Aluminum Holding Corp. plunged into the red in 2013 amid low
aluminum prices and higher natural gas and electricity
destocking in the fourth quarter also hurt the companys
flat-rolled business, the Franklin, Tenn.-based aluminum
producer said in statement on its
earnings data Feb. 19.
But the demand outlook
for aluminum products is favorable, a trend that should support
sales volumes and product premiums, Noranda president and chief
executive officer Layle K. "Kip" Smith said in statement.
"We continue to
believe in the industrys long-term fundamentals despite
continuing low (London Metal Exchange) prices," he said, adding
that the company was "committed to the actions necessary to
create a sustainable cost structure."
Most recently those
actions have included company-wide layoffs (
amm.com, Dec. 17) and a petition to reduce the
power rate for its 260,000-tonne per year smelter in New
Madrid, Mo. The company has said it will lay off more workers
and could shut the smelter if it doesnt receive a lower
amm.com, Feb. 13).
Lower aluminum prices
took a $49.5-million bite out of profits in 2013, while higher
natural gas and electricity tags cost another $33.5 million,
The big losses come as
LME metal prices have collapsed over the past year. The cash
aluminum contract ended the London Metal Exchanges
official session Feb. 19 at $1,726.50 per tonne, down 16.8
percent from $2,075.50 per tonne on the same day last year.
But Noranda has seen
average Midwest transaction prices per pound of product shipped
fall less, averaging 95 cents in 2013 vs. $1.01 in 2012. That
figure was 90 cents in the fourth quarter of 2013, off 10.9
percent from $1.01 in the year-ago quarter.
premiums, including the Midwest premium, have helped to bolster
all-in metal costs (
amm.com, Feb. 6).
While average prices
were lower, volumes gained. The companys primary aluminum
business shipped 589.2 million pounds in 2013, up nearly 3
percent from 572.3 million pounds in 2012. For the quarter,
Noranda shipped 150.5 million pounds of primary aluminum, up
3.7 percent from 145.1 million pounds in the fourth quarter of