China's Chalco Saw 2008 Profit Down Nearly 100%

Loss caused by higher energy prices, falling demand and inventory devaluations as metals prices sank

Aluminum Corp. of China Ltd, or Chalco, said on March 30 its 2008 net profit fell nearly 100% from a year earlier and that the company expected to swing to a net loss in the first quarter of 2009.

The world's largest aluminium firm by market value posted net profit of 9.2 million yuan (US$1.3 million), down from 10.75 billion yuan a year earlier, because of higher energy prices, falling demand and inventory devaluations as metals prices sank, the company said. "(The) international financial crisis, raw material price hikes and sharply decreasing commodity prices further posed unprecedented difficulties and challenges to the group's production and operation," Chalco said.

Chalco is the listed unit of Chinalco, which is awaiting Australian government approval for its $19.5 billion offer to double its stake in mining giant Rio Tinto to 18%.

Chalco issued a profit warning for the first quarter, saying the company still faced "an exceptionally challenging business landscape."

Chalco also said its chairman, Xiao Yaqing, had resigned from that post, effective immediately. The company didn't give a reason for his departure. However, in February Lu Youqing -- deputy general manager of Chalco's parent, Chinalco -- said Xiao was expected to be appointed to a new post as deputy secretary general of the State Council, China's cabinet, Dow Jones Newswires reported.

Xiao, who was also president of Chinalco, was succeeded in that role by Xiong Weiping in February. Xiong has been nominated as a candidate for the executive-director position being vacated by Xiao, Chalco said.

Copyright Agence France-Presse, 2009

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish