Financial Performance - Revenue for 2023 was $12,213 million, a decrease of 12.6% from $13,974 million in 2022[2]. - Adjusted EBITDA for 2023 was $786 million, with an adjusted EBITDA margin of 6.4%, down from 14.5% in 2022[2]. - Net profit for 2023 was $282 million, resulting in a net profit margin of 2.3%, compared to 12.8% in 2022[2]. - Metal sales revenue for 2023 totaled $13.7 billion, with significant contributions from Asia and Russia, while sales in Europe, North America, and South America decreased[38]. - The company's total sales in Europe decreased from $7.52 billion in 2022 to $3.48 billion in 2023, while sales in Asia increased from $4.97 billion to $7.32 billion[38]. - Adjusted net profit for the year was $702 million, down 67.6% from $2,165 million in 2022[158]. - The group recorded a profit of $282 million for the year ended December 31, 2023, down from $1,793 million in 2022, reflecting an 84.3% decline[157]. - Total revenue for the year ended December 31, 2023, was $12,213 million, down 12.6% from $13,974 million in the previous year[142]. - The average realized aluminum price dropped by 18.0% from $2,976 per ton in 2022 to $2,439 per ton in 2023[142]. - The group recognized a tax credit of $38 million for the year ended December 31, 2023, compared to a tax expense of $373 million in 2022[156]. Production and Capacity - Rusal operates 117 aluminum smelters across three countries, with 94% of its aluminum production in Siberia, Russia[22]. - The Taishet aluminum smelter's first phase, with a capacity of 428,500 tons, began production at the end of 2021[8]. - The company has invested in modernizing production facilities, including the reconstruction of two aluminum smelters in Krasnoyarsk and Bratsk, with government approval obtained[18]. - The company has developed and sold several innovative aluminum products, including high-strength foils for batteries and low-carbon footprint aluminum foils[19]. - The company has diversified its sales regions, delivering aluminum products to major consumption areas including Europe, the CIS, China, and other Asian regions[8]. - The company continues to adapt to changing market conditions by developing new markets and products, demonstrating resilience and adaptability[18]. - The company has a diverse portfolio of mining assets, including 15 mines and mining groups, supporting its alumina production capacity[33]. - The total alumina production for 2022 and 2023 was 5,953 thousand tons and 5,134 thousand tons respectively, representing a decrease of 13.8% due to military control in Ukraine and sanctions affecting supply[113]. - The total bauxite production of Rusal reached 13,376 thousand tons in 2023, an increase of 8.6% compared to 12,320 thousand tons in 2022[122]. Environmental Initiatives - The company aims to reduce greenhouse gas emissions per ton of metal by at least 23% by 2035 and 47% by 2050 compared to 2018 levels[10]. - The company is implementing a sustainable development strategy with 12 priority ESG transformation projects aimed at ensuring sustainable procurement and long-term competitive advantages[16]. - The company is advancing towards a low-carbon economy by adopting inert anode technology, which aims to achieve the lowest carbon footprint in primary aluminum production[16]. - Approximately 80% of the industrial by-products and waste generated by the company's production facilities are recycled or sold to third-party consumers[16]. - The company has reduced its direct greenhouse gas emissions from aluminum production by 53% since 2007[55]. - The company aims to achieve carbon neutrality by 2050, balancing greenhouse gas emissions and absorption, while also restoring disturbed land and assisting in biodiversity conservation[51]. - The company has received high ratings for its sustainability and climate performance, including an A- rating in the CDP climate ranking for the aluminum industry in 2021[49]. - The company is committed to responsible consumption of natural resources and establishing a circular economy to reduce its environmental footprint[52]. - The company has successfully passed audits for the latest version of ASI performance standards and regulatory chain standards at 13 production and office locations as of December 31, 2023[50]. Social Responsibility and Community Engagement - The company is focused on social investment strategies to improve the quality of life and social development in the regions where it operates[17]. - Rusal has invested in social infrastructure development in Siberia, focusing on sports, housing, and support for science, education, and healthcare[20]. - The company raised a total of 1,045,721 rubles for regional charities through various city charity events, including sports festivals and charity runs[65]. - In 2023, 51 volunteer projects were implemented with a total value of 2.7 million rubles, benefiting over 2,000 individuals in need[65]. - The company supported the development of urban infrastructure projects with a total funding of 344.4 million rubles from 2020 to 2023, including design and municipal application preparation[67]. - The company signed 18 social and economic cooperation agreements with municipal and regional authorities, totaling 646.4 million rubles, funding over 90 projects valued at more than 575 million rubles[72]. - The scholarship program expanded to cover 56 higher and vocational education institutions across 21 cities in 11 regions, receiving 700 applications and awarding 177 scholarships in 2023[74]. - The company initiated social investment projects in 2023 as part of its sustainable development strategy, focusing on urban sustainability and community development[62]. Compliance and Governance - The company has implemented a comprehensive compliance control system to manage regulatory compliance and compliance risks, including anti-corruption and conflict of interest policies[57]. - In 2023, the compliance department conducted training sessions focusing on sanctions and anti-corruption risks for all management levels[59]. - The compliance system underwent internal and external audits in 2023, achieving ISO 37301:2021 certification and being rated AAA for anti-corruption measures[60]. - The company updated its human rights policy and adopted an equal opportunity policy on January 9, 2024, and registered its forest climate project with the Russian Federation carbon unit registry[169]. Employee Development and Training - The company has established a comprehensive employee incentive system to enhance productivity and retain skilled workers[184]. - The number of students recruited under the target recruitment plan increased from 139 in 2022 to 372 in 2023, representing a growth of approximately 168%[189]. - A total of 105 apprentices were hired under the "New Generation" apprenticeship program by December 31, 2023, aimed at attracting high-potential young professionals[190]. - The Rusal Leaders talent program expanded from 25 projects in 2022 to 45 projects in 2023, with an expected economic benefit of over 8 billion rubles[194]. - 23,088 employees received career development and vocational training, with 9,576 completing the digital aluminum course[198]. - The company trained 64 students from Guinea in various Russian higher education institutions in 2022, with an additional 50 students starting medical studies in 2023[193].

Financial Performance - Revenue for the year ended December 31, 2023, was $12,213 million, a decrease of 12.6% compared to $13,974 million in 2022[4] - Adjusted EBITDA for the year was $786 million, down 61.2% from $2,028 million in the previous year, resulting in an adjusted EBITDA margin of 6.4%[4] - Net profit for the year was $282 million, reflecting an 84.3% decline from $1,793 million in 2022, with a net profit margin of 2.3%[4] - The company’s adjusted net profit for the year was $73 million, down 89.9% from $725 million in 2022[9] - The group reported a profit before tax for the year ended December 31, 2023, of $244 million, down from $2,166 million in 2022[42] - The group recorded a net profit of $282 million for the year ended December 31, 2023, compared to $1,793 million in 2022, reflecting an 84.3% decrease[44] - Earnings per share for the year ended December 31, 2023, was $0.019, a decrease from $0.118 for the previous year, with net profit of $282 million compared to $1,793 million in 2022[165] Assets and Liabilities - Total assets decreased by 12.9% to $21,464 million from $24,631 million year-over-year[10] - The company reported a net debt of $5,779 million, down 7.7% from $6,261 million in the previous year[10] - Total liabilities decreased by $1,876 million or 15.2% to $10,448 million as of December 31, 2023, primarily due to a reduction in outstanding financial debts[46] - The company's equity decreased to $11,016 million in 2023 from $12,307 million in 2022, reflecting a decline in retained earnings and currency translation reserves[62] - Total current liabilities decreased to $3,719 million in 2023 from $4,591 million in 2022, a reduction of approximately 19.0%[64] Cash Flow - Operating cash flow for the year was $1,760 million, a significant improvement from a cash outflow of $412 million in 2022[11] - Net cash generated from operating activities was $1,760 million for the year ended December 31, 2023, compared to a net cash used of $412 million in the previous year[47] - Cash used in investing activities was $1,030 million for the year ended December 31, 2023, compared to cash generated of $472 million in 2022[47] - Cash used in financing activities was $1,747 million for the year ended December 31, 2023, compared to cash generated of $1,415 million in the previous year[47] Production and Sales - Aluminum production for the year was 3,848 thousand tons, a slight increase of 0.3% compared to 3,835 thousand tons in 2022[5] - The average selling price of aluminum decreased by 10.1% to $2,385 per ton from $2,654 per ton in the previous year[5] - The company’s aluminum sales increased by 6.6% year-on-year to 4.153 million tons, while sales of value-added products dropped by 9.1% to 1.547 million tons[24] - Sales of primary aluminum and alloys fell by $1,464 million or 12.6% to $10,129 million, primarily due to a decline in average aluminum prices from $2,976 per ton in 2022 to $2,439 per ton in 2023, representing an 18.0% decrease[28] - Alumina sales revenue decreased by 38.2% from $550 million in 2022 to $340 million in 2023, driven by a 35.1% drop in sales volume and a 4.7% decrease in average price[28] Market Conditions - In 2023, global aluminum demand increased by 1.7% year-on-year to 70.2 million tons, with China's demand rising by 4.9% to 42.8 million tons[13] - The automotive sector accounted for approximately 25.5% of global aluminum usage in 2023, with global sales of electric vehicles (EVs) growing by 31% year-on-year, totaling 13.6 million units[14] - The construction industry, which represents 21.4% of global aluminum usage, experienced negative growth in sales and construction rates due to high borrowing costs and economic uncertainty[14] - Global aluminum supply increased by 3.5% year-on-year to 70.5 million tons, with China's production rising by 3.4% to 41.5 million tons[17] Expenses and Costs - Total sales cost decreased by $325 million or 3.0% from $10,770 million in 2022 to $10,445 million in 2023[31] - Gross profit for the year ended December 31, 2023, was $1,768 million, down from $3,204 million in 2022, with gross margin decreasing from 22.9% to 14.5%[33] - Distribution expenses increased by 8.3% to $755 million in 2023, primarily due to newly imposed export tariffs[34] - Administrative expenses decreased from $769 million in 2022 to $603 million in 2023, mainly due to reduced labor costs[34] - Employee costs decreased to $956 million in 2023 from $1,185 million in 2022, reflecting a reduction of 19.3%[128] Impairments and Non-Current Assets - Non-current asset impairment for the year was $321 million, compared to $196 million in 2022, indicating an increase of approximately 64%[109] - The company identified specific items of property, plant, and equipment with a carrying amount of $111 million as impaired, up from $99 million in the previous year[190] Taxation - The actual tax expense for 2023 was $(38) million, compared to $373 million in 2022, indicating a substantial reduction in tax liabilities[141] - The effective tax rate for the company remained at 20% for the year ended December 31, 2023, consistent with the previous year, except for subsidiaries in Switzerland where the rates were 9.06% and 11.8% respectively[141] - The company recognized deferred tax assets of $1,595 million as of December 31, 2023, up from $1,444 million in 2022, reflecting an increase in potential tax benefits[148] Geopolitical and Operational Risks - The geopolitical situation in Russia, Jamaica, and Guinea has led to significant operational risks, including potential changes in privatization terms following regime changes[81] - The company has faced economic sanctions from the EU, US, Japan, Canada, and Australia, which have increased market volatility and uncertainty regarding its operations[81] - In March 2022, the Australian government banned the export of alumina and bauxite to Russia, impacting supply and procurement costs for the group[85] Future Outlook and Strategies - The management anticipates a rise in global commodity prices, which is expected to improve operational performance[86] - The company plans to continue focusing on operational efficiency and cost management strategies moving forward[129]

Financial Performance - Revenue for the first half of 2023 was $5,945 million, a decrease of 17% compared to $7,153 million in the same period of 2022[3]. - Adjusted EBITDA for the first half of 2023 was $290 million, down 84% from $1,807 million in the first half of 2022, resulting in an adjusted EBITDA margin of 4.9% compared to 25.3%[3]. - Net profit for the first half of 2023 was $420 million, a decline of 75% from $1,680 million in the same period of 2022, leading to a net profit margin of 7.1% compared to 23.5%[3]. - The gross profit for the six months ended June 30, 2023, was $728 million, down from $2,391 million in the same period of 2022, resulting in a gross margin decrease from 33.4% to 12.2%[47]. - The company's profit before tax for the first half of 2023 was $269 million, down from $2,364 million in the same period of 2022[56]. - The total comprehensive income for the six months ended June 30, 2023, was a loss of $1,032 million, compared to a gain of $4,330 million in the same period of 2022[136]. - The company reported a significant increase in financial income to $269 million, compared to $206 million in the same period last year[123]. - The company incurred a net cash outflow from investing activities of $398 million for the six months ended June 30, 2023, compared to a cash inflow of $1,244 million in the same period of 2022[138]. Production and Sales - The production of alumina decreased by 23.7% year-on-year to 2.518 million tons in the first half of 2023, compared to 3.300 million tons in the same period of 2022[26]. - The company's aluminum production increased by 1.2% year-on-year to 1.913 million tons in the first half of 2023, up from 1.891 million tons in the same period of 2022[24]. - Total production of aluminum foil and packaging materials decreased by 1.1% to 54.1 thousand tons for the six months ended June 30, 2023, compared to 54.7 thousand tons in the same period of 2022[29]. - Sales revenue from primary aluminum and alloys dropped by 18.4% to $4,839 million for the six months ended June 30, 2023, primarily due to a 25.7% decrease in average realized aluminum price[40]. - The company experienced a decrease in sales of aluminum and alloys, generating $4,839 million in revenue, down 18.5% from $5,932 million in the same period of 2022[179]. Assets and Liabilities - The total assets as of June 30, 2023, were $21,425 million, down from $24,631 million as of December 31, 2022[3]. - Current assets totaled $7,890 million as of June 30, 2023, down from $10,115 million as of December 31, 2022[66]. - The company's total equity decreased to $11,277 million from $12,307 million at the end of 2022, reflecting the impact of reduced profitability[130]. - Total liabilities as of June 30, 2023, were $10,148 million, down 17.7% from $12,324 million as of December 31, 2022[177]. - The group's debt-to-asset ratio was 36.3% as of June 30, 2023, compared to 38.4% on December 31, 2022[84]. Market Conditions - In the first half of 2023, global primary aluminum demand decreased by 1.5% year-on-year to 33.7 million tons, with demand outside of China dropping by 5.5% to 13.7 million tons, while China's demand grew by 1.5% to 20.0 million tons[16]. - The average price of aluminum on the London Metal Exchange (LME) fell to $2,331 per ton in the first half of 2023, down from $3,075 per ton in the same period of 2022, reflecting a significant decline in market conditions[20]. - The average premium over LME prices decreased to $200 per ton in the first half of 2023, down from $342 per ton in the same period of 2022, reflecting changing market dynamics[20]. - The company experienced a supply surplus of 0.7 million tons in the global aluminum market during the first half of 2023, with a surplus of 0.6 million tons in regions outside of China[18]. Strategic Initiatives - The company is focusing on completing the construction of the Taishet aluminum smelter and anode plant, as well as the ecological modernization of the Siberian aluminum plant[12]. - A new alumina refining plant project in Leningrad region is expected to become one of Russia's largest investment projects[12]. - The company has successfully redirected commodity exports to Asian countries and is committed to developing the domestic market and the Commonwealth of Independent States (CIS) countries[12]. - The company launched new products, including casting alloys made from recycled aluminum, reducing the carbon footprint by nearly 20%[14]. - The company is implementing a sustainable business development strategy through 2035, focusing on 12 key environmental, social, and governance transformation projects[6]. Employee and Governance - The company is focused on improving labor productivity and product quality as part of its employee incentive system[94]. - The audit committee held four meetings in the first half of 2023 to review financial statements and ensure compliance with applicable accounting standards[100][101]. - The company is committed to providing various employee benefits beyond mandatory compensation, including health services and housing assistance[96][95]. - The group did not declare any dividends for the fiscal year 2022, as decided in the 2023 annual general meeting[76]. Risks and Challenges - The company faces significant business risks, including fluctuations in commodity and currency markets, which may lead to unpredictable changes in demand for raw materials[104]. - Rusal's operations are heavily reliant on uninterrupted power supply, and rising electricity prices could adversely affect its financial performance[104]. - The geopolitical situation in Russia, Jamaica, and Guinea has led to significant operational risks, including potential changes in privatization terms following regime changes[151]. - The company has faced supply chain disruptions due to sanctions and geopolitical tensions, impacting the procurement prices of alumina and bauxite[155].

[Financial and Operational Summary](index=4&type=section&id=Financial%20and%20Operational%20Summary) In the first half of 2023, the company's performance faced significant pressure, with revenue decreasing by 16.9%, adjusted EBITDA sharply declining by 84.0%, and net profit falling by 75.0% year-on-year, while net debt remained relatively stable Key Financial and Operational Data for H1 2023 | Metric | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | Year-on-Year Change | | :--- | :--- | :--- | :--- | | **Revenue (Million USD)** | 5,945 | 7,153 | -16.9% | | **Adjusted EBITDA (Million USD)** | 290 | 1,807 | -84.0% | | **Adjusted EBITDA Margin** | 4.9% | 25.3% | -20.4pp | | **Net Profit (Million USD)** | 420 | 1,680 | -75.0% | | **Adjusted Net Profit (Million USD)** | 315 | 689 | -54.3% | | **Earnings Per Share (USD)** | 0.0276 | 0.1106 | -75.0% | | **Net Debt (Million USD)** | 6,289 | - | +0.4% (compared to end of 2022) | [Chairman's Statement](index=5&type=section&id=Chairman's%20Statement) The Chairman's letter highlights the company's continued external challenges in the first half of 2023, including high US tariffs, asset seizure in Ukraine, and EU sanction threats, while successfully maintaining profitability and focusing on supply stability and business resilience - The company faces multiple external challenges, including **200% US tariffs**, asset seizure at the Nikolaev alumina refinery in Ukraine, and ongoing EU sanction threats[6](index=6&type=chunk) - Strategic focus has shifted to ensuring stable raw material supply and business resilience to mitigate supply chain disruptions[6](index=6&type=chunk) - The company adopted a **sustainability strategy until 2035** in May 2023, focusing on ESG transformation projects to enhance long-term competitiveness[6](index=6&type=chunk) - Global aluminum demand is projected to surge by nearly **40% by 2030**, with the company committed to being a reliable low-carbon aluminum supplier[7](index=7&type=chunk) [General Director's Statement](index=7&type=section&id=General%20Director's%20Statement) Despite severe challenges like reduced raw material resources, global inflation, and international sanctions, the company successfully adjusted business processes, focusing investment on key projects, shifting market focus to Asia and CIS, maintaining a stable financial position, and achieving R&D breakthroughs in low-carbon products - Investment strategy prioritizes completing the Taishet aluminum smelter, ecological modernization of Siberian aluminum plants, and a new alumina refinery project in the Leningrad region[9](index=9&type=chunk) - Market strategy successfully redirected commodity exports to Asian countries while vigorously developing the Russian domestic and CIS markets[9](index=9&type=chunk) - The company maintains a **stable financial position**, confirmed by an **A+(RU) credit rating** from ACRA, and secured sufficient liquidity through RMB bond issuance[10](index=10&type=chunk) - R&D advancements include launching low-carbon casting alloys from recycled aluminum, ultra-thin high-strength battery foil, and verifying the near-zero carbon footprint of Allow Inerta inert anode technology[10](index=10&type=chunk) [Management Discussion and Analysis](index=9&type=section&id=Management%20Discussion%20and%20Analysis) [Market Overview](index=9&type=section&id=Market%20Overview) In the first half of 2023, the global aluminum market experienced downward price pressure, with LME aluminum prices retreating, global demand decreasing by 1.5% due to weakness outside China, and a 0.7 million tonne supply surplus, leading to an 18.5% decline in China's downstream aluminum product exports - LME aluminum prices trended downwards in the first half of 2023, falling from a January high of **$2,636 per tonne** to a June low of **$2,096.5 per tonne**[12](index=12&type=chunk) - Global primary aluminum demand decreased by **1.5% year-on-year**, with a **5.5% decline** outside China and a **1.5% increase** in China[12](index=12&type=chunk) - Global primary aluminum supply grew by **2.4% year-on-year**, resulting in a **0.7 million tonne** market surplus in the first half[13](index=13&type=chunk) - China's downstream aluminum product exports significantly decreased by **18.5% year-on-year**, impacted by weak demand in overseas construction and packaging sectors[13](index=13&type=chunk) [Financial and Operating Performance](index=11&type=section&id=Financial%20and%20Operating%20Performance) In the first half of 2023, the company's financial performance significantly declined due to falling aluminum prices and rising costs, with total revenue decreasing by 16.9% to $5.945 billion and adjusted EBITDA sharply falling by 84.0% to $290 million, while primary aluminum production slightly increased and alumina production significantly decreased due to supply chain disruptions [Operating Data and Financial Summary](index=11&type=section&id=Operating%20Data%20and%20Financial%20Summary) Key operating data for the first half shows a slight year-on-year increase in primary aluminum production but a significant 23.7% decrease in alumina production, alongside a 13.3% rise in aluminum segment cost per tonne, while financial metrics like revenue, EBITDA, and profit indicators all experienced substantial year-on-year declines, reflecting a deteriorating market environment Key Operating Data (Thousand Tonnes) | Metric (Thousand Tonnes) | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Primary Aluminum Production | 1,913 | 1,891 | | Alumina Production | 2,518 | 3,300 | | Bauxite Production | 6,754 | 6,740 | | Sales of Primary Aluminum and Alloys | 1,935 | 1,763 | Key Financial Data (Million USD) | Metric (Million USD) | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Revenue | 5,945 | 7,153 | | Adjusted EBITDA | 290 | 1,807 | | Profit for the Period | 420 | 1,680 | | Adjusted Net Profit | 315 | 689 | [Production Analysis](index=12&type=section&id=Production%20Analysis) Primary aluminum production increased to 1.913 million tonnes in the first half, primarily due to higher output from the Taishet aluminum smelter, while alumina production sharply decreased by 23.7% to 2.518 million tonnes due to the suspension of the Nikolaev refinery and Australian sanctions, with bauxite and nepheline production remaining stable or slightly increasing - Primary aluminum production increased year-on-year, reaching **1.913 million tonnes**, mainly due to increased output from the Taishet aluminum smelter[17](index=17&type=chunk) - Alumina production significantly decreased by **23.7% year-on-year** to **2.518 million tonnes**, primarily due to the suspension of the Nikolaev alumina refinery and supply disruptions caused by Australian government sanctions[18](index=18&type=chunk) - Bauxite production slightly increased by **0.2% year-on-year** to **6.754 million tonnes**, and nepheline production increased by **5.9%** to **2.285 million tonnes**[19](index=19&type=chunk) [Revenue Analysis](index=16&type=section&id=Revenue%20Analysis) Total revenue decreased by 16.9% to $5.945 billion, primarily driven by an 18.4% decline in core primary aluminum and alloy sales due to a 25.7% drop in average realized prices despite a 9.8% increase in sales volume, reflecting a strategic shift in market focus with increased sales contributions from CIS and Asia Revenue by Product (Million USD) | Product | H1 2023 | H1 2022 | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Sales of Primary Aluminum and Alloys | 4,839 | 5,932 | -18.4% | | Sales of Alumina | 181 | 299 | -39.5% | | Sales of Foil and Other Aluminum Products | 279 | 286 | -2.4% | | Other Revenue | 646 | 636 | +1.6% | | **Total Revenue** | **5,945** | **7,153** | **-16.9%** | Revenue Share by Region | Region | H1 2023 Share | H1 2022 Share | | :--- | :--- | :--- | | Europe | 31% | 40% | | CIS | 33% | 29% | | Americas | 2% | 7% | | Asia | 33% | 23% | [Cost and Profit Analysis](index=18&type=section&id=Cost%20and%20Profit%20Analysis) Cost of sales increased by 9.6% to $5.217 billion, primarily driven by a 54.8% increase in alumina procurement costs and a 9.7% rise in energy costs, leading to a sharp drop in gross profit from $2.391 billion to $728 million and a significant 84.0% decrease in adjusted EBITDA to $290 million, while profit contribution from Norilsk Nickel also substantially declined - Cost of sales increased by **9.6% year-on-year**, primarily due to a **54.8% increase** in alumina procurement costs and a **9.7% rise** in energy costs[29](index=29&type=chunk)[30](index=30&type=chunk) - Adjusted EBITDA significantly decreased from **$1.807 billion to $290 million**, a **84.0% year-on-year decline**, with the adjusted EBITDA margin falling from **25.3% to 4.9%**[32](index=32&type=chunk) - Share of profit from associate Norilsk Nickel decreased from **$1.317 billion to $212 million**, a **83.9% year-on-year reduction**[35](index=35&type=chunk) - Profit for the period was **$420 million**, a substantial **75.0% decrease** from **$1.680 billion** in the prior year[38](index=38&type=chunk) [Segment Reporting](index=23&type=section&id=Segment%20Reporting) The core Aluminum segment's performance significantly deteriorated, with segment EBITDA decreasing from $2.218 billion to $373 million and its margin sharply falling from 39.5% to 8.0%, while the Alumina segment showed some improvement, turning its segment EBITDA positive at $48 million from a prior year loss, though still recording a segment loss of $22 million Core Segment Performance (Million USD) | Segment | Metric | H1 2023 | H1 2022 | | :--- | :--- | :--- | :--- | | **Aluminum** | Segment Revenue | 4,676 | 5,622 | | | Segment Result | 205 | 2,053 | | | Segment EBITDA | 373 | 2,218 | | | **Segment EBITDA Margin** | **8.0%** | **39.5%** | | **Alumina** | Segment Revenue | 1,036 | 1,453 | | | Segment Result | 22 | (43) | | | Segment EBITDA | 48 | (2) | | | **Segment EBITDA Margin** | **4.6%** | **(0.1%)** | [Capital Expenditure, Debt and Cash Flow](index=25&type=section&id=Capital%20Expenditure%2C%20Debt%20and%20Cash%20Flow) In the first half of 2023, capital expenditure slightly decreased to $417 million, primarily for maintenance, while the company managed debt through new credit facilities and bond redemptions, maintaining stable net debt, and operating cash flow improved to a net inflow of $236 million, though overall cash and cash equivalents decreased due to investing and financing outflows - Total capital expenditure for the first half was **$417 million**, a decrease from **$465 million** in the prior year, primarily allocated to repairs and re-equipment[45](index=45&type=chunk)[46](index=46&type=chunk) - The company undertook significant debt management activities, including signing new credit facilities of up to **$4.4 billion** with Russian banks and redeeming two international bonds totaling over **$800 million**[50](index=50&type=chunk) - Net cash inflow from operating activities was **$236 million**, a significant improvement compared to a net outflow of **$958 million** in the prior year[51](index=51&type=chunk) - Net cash outflow from financing activities was **$1.443 billion**, mainly due to loan repayments, leading to a decrease in cash and cash equivalents from **$3.193 billion** at the beginning of the period to **$1.485 billion** at period-end[51](index=51&type=chunk)[52](index=52&type=chunk) [Risks, Governance and Other](index=29&type=section&id=Risks%2C%20Governance%20and%20Other) The company faces key business risks including commodity market volatility, supply chain disruptions, reliance on power, foreign exchange fluctuations, and geopolitical factors, while the Audit Committee has reviewed the interim financial report for compliance, and the company made progress in product innovation, sustainability, and financing during the period - Key business risks identified by the company include metal demand volatility, supply chain disruptions, reliance on power and transportation, foreign exchange risk, and regulatory and political risks associated with multiple jurisdictions[63](index=63&type=chunk)[64](index=64&type=chunk) - The Audit Committee, comprising three independent non-executive directors, reviewed the interim financial statements and deemed them adequately disclosed and compliant with applicable standards[61](index=61&type=chunk) - Significant events in the first half include: launching low-carbon casting alloys from recycled aluminum, publishing the 2022 Sustainability Report, board approval of the 2035 Sustainability Strategy, confirmation of an **A+(RU) credit rating**, and international verification of the carbon footprint for the ALLOW INERTA brand[67](index=67&type=chunk)[68](index=68&type=chunk) [Independent Auditor's Report](index=39&type=section&id=Independent%20Auditor's%20Report) The auditor issued a standard review conclusion on the company's interim condensed consolidated financial statements, prepared in accordance with IAS 34, but included an "Emphasis of Matter" paragraph highlighting significant uncertainties regarding the company's going concern ability due to geopolitical tensions, sanctions, and market volatility, without modifying their opinion - The auditor concluded that nothing came to their attention to suggest the interim financial statements were not prepared in all material respects in accordance with **International Accounting Standard 34**[72](index=72&type=chunk) - The report includes an "Emphasis of Matter" paragraph, drawing attention to significant uncertainties that may cast substantial doubt on the Group's ability to continue as a going concern due to geopolitical tensions, sanctions, and market volatility[72](index=72&type=chunk) - The auditor explicitly stated that their review opinion was **not modified** in respect of the aforementioned "Emphasis of Matter"[72](index=72&type=chunk) [Interim Condensed Consolidated Financial Statements](index=42&type=section&id=Interim%20Condensed%20Consolidated%20Financial%20Statements) [Key Financial Statements](index=42&type=section&id=Key%20Financial%20Statements) The financial statements for the first half of 2023 show a significant decline in company performance, with the income statement reflecting substantial decreases in both revenue and profit, the statement of financial position indicating a reduction in total assets and equity, and the cash flow statement revealing an overall decrease in cash levels despite improved operating cash flow, due to significant debt repayments Summary of Interim Condensed Consolidated Income Statement (Million USD) | Metric | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Revenue | 5,945 | 7,153 | | Gross Profit | 728 | 2,391 | | Result from Operating Activities | (33) | 1,532 | | Profit Before Tax | 269 | 2,364 | | **Profit for the Period** | **420** | **1,680** | Summary of Interim Condensed Consolidated Statement of Financial Position (Million USD) | Metric | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Total Assets | 21,425 | 24,631 | | Total Liabilities | 10,148 | 12,324 | | **Total Equity** | **11,277** | **12,307** | | Net Current Assets | 5,015 | 5,524 | Summary of Interim Condensed Consolidated Cash Flow Statement (Million USD) | Metric | H1 2023 | H1 2022 | | :--- | :--- | :--- | | Net Cash from Operating Activities | 236 | (958) | | Net Cash Used in Investing Activities | (398) | 1,244 | | Net Cash Used in Financing Activities | (1,443) | (975) | | **Net Change in Cash and Cash Equivalents** | **(1,605)** | **(689)** | [Summary of Notes to the Financial Statements](index=49&type=section&id=Summary%20of%20Notes%20to%20the%20Financial%20Statements) The notes to the financial statements provide detailed explanations, confirming the company's "going concern" basis despite significant uncertainties, highlighting the Aluminum segment as the core revenue and profit driver with a significant performance decline, detailing the substantial investment in Norilsk Nickel, outlining the debt structure primarily composed of secured bank loans and bonds, and disclosing contingent liabilities related to legal, environmental, and tax matters - **Going Concern Assumption**: Management acknowledges significant uncertainties regarding the ability to continue as a going concern due to sanctions, supply chain issues, and market volatility, but still prepares financial statements based on this assumption[97](index=97&type=chunk) - **Segment Performance**: The Aluminum segment is core, contributing **$5.119 billion** in total segment revenue and **$141 million** in segment profit, while the Alumina segment generated **$2.383 billion** in revenue and recorded a **$20 million loss**[105](index=105&type=chunk) - **Investment in Associates**: As of June 30, 2023, the company's investment in Norilsk Nickel had a carrying amount of **$3.734 billion**, with a share of profit from the associate of **$212 million** in the first half[130](index=130&type=chunk) - **Loans and Borrowings**: Total loans and borrowings amounted to **$7.776 billion** as of June 30, 2023, with **$6.499 billion** classified as non-current and **$1.277 billion** as current[152](index=152&type=chunk) [Compliance and Governance Information](index=88&type=section&id=Compliance%20and%20Governance%20Information) This section discloses information required by the Hong Kong Stock Exchange Listing Rules, covering director changes, shareholdings of directors and major shareholders, confirmation of compliance with most Corporate Governance Code provisions, and details of loan agreements with change of control clauses, while major shareholder holdings remained stable - Mr Semen Mironov was appointed as a non-executive director on **June 28, 2023**, succeeding Mr Marco Musetti who retired[177](index=177&type=chunk) Major Shareholder Holdings (as of June 30, 2023) | Shareholder Name | Capacity | Number of Shares Held (Long Position) | Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | En+ | Beneficial Owner | 8,641,888,022 | 56.88% | | SUAL Partners | Beneficial Owner | 3,907,527,611 | 25.72% | - The company confirmed compliance with the code provisions of the Hong Kong Stock Exchange Corporate Governance Code during the review period, with the exception of some non-executive directors unable to attend the general meeting due to scheduling conflicts[184](index=184&type=chunk)[185](index=185&type=chunk)

Financial Performance - In 2022, the company reported revenues of $13,974 million, an increase from $11,994 million in 2021, representing a growth of approximately 16.5%[3] - Adjusted EBITDA for 2022 was $2,028 million, with an adjusted EBITDA margin of 14.5%, down from 24.1% in 2021[3] - The net profit attributable to shareholders was $1,793 million, resulting in a net profit margin of 12.8%, compared to 26.9% in the previous year[3] - Total assets increased to $24,631 million in 2022, up from $20,906 million in 2021, reflecting a growth of approximately 17.0%[3] - The company has a net debt of $6,261 million, which increased from $4,749 million in 2021[3] - The company successfully repaid $3.6 billion in loans and raised over $6 billion in long-term financing from overseas markets during the review period[36] - The company recorded a profit of $1,793 million for the year ended December 31, 2022, down 44.4% from $3,225 million in 2021[147] - The adjusted net profit for the year was $725 million, a decrease of 52.8% compared to $1,536 million in the previous year[149] - Gross profit for the year ended December 31, 2022, was $3,204 million, down from $3,721 million in the previous year, with gross margins of 22.9% and 31.0% respectively[138] - Adjusted EBITDA decreased by 29.9% from $2,893 million in 2021 to $2,028 million in 2022[140] Production and Operations - The company operates 10 aluminum smelters and 8 alumina refineries, with production facilities located in Russia, Sweden, and Nigeria[4] - Rusal's aluminum production capacity is supported by its own bauxite resources, ensuring over 75% of its alumina needs are met internally, with sufficient bauxite reserves to sustain operations for over 100 years[23] - In 2022, Rusal's total sales volume was 3,896,000 tons, with value-added products accounting for 1,702,000 tons, indicating a focus on higher-margin downstream businesses[26] - The total rated capacity of the aluminum smelters is 4,205 thousand tons with an average utilization rate of 90%[40] - The total rated capacity of alumina refineries is 13,908 thousand tons, with an average utilization rate of 43%[46] - The company operates seven bauxite mines with a total rated capacity of 20,600 thousand tons and an average utilization rate of 60%[47] - The Achinsk alumina refinery has a rated capacity of 1,069 thousand tons with a utilization rate of 85%[46] - The Ural alumina refinery has a rated capacity of 900 thousand tons with a utilization rate of 102%[46] - The total production of nepheline syenite was 4,363 thousand tons in 2022, slightly down by 0.6% from 4,390 thousand tons in 2021[119] - The downstream segment produced 111.3 thousand tons of aluminum foil, an increase of 2.3% from 108.83 thousand tons in 2021[120] Environmental Sustainability - The company aims to reduce greenhouse gas emissions per ton of metal by at least 25% by 2032 and by at least 47% by 2050 compared to 2018 levels[30] - The company has approved a waste management strategy aiming for zero waste to landfill by 2030, with a goal of ensuring at least 95% of aluminum-silicon production waste and at least 65% of alumina sector waste achieves economic recycling[36] - The company’s low-carbon aluminum supply under the ALLOW brand is recognized as one of the lowest carbon footprints globally[34] - The company has achieved a 53% reduction in direct greenhouse gas emissions from aluminum production since 2007[69] - The company has set a goal to achieve carbon neutrality by 2050, balancing greenhouse gas emissions and absorption[67] - The company has implemented an internal carbon price of $20 per ton of CO2 equivalent for all new projects since 2017[70] - The company has successfully developed a technology to reduce the residual alkali content of red mud to 0.5%, suitable for various industrial applications[69] - The company has committed to eliminating all PCB-containing equipment and waste by 2025 as part of its waste management strategy[69] Market Strategy and Growth - The company plans to expand its market presence and invest in new technologies to enhance production efficiency and sustainability[20] - The company is focusing on vertical integration in aluminum production to maintain its position as one of the largest producers globally[20] - The company is exploring strategic partnerships and potential acquisitions to strengthen its market position and expand its product offerings[20] - Rusal holds a 26.39% stake in Norilsk Nickel, one of the largest palladium producers globally, diversifying its investment portfolio[32] - The company aims to capture a significant market share in the battery sector through supply agreements and deeper integration into the European battery value chain[58] Compliance and Governance - The company has established a corporate governance code based on the Hong Kong Stock Exchange's guidelines, ensuring compliance with governance standards[160] - The compliance committee held four meetings in 2022 to review the development of the compliance system and the achievements of the compliance team[74] - The company has implemented a risk management system that includes quarterly reviews of significant risks by the audit committee[198] - The company has established a hotline for confidential reporting of potential violations, ensuring all reports are investigated and actions are taken to prevent recurrence[71] - The company updated its code of ethics to align with current strategies and operational principles in 2022[72] Employee Welfare and Development - The company has a strong commitment to employee welfare, providing salary increases, social benefits, and training programs despite external challenges[36] - The total number of employees increased from 57,933 as of December 31, 2021, to 59,463 as of December 31, 2022[174] - In 2022, a total of 26,641 employees received training, including 79 senior management, 8,790 middle management and specialists, and 17,772 blue-collar workers[184] - The company offers various benefits beyond mandatory compensation, including free medical services and subsidized housing programs[179] - Employee bonuses are based on individual and collective performance, with specific key performance indicators set for white-collar employees[179] Challenges and Risks - The company identified significant risks including price and demand volatility due to macroeconomic factors, which could adversely affect efficiency and financial performance[198] - The company faces stricter environmental regulations and public scrutiny regarding emissions and waste management, which may impact operations[198] - The company relies on uninterrupted power supply for its operations, and any increase in electricity prices or supply disruptions could have a significant negative impact[199] - The company is exposed to risks related to credit financing terms that may restrict dividend payments, potentially affecting shareholders[199] - The company is affected by currency fluctuations, which may impact financial performance[199]

Financial Performance - The average selling price for the six months ended June 30, 2022, was clarified to be 3,365, not 2,287[1] - The year-on-year change percentage for the second half compared to the first half was corrected to (21.1%), instead of 16.0%[1] - All other information in the earnings announcement remains unchanged[2]

Financial Performance - Revenue for the year ended December 31, 2022, was $13,974 million, representing a 16.5% increase compared to $11,994 million in 2021[2] - Adjusted EBITDA decreased by 29.9% to $2,028 million from $2,893 million year-over-year[2] - Net profit for the year was $1,555 million, down 13.9% from $1,807 million in the previous year[2] - Total revenue increased by $1,980 million or 16.5% from $11,994 million in 2021 to $13,974 million in 2022[13] - The company reported a net profit of $1,793 million for the year, contributing to the overall increase in equity[43] - The company’s net profit for the year ended December 31, 2022, was $1,793 million, a decrease of 44% compared to $3,225 million in 2021[44] - The company’s share of profits from associates and joint ventures was $1,555 million in 2022, compared to $1,807 million in 2021, indicating a decrease of 13.9%[79] Assets and Liabilities - Total assets increased by 17.8% to $24,631 million from $20,906 million year-over-year[6] - Total liabilities rose by $1,942 million or 18.7% from $10,382 million in 2021 to $12,324 million in 2022[27] - Total equity reached $12,307 million in 2022, up from $10,524 million in 2021, indicating a growth of 16.9%[40] - The company’s non-current liabilities rose to $7,733 million in 2022, up from $5,790 million in 2021, reflecting a growth of 33.5%[40] - The total current liabilities for PJSC MMC Norilsk Nickel were $2,029 million in 2022, a decrease from $2,133 million in 2021, indicating a reduction of about 4.9%[179] Cash Flow - Operating cash flow for the year was negative at $(412) million, compared to a positive $1,146 million in 2021[7] - The net cash used in operating activities for the year ended December 31, 2022, was $412 million, down from $1,146 million in the previous year[28] - The net cash generated from investing activities for the year ended December 31, 2022, was $472 million, compared to $490 million in the previous year[28] - The net cash generated from financing activities for the year ended December 31, 2022, was $1,415 million, down from $1,891 million in the previous year[28] Production and Sales - Aluminum production for the year was 3,835 thousand tons, a 1.9% increase from 3,764 thousand tons in 2021[3] - The average selling price of aluminum decreased by 6.3% to $2,654 per ton from $2,832 per ton in the previous year[3] - Revenue from primary aluminum and alloys rose by $1,627 million or 16.3% to $11,593 million, driven by a 16.6% increase in average realized aluminum price from $2,553 per ton in 2021 to $2,976 per ton in 2022[15] - The aluminum segment reported revenues of $10,962 million for the year ended December 31, 2022, compared to $9,102 million in the previous year, reflecting an increase of approximately 20.4%[30] Costs and Expenses - Total sales cost increased by $2,497 million or 30.2% from $8,273 million in 2021 to $10,770 million in 2022[16] - Energy costs rose by $588 million or 28.4% to $2,658 million, attributed to a 14.7% increase in electricity prices during the reporting period[17] - Distribution expenses increased by 13.0% to $697 million, primarily due to rising transportation costs[19] - Administrative expenses rose to $769 million from $603 million in 2021, mainly due to increased labor costs[19] Dividends and Financial Income - The company reported a significant increase in dividends from Norilsk Nickel, rising 164.4% to $1,639 million from $618 million[7] - Financial income increased by $70 million or 111.1% from $63 million in 2021 to $133 million in 2022, primarily due to higher dividends from other investments[21] Market and Industry Trends - Global aluminum demand in 2022 increased by 0.3% year-on-year to 69 million tons, with China's demand also growing by 0.3% to 40.6 million tons[8] - The automotive sector accounted for 24% of global aluminum demand, growing by 2.7% due to increased production of electric vehicles and SUVs[8] - The global packaging industry saw a demand increase of 4.6% in 2022, driven by a shift from plastic and glass to aluminum[8] - Aluminum demand in the power sector grew by 9.4% year-on-year, primarily due to the expansion of renewable energy capacity[8] Impairments and Losses - The company reported a significant increase in impairment of trade receivables, which rose to $163 million from $60 million in 2021, indicating a 171% increase[44] - The impairment loss recognized for the Sayanal and PGLZ assets was $85 million, while a reversal of previously recognized impairment losses for KAZ, VgAZ, Kubal, and Taishet aluminum smelters totaled $699 million[148] Taxation - The company recognized a tax expense of $373 million in 2022, compared to a tax credit of $416 million in 2021[25] - The effective tax rate for the company remained at 20% for both 2021 and 2022[104] Shareholder Information - The earnings per share (EPS) for the fiscal year ending December 31, 2022, was $0.118, down from $0.212 in the previous year, indicating a decline of approximately 44.3%[128][129] - The total remuneration for executive directors in the fiscal year ending December 31, 2022, was $7,817 thousand, compared to $7,629 thousand in the previous year, reflecting an increase of approximately 2.5%[114][115]

Financial Performance - Revenue for the first half of 2022 reached $7,153 million, up from $5,449 million in the same period of 2021, representing a growth of 31.1%[3] - Adjusted EBITDA increased to $1,807 million with an adjusted EBITDA margin of 25.3%, compared to $1,315 million and 24.1% in the previous year[3] - Net profit decreased to $1,680 million, resulting in a net profit margin of 23.5%, down from 37.0% in the prior year[3] - The total assets increased to $25,419 million, up from $20,906 million year-on-year, indicating a growth of 21.5%[3] - Revenue for the first half of 2022 was $7.153 billion, up from $5.449 billion in the same period of 2021, representing a year-on-year increase of 31%[12] - The adjusted EBITDA for the first half of 2022 was $1.807 billion, compared to $1.315 billion in the same period of 2021, reflecting a significant increase[12] - Gross profit for the first half of 2022 was $2,391 million, with a gross margin increase from 29.9% to 33.4%[26] - The company's profit before tax for the first half of 2022 was $2,364 million, up from $2,161 million in the same period of 2021[32] - The net profit for the first half of 2022 was $1,680 million, a decrease of 16.7% from $2,018 million in the same period of 2021[33] - Adjusted net profit for the first half of 2022 was $689 million, slightly up by 1.5% from $679 million in the same period of 2021[34] Market Conditions - The company faced significant challenges due to geopolitical tensions and sanctions, impacting operations and supply chains[4] - Global primary aluminum demand grew by 0.8% to 34.2 million tons in the first half of 2022, while demand in China contracted by 1.3% to 19.7 million tons[8] - Over 1 million tons of aluminum smelting capacity in the EU and the US was partially or completely shut down due to high production costs and negative profit margins[8] - The average aluminum price on the London Metal Exchange fell from a record high of $3,985 per ton in Q1 2022 to below $2,400 per ton in Q2 2022[8] - In the first half of 2022, global aluminum market recorded a supply shortage of 0.5 million tons, with the rest of the world also experiencing a shortage of 0.5 million tons, while China maintained supply-demand balance during the same period[9] - China's exports of unwrought aluminum, alloys, and aluminum products increased by 34.1% year-on-year to 3.51 million tons in the first half of 2022, marking 14 consecutive months of year-on-year growth[9] Production and Costs - The aluminum segment's cost per ton increased to $2,028 in the first half of 2022 from $1,523 in the same period of 2021, indicating rising production costs[11] - Alumina production decreased by 19.56% year-on-year to 3.3 million tons in the first half of 2022, primarily due to the suspension of production at the Nikolaev alumina refinery in Ukraine[14] - Bauxite production fell by 11.75% year-on-year to 6.74 million tons in the first half of 2022, driven by reduced demand due to lower alumina production[15] - The production of aluminum foil and packaging materials increased by 1.7% to 54.7 thousand tons in the first half of 2022 compared to the same period in 2021[16] Financial Position - The company's operating working capital increased by 75.5% to $5,143 million as of June 30, 2022, compared to $2,930 million at the end of 2021[38] - Inventory rose by 23.2% to $4,548 million as of June 30, 2022, from $3,692 million at the end of 2021[38] - Trade receivables increased by 54.5% to $2,543 million as of June 30, 2022, compared to $1,646 million at the end of 2021[39] - The company's debt-to-asset ratio was 28.7% as of June 30, 2022, compared to 32.2% at the end of 2021[49] - The return on equity was 11.3% for the first half of 2022, down from 21.6% in the same period of 2021[49] - The interest coverage ratio improved to 21.0 for the first half of 2022, compared to 14.9 in the same period of 2021[50] Strategic Initiatives - The company aims to adapt to the current market conditions and continue supporting its long-term strategic goals despite the challenges[6] - The company is committed to maintaining its position as a leading low-carbon aluminum producer and stabilizing the global aluminum market[4] - The company plans to continue expanding its market presence and investing in new technologies to drive future growth[112] Risks and Challenges - The company identified several business risks, including significant fluctuations in demand for raw materials and alloys due to global market volatility[62] - The company relies on uninterrupted power supply for its competitive position in the global aluminum industry, with rising electricity prices posing a significant risk[62] - Rusal's operations face risks related to labor disputes, labor shortages, and rising labor costs[63] - The company is dependent on third-party suppliers for several materials, including alumina and bauxite, which poses procurement cost risks[63] - The company is subject to sanctions from the U.S. Treasury Department's Office of Foreign Assets Control, impacting its operations[199] Corporate Governance - The company has adopted corporate governance standards to enhance business development and protect shareholder interests[186] - The company has established compliance policies to ensure adherence to regulatory requirements and best business practices[187] - The board held five meetings during the review period, with four instances where executive/non-executive directors may have had significant interests in transactions, and those directors abstained from voting[188] Shareholder Information - Oleg Deripaska holds a total of 8,643,557,087 shares, representing 56.89% of the issued share capital as of June 30, 2022[180] - Access Aluminum Holdings Limited has a controlling interest of 4,967,738,987 shares, which is 32.70% of the issued share capital as of June 30, 2022[180] - The company has not received notification of any other reportable interests exceeding 5% of issued shares as of June 30, 2022[182]

Financial Performance - The company's revenue for 2021 was $11,994 million, a significant increase from $8,566 million in 2020, representing a growth of 40.5%[9] - Adjusted EBITDA for 2021 reached $2,893 million, with an adjusted EBITDA margin of 24.1%, compared to 10.2% in 2020[9] - Net profit for 2021 was $3,225 million, resulting in a net profit margin of 26.9%, up from 8.9% in the previous year[9] - The total assets of the company increased to $20,906 million in 2021, up from $17,378 million in 2020[9] - The company’s net debt decreased to $4,749 million in 2021 from $5,563 million in 2020, indicating improved financial health[9] - The company reported total revenue of $1,421 million, with an increase in capital expenditures of $295 million and a decrease in dividends from associates and joint ventures by $550 million compared to the previous period[151] - The aluminum segment generated revenue of $9,102 million with a production volume of 3,590 thousand tons, while the alumina segment generated $2,649 million with a production volume of 7,554 thousand tons for the year ended December 31, 2021[153] - The aluminum segment's EBITDA was $3,139 million, reflecting an EBITDA margin of 34.5%, while the alumina segment reported an EBITDA of $113 million with a margin of 4.3%[153] Production and Operations - The company produced 1.8 million tons of alumina in 2021, but production was temporarily halted in March 2022 due to logistical challenges in Ukraine[4] - The company’s core smelting operations are strategically located near hydropower plants, meeting approximately 93% of its total electricity needs with renewable energy[14] - The company’s bauxite and nepheline syenite mining operations supply 77% of its alumina refining needs, ensuring a stable raw material supply[15] - The company operates 11 aluminum smelters, with 9 located in Russia, indicating a strong operational presence in the region[23] - The total aluminum production capacity across the company's smelters is 4,205 thousand tons, with an average capacity utilization rate of 90%[44] - The company operates nine alumina refineries with a total rated capacity of 13,908 thousand tons and an average utilization rate of 81%[50] - The company manages seven bauxite mines with a total rated capacity of 20,600 million tons and an average utilization rate of 73%[52] - The company has a diversified sales network, delivering aluminum products to key markets including Europe, the USA, and Southeast Asia[18] Environmental Sustainability - In 2021, the company maintained its position as a leading low-carbon aluminum producer, with a commitment to reduce greenhouse gas emissions by at least 35% by 2030 and achieve net-zero emissions by 2050[33] - The company is committed to environmental management and regularly reviews its policies to improve sustainability practices across all production facilities[19] - The company has reduced its corporate emissions by nearly 35%, industrial wastewater discharges by 60%, and freshwater consumption by over one-third due to implemented environmental measures[38] - The company emphasizes its commitment to sustainability and reliable low-carbon aluminum supply, aiming to lead the industry towards a greener future[33] - The company has established several strategic partnerships with organizations aiming to use low-carbon aluminum in their supply chains, successfully integrating ALLOW low-carbon aluminum into their operations[33] - The company has received high sustainability ratings, including an A- rating in the CDP climate ranking for the aluminum industry in 2021[78] - The company is focused on achieving the lowest carbon footprint, successfully producing aluminum with the lowest carbon footprint globally using inert anodes[82] Technological Advancements - The company has developed new energy-efficient smelting technologies RA-500 and RA-550, aiming to become the most energy-efficient technology in the industry[16] - The company achieved a significant reduction in operational costs by 10% through the introduction of inert anode technology, which also reduces greenfield project costs by over 30%[16] - The RA-550 electrolytic cell has been successfully piloted, achieving energy efficiency below 12,800 kWh/ton and a current efficiency of 96%[79] - The new RA-550 electrolytic cell design reduces the amount of used lining material by 80% and the number of linings and costs by 10-15%[79] - The company is developing the RA-800+ electrolytic cell, which aims to have the highest performance globally[79] - The company has successfully certified 13 production facilities under the ASI performance standards, enhancing its commitment to sustainable practices[78] Market Trends and Demand - Global aluminum demand increased by 8.8% year-on-year to 69.0 million tons in 2021, with demand in other regions rising by 12.8% to 28.6 million tons and China's demand increasing by 6.1% to 40.4 million tons[99] - The construction sector accounted for the largest portion of global aluminum demand, growing by 5% in 2021 compared to the previous year, and 3% compared to pre-pandemic levels in 2019[99] - The packaging industry saw a 9% growth in aluminum demand in 2021, continuing from a stable demand in 2020[99] - The global sales of pure electric and plug-in hybrid vehicles surged over 70% in 2021, with China's electric vehicle sales skyrocketing by 154%[99] Social Responsibility and Community Engagement - The company allocated over 45 million USD for social investment and charitable projects in 2021[95] - The "Easy Help" volunteer program allocated over 5.1 million rubles in funding, with an additional 4 million rubles from partners, supporting 60 projects across 14 cities[95] - The "Green Wave" environmental volunteer project provided over 3.9 million rubles in funding, benefiting 44 projects in 22 regions[95] - The company aims to invest 826 million rubles in social projects, focusing on the construction and modernization of social infrastructure and public recreational spaces[93] Employee Development and Safety - The total number of employees increased from 53,976 in 2020 to 57,933 in 2021, representing a growth of approximately 7.3%[170] - The company continued to develop its "New Generation" apprenticeship program, employing 213 apprentices in 2021[176] - The company has established a comprehensive employee incentive system, focusing on monetary compensation based on skills, complexity, and performance[171] - The lost time injury rate for 2021 was 0.18, a decrease from 0.20 in 2020, but still above the global average for the aluminum industry[169] Governance and Management - The company has adopted a corporate governance code based on the Hong Kong Stock Exchange Listing Rules, ensuring compliance and transparency in its operations[155] - The management team has no direct or indirect shareholding in the company as of the end of the fiscal year 2021[195][196] - The board is committed to implementing best practices in financial disclosure and governance, as evidenced by Burnham's initiatives at the United Nations[198] - The leadership team emphasizes collaboration and knowledge sharing to drive operational improvements and strategic initiatives[195][196]

Financial Performance - Revenue for the six months ended June 30, 2021, was $5,449 million, a 35.6% increase from $4,015 million in 2020[4] - Adjusted EBITDA for the same period was $1,315 million, with an adjusted EBITDA margin of 24.1%, compared to 5.5% in the previous year[4] - Net profit for the first half of 2021 was $2,018 million, resulting in a net profit margin of 37.0%, a significant improvement from a net loss of $124 million in 2020[4] - The adjusted net profit for the first half of 2021 was $679 million, compared to an adjusted net loss of $63 million in the same period of 2020[4] - Gross profit for the first half of 2021 was $1,630 million, up from $495 million in the same period of 2020, with the gross margin increasing from 12.3% to 29.9%[28] - Operating profit reached $942 million, a substantial increase from a loss of $106 million in the previous year[75] - The company reported a total of 7,637 thousand tons of bauxite mined in H1 2021, an increase from 7,469 thousand tons in the previous year[12] - The company reported a pre-tax profit of $2,161 million in the first half of 2021, compared to a pre-tax loss of $204 million in the same period of 2020[35] Production and Sales - Aluminium production remained stable at 1.868 million tons, with global primary aluminium demand increasing by 11.9% to 33.9 million tons in the first half of 2021[7] - The company sold 2,000 thousand tons of primary aluminum and alloys, compared to 1,890 thousand tons in the previous year, reflecting a growth in sales[12] - The average price of aluminum per ton on the London Metal Exchange was $2,245, up from $1,592 in the previous year[12] - The average realized aluminum price increased by 30.2% to $2,287 per ton in the first half of 2021, up from $1,756 per ton in the same period of 2020[22] - Sales of aluminum foil and other aluminum products generated $232 million, a 30.3% increase from $178 million in the first half of 2020[23] Sustainability Initiatives - The company signed a $200 million sustainability-linked pre-export financing loan in January 2021, aimed at supporting its low-carbon agenda[5] - The company aims to achieve carbon neutrality by 2050 through its breakthrough inert anode technology, which significantly reduces greenhouse gas emissions[6] - The company has established partnerships to provide low-carbon aluminium products to major manufacturers, reinforcing its commitment to sustainability[7] - Rusal plans to increase Aluminium Rheinfelden's alloy production capacity to 30,000 tons per year as part of its long-term growth strategy[66] - Rusal is testing a revolutionary inert anode technology that could nearly eliminate greenhouse gas emissions during aluminum production[68] - Rusal has begun construction of an open-pit bauxite mine in the Komi Republic, with reserves exceeding 14 million tons[68] Financial Position and Assets - Total assets as of June 30, 2021, were $20,466 million, up from $17,378 million at the end of 2020[4] - The company's total current assets reached $8,064 million, an increase from $5,877 million at the end of 2020[41] - The company’s debt as of June 30, 2021, amounted to $5,380 million, excluding an additional $2,457 million in bonds[45] - The company’s total equity rose to $9,340 million from $6,543 million, reflecting a stronger financial position[79] - The company reported a significant increase in cash and cash equivalents, reaching $3,766 million compared to $2,229 million in the previous year[79] Operational Efficiency and Cost Management - The company plans to implement a comprehensive reform plan to build new capacities at smelters in Krasnoyarsk, Bratsk, Irkutsk, and Novokuznetsk, aiming to reduce energy consumption by up to 20%[8] - Total sales cost increased from $3,520 million in the first half of 2020 to $3,819 million in the same period of 2021, representing an 8.5% increase, primarily driven by a 5.8% increase in primary aluminum sales volume[25] - Alumina cost rose from $296 million in the first half of 2020 to $356 million in 2021, mainly due to a 29.4% increase in procurement prices[26] - The company incurred $543 million in capital expenditures for property, plant, and equipment during the first half of 2021, compared to $392 million in the same period of 2020[84] Market Trends and Future Outlook - The global aluminum demand and production are expected to show positive trends, supported by increased business activity and government measures[92] - Future guidance indicates a projected increase in production capacity, aiming for a 10% rise in output over the next fiscal year[172] - The overall revenue for the last quarter showed a growth of 12% year-over-year, driven by increased demand in key markets[175] Corporate Governance and Compliance - The company adheres to high-quality corporate governance standards to enhance shareholder value and internal controls[160] - The board has ensured compliance with the Hong Kong Stock Exchange's corporate governance code throughout the review period[162] - The company has adopted a securities trading code that exceeds the standards set by the Hong Kong Stock Exchange's listing rules[164] Employee and Community Engagement - The company offers various employee benefits, including free medical services and subsidized housing programs, to enhance employee satisfaction and retention[58] - The company has implemented a performance-based bonus system for employees, ensuring alignment with individual key performance indicators[59] - The company has established a corporate social responsibility program, providing financial assistance to pensioners and veterans associated with its production facilities[58]