Alumina sees a jump in earnings for Q1 2015

Alumina says average earnings per tonne jumped at its AWAC joint venture during the first quarter of the year amid "healthy demand" and lower costs, while the longer-term outlook is likely to benefit from a global supply squeeze.

Chief executive Peter Wasow said average alumina earnings before interest, tax, depreciation and amortisation (EBITDA) increased to $US102 a tonne in the first quarter of 2015 from $US85 in the fourth quarter as positive momentum from last year continued.

The Alcoa World Alumina and Chemicals joint venture, in which Alumina has a 40 per cent interest, had average EBITDA per tonne of $US54 in 2014, up from $US45 in 2013.

Mr Wasow told the Alumina annual general meeting today that the industry had been experiencing a strong demand-pull.

"Aluminium demand growth has been running ahead of global GDP growth for sometime and most commentators expect that to continue," Mr Wasow said.

An Indonesian ban on unrefined exports of bauxite, the raw material for alumina production, had helped curb refinery growth in China, pointing to the potential for supply shortages in coming years, Mr Wasow said.

The AWAC joint venture is the world's largest alumina producer with operating costs in the lowest quartile.

Mr Wasow said a weakening Australian dollar and Brazilian currency were contributing to lower production costs.

Alumina reported a loss of $US98m in 2014, after taking a hit for restructuring costs for the sale or closure of two AWAC operations. Excluding the write-downs, Alumina would have reported a profit of $US91m.

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