Ru
Ru

Leading vertically integrated aluminium and power producer

Strategy

The Group’s strategy concentrates on organic growth with a focus on capital discipline and deleveraging

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Focus on vertical integration, cost-efficiency and industry leadership

The Group’s strategy is to achieve vertical integration and self-sufficiency across the aluminium value chain (power generation, raw materials, and finished products), maintain and grow our high-margin, low-risk aluminium production and financial strength, and grow total shareholder returns and dividend payments.

Ensuring maximum efficiency

Vertical integration for maximum efficiency

Almost 100% of the electricity supply to our aluminium smelters is provided by the Group’s own hydropower plants. This ensures revenues for the Power segment by creating basic demand for electricity and reduces the carbon footprint of the primary luminium production as almost 100% of energy used for smelting is renewable.

  

Prodaction cost saving

We pursue cost-cutting initiatives across the Group. A high-level of selfreliance in both bauxite and nepheline is achieved in the Metals segment. We develop and implement new projects for inhouse production of alumina. In addition, the second phase of the Taishet anode plant is meanwhile under active construction.

Higher profitablility

The Metals segment’s development priority is raising VAP production capacity. To achieve that, the Aluminium division expands its VAP manufacturing facilities with new capacities in wire rod. The Downstream division produces foil, extrusion and car wheels which are sold at a high premium.

Increasing production capacity

Aluminium prodaction capacity ramp-up

The first phase of the Taishet aluminium smelter was partly commissioned during 2022, becoming the Group’s most modern and hightech aluminium smelter equipped with cuttingedge electrolysis facilities.

 

Development of generating capacity

The Company has continued to pursue the development of new hydropower generation capacity. The project portfolio includes four HPPs, i.e., Nizhneboguchanskaya, Motyginskaya, Telmamskaya and Krapivinskaya, with a 2.5 GW aggregate capacity. The Company also continues development of both solar and wind power projects.

 

Ensuring a stable-financial position

Ensuring stable FCF

The Metals segment managed to achieve strong sales revenue at the level of 2021 despite the aluminium market price falling almost twice between Q1 and Q3. The Power segment outperformed the previous year and earned record high revenues.

Implementing innovations

Innovations in metals segment

The Metals segment is seeking to introduce inert anode technology on an industrial scale, which is the key technological development vector for the segment. Inert anode difference from conventional technology in that electrolytic smelting of one tonne of aluminium produces 2 tonnes of oxygen instead of carbon dioxide emissions. Tests on inert anode electrolysis cells are underway at the Krasnoyarsk aluminium smelter; the electrolytic cells are supposed to emit no greenhouse gases (GHGs) upon transition.

 

R&D project in power segment

The Power segment’s R&D projects involved into development of tank containers for transportation of liquid hydrogen and a small-capacity nuclear reactor.

   

Committing to sustainability

Aligning with SDGS

The Group’s sustainability focus extends to climate leadership, environmental stewardship, human development, and collaboration with stakeholders in support of sustainability principles both nationally and internationally. From programmes aimed at reducing the Group’s environmental impact, to research around ecosystem impact in our regions of operation, to social initiatives supporting healthcare and education, the Group’s operations align with the
Group’s priority SDGs.

        

Net Zero transition

In early 2021, the Company announced its ambition to achieve a reduction in GHG emissions by at least 35% by 2030, and net zero GHG emissions by 2050 (compared with 2018). In September 2022, the Company reported for the first time on progress in achieving these climate targets.

 

Closed loop economy development

The Metals segment is developing new products to be manufactured from secondary aluminium alloys to further reduce carbon footprint in response to the Group’s clients declaring their own Scope 3 reduction goals.

Three of the Group’s plants have recycling projects underway, with a substantial share of production to involve recycled aluminium in the future
  

Group’s strategy

The Group’s strategy aims to lead the Company to become
the world’s largest vertically integrated producer of high
value-added products from low-carbon aluminium using our
own renewable energy and raw materials.
We adhere to the Group’s sustainable development strategy aligning with
the international agenda through improvement of production technology
and asset modernisation in both Metals and Power segments while at the
same time raising the output of low-cost aluminium, which positively
affects margins, financial stability and deleveraging.

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