UC RUSAL Sustainability report 2015


Profile

United Company RUSAL (UC RUSAL, or the Company) is a vertically-integrated aluminium producer, where its key enterprises are located in the Russian territory in Siberia. Following the 2015 results, UC RUSAL is the world’s second leading producer of primary aluminum and alloys. G4-3

The production chain of UC RUSAL includes bauxite and nepheline mines, alumina refinery plants and aluminium smelters, foundries, foil rolling plants and packaging centres, as well as energy facilities. G4-9

The Company comprises the following enterprises: G4-13

·         14 aluminium smelters, among which 12 plants are located in Russia, two plants - in Sweden and Nigeria (five plants have been mothballed, four of which – in Russia and one – in Nigeria);

·         11 alumina refineries, ten of which are located in six countries: Ireland, Ukraine, Italy and Guinea each have one plant, two plants are located in Jamaica and four plants in Russia (including four mothballed alumina refineries, among which two – in Russia, one – in Italy and one – in Jamaica);

·         8 bauxite deposits located in four countries: two enterprises in Russia and two enterprises in Jamaica, two enterprises and one project in Guinea and one enterprise in Guyana (one enterprise in Guinea has been mothballed);

·         4 foil rolling plants.

·         Boguchansky Energy and Metals Complex (BEMO) project, which is joint venture of UC RUSAL and PJSC RusHydro. Energy and Metals Complex includes the aluminium smelter with annual output capacity of 588 thousand tonnes and 3000 MW hydropower plant. The first starting complex with output capacity of 147,000 tonnes per annum was commissioned in 2015.

 

The structure of UC RUSAL also includes a number of mining assets in production of coal, quartzite, fluorite, limestone and other minerals.

The Companys main production facilities are located in Siberia, which contain two important advantages for RUSAL: an access to ecologically pure and renewable hydropower and a proximity to Asian markets.

The Company takes advantages of income diversification and strategic plans through investments in PJSC GMK Norilsk Nickel, the world’s largest nickel and palladium producer and one of the leading platinum and copper producers; UC RUSAL holds 28.05% of the company shares.



On the whole, UC RUSAL operates in 19 countries across five continents, including (apart from the listed above) Australia, Armenia, Kazakhstan, China, Turkey and other countries. The Company’s headquarters is located in Russia (Moscow). G4-5  G4-6

Products

UC RUSAL produces a diversified range of products; nearly half (45%) of the sold products are high-value-added products (aluminium sheet, ingots, wire rods, cast alloys, extrusion billets, etc.). The Company has set a target to increase this figure up to 55% by 2020.

The Company’s main types of products are primary aluminium, aluminium alloys, foil, and alumina. The types of products produced by the Company are described in the detailed table below.

Main Types of Products G4-4

Type of Products

Industrial Applications

Description

Primary

aluminium

Transport, construction, electronics and packaging industries.

Primary aluminium is produced in accordance with international quality standards, Russian GOST standards and various technical specifications developed on request of consumers.

Alumina and bauxites

Semi-finished goods out of which aluminium is produced.

Alumina production is carried out using Bayer technology.

High-purity aluminium

Electronics, production of computer hard drives and capacitor foil.

UC RUSAL is the only producer of high-purity aluminium in Russia and the CIS.

Aluminium alloys

Transport, construction, electronics and packaging industries.

UC RUSAL has modern foundry facilities and produces a wide range of high-quality aluminum-based alloys.

Foil and packaging  

Food, pharmaceutical, construction, tobacco and cosmetics industries.

UC RUSAL enterprises produce foil with a thickness of 5 to 240 microns, the flexible packaging that uses this foil, aluminium tape, foil for domestic and technical needs.

Aluminium powder, dust and pellets

Metals, chemical, energy, mining and construction industries, manufacture of military hardware.

UC RUSAL is the largest Russian producer of aluminium powders.

Wire rod

Cable industry, ferrous metallurgy, manufacture  of other metal goods.

UC RUSAL produces wire rods in accordance with GOST standards and international specifications. The product passed certification of the largest Russian and foreign manufacturers of cabling and wiring products.

Silicon

Metals, chemical industries, electronics, production of solar panels.

UC RUSAL produces metallurgical silicon for AlSi system alloy production, as well as refined silicon.

Gallium

Production of various chemical compounds, used in solar energy and electronics industries.

UC RUSAL produces metallurgical gallium with purity levels of 99.99% and 99.999%.

Corundum  

Production of abrasive tools, ceramic and fireproof products.

UC RUSAL is the Russia’s largest and one of the world’s largest producers of white alumina.

Chemical products

 

 

 

 

 

The Company produces the following types of chemical products:  

·         sodium carbonate, used in various production industries;

·         potassium sulfate, used in fertilizers, glass industry, manufacture of potassium aluminium sulfate and other products;

·         fluorite briquettes (fluorspar), used in ferrous metallurgy;

·         zinc concentrate, which is raw material used in the production of zinc metal;

·         soda-sulfate mixture, used in production of glass containers.

UC RUSAL produces chemical products whose properties and specifications meet contemporary Russian and international standards.

Products supply

In addition to its domestic market, the Company delivers aluminium products to Europe, the USA, and Southeast Asia. The main consumers are companies of various industries and sectors of the economy, such as construction, transport, packaging, machine-building, energy industries and the consumer sector. The Company’s products are shipped by rail, automotive, river and sea transport. G4-8

Geography (actual volume)


Modes of Transport

Products

Means of transport

Aluminium in bags and ingots

Rail shipments (covered and combined wagons), auto transport, river transport, sea transport (ships with carrying capacity of 3.1 to 20. 4 thousand tonnes)

Aluminium in slabs (flat ingots) and billets (cylindrical ingots)

Rail shipments (open wagons), auto transport, river transport, sea transport (ships with carrying capacity of 3.1 to 20. 4 thousand tonnes)

Alumina

Rail shipments (hopper wagons, open wagons (including those equipped with big bags), combined wagons, covered wagons), sea transport (ships with carrying capacity of 23 to 45 thousand tonnes).

Participation in Financial Markets

Ordinary shares of UC RUSAL are traded on both the Stock Exchange of Hong Kong and Moscow Stock Exchange. The Moscow Exchange listing was held in March 2015 which provides the opportunity for the Company to enlarge its investor base. The Company is also listed in the securities market Euronext Paris in the form of Global Depositary Receipts (GDRs) and in Moscow exchange in the form of Russian Depositary Receipts (RDRs).  

Ownership and Shareholding Structure

UC RUSAL is a private publicly traded company and its ordinary shares are traded at the main board of  the Stock Exchange of Hong Kong (ticker 486), Global Depositary Receipts (GDRs) and Russian Depositary Receipts (RDRs) for RUSAL. Shares are traded on the NYSE Euronext stock exchange in Paris (RUSAL) and Moscow Interbank Currency Exchange (RUALR), respectively.

In 2015 major shareholders of the Company who directly or indirectly own the largest shares were En+, SUAL Partners, Onexim and Amokenga Holdings. The number of shares in free circulation remains the same and amounts to 10.05 % of the total number of shares in the Company. G4-7