The world's largest aluminum producer Alcoa Inc. (NYSE:AA) has kick
started the earnings season with better-than-expected first quarter
earnings on strong productivity growth and improved market conditions.
The company ended streak of earnings disappointments over the last year,
sending its shares up 5.04% in aftermarket.
Earnings from continuing operations for the first quarter were $94
million or $0.09 per share, down from $309 million or $0.27 per share
last year. Adjusted earnings from continuing operations for the latest
quarter were $105 million or $0.10 per share.
Sales increased to $6.01 billion from $5.96 billion. Analysts had
expected a loss of $0.04 per share on revenue of $5.77 billion.
Alumina sales decreased to $775 million from $810 million, while
primary metals sales declined to $1.94 billion from $1.98 billion.
Third-party sales from global rolled products declined to $1.85 billion
from $1.89 billion, while sales from engineered products and solutions
increased to $1.39 billion from $1.25 billion.
Shipments of aluminum products increased to 1.295 million metric tons from 1.212 million metric tons.
production rose to 4.15 million metric tons from 4.02 million metric
tons, while third-party alumina shipments grew to 2.29 million metric
tons from 2.21 million metric tons.
Aluminum production increased to 951,000 metric tons from 904,000
metric tons, while third-party aluminum shipments rose to 771,000 metric
tons from 698,000 metric tons.
A 9% decrease in the realized
price of aluminum and a 13% drop in the realized price of alumina,
year-on-year, were partially offset by higher third-party shipments in
the upstream businesses, better volume and mix in the midstream
business, and improved volume in the downstream business.
Looking ahead into the fiscal 2012, Alcoa is raising its global
growth forecast for the aerospace market 3 percentage points (13%-14%)
company expects global growth in the automotive of 3% to 7%, commercial
transportation of 1% to 5%, packaging of 2% to 3%, building and
construction of 2.5% to 3.5%, and industrial gas turbine of 1% to 2%
In 2012, Alcoa continues to project a global aluminum supply deficit
and reaffirmed its forecast that global aluminum demand would grow 7% in
2012, on top of the 10% growth seen in 2011.
announced, Alcoa is curtailing 390,000 metric tons of its system
refining capacity to improve the company's competitive position and to
reflect updated internal demand following smelting curtailments
announced earlier this year.
Combined with the curtailments and closures of high-cost smelting
capacity, these actions will improve the competitiveness of Alcoa's
Primary Products business and help the company meet its previously
stated goal of moving down the cost curve 10 percentage points in
smelting and 7 percentage points in refining by 2015.
AA closed Tuesday's regular session down 2.92% at $9.32. The stock
has been trading between $8.45 and $18.19 for the past 52 weeks.