Nornickel Reports Nearly One-Third Drop in H1 Profit

• Nornickel’s profit fell by nearly 30% in the first half of the year due to low prices and logistical challenges.
• The company’s revenue dropped by 22% to $5.6 billion.
• Capital expenditures for 2024 are expected to be lower than initially anticipated.

Moscow, August 26 (FinanceFlashNews.com) – Russian industrial conglomerate Nornickel reported a nearly one-third drop in profit for the first half of this year, driven by low metal prices, logistical issues, and challenges with cross-border payments. This information was reported by Reuters.

“Declining prices for palladium and nickel, logistical challenges in the Red Sea, and increased difficulties with cross-border payments had a significantly negative impact on our revenue, profitability, and free cash flow,” stated Nornickel CEO Vladimir Potanin.

The average price of nickel on the London Metal Exchange dropped by 28% in the first half of this year, significantly affecting the company’s results. Additionally, attacks by Yemeni rebels on merchant ships in the Red Sea increased logistics costs. Nornickel relies on this route to deliver its raw materials to markets, including Asia, which now accounts for 52% of the company’s total exports.

Nornickel’s core profit for the first half of the year reached $2.35 billion (2.11 billion EUR), representing a 30% year-over-year decline. Revenue fell by 22% to $5.6 billion.

The company also announced that it will slightly lower its capital expenditure forecast for 2024. Initially expected to range between $3 billion and $3.2 billion, the expenditures are now projected to not exceed $3 billion.

Table: Nornickel’s Financial Results for H1 2024

Keywords: Nornickel, Russian economy, metal prices, logistical challenges, Vladimir Potanin