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Alcoa Swings To Q2 Profit; Beats Top And Bottom Street Views

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Alcoa (NYSE: AA) swung to second-quarter net profitability and beat Wall Street's top and bottom line expectations, citing a continued shift to value-added products.

The company posted net income of $138 million, or 0.12 cents a share, including $78 million in restructuring charges. The year-ago net loss was $119 million or 11 cents a share.

Excluding restructuring charges and other items earnings for the recent period was $216 million, or 0.18 cents a share. Analysts expected adjusted earnings of $0.12 The year-earlier result, excluding items, equaled earnings of $76 million or 7 cents a share.

Revenue for the recent quarter was essentially flat at $5.8 billion compared with a year earlier. Wall Street expected $5.64 billion in revenue.

Special items included costs for shutting a smelter in Australia and the Australian rolling mills. Also included were costs of a $2.85 billion acquisition agreement with Firth Rixon, as well as labor contract negotiations.

Free cash flow for the quarter was $260 million, with cash from operations generating $518 million. Alcoa ended the quarter with cash on hand of $1.2 billion, up from $665 million in first quarter 2014.

Net debt declined to the lowest level since 2007 and stood at $6.9 billion in second quarter, versus $7.1 billion in the first quarter

Alcoa reaffirmed its seven percent global aluminum demand growth forecast for 2014.

For the year, the company sees a global aluminum deficit of 930,000 metric tons, an increase from a deficit of 730,000 metric tons estimated in the first quarter.

Alcoa noted that its Firth Rixson unit's revenue are expected to grow 60 percent over the next three years, from $1 billion in 2013 to $1.6 billion.

In after-hours trading, Alcoa changed hands at $15.01, up 1.08 percent.

Posted-In: Earnings News

 

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