Qatar Aluminium Manufacturing Company (QAMCO), a 50 percent joint venture partner in Qatar Aluminum Limited Q.S.C. (Qatalum or JV), yesterday reported a net profit of QR835m for the year ended December 31, 2021, with earnings per share (EPS) of QR0.15.
Commenting on the financial and operational performance for the year ended December 31, 2021, Abdulrahman Ahmad Al Shaibi, Chairman of the Board of Directors, QAMCO, said: “The main highlight of 2021 was a sequential macroeconomic recovery leading to strong price trajectories for primary aluminum, operational excellence along with good business management in the continuing COVID-19 situation, which resulted in an improved set of financial results since QAMCO’s incorporation. While macroeco-nomic sentiments remained pos-itive, we continued to focus on operational excellence, safety, flexibility and sustainability. Our firm belief and commitment to HSE has successfully positioned our JV to meet our health, environment, and social responsibility targets. Going forward, our com-petitive strengths coupled with our operational excellence, would position us better for our long-term goals.”
QAMCO has set a record with highest yearly and quarterly net income, since incorporation, while benefitting from con-structive macroeconomic drivers
.QAMCO recorded a net profit of QR835m for the year ended 31 December 2021, as compared to QR95m for last year, with an earnings per share (EPS) of QR 0.15 versus QR 0.017 for last year.
Share of revenue from the JV increased by 42 percent to reach QR3,118m as compared to QR2,197m for last year. EBITDA increased by 106 percent and reached QR1,374m as compared to QR667m for last year.
QAMCO’s improved financial results in comparison to last year, were largely attributed to an overall growth in average realized selling prices which increased by 42 percent during 2021 versus last year, and contributed QR932m positively towards current year’s net earnings in comparison to last year.
Production activity remained stable with volumes witnessing a marginal increase of 1 percent during the year. Sales volumes marginally declined by 0.4 percent versus last year reflecting the timing of shipment to various destinations. QAMCO’s JV remained successful in realizing higher production and sales of VAP in comparison to last year.
This strategic production shift, since latter part of last year has positively supported evolution of EBITDA margins for the JV. JV’s cost of goods sold for the current year were higher com-pared to last year, mainly on account higher raw material costs, offset by favorable inventory movements and cost optimization initiatives.
On overall basis, increase in cost of goods sold con-tributed QR179m negatively to QAMCO’s net profits for the current year versus last year.
Finance cost for 2021 wit-nessed a decline of 32 percent versus last year, on account of decline in interest rates and absence of unamortized portion of financing cost being written-off last year. The decline in finance cost contributed QR33m positively to QAMCO’s net earnings for the current year versus last year.
Compared to Q3-21, share of JV’s revenue improved by 28 percent, while QAMCO’s net profits improved by 34 percent. The key contributor towards this growth was a continued growth in average selling prices, on the back of supportive macroeco-nomic trends which echoed from the previous quarters.
Average realized selling prices increased by 11 percent during Q4-21 versus Q3-21. Sales volumes significantly increased by 16 percent versus Q3-21, as more sales of extrusion and standard ingots were made during the quarter in line with the market demand.
QAMCO’s financial position continued to remain robust with cash and bank balances as at the end of December 31, 2021 reaching QR1.5bn.
QAMCO’s JV generated share of operating cash flows of QR917m, with a share of free cash flows of QR693m.
QAMCO’s JV continue to maintain efficiency and cost competitiveness in terms of its production and operations. CAPEX projects were conducted as planned for the year, and in line with the operational requirements. These CAPEX programs will support JV’s drive for operational efficiency and reduce carbon footprints.
After reviewing current year’s robust financial performance, with the present and forecasted liquidity position, and considering current and future macroeconomic conditions, business outlook, CAPEX, long term loan repayment plan of the Company, the Board of Directors proposed a total annual dividend distribution of QR446m for the year ended December 31, 2021, representing a payout ratio of 53 percent of current year’s net earnings.
A dividend of QR0.08 per share represents 8 percent of par value resulting in a dividend yield of 4.4 percent on the closing share price as of 31 December 2021
.QAMCO will host an IR earnings call to discuss the current year’s results, business outlook and other matters on 9th February 2022 at 1:30 p.m. Doha time.
