Melbourne's Alumina has swung to profit in the half-year to the end of June, and expects to see solid margins in the second half as favourable exchange rates lead to lower production costs.

Alumina today posted a net profit after tax of $US122 million for the six months to the end of June, an increase of 357 per cent on the same period last year when the firm posted a $US47.4m loss.

Alumina, in the prior corresponding period, had taken a writedown charge of nearly $US80m on restructuring Point Henry. It's half yearly accounts this year were weighed down by restructuring costs with its Suriname operations and its Anglesea power station.

The firm operates in bauxite mining and alumina refining through the Alcoa World Alumina & Chemical (AWAC) joint venture with Alcoa.

Alumina's chief executive Peter Wasow said AWAC had achieved a significantly higher alumina earnings margin for the half, with improved profit performance and strong cash generation.

AWAC is 60-40 split between the New York-based Alcoa and Melbourne’s Alumina.

"AWAC has capitalised on market conditions and portfolio reform to post its best result for several halves," Mr Wasow said.

Its earnings before interest, tax, depreciation and amortisation (EBITDA) margin for alumina of $US104 per tonne was the highest since 2007, the firm said.

The cash cost of alumina production fell by $US30 a tonne, while the average realised price had risen $US21 a tonne.

Investors welcomed the strong results, pushing Alumina shares to their highest point in 8 months, thanks to an increase in the forecast output.

The stock jumped as high as 6.2 per cent in early trade, but soon moderated to a lift of 2.12 per cent, up at $1.32 by 10.30am (AEST).

The company forecast an increase in alumina output over the coming year, targeting production of 15.3 million tonnes -- a slight lift on May's expectations of 15.2 million tonnes.

Aluminium output is expected to total 164 thousand tonnes over the year.

The firm said it was expecting to spend around $220m in sustaining investment over 2015.

“Despite the recent fall in commodity prices, we expect to see solid margins in the second half due to increased sales on an index basis and lower production costs resulting from favourable exchange rate," Mr Wasow said.

The firm will pay an fully franked interim dividend of US4.5c per share. Last year it paid no interim dividend and a final dividend of US1.5c per share