Aluminium group Hulamin reported lower full-year earnings as softer global markets and business simplification resulted in a 15% decline in volumes.
The company reported profit after tax of R271.8m for the year to end-December from R299.7m a year earlier. Headline earnings per share (HEPS) were down 11% at 88c. It did not declare a dividend.
“The group experienced challenging trading conditions with softer global markets impacting demand, resulting in pricing pressure for common alloys, export can and plate products,” it said in a statement on Monday.
However, its simplification strategy proved effective as it enabled an agile response to changing markets.
Volumes were down 15% at 169,149 tonnes, but the company reported an improved mix, with local sales at 51% making up 86,252 tonnes and can stock at 60% of total local sales.
The company said it was able to substantially protect full-year profitability and free cash flow by improving the product mix to focus on higher-margin products, undertaking planned plant shuts to reduce production capacity in line with constrained demand, reducing fixed costs and reducing metal purchases to manage working capital.
“These actions, together with the benefit of a weaker average exchange rate, assisted profitability and cash flow in a challenging macro environment.”
The 2024 financial year has experienced similar trends, with export markets under continued short-term pressure while customer demand locally is proving resilient.
“The group continues to focus on stable plant performance, simplification and investment into future capacity primarily in the local can stream,” said CEO Mark Gounder.
In early afternoon on the JSE, the company’s share price was down 5.3% at R3.04.
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