Maaden aluminium earnings dip as weaker 2Q offsets growth

Maaden

Maaden aluminium earnings softened in 1H25 as prices and trade flows weighed on results. The company said 2Q25 pressure offset earlier strength. Maaden aluminium earnings will remain sensitive to geopolitics and freight costs.

1H snapshot: revenues up, profitability down

Maaden aluminium earnings slipped despite higher sales. First-half ebitda fell 3pc to SR1.47bn. However, revenues rose 15pc to SR5.26bn. Second-quarter ebitda dropped 20pc quarter on quarter to SR656mn. As a result, margin compression accelerated late in the half.

Operations: alumina steady, FRP scales, sales lag output

Operations stayed largely stable, but mix shifted. Alumina output was 939,000t, down 1pc year on year. External alumina sales fell 17pc to 131,000t. Aluminium production reached 496,000t, up 2pc, yet sales fell 8pc to 280,000t. Meanwhile, FRP output surged 31pc to 154,000t, showing downstream momentum.

Maaden aluminium earnings reflect softer realized prices and slower demand. Second-quarter aluminium output eased 1pc to 247,000t. Sales declined 6pc to 136,000t amid weaker buying. Therefore, inventory timing and shifting trade flows likely constrained cash conversion.

Market forces continue to shape the outlook. Lower treatment of external alumina and thinner regional premia affected profitability. However, FRP growth suggests contract depth with packaging and industrial customers. Consequently, product mix could cushion cyclicality.

Maaden aluminium earnings face policy and logistics risks. Cross-border tariffs, Red Sea routing, and currency volatility raise landed costs. Even so, medium-term fundamentals look constructive. Energy transition, construction, and packaging should outpace supply growth.

The Metalnomist Commentary

Maaden’s rising FRP output signals a strategic pivot to value-added margins. Watch premia, freight spreads, and contract rollovers into 2026 for earnings leverage. If FRP volumes keep compounding, price dips in primary metal may have less impact.