Pacific Aluminium's earnings from the Southland smelter experienced a steep dive during the course of last year, the company says.
The Tiwai Point smelter produced underlying earnings of $54 million for the calendar year, $2m less than last year.
But most of this profit stemmed from a moderate uplift in the aluminium price during the first quarter of 2015, coupled with a weaker New Zealand dollar throughout the year.
However, over the course of the year, the cash price for aluminium was 12 percent lower than in 2014.
The smelter management says these worsening conditions meant only $4m of the $54m profit was delivered in the second half of the year.
They add the smelter faces even tougher conditions in 2016.
Pacific Aluminium, a subsidiary of Rio Tinto, owns four fifths of the smelter.
It adds the smelter continues to pay one of the highest power and transmission prices of any smelter in the world outside China, making it harder to compete in a highly competitive market.
Last year it says the smelter paid $64m in transmission costs.
A new proposal from the Electricity Authority would shave $20m off this price, but that is open to further debate.
The smelter management say despite its financial challenges, it broke volume records last year.