Alcoa swung to a third-quarter loss from the year-earlier period, dragged down by legal charges
But the aluminum maker topped Wall Street's expectations
Alcoa posted a loss of $143 million, or 13 cents a share a share
Excluding charges, Alcoa said it made 3 cents a share, outpacing the consensus estimate for Alcoa to break even on a per-share basis, according to FactSet
The company earned $172 million, or 15 cents a share, in the same 2011 period
Sales fell 8% to $5.8 billion due to lower metal prices
But that was above the $5.56 billion analysts had projected
Due to a slowdown in China, Alcoa tweaked its 2012 global aluminum demand forecast to 6% growth, down from 7%
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Alcoa Inc. swung to a third-quarter loss as charges related to settlements with a Bahrain company and the Environmental Protection Agency weighed, though adjusted earnings and revenue topped analyst expectations.
Alcoa's average realized price for aluminum fell 17% from a year earlier and declined 5% from the prior quarter. Shipments of aluminum products rose 3.1% from a year earlier and improved 0.9% from the prior quarter.
The company's results have been hurt recently by a decline in aluminum prices--a result of weak demand in Europe, global uncertainties and excessive production--and higher raw-material costs. To contend with sluggish prices, the aluminum giant earlier this year said it would cut output by 12% in the U.S. and Europe. Alcoa is also relying more on high-margin end products less vulnerable to slumping metal prices, such as bolts and wheels for cars and airplanes.
"We're capitalizing on pockets of strong growth and achieving record profitability in our mid and downstream businesses," said Chairman and Chief Executive Klaus Kleinfeld.
The latest period includes $175 million in special items, related to a settlement with the Environmental Protection Agency and the settlement of a lawsuit with Aluminium Bahrain BSC.
Earlier Tuesday, Alcoa agreed to a multimillion-dollar settlement of a four-year legal battle with Aluminum Bahrain BSC, a Bahrain government-owned manufacturing company also known as Alba, that alleged it took part in a scheme involving bribery and sham companies to gain lucrative contracts. Alcoa will pay $85 million to Alba, $40 million of which was recorded as a charge in the third quarter.
Total costs and expenses for the period slipped 1.6%.
Alcoa, an industrial bellwether that unofficially kicks off the U.S. earnings season, posted a loss of $143 million, or 13 cents a share, compared with a year-earlier profit of $172 million, or 15 cents a share. Excluding restructuring charges, discrete tax items and other special items, earnings from continuing operations in the latest period were three cents a share. Revenue slipped 9.1% to $5.83 billion. Analysts surveyed by Thomson Reuters predicted break-even per-share earnings and revenue of $5.54 billion.
Shares rose 1.6% to $9.28 after hours. Through the close, the stock is up 4.2% over the past three months
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