Alcoa Profit Beats Forecasts on Strong Demand
NEW YORK – Alcoa Inc. (AA), the world's largest aluminum producer, said Thursday that quarterly profit rose as revenues soared 13 percent on strong demand from the aerospace, commercial vehicle and construction markets.
Alcoa's record second-quarter results, which beat Wall Street expectations, were also boosted by the sale of its stake in a Norwegian metals firm during the qion last year as aluminum demand and prices remained high.
The company's shares rose 3.5 percent in after-hours trading to $27. It closed at $26.09 on the New York Stock Exchange.
Analysnths in the second phase of its restructuring which will eliminate a total of 8,100 positions.
Alcoa posted a second-quarter after-tax profit of $219 million on the sale of its shares in Elkem (search), the Norwegian metals firm and also $120 million in tax benefits.
But it also had after-tax charges of $230 million for the restructuring and recorded $29 million in losses from the integration of new Russian facilities.
"We achieved the highest quarterly income and revenues in Alcoa history," said Chairman and Chief Executive Officer Alain Belda. "We delivered strong results and took necessary steps to restructure, control costs, and lay the framework for solid performance over the long term."
The company had about $60 million of cost increases in the quarter for items such as energy, resins and other raw materials, which offset cost reduction efforts.
"Our restructuring program will help further position the company to eliminate costs and place us in a stronger position," said Belda.
Alcoa said revenues were driven by higher volumes and the company's acquisition of fabricating facilities in Russia. A record performance by the alumina business, a better mix of value-added fabricated products, coupled with stronger pricing and demand in the aerospace, commercial vehicle and building markets also drove revenues higher.