x Abu Dhabi, UAETuesday 16 January 2018

Alba denies any interruptions

The chief executive of Aluminium Bahrain is adamant the recent unrest has not harmed his bottom line

Aluminium Bahrain (Alba), the world's fourth-largest aluminium smelter and an important component of Bahrain's US$22.9 billion (Dh84.1bn) economy, has repeatedly said last month's unrest has not affected operations. The latest figures show sales volumes in the first quarter increased to 217,000 tonnes, up from 201,000 tonnes in the same period last year. Output also rose to 217,000 compared with 210,000 a year earlier. Here, Laurent Schmitt, Alba's chief executive, talks about the smelter's expansion plans and tapping into Saudi Arabia's construction boom.

What has been the impact of protests on Alba's business?

Despite the unrest in Bahrain, Alba has been operating at full capacity and hasn't suffered any loss in production. There has been no logistical disruption in the supply of raw material or in the production of aluminium.

About 300 Alba staff members were on strike when the General Federation, Bahrain's largest trade union, announced a strike. How did this affect operations?

During this period we made adjustments because we did not have 100 per cent attendance. Only one contingency measure was taken up by Alba, and it was in the adjustment of the workforce shifts. There were some difficulties for a limited time in shipping finished goods [but this was] due to restrictions in freight facilities. Those issues have now been resolved [and] shipping has been back to normal since March 20.

Alba listed its shares at the end of last year, but has been criticised for not floating more than the 10 per cent it offered. Are there plans to list any more of the stock?

This is up to the board. [But] the listing of Alba's shares enhances Bahrain Stock Exchange and increases its trading activity. The step brings more liquidity to the market and [will] eventually expand the shareholders' and traders' base.

What are Alba's plans for the year ahead?

Obviously the big area of growth will be Saudi Arabia. Construction in Saudi Arabia will boost sales across all our main "value-added" products. The kingdom's spending plan is going to boost the amount of building work and we expect indirect demand from this. We are also planning to increase our presence in Asia-Pacific and Europe where we export 18 per cent and 14 per cent of our products.

Does this mean reducing your exposure to the Middle East?

Of course we have a big market in the Middle East. Fifty per cent of Alba's output is supplied to Bahrain and nearly 20 per cent is exported to other Middle East and North African countries.

We have limited capacities and you have to optimise target regions but increasing output to one means you have to reduce output to the other.