the company faced escalating costs for energy and bauxite.
China is the world’s biggest producer and consumer of aluminum. Total output climbed 34 percent to 12.6 million tons in 2007, while demand rose 44 percent to 12.4 million tons.
The company teamed up with Alcoa Inc. last month to acquire 12 percent of the shares of global mining company Rio Tinto PLC in a deal worth $14.05 billion, the largest overseas investment ever by a Chinese company.
Chinalco’s listed units have shares traded in Shanghai and Hong Kong. In Shanghai, the company’s shares slumped 9.8 percent to 22.20 yuan on Tuesday.