Dubai Aluminium Company (Dubal) has announced a 101.9 per cent jump in net profit to Dh2.12 billion for 2010.
The growth in profit has been driven by strong market demand, increasing aluminium prices and a reduction in costs. The company is expected to maintain its strong profits in the coming year because of rising demand for commodities on international markets, although this will also increase the prices of its raw materials. Dubal management will have to keep an even closer eye on its operating costs in the coming months.
The investment in aluminium to diversify the economy is paying off for Dubai and the UAE. So much so that the Abu Dhabi-based Mubadala Development Company has offered to buy shares in Dubal. This creates the possibility of the formation of a holding company that includes Emirates Aluminium Company (Emal), with a production capacity of 2.5 million tonnes annually.
Being a global centre for aluminium production will give the UAE opportunities to expand its markets and negotiate better prices for the necessary raw materials. There are also opportunities to expand the downstream manufacturing industry in the country by producing goods from aluminium. This will boost job creation, economic growth and increase revenue for the UAE.
