HAMBURG (dpa-AFX) – The alleged fraud by individual scrap suppliers is expected to cost the copper company Aurubis around 150 million euros. The announced extraordinary inventory of metal stocks resulted in a shortage worth 185 million euros, which will burden the 2022/23 financial year, which runs until the end of September, the MDAX group announced on Tuesday in Hamburg. Insurance money and a possible collection of perpetrator funds are likely to reduce the amount by around 30 million euros. For this reason and in view of the economic development in the fourth quarter of the financial year, Aurubis expects an operating profit before tax of between 310 and 350 million euros for 2022/23.
The Aurubis shares rose on the news and led the MDax in the early afternoon with an increase of almost 5 percent to 70.70 euros. “With the ad hoc announcement, the uncertainty is gone and the chapter for the capital market is closed. The damage is not even a negative surprise,” commented stock expert Frederik Altmann from Alpha Securities Trading.
At the end of August, the Hamburg-based company discovered significant deviations from the target inventory in the metal inventory as well as deviations in special samples from certain deliveries of input materials in the recycling area. This is likely to be the result of further criminal acts that go beyond the cases published in June 2023, it was said. The State Criminal Police Office was called in. At that time, the group had also suspended its annual forecast of an operating pre-tax profit of 450 to 550 million euros. The shares then collapsed by almost a fifth to 62.50 euros, but have recently recovered quite a bit.
In light of the new Aurubis forecast, Salzgitter AG (Salzgitter) is also expected to comment on its annual outlook soon. The steel maker holds around 30 percent of the shares and had also suspended its annual profit target due to the Aurubis uncertainties.
According to Aurubis, it is now “confirmed knowledge that deliveries and samples for input materials in the recycling sector with high contents of valuable metals were manipulated to the detriment of Aurubis.” As a result, excessive bills were paid, despite industry-standard safety standards. However, it cannot yet be said which suppliers would be affected. The company contacted the State Criminal Police Office, which is continuing to investigate.
However, it can be ruled out that Aurubis customers and deliveries to them were affected by the fraud, it said.
In order to prevent the incident from happening again, CEO Roland Harings now wants to implement “process improvements and further security measures”. Details could then be available on December 6th when the annual figures are published.
As Aurubis recently emphasized, the financial damage will not affect its expansion plans. As has been known for some time, the people of Hamburg want to invest around 1.1 billion euros in the USA, Bulgaria and Germany by 2026. The recycling plant in Richmond (USA), where production is scheduled to start later in 2024, will then make the largest profit contribution from the current growth projects. Scrap metal recycling is booming in the USA.
And battery recycling, which is becoming increasingly important in times of electromobility, is also becoming a focus at Aurubis. The exam is ongoing. However, a decision is only likely to be made in the medium term./mis/knd/nas
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