Aluar disclosed lower than expected results, led by negative financial results, a low aluminum price and depressed local demand.
In the semester ended December 31, 2019, net result amounted AR$-1,425 million, affected by negative financial results (AR$-3,914 million) caused by the Argentine Peso devaluation and its impact on the foreign currency liability position, and by a lower operating result. Sales revenues were reduced by the lower aluminum price, while distribution costs grew due to the introduction of duties and the elimination of export refunds.
In the last quarter of 2019 the price of aluminum averaged US$1750 per ton and no significant change is foreseen in the short term. For 2020, the company does not expect any inconvenience to place the planned volumes abroad as long as the commercial conditions with the United States are not altered. In the domestic market there is still no recovery in demand.
Given this context, the target price is likely to remain relatively stable.