Aluminium supplier Hulamin has reported a healthier order book and a return to operating profitability in the final quarter of its 2020 financial year, ended December 31, after having experienced strong headwinds from March 2020.
The company explains in its latest results statement that local and export sales were impacted on by Covid-19-related slowdowns across the local and global economies.
Lockdowns in South Africa and across the globe impacted on sales of all products and resulted in the inability to operate until Hulamin Rolled Products was issued an “essential services” certificate in mid-April 2020.
Sales volumes of beverage can material were then further impacted on by the lockdown-driven ban on alcohol sales in South Africa.
Group sales volumes decreased by 24% year-on-year to 166 000 t in the year under review, leading to the company posting a loss a share of 75c.
Normalised earnings before interest, taxes, depreciation and amortisation were down 128% year-on-year to a loss of R89-million.
The company posted a normalised headline loss a share of 91c, compared with a normalised headline loss a share of 8c reported for the 2019 financial year.
“Following the partial lifting of lockdown restrictions during the second half of 2020, all operations returned to operating profitability in the final quarter as volumes improved,” Hulamin confirms.
Demand for beverage can products is particularly firm at the moment, the company adds.
This while Hulamin Extrusions completed its turnaround plans during the year.
Following the closure of its Olifantsfontein site, which has subsequently been sold, the business has consolidated operations successfully in Pietermaritzburg and returned to profitability in the second half of the year.
Both the Hulamin Rolled Products and Hulamin Extrusions businesses are focused on returning to full manufacturing volumes, although Hulamin Rolled Products is in the process of undertaking a comprehensive maintenance shutdown during the first half of this year.
Sales volumes, together with the level of the rand against the dollar, will play a key role in determining performance for the full 2021 financial year, Hulamin avers.