World's fourth-largest aluminium smelter says its production not affected by strikes in Bahrain
Aluminium Bahrain (Alba), the world's fourth-largest aluminium smelter, plans to increase exports of higher-margin products to Europe and says its production is not affected by strikes in Bahrain.
"We will increase our sales in Europe [this year] and have a slight decrease in the Middle East... because we want to develop our value-added products' share", chief executive officer Laurent Schmitt said in an interview on Tuesday.
Last year, Alba generated 50 percent of its sales in Bahrain, 20 percent elsewhere in the region and 10 percent in Europe, to where it plans to sell more billets, foundry alloys and rolling slaps.
Schmitt said production at Alba had not been affected by labour strikes and road closures during the recent unrest in Bahrain. "We didn't lose any production, we kept our plant at full capacity," he said.
The island kingdom saw weeks of protests by its Shi'ite majority against its Sunni rulers until security forces cleared a central square in Manama last week.
The protests prompted Bahrain's king to impose martial law and call on Sunni-led neighbours to send troops to help quell the unrest.
Bahrain's trade unions have called for a general strike but the call has failed to gain much traction.
Schmitt said currently about 80-90 percent of workers were at work. "We reorganised our shifts and so we were able to run our operations without any disturbances."
Alba is majority-owned by Bahrain's sovereign wealth fund Mumtalakat, which floated a 10 percent stake in the company in an initial public offering (IPO) last year.
The smelter that has an annual production capacity of 860,000 tonnes swung to a full-year net profit of BHD138m ($366m) in 2010 on higher sales.
Schmitt said Alba expected its full-year profit to rise this year on the back of higher aluminium prices, but declined to give a more precise outlook.
He said in addition to higher top-line revenues the company will also boost profits by about $70 million in cost savings and higher margins.
Alba is currently studying how to supply energy to a planned sixth production line that would boost its capacity by 400,000 tonnes annually.
Schmitt said Alba is negotiating with Bahrain's government to receive more gas or electricity but is also considering replacing its power stations to improve energy efficiency.
He added that a decision on the expansion could be made in early 2012.