Analyst Note| Mark Taylor |
No-moat-rated Alumina’s first-half 2022 result was strong, with underlying net profit after tax rising 73% to USD 120 million, or AUD 5.9 cents per share. Statutory net profit of USD 168 million benefited from a near-USD 50 million aftertax gain on favourable revaluation of Portland Energy contracts. Alumina’s profit reflects its 40% share of the Alcoa Worldwide Alumina and Chemicals joint venture, or AWAC. At the AWAC level, excluding the uplift in the energy contract revaluation, adjusted EBITDA increased 33% to USD 628 million, better than our AUD 540 million expectations. Higher prices more than offset headwinds from volumes and input cost inflation.