Alucam, Cameroon’s largest aluminum producer, faces a critical need for recapitalization, according to a recent audit report by the Chamber of Accounts of the Supreme Court. Published on April 10, 2025, the report highlights that Alucam, which is 79.6% state-owned, needs a CFA43 billion capital boost to sustain its activities. The Chamber’s analysis, based on financial statements from 2017 to 2021, shows that the company’s smelting operations must be revived to reach an annual production capacity of 110,000 to 120,000 tons of primary aluminum.
In the absence of such recapitalization by the government or the entry of a private investor, the Chamber suggests that Alucam may need to consider suspending its smelting operations, which would have a significant impact on its future viability.
Declining Financial Health
The Chamber’s report paints a grim picture of Alucam’s financial situation over the past five years. The company’s revenue dropped by 25.5%, falling from CFA123.4 billion in 2017 to CFA91.9 billion in 2021, with a low point of CFA77.8 billion in 2019. During the same period, the company accumulated a net loss of CFA45.6 billion, with three years (2018, 2019, and 2020) seeing significant deficits, though it managed to break even in 2021 following its merger with SOCATRAL.
The Chamber also noted significant issues with the company’s accounting, pointing out inconsistencies in the balance sheets from one year to the next, anomalies in accounting entries, and irregularities in the bank reconciliations.
Alucam’s production also suffered a 53% decline, dropping from 73,759 tons in 2017 to 34,431 tons in 2021. Despite the reduced production, fixed costs remained high, which deepened the financial strain. The company’s smelting segment, which was profitable in 2017 (+CFA6.3 billion), became increasingly negative, with losses growing from -CFA11.1 billion in 2018 to -CFA37.8 billion in 2021.
The Chamber also raised concerns about the prolonged mandates of the auditing firms PricewaterhouseCoopers and SEACA (EKOKA), which have been responsible for certifying Alucam’s accounts since 2004.
The Path Forward: Recommendations and Challenges
Despite the ongoing financial deterioration, the most recent reports from the auditing firms in 2023 showed that by the end of 2022, Alucam’s capital had still not been restored. Due to a revaluation gap of CFA11 billion and a loss of CFA8 billion in 2022, the company’s equity remained less than half of its original capital. By December 2023, Alucam’s equity was still negative at -CFA28.3 billion, based on a net loss of CFA23.6 billion for the year.
Both the Chamber’s report and the auditors pointed out that Alucam’s deadline to correct its financial issues had already passed. They warned that any interested party could call for the dissolution of the company due to the continuing negative equity.
To address the situation, the Chamber recommends that the company’s management sell off non-strategic assets, such as land in Douala and Édéa, as well as shares in service companies. The Chamber also advises appointing new auditors once the current mandates end and urges the company to streamline its production processes and improve its commercial strategy to return to profitability.
The Cameroonian government has been negotiating with the International Tropical Conservation Fund (ITCF), the Franco-German BHF financial group, and the Public Investment Bank (BPI) since 2022 to help restore Alucam’s capital. The Technical Commission for the Rehabilitation of Public and Semi-Public Enterprises (CTR), which revealed this information, has not disclosed further details about the financial arrangement. As of now, the outcome of these negotiations remains confidential.
Founded in 1954 through an agreement between the Cameroonian government and Pechiney-Ugine, the aluminum company has faced several changes in ownership over the years. In 2015, Rio Tinto Alcan, the majority shareholder, exited the capital, selling its shares to the government. In 2020, Alucam merged with the Société Camerounaise de Transformation d'Aluminium (Socatral) as part of a restructuring effort.