Vimetco outlook remains unchanged
by Vimetco NV 12 Nov 15:26
Zurich, 12 November 2008: Vimetco NV (LSE: VICO), the global producer of primary and processed aluminium products, in response to the fall of its share price over the last weeks, confirms that its outlook, as announced in the Interim Statement on October 23rd, remains unchanged.
As disclosed then, Vimetco, has taken action to cut less efficient capacity (95’000 tpa) and delay capex on new projects in China in response to deteriorating market conditions. Additionally in Romania production will be reduced by up to 65,000 tpa, resulting in a total production cut of 160,000 tpa in 2009. Rigorous cost reductions, including the outsourcing of non-core services, sale of non-business crucial assets and a substantial cut back in head count in Romania and a new state-of-the art smelter in China will contribute to lower production costs per tonne.
Vimetco confirms that, although it has not remained unaffected by the recent financial crisis and slow down in the global economy, its funding profile remains sound and operational prospects are expected to remain stable.
Vimetco remains confident that the aluminium price will recover during 2009. Since the Interim Statement the aluminium price has been positively impacted by the announcement of the Chinese Government’s economic stimulus plan to boost the Chinese economy with a significant investment programme, mainly in infrastructure. While we expect some fall-out of higher cost producers, Vimetco should be better positioned to cope in these conditions due to greater efficiency, the integrated nature of operations and lower cost facilities than most existing aluminium operations in China.