HAMBURG (dpa-AFX) - Copper group Aurubis believes it is on track to meet its annual targets despite continued low sulfuric acid prices and weaker metal prices in some areas. Tailwinds are provided by increased refining charges for the processing of copper concentrates and recycling material as well as lower energy costs. In addition, there is a high insurance payment in connection with the flood disaster at the Stolberg site in July 2021. Aurubis shares fell by up to eight percent to 77.56 euros in early trading, making it the weakest stock in the MDax.

Morgan Stanley analyst Ioannis Masvoulas criticized the earnings performance to some extent. Excluding the insurance payment, the underlying development is likely to have been worse than generally expected. For 2023, Aurubis now still has a plus of about three percent on the price list, after the shares had risen significantly until the beginning of February, even breaking through the 100 euro mark.

Aurubis CEO Roland Harings continues to calculate operating pre-tax earnings - i.e. adjusted for special effects - of 450 to 550 million euros for fiscal year 2022/23, which runs until the end of September. The company is benefiting from the mobility and energy turnaround, which is driving the wire rod business, the company manager explains. Therefore, Aurubis is on track, despite the 40-day maintenance shutdown at the important Bulgarian plant, he added.

In the past third fiscal quarter, the company achieved an operating profit before taxes of 115 million euros, with sales down 17 percent to 4.17 billion euros. This is a good fifth more than a year ago and slightly exceeds the average analyst estimate thanks to insurance reimbursements of around 15 million euros in connection with the July 2021 flood disaster at the Stolberg site. The company also benefited from lower energy costs. Sales lagged behind the consensus estimate.

At 92 million euros, the bottom line in the months from April to June was a good quarter higher than in the same period of the previous year. For the first nine months of the fiscal year, pre-tax operating profit was 406 million euros, less than 100 million euros short of the mid-point of the annual target range of 450 to 550 million euros. Analysts currently expect operating profit before taxes for 2022/23 to be 523.

The annual target also takes into account rising costs for the Hamburg company's growth plans. As is known, they want to invest around 1.1 billion euros in the USA, Bulgaria and Germany by 2026. The largest profit contribution of the current growth projects is then to be made by the recycling plant in Richmond (USA), where production is to start later in 2024. Scrap metal recycling is booming in the USA.

And battery recycling, which is becoming increasingly important in the age of electromobility, is also coming into focus at Aurubus, with testing underway. However, a decision is only likely to be made in the medium term./mis/mne/zb