Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Global commodities trader, Trafigura, posted healthy profits in H1 2020 ended March 31, 2020 despite the impact of COVID-19 related lockdowns.


However, the company’s group revenue fell, reflecting lower commodities prices during the period, and the company warned that uncertain markets would continue to prevail in H2 2020.


Trafigura noted in its market review released with the interim results, that the metals market could bounce back faster than oil and gas because of the duality of both the supply and demand sides in metals trading being affected by COVID-19 related shutdowns, first in China and then in the rest of the world.


In H1 2020, the Amsterdam based company reported trading at higher volumes for its refined metals and bulk minerals business. 


The company said that its turnaround plans for Nyrstar, the zinc and lead refining company acquired by Trafigura in 2019, started showing the desired results in H1 2020. Nyrstar contributed $370mn to Trafigura’s gross profit and $72mn on the Group’s EBITDA for the first time in 2020 although the refiner posted a loss $137mn on a standalone basis during this period.


The commodities trader’s net profit in H1 2020 increased by 27pc to $542mn from $426mn during the same period last year. The group posted revenue of $82.9bn, with revenue from metals and materials business making up 37pc of the total revenue. 

Trafigura’s gross profit in H1 2020 increased to $3.12bn from $1.47bn during the same period last year while its gross profit margin grew to 3.8pc from 1.7pc during the same periods under comparison.


The company’s EBIDTA for the same period stood at $2.41bn. Excluding the impact of International finance reporting standard adopted by the company on January 16, EBITDA for the first half of the year, rose to $1.92bn from $1.11bn in H1 2019.

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