Aluminium supplier and exporter Hulamin continued with its turnaround actions for both its rolled and extruded product segments, despite the ongoing Covid-19 pandemic, for the period ended June 30.
In the six-month period, Hulamin’s rolled and extruded product sales increased by 43% and 58%, respectively, compared with the same period in 2020.
Overall, the group improved its profit performance and generated free cash flows of R128-million, despite the pandemic’s impact.
Hulamin’s group sales volume also increased by 44% to 102 000 t for the period, while revenue increased by 50% to R5.5-billion.
Earnings before interest, taxes, depreciation and amortisation improved by 166% to R78.6-million, while basic earnings a share increased by 139% to 29c.
Meanwhile, both rolled and extruded products’ turnaround actions included improvements to capacity utilisation, cost management, tight controls over working capital and a focus on sales growth and distribution.
CEO Richard Jacob on August 31 said the rolled products division would, in the second half of the year, continue to focus on improving manufacturing performance, while simultaneously driving cost reduction actions and strengthening cost controls.
Hulamin intends to maximise local sales of its rolled products, particularly the beverage can sheet, as it further continues to ramp up new automotive sheet volumes in the US.
Additionally, Jacob said Hulamin would focus on unique technology developments, drive scrap consumption and work on reducing working capital.
Extrusions, meanwhile, will continue to improve its productivity, while also focusing on key market segments and improved margin management.
Jacob said Hulamin would also improve the company’s customer focus through improved quality, on-time delivery and improved customer service.
Post-period end, the aluminium supplier lost about one week of production in mid-July owing to civil unrest and riots in parts of KwaZulu-Natal and Gauteng.
While Hulamin was fortunate in that it suffered no damages to its plant in KwaZulu-Natal, nor any of its other properties or equipment, the group did, however, lose about 4 000 t of sales during that week.
The group “barely managed to recover” from the civil unrest’s impact, when a cyberattack on State-owned Transnet’s Durban port later in July led to about 2 000 t of July sales being delayed into August.
The cash flow impact of the cyberattack on Hulamin’s financials amounted to about R200-million.
Looking ahead, Jacob said Hulamin was targeting sales volumes of 105 000 t for the second half of the year, with full-year sales targeted at just over 200 000 t.
Hulamin will also be focusing on its cash flows, funding and working capital.
In terms of rolled products, in particular, Hulamin will focus on cost management, a continued ramp-up in volumes and the commercialisation of new products.
There will also be an increased focus on consolidating improved profits and cash flows in the extrusions segment, while simultaneously evaluating the medium- to long-term capacity and capabilities.