AoG expects critical decisions

Aluminium of Greece, the country’s biggest industrial investment when it was founded in 1960 and still one of its biggest industries, is entering a critical period. The firm recently came under new owners, after its parent company, France’s Pechiney, was taken over by one of the world’s biggest metallurgy groups, Canada’s Alcan. The new owners, who have a presence in 63 countries, are currently considering a restructuring of Pechiney’s operations worldwide but have given no indication of their intentions as regards Aluminium of Greece. The Greek firm, based in Aghios Nikolaos on the northern coast of the Gulf of Corinth, has benefited for more than 40 years under a favorable agreement with the Public Power Corporation, which provides it with cheap electricity. The agreement, the terms of which have often been criticized as too generous for Aluminium of Greece, expires in a year-and-a-half. Company officials consider that the prospects of the firm, in the framework of Pechiney’s restructured operations, will become clear within the first half of 2004. They point out that, on the basis of the current dollar-euro parity and oil prices, Aluminium of Greece is bound to pay higher prices for its considerable energy needs. The board of directors is scheduled to meet on February 27 to finalize 2003 results, which are expected to be lower due to the sliding dollar. Already, in the nine-months of 2003, the firm reported lower sales and a significant drop in profits. Group sales fell 15.8 percent year-on-year to 235 million euros and pretax profits, 55.5 percent to 14.52 million. A recovery is expected in the first quarter of this year, as prices of aluminium on London’s Metal Exchange had exceeded $1,700 per ton on February 13, against $1,688 a week earlier.