OREANDA-NEWS. UC RUSAL (SEHK: 486, Euronext: RUSAL/RUAL, Moscow Exchange: RUAL/RUALR), a leading global aluminium producer, announces its results for the year ended 31 December 2016.

Key highlights

  • RUSAL continued to see challenging environment in the aluminium industry during 2016. The Company’s revenue for the year ended 31 December 2016 decreased by 8.0% to USD 7,983 million as compared to USD8,680 million for 2015 following a 3.5% decrease in the average London Metals Exchange (“LME”) aluminium price from USD1,663 per tonne in 2015 to USD1,604 per tonne in 2016 and a 43.4% drop in the average realized premiums to the LME price.

  • At the same time, the LME aluminium price increased by 14.4% to USD1,710 in the fourth quarter of 2016 as compared to USD1,495 in the same quarter of 2015, which together with the 5.3% growth in aluminuim sales volumes between the comparable periods resulted in the increase in revenue by 9.2% to USD2,027 million in the last quarter of 2016 as compared to USD1,857 million in the same period of 2015 with the average realized price increasing by 4.0% to USD1,799 per tonne for the last quarter of 2016 as compared to USD1,729 per tonne in the same period of 2015.

  • Aluminium segment cost per tonne decreased by 4.7% to USD1,344 in the fourth quarter of 2016 in comparison with USD1,410 in the same period of 2015 resulting from continuous cost control measures and the decrease in raw material price. This, along with improvement in average sales price and sales volume, allowed the Company to increase an Adjusted EBITDA to USD412 million with Adjusted EBITDA margin of 20.3% in the fourth quarter of 2016 as compared to USD306 million with Adjusted EBITDA margin of 16.5% in the same quarter of 2015. Aluminium segment cost per tonne decreased by 8.4% to USD1,333 in 2016 in comparison with USD1,455 in 2015.

  • The Company achieved Adjusted Net Profit and Recurring Net Profit of USD590 million and USD1,257 million, respectively, for the year ended 31 December 2016 as compared to USD671 million and USD1,097 million for the prior year. In the fourth quarter of 2016, the Company achieved Adjusted Net Profit of USD342 million and Recurring Net Profit of USD505 million.

  • In July 2016 RUSAL entered into an agreement to sell its 100% stake in the Alumina Partners of Jamaica (“Alpart”) to the Chinese state industrial group, JIUQUAN IRON & STEEL (GROUP) Co. Ltd. (“JISCO”) for a consideration of USD299 million. In November 2016 the Company completed the sale of Alpart and received the full consideration in cash.

Commenting on the full year 2016 results, Vladislav Soloviev, CEO of RUSAL, said:

“Despite a challenging start of the year, with aluminium prices reaching multi-year lows, RUSAL achieved a solid financial performance in 2016. On the one hand, we saw improved market conditions in the second half of the year, supporting our key performance metrics and on the other, our solid results were down to our dedication to cost management, production discipline, and a stronger focus on innovation and value added products (VAP) development.

RUSAL recorded a net profit of USD1.18 billion and recurring net profit of USD1.26 billion, both higher than our 2015 results. Cash cost per tonne decreased to USD1,333, 8.4% below last year’s average with a healthy Adjusted EBITDA margin of 18.65%. In order to expand our VAP proposition, we invested into new casthouse projects at our Krasnoyarsk and Khakas smelters, with new alloys expected to be shipped to customers already in 2017.

Another milestone achievement of the previous year was the launch of the superpower RA-550 cell running at over 550 kA at our Sayanogorsk smelter. RUSAL’s proprietary technology counters a major drawback of superpower cells which, in most cases, lose efficiency or increase energy consumption as amperage increases. RUSAL’s commitment to improve its energy efficiency across its production chain will work alongside achieving its climate change goals of aiming to be among the most efficient low carbon aluminium producers worldwide.

I would also highlight that post the reporting period, RUSAL completed its debut offering of a 5-year Eurobond with a principal amount of USD600 million. While the bond proceeds were used to refinance some of RUSAL’s existing pre-export finance facility and improved the Company’s debt maturity profile, the successful debut placement is a testament to RUSAL’s credit strength and its name recognition in the investor community.

Looking ahead into 2017, we expect the aluminium market to remain in a good shape with demand increasing by 5% and global market deficit widening to 1.1 mn tonnes.”

Financial and operating highlights

 

 

Three months

ended 31 December

Change quarter on quarter, % (4Q to 4Q)

Three months ended 30 Septem-ber

Change quarter on quarter, % (4Q to 3Q)

Year ended
31 December

Change, year-on- year, %
 

2016

2015

  

2016

  

2016

2015

  
 

unaudited

unaudited

 

unaudited

 

 

 

  

Key operating data

                

(‘000 tonnes)

                

Aluminium

930

921

1.0%

920

1.1%

3,685

3,645

1.1%

Alumina

1,939

1,906

1.7%

1,865

4.0%

7,528

7,402

1.7%

Bauxite

2,841

2,850

(0.3%)

3,211

(11.5%)

12,187

12,112

0.6%

Key pricing and performance data

            

(‘000 tonnes)

                

Sales of primary aluminium and alloys

922

876

5.3%

981

(6.0%)

3,818

3,638

4.9%

(USD per tonne)

                

Aluminium segment cost per tonne[1]

1,344

1,410

(4.7%)

1,330

1.1%

1,333

1,455

(8.4%)

Aluminium price per tonne quoted on the LME[2]

1,710

1,495

14.4%

1,621

5.5%

1,604

1,663

(3.5%)

Average premiums over LME price[3]

151

179

(15.6%)

150

0.7%

159

281

(43.4%)

Average sales price

1,799

1,729

4.0%

1,754

2.6%

1,732

2,001

(13.4%)

Alumina price per tonne[4]

307

234

31.2%

234

31.2%

253

303

(16.5%)

Key selected data from the consolidated statement of income

  

(USD million)

                

Revenue

2,027

1,857

9.2%

2,060

(1.6%)

7,983

8,680

(8.0%)

Adjusted EBITDA

412

306

34.6%

421

(2.1%)

1,489

2,015

(26.1%)

margin (% of revenue)

20.3%

16.5%

NA

20.4%

NA

18.7%

23.2%

NA

Profit /(Loss) for the period

645

(267)

NA

273

136.3%

1,179

558

111.3%

margin (% of revenue)

31.8%

(14.4%)

NA

13.3%

NA

14.8%

6.4%

NA

Adjusted Net Profit for the period

342

55

521.8%

181

89.0%

590

671

(12.1%)

margin (% of revenue)

16.9%

3.0%

NA

8.8%

NA

7.4%

7.7%

NA

Recurring Net Profit /(Loss) for the period

505

(40)

NA

327

54.4%

1,257

1,097

14.6%

margin (% of revenue)

24.9%

(2.2%)

NA

15.9%

NA

15.7%

12.6%

NA


Key selected data from consolidated statement of financial position

 

 

As at

Change year-on-year, %

 

31 December 2016

31 December 2015

(USD million)

 

 

 

 

 

 

 

Total assets

14,452

12,809

12.8%

Total working capital[5]

1,691

1,596

6.0%

Net Debt[6]

8,421

8,372

0.6%


Key selected data from consolidated statement of cash flows

 

 

Year ended

Change year-on-year,%

 

31 December 2016

31 December 2015

(USD million)

 

 

 

 

 

 

 

Net cash flows generated from operating activities

1,244

1,568

(20.7%)

Net cash flows generated from investing activities

104

261

(60.2%)

of which dividends from associates and joint ventures

336

755

(55.5%)

of which CAPEX[7]

(575)

(522)

10.2%

Interest paid

(452)

(516)

(12.4%) 


Overview of trends in the aluminium industry and business environment

Highlights for the full year 2016

  • Global aluminium demand grew by 5.5% in 2016 year-on-year (YoY), as a result of strong demand in China, Europe, Asia and North America. Aluminium demand in 2017 is estimated to grow at approximately 5% YoY.

  • Global aluminium supply grew at a slower pace in 2016, increasing by 3.6% to 59 mln tonnes, compared to 6% growth in 2015 due to Chinese supply slowdown.

  • In 2017, Chinese supply will be challenged by significant cost inflation, environmental regulation as well as the continuation of supply side reform. In 2016, Chinese semis export declined by 3.2% YoY with a further downside risk in 2017 due to anti-dumping tensions and the ongoing WTO case.

  • In 2016, the global aluminum market reached a deficit of 0.7 mln tonnes which is set to widen to approximately 1.1 mln tonnes in 2017.

  • Aluminum premiums in key consuming regions started to improve at the end of 4Q16 with a 20% rise in October-December compared to the beginning of this year. This was supported by strong demand and reduced supply in key regions after smelting capacity reduction/closures (North America, Australia).

Aluminium demand

Global aluminium demand grew by 5.5% in 2016 to 59.7 million tonnes. Demand rose in the world (excluding China) by 3.4% to 28.3 million tonnes, while China’s growth alone increased 7.6% to 31.4 million tonnes.

China’s economy hit its growth target last year accelerating towards the end of the year. China’s economic growth remained stable in 3Q, ensuring the government achieved its full-year growth target. Gross domestic product expanded 6.7% in 2016 YoY, above the official target of 6.5%. The China Caixin Manufacturing PMI rose to 51.9 in December from 50.9 in November, avoiding contractionary territory for the sixth month straight. 

China's industrial output rose 6% YoY with retail sales increasing 10.9% in 2016. Fixed-asset investment for the whole year grew 8.1% YoY. China produced 28.19 million units of vehicles in 2016, up 14.5% YoY, according to monthly data released by the China Association of Automobile Manufacturers (CAAM). Sales of commercial buildings rose 35% percent in 2016, and residential sales climbed 36% for the same period. As prices continued to increase in 2016, this led to healthy property restocking and growth in construction activity.

In North America, Donald Trump’s win in the US Presidential elections saw a surge in economic optimism. His proposed infrastructure spending plan increased most indicators by the end of the year. The US manufacturing sector ended 2016 on a buoyant note, with promising signs of further growth in 2017. The pace of growth signaled by the PMI in December (54.7) was at its strongest for almost two years, driven almost entirely by rising demand from domestic customers, with exports hindered by the dollar’s recent surge. Construction was relatively strong with the number of new housing growing by nearly 5% in 2016 YoY. Automotive production increased by 1.2% in North America.

The Eurozone manufacturing sector also ended 2016 on a high note; the PMI climbed up to 54.9 in December. Alongside the improved performance of the Eurozone manufacturing sector, production and new orders witnessed its fastest growth. Rates of expansion in both were either at, or close to, the steepest increase since early 2011. Car production in Europe increased in 2016 on the back of EUR/USD depreciation in 2H16, as well as increased demand in exporting countries such as the US and China, where demand is supported by tax reduction for lower-powered light vehicles. Preliminary data for the first eleven months of 2016 showed a rise by 3.7% YoY.

The final months of 2016 saw Japan’s economy expand with exports rebounding meaningfully along with production backed by the sharp depreciation of the yen and improving global demand. The PMI posted 52.4 in December, up from 51.3 in November, signaling a sharper improvement in manufacturing conditions in Japan and this contributed to the strongest quarterly average since 4Q 2015. In 2016, Japanese new house building increased by over 5% according to the latest data for the January-November period.

Growth in the ASEAN economy remained on track with annual growth at 4.7% in 2016, a slight pick-up from 4.5% in 2015. Car production growth gained momentum at the end of 2016, largely in Thailand (2.7%), Indonesia (5.6%), and Vietnam (38.4%) where domestic demand and exports uptick boosted manufacturing. According to preliminary data for the January-November period, automotive production grew by 3% in the region.

In 2016, Russia’s key economic indicators continued to decrease. According to preliminary data, the GDP index was -0.7%, industrial production index for processing industries was -0.7%, and fixed assets investments decreased by 3.3%.

However, by the end of the year there were signs of stabilization. Current forecasts for 2017 predict that indicators will be positive. In the second half of 2016, PMI demonstrated steady growth, peaking in November/December at 53.7, which is the highest it has been for 69 months. Cheap ruble currency make domestic producers more competitive for both domestic and export markets. Passenger car production continued to decline due to a lower automotive market demand, but commercial vehicles (trucks, light commercial vehicles, buses) production increased by 8.2% in 2016 compared to 2015.

Against the backdrop of a weak ruble, in 2016 the volume of aluminium semis imports significantly decreased while exports increased. As a result, the volume of exports of aluminum products exceeded imports for the first time. That has allowed domestic enterprises to retain production volume in terms of reducing domestic demand.

Supply 

Overall global aluminum supply rose by 3.6% to 59 mln tonnes in 2016 YoY.

IAI and CRU data show that during 2016, primary aluminium production in the world ex-China rose 2.2% to 26.7 million tonnes mostly due to growth in Asia, Malaysia and Eastern Europe. According to the Aladdiny agency, aluminum production in China increased by 5.5% to 32.3 mln tonnes. This was as a result of new capacity ramping up in Q4 2016.

Despite 4 mln tonnes of new Chinese capacity in 2016 and some restarted capacity, we believe that the Chinese market will become more balanced due to its adoption of the new antipollution plan. In addition, the country may still have a high risk of supply tightness due to the new environmental measures against pollution including outlined capacity closures (below 300KA) and a significant decline in new capacity additions.  This is similar to what we have witnessed and was implemented in the steel sector.

The Chinese Ministry of Environmental Protection (MEP) is tightening control over pollution due to an increase in heavy smog during December-January. Four provinces near Beijing 2+26 cities (namely, Hebei, Shandong, Henan, Shanxi) occupy just 7% of the territory of China but produce 340Mt of steel (43% of China`s total), 47% of coke, 12Mt of energy intensive aluminium (38%), 460Mt of cement (19%) and 27% of coal-fired power. This scale of pollution producing facilities within a relatively small area creates enormous pressure on both the environment and on the civilian`s health. According to the new antipollution plan developed by the MEP with other authorized bodies and approved by the Chinese Government, 30% of approximately 10Mtpy of aluminium smelting capacity in these provinces is due to close between November to March in 2017-2018. This would result in a 1.2Mt impact in the first full year of the policy. It would also make greenfield and brownfield expansions in these key producing provinces unlikely. In addition, 30% of alumina and 50% of anode/cathode production in 2+26 cities could potentially affect further key raw materials prices appreciation used for aluminum production. Since January last year, the average weighted production cash cost for China’s aluminum industry climbed by 40% and according to February 2017 cash cost per data and SHFE average price in February (RMB13,800/t), there were 14% (or 5Mt) of loss making capacities in China based on the estimation current cost curve which has a strong support at RMB14,000/t level. 

Forecast for 2017

Strong market and regional fundamentals will contribute to a widening deficit of 1.1 mln tonnes. 

 

  • Global aluminum demand to grow by 5.0% to 62.7 mln tonnes. Chinese demand to grow by 6.7% to 33.5 mln tonnes and ex-China by 3.3% to 29.2 mln tonnes driven by growth in EMEA, North America and Asian economies.

  • Global aluminum supply will grow by 4.3% to 61.6 mln tonnes vs 3.7% growth in 2016 and will be affected by a tight supply in China due to the new antipollution plan. Chinese supply will grow by 6% to 34.3 mln tonnes. Ex-China supply will grow by 2.4% to 27.3 mln tonnes.

  • Global aluminum market deficit to widen to 1.1 mln tonnes in 2017 vs 0.7 mln tonnes in 2016

Financial overview

Revenue

 

 

Year ended

31 December 2016

Year ended

31 December 2015
 

USD million

kt

Average sales price (USD/t)

USD million

kt

Average sales price (USD/t)

 

 

 

 

 

 

 

Sales of primary aluminium and alloys

6,614

3,818

1,732

7,279

3,638

2,001

Sales of alumina

622

2,267

274

595

1,722

346

Sales of foil

240

77

3,117

270

81

3,333

Other revenue

507

—

—

536

—

—

Total revenue

7,983

 

 

8,680

 

 

Total revenue decreased by USD697 million or by 8.0% to USD7,983 million in 2016 compared to USD8,680 million in 2015. The decrease in total revenue was primarily due to the lower sales of primary aluminium and alloys, which accounted for 82.9% and 83.9% of UC RUSAL’s revenue for 2016 and 2015, respectively.

 

 

Three months ended 31 December

Change, quarter on quarter, % (4Q to 4Q)

Three months ended 30 Septem-ber

Change, quarter on quarter, % (4Q to 3Q)

Year ended
31 December

Change, year-on- year, %
 

2016

2015

  

2016

  

2016

2015

  
 

unaudited

unaudited

 

unaudited

        

Sales of primary aluminium and alloys

                

USD million

1,659

1,515

9.5%

1,721

(3.6%)

6,614

7,279

(9.1%)

kt

922

876

5.3%

981

(6.0%)

3,818

3,638

4.9%

Average sales price (USD/t)

1,799

1,729

4.0%

1,754

2.6%

1,732

2,001

(13.4%)

Sales of alumina

                

USD million

164

144

13.9%

157

4.5%

622

595

4.5%

kt

570

485

17.5%

566

0.7%

2,267

1,722

31.6%

Average sales price (USD/t)

288

297

(3.0%)

277

4.0%

274

346

(20.8%)

Sales of foil (USD million)

65

63

3.2%

62

4.8%

240

270

(11.1%)

Other revenue (USD million)

139

135

3.0%

120

15.8%

507

536

(5.4%)
                 

Total revenue
(USD million)

2,027

1,857

9.2%

2,060

(1.6%)

7,983

8,680

(8.0%)

Revenue from sales of primary aluminium and alloys decreased by USD665 million, or by 9.1%, to USD6,614 million in 2016, as compared to USD7,279 million in 2015, primarily due to 13.4% decrease in the weighted-average realized aluminium price per tonne driven by a decrease in the LME aluminium price (to an average of USD1,604 per tonne in 2016 from USD1,663 per tonne in 2015), as well as a decrease in premiums above the LME prices in the different geographical segments (to an average of USD159 per tonne from USD281 per tonne in 2016 and 2015, respectively).

Revenue from sales of alumina increased by USD27 million or by 4.5% to USD622 million for the year ended 31 December 2016 as compared to USD595 million for the previous year. The increase was mostly attributable to 31.6% growth in alumina sales volume partially offset by a 20.8% decrease in the average sales price.

Revenue from sales of foil decreased by 11.1% to USD240 million in 2016, as compared to USD270 million in 2015, primarily due to a 6.5% decrease in the weighted average sales price and 4.9% decrease in sales volumes.

Revenue from other sales, including sales of other products, bauxite and energy services decreased by 5.4% to USD507 million for the year ended 31 December 2016 as compared to USD536 million for the previous year, due to a 22.0% decrease in sales of other materials (such as silicon by 16.2%, soda by 12.2%, potassium sulfate by 48.9%).

Cost of sales

The following table shows the breakdown of UC RUSAL’s cost of sales for the years ended 31 December 2016 and 2015, respectively:

 

 

Year ended 31 December

Change, year-on-year, %

Share of costs,
%

 

2016

2015

 

 

(USD million)

 

 

 

 

Cost of alumina

716

733

(2.3%)

11.8%

Cost of bauxite

427

538

(20.6%)

7.0%

Cost of other raw materials and other costs

2,131

2,189

(2.6%)

35.1%

Purchases of primary aluminium from JV

229

58

294.8%

3.8%

Energy costs

1,568

1,680

(6.7%)

25.8%

Depreciation and amortisation

434

434

0.0%

7.2%

Personnel expenses

520

505

3.0%

8.6%

Repairs and maintenance

56

58

(3.4%)

0.9%

Net change in provisions for inventories

(11)

20

NA

(0.2%)

Total cost of sales

6,070

6,215

(2.3%)

100.0%

Total cost of sales decreased by USD145 million, or by 2.3%, to USD6,070 million in 2016, as compared to USD6,215 million in 2015. The decrease was primarily driven by the continuing depreciation of the Russian Ruble and the Ukrainian Hryvnia against the US Dollar by 10.0% and 17.0%, respectively, between the reporting periods which was partially offset by the increase in volumes of primary aluminium and alloys sold.

Cost of alumina decreased in the reporting period (as compared to 2015) by USD17 million, or by 2.3%, primarily as a result of a decrease in alumina transportation costs following significant Russian Ruble depreciation and a slight decrease in tariff.

Cost of bauxite decreased by 20.6% for the year ended 31 December 2016 as compared to the same period of prior year, primarily as a result of a decrease in the purchase price.

Cost of raw materials (other than alumina and bauxite) and other costs decreased by 2.6% due to the lower raw materials purchase price in 2016 as compared to the previous year (such as raw petroleum coke by 30.0%, calcined petroleum coke by 20.9%, pitch by 6.2%, raw pitch coke by 2.5%).

Increase in purchases of primary aluminium and alloys were mainly caused by start of aluminium production at BoAZ and further increase of its production capacity. The Group purchases aluminium from BoAZ under long-term purchase commitment for further export.

Adjusted EBITDA and results from operating activities

 

Year ended

31 December

Change, year-on-year, %

 

2016

2015

 

(USD million)

 

 

 

Reconciliation of Adjusted EBITDA

 

 

 

Results from operating activities

1,068

1,409

(24.2%)

Add:

 

 

 

Amortisation and depreciation

453

457

(0.9%)

(Reversal of)/impairment of non-current assets

(44)

132

NA

Loss on disposal of property, plant and equipment

12

17

(29.4%)

Adjusted EBITDA

1,489

2,015

(26.1%)

Adjusted EBITDA, defined as results from operating activities adjusted for amortisation and depreciation, impairment charges and loss on disposal of property, plant and equipment, decreased to USD1,489 million for the year ended 31 December 2016, as compared to USD2,015 million for the previous year. The factors that contributed to the decrease in Adjusted EBITDA margin were the same that influenced the operating results of the Company.

Results from operating activities decreased by 24.2% to USD1,068 million for the year ended 31 December 2016, as compared to USD1,409 million for the previous year, representing operating margins of 13.4% and 16.2%, respectively.

Profit for the period

As a result of the above, the Company recorded a profit of USD1,179 million in 2016, as compared to USD558 million in 2015.

Adjusted and Recurring Net Profit

 

 

Year ended

Change year-on-year,%

 

31 December 2016

31 December 2015

(USD million)

 

 

 

Reconciliation of Adjusted Net Profit

 

 

 

Net Profit for the period

1,179

558

111.3%

Adjusted for:

 

 

 

Share of profits and other gains and losses attributable to Norilsk Nickel, net of tax effect

(667)

(426)

56.6%

Change in derivative financial instruments, net of tax (20.0%)

122

342

(64.3%)

Foreign currency translation gain recycled from other comprehensive income on deconsolidation  of subsidiaries

-

(95)

(100.0%)

Impairment of non-current assets, net  of tax

(44)

132

NA

Net impairment of underlying net assets of joint ventures and associates

-

160

(100.0%)

 

 

 

 

Adjusted Net Profit

590

671

(12.1%)

Add back:

 

 

 

Share of profits of Norilsk Nickel, net  of tax

667

426

56.6%

Recurring Net Profit

1,257

1,097

14.6%


Adjusted Net Profit for any period is defined as the profit adjusted for the net effect of the Company’s investment in Norilsk Nickel, the net effect of derivative financial instruments, gains and losses recycled from other reserves and the net effect of non-current assets impairment and restructuring costs. Recurring Net Profit for any period is defined as Adjusted Net Profit plus the Company’s net effective share in Norilsk Nickel results.

Segment reporting

The Group has four reportable segments, which are the Group’s strategic business units: Aluminium, Alumina, Energy and Mining and Metals. These business units are managed separately and results of their operations are reviewed by the CEO on a regular basis. The core segments are Aluminium and Alumina.

 

 

Year ended 31 December

 

 

2016

2015

 

Aluminium

Alumina

Aluminium

Alumina

(USD million)

 

 

 

 

Segment revenue

 

 

 

 

kt

3,891

8,165

3,749

6,901

USD million

6,708

2,071

7,426

2,094

Segment result

1,157

2

1,607

212

Segment EBITDA[8]

1,519

90

1,971

298

Segment EBITDA margin

22.6%

4.3%

26.5%

14.2%

 

 

 

 

 

Total capital expenditure

336

146

303

164
           


The segment result margin (calculated as a percentage of segment profit to total segment revenue per respective segment) for aluminium segment decreased to 17.2% for the year ended 31 December 2016 from 21.6% for the year ended 31 December 2015, and decreased to 0.1% compared to 10.1%, respectively, for the alumina segment. Key drivers for the decrease in margin in the aluminium segment are disclosed in “Revenue”, “Cost of sales” and “Adjusted EBITDA and results from operating activities” sections above. Detailed segment reporting can be found in the consolidated financial statements for the year ended 31 December 2016.

Forward-looking statements

This press-release contains statements about future events, projections, forecasts and expectations that are forward-looking statements. Any statement in this announcement that is not a statement of historical fact is a forward-looking statement that involves known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements  expressed or implied by such forward-looking statements. These risk and uncertainties include those discussed or identified in the prospectus for UC RUSAL. In addition, past performance of UC RUSAL cannot be relied on as a guide to future performance. UC RUSAL makes no representation on the accuracy and completeness of any of the forward-looking statements, and, except as may be required by applicable law, assumes no obligations to supplement, amend, update or revise any such statements or any opinion expressed to reflect actual results, changes in assumptions or in UC RUSAL’s expectations, or changes in factors affecting these statements. Accordingly, any reliance you place on such forward-looking statements will be at your sole risk.


[1] For any period, “Aluminium segment cost per tonne” is calculated as aluminium segment revenue less aluminium segment results less amortisation and depreciation divided on sales volume of the aluminium segment.

[2] Aluminium price per tonne quoted on the LME represents the average of the daily closing official LME prices for each period.

[3] Average premiums over LME realized by the company based on management accounts.

[4] The average alumina price per tonne provided in this table is based on the daily closing spot prices of alumina according to Non-ferrous Metal Alumina Index FOB Australia USD per tonne.

[5] Total working capital is defined as inventories plus trade and other receivables minus trade and other payables.

[6] Net Debt is calculated as Total Debt less cash and cash equivalents as at the end of any period. Total Debt refers to UC RUSAL’s loans and borrowings and bonds outstanding at the end of any period.

[7] CAPEX is defined as payment for the acquisition of property, plant and equipment and intangible assets.

[8] Segment EBITDA for any period is defined as segment result adjusted for amortisation and depreciation for the segment.