CHICAGO Aleris International Inc. swung to a loss in 2013 on softer aluminum prices, lower prices for its products and reduced sales volumes.
Tighter scrap and metal spreads also hurt results (amm.com, March 10), as well as reduced rolling margins,
the Cleveland-based aluminum company said in commentary released with its earnings results
Despite our best efforts ... 2013 was a disappointing year, and we are sharply focused on improving productivity and driving better performance in 2014, Aleris chairman and chief executive officer Steven J. Demetriou said in a statement.
The company also warned that a harsh winter in North America had hurt production, logistics and demand and could dent its results in the first quarter of 2014, adding that low London Metal Exchange prices for aluminum and historically high Midwest premiums also could ding results.
Midwest premiums spiked to more than 20 cents per pound earlier this year, disrupting normal buying patterns and attracting imports (amm.com, March 6).
But despite the red ink, Aleris remained bullish about its prospects for 2014, predicting that a continued push to reduce vehicle weight would bolster demand from the automotive sector while parts of Europe are seeing better demand.
The companys North American rolled products division recorded segment income of $81.8 million in 2013, down 30.4 percent from $117.6 million a year earlier on decreased demand from the transportation industry, Aleris said. The companys rolled products business in Europe saw segment income fall 8.6 percent to $132.1 million from $144.6 million in 2012 as a strong showing from the companys Duffel, Belgium, cold mill was offset by declines in aerospace sales, inflation in labor and energy costs, and higher maintenance spending.
Aleris last year completed a new cold-rolling mill at its Duffel, Belgium, facility aimed at meeting increasing demand for wide automotive body sheet (amm.com, March 14).
Aleris extrusion business posted segment income of $11.7 million in 2013, down 28.7 percent from $16.4 million in 2012. The extrusion unit experienced increased demand from the automotive sector but suffered from continued weakness in the European building and construction market, the company said.