Hulamin Aluminium announces lacklustre performance
Pietermaritzburg – Having implemented turnaround actions initiated in 2019, both Hulamin Rolled Products and Hulamin Extrusions started 2020 with expectations of improved performance. However, sales volumes were measurably disrupted due to the impact of Covid-19 and consequent lockdowns.
As businesses with high fixed costs, these disruptions to both sales and manufacturing resulted in losses in the first half. The external environment improved as tight lockdown regulations were partially lifted in the second half.
Increases in the Rand value of aluminium and the consequent working capital requirements, the withdrawal of customer supply chain financing arrangements and losses in the first half, all contributed to cash outflows.
The improvement in the expected loss over 2019 is largely due to the impairment of property, plant and equipment in 2019 that was not repeated in 2020. The improvement in the expected headline loss is largely due to the once-off restructuring costs in 2019, the favourable 2020 metal price lag and the lower 2020 depreciation that were partly offset by lower 2020 sales volume. The decline in the expected normalised headline loss reflects the lower 2020 sales volume owing to COVID-19.
2020 Annual Results are scheduled to be released on Wednesday, 14 April 2021 at 10h00 with a management presentation to stakeholders to follow at 13h00.