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Johannesburg - Aluminium producer Hulamin [JSE:HLM] said on Wednesday that it expects headline earnings per share of between 19 cents and 23 cents for the year ending December 2010, from 37 cents previously.
It expects earnings per share between 19 cents and 23 cents, from 37 cents in 2009.
"Hulamin has continued to improve operational performance in the second half of the year, which has resulted in higher sales volumes, improved US dollar margins and continued cost containment," it said, adding that its gains were counterbalanced by reduced export earnings due to the strengthening of the rand.
"In a challenging business climate, the Rolled Products' operation in particular has improved sales and production volumes, US dollar margins, sales mix, inventories and metal recoveries in the second half of the year," Hulamin said.
It noted that unit costs are at similar levels to the first half of 2010 in spite of increased electricity prices and full absorption of costs related to the recently completed expansion project.
The group said that during the second half of the year the rand has on average strengthened by almost 7% against the US dollar compared to the first half of 2010. "This has eroded much of the operational improvement benefits mentioned above."
It said that Hulamin Extrusions continues to face difficult trading conditions, particularly in relation to sales into the construction sector.
"The results for the second half of the year were positively impacted by both a pension fund surplus allocation and a metal price revaluation.
"The R75m project to increase rolling slab casting capacity remains on schedule to start up early in the second quarter of 2011," Hulamin said.
It expects earnings per share between 19 cents and 23 cents, from 37 cents in 2009.
"Hulamin has continued to improve operational performance in the second half of the year, which has resulted in higher sales volumes, improved US dollar margins and continued cost containment," it said, adding that its gains were counterbalanced by reduced export earnings due to the strengthening of the rand.
"In a challenging business climate, the Rolled Products' operation in particular has improved sales and production volumes, US dollar margins, sales mix, inventories and metal recoveries in the second half of the year," Hulamin said.
It noted that unit costs are at similar levels to the first half of 2010 in spite of increased electricity prices and full absorption of costs related to the recently completed expansion project.
The group said that during the second half of the year the rand has on average strengthened by almost 7% against the US dollar compared to the first half of 2010. "This has eroded much of the operational improvement benefits mentioned above."
It said that Hulamin Extrusions continues to face difficult trading conditions, particularly in relation to sales into the construction sector.
"The results for the second half of the year were positively impacted by both a pension fund surplus allocation and a metal price revaluation.
"The R75m project to increase rolling slab casting capacity remains on schedule to start up early in the second quarter of 2011," Hulamin said.
