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Chalco 2008 profit down over 50% on cost increases

(Xinhua)
Updated: 2009-01-23 13:23

Aluminum Corp of China Ltd (Chalco), the country's largest producer of the metal, said Friday its 2008 unaudited net profit may fall more than 50 percent from a year earlier.

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The profit slump reflected large increases in raw materials costs in the first three quarters and plant closures caused by a power supply shortage last winter and summer according to a statement submitted to the Shanghai Stock Exchange.

This slump also came after products prices fall sharply as the economic slowdown cut demand, prompting Chalco to idle 4.11 million tons production capacity of alumina and 720,000 tons capacity of electrolytic aluminium since mid-October.

The company said the forecast was based on preliminary estimates under Chinese accounting standards.

Chalco didn't give a net profit figure for 2008, but its net profit for 2007 was 10.24 billion yuan ($1.50 billion), or 0.82 yuan per share.

Listed companies in China must issue unaudited statements under three conditions: If profits rise or fall more than 50 percent; if they move from a profit to a loss; or if they expect to report a loss regardless of the previous comparable period results.

Audited 2008 annual results are due on March 30.

The profit warning drove shares of Chalco down 1.7 percent to 6.99 yuan at 10 am Beijing time in Shanghai.