Alcoa Inc Misses Earnings Estimates, Beats On Revenue

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Alcoa released the earnings results from its second quarter after closing bell tonight, posting adjusted earnings of 19 cents per share, a 16% year over year increase, on $5.9 billion in revenue. Analysts had been expecting adjusted earnings of 23 cents per share on $5.79 billion in revenue.

In the same quarter last year, the aluminum manufacturer reported earnings of 18 cents per share and $5.8 billion in revenue.

Key metrics from Alcoa’s earnings report

Alcoa reported net income of 10 cents per share or $140 million for the second quarter. The company said the main driver of its revenue growth during the quarter was strong organic growth in its alumina, automotive and aerospace businesses.

The company saw record operating income of $210 million in its Engineered Products and Solutions division. Also Aerospace revenue climbed 29% year over year. Operating income in Alcoa’s Global Rolled Products division climbed 9% to $76 million, while adjusted EBITDA per metric ton for the segment climbed 18%. Also revenue from automotive sheets increased 180% year over year as volume in the segment climbed 200% year over year to set a new record.

Alcoa reported $215 million in operating income in its Alumina segment, marking the best profitability for the segment in the first half of the year since 2007. The Primary Metals business saw $67 million in operating income. Transaction prices in the Midwest have fallen $527 per metric ton, a 22% decrease, so far year to date.

Alcoa provides guidance

Management still expects growth to remain steady this year across most of Alcoa’s end markets. They’re expecting between 8% and 9% in global sales growth in the aerospace sector. Alcoa also is receiving an increasing number of orders for heavy duty trucks and trailers in North America.

The company expects growth of between 9% and 11% for the segment this year, an increase from the previous growth estimate of between 4% and 6. Globally, however, management reduced their growth estimate for heavy trucks and trailers from a decline of 2% to 4% to a decline of 4% to 6%.

Alcoa expects to see global demand for aluminum to increase 6.5% this year.

Shares of Alcoa edged upward by as much as 0.48% to $10.55 per share after tonight’s earnings report. The aluminum manufacturer’s stock ended the regular trading day down by 5.11% at $10.50 per share.

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