Hydro reports slimmer margins for 2019
Photo supplied by Hydro.

Hydro reports slimmer margins for 2019

Norway-based aluminum producer points to low price environment.

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February 11, 2020

Norway-based aluminum and energy producer Hydro has reported 2019 net earnings roughly one-third the size of those for the preceding year. The company says “the weaker results reflect lower realized aluminum and alumina prices.”

Hydro, which operates globally, says its “underlying EBIT (earnings before interest and taxes) for 2019 was nearly 3.36 billion Norwegian krone ($362.5 million), down 63 percent from the nearly 9.1 billion Norwegian krone ($978.8 million) it earned in 2018. The company also reports that “lower raw material costs” helped offset some of the ill effects of 2019.

The company’s president and CEO Hilde Merete Aasheim comments, “We have taken firm measures in a weak market. Our improvement efforts will continue with full force, in line with our agenda towards lifting profitability and driving sustainability.

Merte includes Hydro’s recycled-content CIRCAL aluminum as a reason for optimism. “The increasing pull for low-carbon products and solutions is an encouraging trend, and we are well-positioned for a low-carbon future. Since we launched CIRCAL one year ago, we have signed 60 new low-carbon building projects around the world.”

In a January news release, Egil Hogna, head of Hydro’s Extruded Solutions business area, refers to CIRCAL as “currently one of Hydro’s fastest-growing segments.” Adds Hogna, “By the end of 2020, all of Hydro Building Systems’ products and solutions in Europe will be available in CIRCAL and REDUXA, and we expect demand for low-carbon aluminum to grow in the years to come. REDUXA is what Hydro calls primary aluminum it makes that it considers to be low-carbon.

Regarding the recycled-content CIRCAL, the company says it will ramp up production of CIRCAL in 2020 by increasing annual capacity to 25,000 metric tons, after completing an upgrade to and expansion of the Azuqueca secondary production plant in Spain.