Business Description:
Alumina Limited (AWC) is involved in bauxite mining, alumina refining and smelting of aluminium. Alumina's primary asset is its 40% interest in Alcoa World Alumina and Chemicals (AWAC). AWAC mainly produces smelter grade alumina feedstock (for the production of aluminium) and aluminium from 2 smelters in Australia. AWAC employs over 7,000 people.

Strategy Analysis:
AWAC's growth policy focuses on the alumina business via low-cost and low-risk brownfield expansion. AWC's strategy is to maintain and manage its 40% equity stake in AWAC for the benefit of its shareholders. Alumina reported NPAT up 53% to US$67.7m for the half-year ended 30 June 2011. Underlying earnings increased to US$77.7m from US$22.2m in 2010. Revenues from ordinary activities were US$0.1m. Basic and Diluted EPS was 2.8 US cents compared to 1.8 US cents last year. Net operating cash flow was US$147.1m compared to US$79.0m last year. The interim dividend declared was 3.0 US cents compared with 2.0 US cents last year. Looking ahead, the company is in a solid position, with low levels of gearing, and a well managed balance sheet. The company expects market conditions to favour its large, low cost assets and substantial bauxite footprint.