MOSCOW - Russia's Nornickel, a major world producer of refined nickel and palladium, said its 2024 net profit fell 37% to $1.8-billion as Western sanctions and low metals prices squeezed earnings.

Nornickel said 2024 revenue fell by 13% to $12.5-billion, while earnings before interest, tax, depreciation and amortization declined by 25% to $5.2-billion.

"Sanctions and restrictions as well as falling prices of our key metals continued to weigh on our revenue, profitability and ability to generate cash flow," Nornickel's President Vladimir Potanin said in a statement.

While Nornickel is not subject to direct Western sanctions, the measures have prompted some Western producers to avoid buying Russian metal, complicated payments, and restricted access to Western equipment, leading the company to redirect sales to Asia.

Potanin said Nornickel managed to cut cash operating expenses by 3% and stop the growth of net working capital, which he called a major negative trend of the last few years as the company was accumulating stocks of the metals it produces.

Nornickel said a weaker rouble and a reduction of stocks helped to contain net working capital growth last year. The company said its management will recommend the board not to pay dividends for 2024.

"In the context of ongoing volatility in commodity markets and high geopolitical risks, our absolute priority is to maintain the company's financial stability, enhance operational efficiency, and invest in future markets and products," said the company's CFO Sergei Malyshev.

The company said it saw a global nickel surplus of 150 000 t in 2025 and expected the global palladium market to be in balance this year.

Nornickel said that the less aggressive electrification agenda of US President Donald Trump's administration supported the demand outlook for palladium, which is used in exhaust systems of internal combustion engine vehicles.

It added that a "new wave of industrialization in the West sparked by the return of the Trump administration", coupled with China's economic stimulus, supported global copper demand.

Nornickel said it had adapted to supply disruptions linked to Western sanctions which had affected the delivery of equipment for repairs to a major furnace at its flagship Nadezhda smelter, which returned to operation last year.

The company plans to invest $2.1-billion this year, including in research into new potential uses of the metals it produces.