Alcoa CEO: We Are Creating "Two Pronged Value Engines"

Alcoa Inc AA came out with better than expected quarterly numbers on Wednesday on back of a turnaround in the company's smelting business. The company reported EPS of $0.14 for the quarter, compared to a loss of $0.16 in the same quarter last year. Revenue for the quarter came at $5.82 billion a 6.7 percent year-over-year increase.

Alcoa chairman and CEO Klaus Kleinfeld was on CNBC recently to discuss the quarterly results.

Strong Operational Performance

"Let's characterize the quarter," Kleinfeld said. "I think you see it's a strong operational performance on the quarter and the transformation is really well on track. Looking at the revenues, revenues year on year up 7 percent, mainly driven by organic growth in the auto as well as in the aero sector that's what happening then."

Kleinfeld continued, "Then when you lift the hood on the profit side, you see a record performance on the upstream side again; super good first-quarter and you see a very, very good performance on the downstream side. Then you look at the transformation, you see Firth Rixson integration well under way, […] same thing, RTI going in the right direction and then we transform the upstream portfolio to make it more competitive and I think this shines through very, very nicely in this first quarter."

Creating Value

On why Alcoa is not spinning off its upstream business, Kleinfeld said, "We have an obligation from our shareholders to make the best value out of the portfolio that we have and when you look at what we are doing, we are creating this two pronged value engines …both of these value engines are helping to create the value so and I think you see this very, very clearly in this quarter."