OSLO, July 23 (Reuters) - Norwegian aluminium maker Norsk
Hydro reported a sharp jump in second-quarter core
profit on Friday that beat expectations, as global economic
recovery supported increased demand for the metal.
Adjusted earnings before interest, tax, depreciation and
amortisation (EBITDA) for April to June more than doubled
year-on-year to 6.6 billion crowns ($745.70 million), beating
the average consensus estimate of 6.09 billion crowns in a poll
"It's a strong result and actually the best quarterly
results we have had since becoming a pure play aluminium company
back in 2007," Chief Financial Office Paal Kildemo said.
Both the aluminium metal and extrusion divisions reported
Rising aluminium prices had been a key driver in the
earnings recovery, Kildemo said.
During the quarter, the cash price for aluminium on the
London Metal Exchange traded at its highest level in close to a
decade, with the strong demand dynamics lifting premiums, Norsk
The price of aluminium rose by two-thirds from the lows hit
in the second quarter of 2020 to around $2,500 a tonne by the
end of June this year, aided by the global economic recovery.
"We currently don't see any indications of the markets
moving down again," Kildemo said.
All operations were running at full production, he added.
Norsk Hydro returned its Norwegian Husnes aluminium plant to
full capacity of 195,000 tonnes a year in the second quarter
after it had been curtailed since 2009.
Hydro's earnings also benefited from better results from its
energy division, but higher raw material costs upstream and
negative currency effects offset some gains, Norsk Hydro said.
Hydro's share price, which has doubled since July last year,
rose as much as 2.4% on Friday morning and were up 0.7% at 1013
($1=8.8507 Norwegian crowns)
(Reporting by Nora Buli; Editing by Clarence Fernandez, Rashmi
Aich and Louise Heavens)