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Russian Aluminum

April 24, 2003

RUSAL reports increased output across all major product types for Q1 of 2003

MOSCOW, 24 April, 2003 - RUSAL, the world's second largest aluminium company, today reported   production results for the first quarter ended March 31st, 2003. The group registered increased output across all major product types.

Smelting production across the group increased by almost 3 %. This was due primarily to the addition of new electrolysis cells at Sayanogorsk Aluminium Smelter, as well as the rise of electrical strength at Sayanogorsk (by 11.5 kA to 220.45 kA) and Krasnoyarsk (by 2.23 kA to 157.78 kA). Sayanogorsk Aluminium Smelter produced 109 761 tons of primary aluminium and alloys, showing 10.5% year-on-year growth. Production of alloys at Sayanogorsk increased significantly. Alloys now make up 34.3% of the smelter’s product mix as compared with 17% in the first quarter of 2002. Modernization programmes at Krasnoyarsk, Bratsk and Novokuznetsk helped to raise the smelters’ output by 2.2%, 0.5% and 2% respectively.

RUSAL’s efforts to expand its raw material base resulted in substantial increases in alumina output. Friguia Alumina Refinery, which was integrated into the group last year, added 171 247 tons of alumina as well as 551 447 tons of bauxite to the first quarter’s output. Achinsk and Nikolayev Alumina Refineries increased their output by 1.5% and 6.4% respectively.

The group’s downstream facilities also registered significant growth in output due to investments in the plants’ modernization last year. Modernization programmes at Belaya Kalitva undertaken last year, which included installation of a new plate cutting line, lead to a 31.6% increase of its production.

ROSTAR continued to increase its output following the growth of the beverage can market in Russia and this was supported by stable supplies of high quality can strip from Samara where substantial upgrades had been made to improve the quality of can-related semi products.

Modernization programmes are continuing at Armenal as part of its 10 year $34 mln. investment programme.  Modernization of the plant was accompanied by upgrading the foil semis production at Samara and alloy production at Bratsk Smelter, which altogether helped to raise Armenal’s output by 294%. RUSAL’s total foil output was raised by 43%, while forged product output increased by 29%


Highlights for the Q1 2003 included:

• RUSAL acquired the outstanding 26% stake in the Armenal foil mill from the Armenian government and obtained 100% control over the plant.
• Engineering consultants SNC Lavalin completed a feasibility study for the expansion of the Sayanogorsk smelter.
• A three-year framework agreement was signed with Germany’s Siemens for the full automation of the production process at the Armenal foil mill.  This will result in improving production efficiencies and a 20% reduction of metallurgical equipment down time.
• Closing of $190 mln syndication of a pre-export credit facility arranged by BNP Paribas, Glencore International and Natexis Banques Populaires, further improving RUSAL’s debt structure.
• RUSAL appointed BNP Paribas as main financial adviser for the proposed project financing of Sayanogorsk smelter expansion.    
• Formation of a new subsidiary of RUSAL group, RUSAL-management company, part of a major reorganization and rationalization of the management structure.
• RUSAL Service Center established as a new maintenance division for the Group’s aluminium smelters; part of the programme to spin off non-core business functions.
• RUSAL’s Dmitrov rolling mill and Sayansk foil mill successfully passes ISO 14001 environmental certification, BAT received quality management ISO 9001 certificate, Dmitrov plant upgraded its quality management certification to ISO 9001: 2000. 

Other steps during the quarter included the extension and improvement of the terms of its global insurance agreement covering the company's property, business interruption losses and marine cargo risks worldwide. The company also signed a five-year voluntary medical insurance agreement with the Russian-based Max insurance company covering 61 000 employees at RUSAL’s 15 plants.

Table 1 – Production results (metric tons, unless otherwise noted)

Products

 

Q1/2003

Q1/2002

Yr on Yr

Change (%)

 

 

 

 

Bauxite

1,005,430

419,321

*

Alumina

722,147

529,300

*   

Primary aluminium & alloys

626,705

608,974

2.9

Aluminium semi products including:

61,617.7

49,678

24

Flat rolled products

49,196.5

40,018

22.9

Extruded and forged products

12,421.2

9,660

28.6

Foil

10,380.9

7,264

42.9

Aluminium beverage cans (‘000)

206,177.1

170,088

21.2

Other cans

20,981.4

18,213

15.2

* The sharp increase in bauxite and alumina production is due to the addition of the Friguia alumina refinery facilities in Guinea, after a 25-year lease management agreement was signed in December 2002.


 

Table 2 – Bauxite & Alumina (metric tons)

 

Mines and refineries

Q1 2003

Q1 2002

Yr on Yr

Change (%)

Compagnie des Bauxites de Kindia (Guinea) -  bauxite

453,983

419,321

8.3

Achinsk Alumina Refinery

- alumina

257,700

253,800

1.5

Nikolayev Alumina Refinery

- alumina                                     

293,200

275,500

6.4

Alumina Company of Guinea

- bauxite

551,447

 

 

Alumina Company of Guinea

- alumina

171, 247

 

 

 

 

Table 3 – Primary Aluminium (metric tons)

 

Smelters

Q1 2003

Q1 2002

Yr on Yr

Change (%)

Bratsk Aluminium Smelter (BrAZ)

228,020

226,906

0.5

Krasnoyarsk Aluminium Smelter (KrAZ)

217,175

212,420

2.2

Sayanogorsk Aluminium Smelter (SAZ)

109,761

99,307

10.5

Novokuznetsk Aluminium Smelter (NkAZ)

71,749

70,341

2.0

 

Table 4 - Downstream Production Units (metric tons unless otherwise noted)

 

Plants

Q1 2003

Q1 2002

Yr on Yr

Change (%)

Samara Metallurgical Plant

50,257.8

43,734

14.9

Belaya Kalitva Metallurgical Plant

9,551.9

7,256

31.6

Sayansk Foil Mill

8,558.2

7,770

10.1

Armenal

2,690.4

683

293.9

ROSTAR (beverage cans)

206,177.1

170,088

21.2

ROSTAR (ends)

360,428.4

350,451

2.8

DOZAKL (cans)

20,981.45

18,213

15.2

DOZAKL (ends)

23,769.72

21,739

9.3

 

END


About RUSAL
RUSAL is the second largest primary aluminium producer in the world, formed in March 2000 from the merger of a number of the largest smelters and other aluminium producers located in the CIS. The Company accounts for 75% of Russia's primary aluminium output and 10% of the global primary aluminium output. RUSAL is a fully vertically integrated company with a complete production cycle from bauxite mining and the production of raw materials, to the production of primary metal, semi-products and aluminium-based end products. RUSAL is headquartered in Moscow.

 

For further information:


www.RUSAL.com
Eugenia Harrison, Moscow, +7 095 720 5170, or zharrison@RUSAL.ru; Fred Harrison, London, +44 (0) 20 7431 7517, or fharrison@ansdellconsult.com; Stan Neve, New York, +1 212 333 3810, or sneve@brunswickgroup.com


 

 

 

 

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