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Aluminium productions by electrolytic method and aluminium conversion into finished products needs three basic sectors:
· Anode plant -; which manufactures the anodes requested by the electrolysis process;
· Electrolysis sector - the leading unit of this sector is the electrolysis cell multiplied by 128 times for each pot room.
· Foundry workshop where the electrolytic aluminium is conversed into semi- products.
Beside these sectors in ALRO run a number of auxiliary sections necessary for a proper operation of the basic sectors -; conversion and rectification of the electrical energy, utilities, metallurgic repairs, repairs of the pots and furnaces, production of metallurgic equipment and spare parts.

ALRO S.A. is the sole domestic producer for following product:
· Liquid electrolytic grade aluminium
· Primary aluminium alloy ingots;
· Primary aluminium wire rod;
· Primary homogenized aluminium alloys billets;
ALRO S.A. Slatina is an integrated enterprise which by means of its basic and auxiliary sections produces electrolytic aluminum semi-products.

BASIC SECTIONS:

ANODE SECTION: produces the pre-baked anodes necessary for the electrolysis process.
ELECTROLYSIS SECTION: produces the liquid aluminum using Pechiney’s technology and license;
CAST HOUSE: this is the work shop where the electrolytic aluminum is converted into semi-products.

AUXILIARY SECTIONS:

TRANSFORMATION-RECTIFYING SECTION: assure the electrical power feeding for the entire company.
UTILITIES: Assure the industrial water feeding , thermal agent and compressed air of the company.
METALLURGICAL REPAIRS: assure the reparations and maintenance of the company’s metallurgical equipment.
POT AND FURNICE REPAIRES: assure the repaire of the electrolysis pots and baking anode furnaces.
METALLURGICAL TOOLS AND SPARE PART SECTION: assure the spare parts necessary for the metallurgical tools and of the other equipment in company’s endowment.
Quality
The aluminium quality achieved in ALRO Slatina, is in conformity with the international norms and the LME standard. This fact assured a good name of the company on the world market and consequently a bigger and bigger demand which can be satisfied only within the limits of the existent production capacity.

The implication of ALRO’s management team in achieving the quality has been clearly established on the business plan prepared for management’s responsibilities taking over and it has been approved by the Shareholder General Meeting. The management team experience in production domain, sales and marketing of aluminium helped the company so that the orientation to the customer becoming a pivot of the company round about to develop. This message has been communicated to all its employees during the presentation of the business plan.

Generally, the object of SC ALRO SA is to obtain and keep its reputation on the domestic and external markets.

SC ALRO SA will do all the best to carry out the needs of its customers by delivering products with a constant good quality.

Obtaining of the general object is realized only by cooperation and implication of all factors contributing to the product quality assurance in ALRO SA.

The message regarding the quality is communicated in the policy concerning the quality domain, declaration and message of the Managing Director, preparing meetings, audits.

ALRO implemented an Quality Assurance System certified SR EN ISO 9002:95 in 1996 and certified again according to the same standard in 1998 by SRAC.

Domestic and foreign auditors regularly audited the system. In April 2000 ALRO has been audited by Alcoa Kofem Kft company. The result of this audit was “excellent (98%)”. The audit cycle, preventive and corrective measures and analysis of the management helped to the implementation of PDCA approach (Planning, Development, Control, Amelioration) in the company.

Besides keeping a certified quality system ALRO approached since 2001 an “Quality -; Environment” Integrate Management System obtaining the certification as per the new standard ISO 9001:2000 and shortly the certification according to ISO 14001.

The contribution of the Quality Management System to ALRO strategy implementation concerning the product quality towards the customers has as objectives:
· Satisfaction of the customers.
· Satisfaction of the shareholders.
· Satisfaction of the employees.
This contribution is illustrated by the following example:
· a data base regarding the stage of the non-conformities discovered.
· a data base containing the specifications of the raw materials (performed with the supplier’s help) and a data base containing the product specification (achieved by cooperation with our customers).
Quality Manual indications for assurance of the consistency and uniformity of the operational procedures, execution and control procedures are observed by all operators.

A regular analysis of the contracts including of those involving the sale/marketing and technical functions so that ALRO to be able to perform permanently the contractual requests.

Standardization of the analytic methods by calibration of the analytic equipment and common successive tests with the customers (when is necessary).

Once engaged to obtain a “TOTAL QUALITY” in ALRO a frame has been created where the creative ideas are encouraged for improving the processes.

The continuous development process is supported by:

formation of a good trained labour based on a competence criteria.

The extensive training of the employees within the specific domains of their profession, within the quality and safety domains.

Approach involving the employees for understanding and observing the customer requests.

Information from the customers and from reports, regular connections and solving of the claims.

The cycle of domestic and foreign audits, management analysis and corrective/preventive measures in the system certified SR EN ISO 9001, recognition of employees contribution for amelioration of the quality product.

The performances in service supply to the customers are measured depending on the delivery in due time, reaction speed, adjustment of the claims and report results regarding satisfaction of the customers.

ALRO’s management promoted the use of instruments with an adequate quality in the entire organization. The analysis of the primary reasons is used for instance by using the fish-bone diagrams (Cause-effect) for identification of the base problems and Pareto analysis in order to establish the priorities. Use of charts and data in the company became more systematic due to the use of statistic methods. The most important achievement was the understanding and the use of the variation concept (not only medium values) by the management and employees. This fact leaded to a systematic implementation of the statistic control process and studies related to the capacities of the production process. It was relatively easy to encourage all members of the company to use diagrams and concepts regarding the processes.

Latest News

On October 15th, 2002 was finalized the modernization of the last two pot-lines, i.e. lines no. 7 and 8. Consequently, the whole smelter is now fully modernized with central point-feeding and dry scrubbing systems. By this modernizations the quality of the metal, the costs and the working conditions are improved, the smelter being compliant with the EU environmental standards.
During 7-13.10.2002 it was tested the new production line acquired from Wagstaff - USA. The new system started to operate on October 14th 2002 bringing the quality of the billets at the highest standards and increasing the output by 50%.
On October 15th, 2002 it was made the change in the shareholders record and Marco International becoming the owner of the majority stake in ALRO SA Slatina. The structure of the shareholders is as follows:
Name Volume %
MARCO GROUP 275,940,143 77.92
A.P.A.P.S. 70,859,106 20.01
Others 7,319,187 2.07
TOTAL 354,118,436 100

For the year 2001 and 1st semester of 2002, the main indicators are as follow:
Indicator 2001 1st sem.2002
% %
Economic profitabileness 44,80 22,78
Financial profitableness 39,40 20,22
Assets profitableness 25,64 15,14
Current ratio liquidity 162,91 185,64
Liquidity rate 90,65 94,90
Quick ratio liquidity 5,66 7,95
Financial independence 100 100
Debt rate 34,78 24,94
ALRO's main markets
Product Main markets
Ingots of Al 99.7% Italy, Greece, France, Austria, Bulgaria
Aluminium alloy AlMgSi bars Greece, Slovenia, Bulgaria, Turkey, Spain, Hungary
Primary aluminium 99.7% wire rod Greece, Poland, Turkey, Yugoslavia, Italy
The distribution of products for export, counting for about 75% of annual production, is done not only by direct export to end clients but also by foreign and romanian trading companies.
Rate of income from turnover, by products and services
1999 2000 2001 1st semester 2002
% % % %
Income from sales of finished goods 89.05 95.18 97,12 87,82
Income from sales of waste products 0.12 0.09 0,11 0,09
Income from services 9.62 0.45 0,38 0,39
Income from merchandise sales 1.18 4.27 2,38 11,68
Income from other activities 0.03 0.01 2,39 0,02
TURNOVER 100 100 100 100
Rate of income from total income, by products and services
1999 2000 2001 1st semester 2002
% % % %
Income from operations 97.59 96.24 97,27 98,15
Income from financial activities 2.01 2.98 1,73 1,85
Income from other activities 0.4 0.78 - TOTAL 100 100 100 100


Board of Directors

· Alexander Krasner - President · Peter Braun - Vice President · Satish Manaktala - Member · Marian Nastase - Member · Andrei Ioan Mauthner - Member
Balance Sheet
1999 2000 2001 1st semester 2002
% % % %
TOTAL ASSETS, of which 100 100 100 100
Intangible assets 28.69 49.77 43,34 53,66
Inventories, of which 17.33 28.78 24,13 22,63
Raw materials, consumables, and others 8.9 17.32 11,4 12,92
Other receivables and prepayments 51.73 18.81 29,56 9,37
Cash and cash equivalents 2.25 2.64 1,97 1,42
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY 100 100 100 100
Capital and reserves, of which 36.47 62.07 65,06 74,88
Ordinary shares 9.95 24.49 14,22 16,03
Reserves 1.99 7.08 26,90 30,33
Other 24.53 53.46 23,90 28,50
Liabilities 61.65 33.21 34,77 24,94
Income Statement
Unit 1999 2000 2001 1st semester 2002
Net sales million ROL 3,754,163 6,749,735 8,426,850 4,825,467
Turnover million ROL 3,798,915 7,050,402 8,632,086 5,463,491
Costs components of minimum 20% of net sales
Raw materials and consumables % 39.55 44.95 46,9 36,57
Electricity and water % 27.72 15.24 29,1 26,97
Personnel expenses % 8.69 14.4 8,2 7,07
Provisions for other expenses million ROL 105,459 228,802 100,847 Dividents million ROL 146,553 437,031 590,946 -