| Alcoa’s Alumina Segment Generates Best Profitability since 2007 | |
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Alcoa Reported 3Q15 Earnings on October 8: Investor Takeaways (Continued from Prior Part) Alumina segment
Alcoa (AA) is the largest global bauxite and alumina producer, with a strong first quartile cost position in both businesses. Alcoa reports the earnings of its bauxite mining and alumina refining business under its Alumina segment. The segment supplies alumina to Alcoa’s Primary Metals segment as well as sells to third-party customers.
In this part of the series, we’ll look at the Alumina segment’s 3Q15 financial performance.
Together, Alcoa and Ball Corporation (BLL) form ~4.4% of the Materials Select Sector SPDR ETF (XLB).
Record earnings
- The Alumina segment’s third-party shipments in 3Q15 stood at 2,798 thousand tons, which represents a 3.1% year-over-year (or YoY) increase.
- Alcoa has been gradually moving away from aluminum-based pricing. Now it prices ~75% of its alumina based on the API (alumina price index) or spot pricing. This makes the Alumina segment’s fundamentals independent of aluminum prices.
- Third-party selling price in 3Q15 was up ~1% from the corresponding quarter last year, as you can see in the graph above.
- Alcoa’s alumina selling prices have risen on a YoY basis but have fallen compared to 2Q15. In 3Q15, lower API prices had a negative impact of $67 million on the Alumina segment’s earnings compared to 2Q15.
- In 3Q15, the Alumina segment generated ATOI (after-tax operating income) of $212 million, which was up more than 240% year-over-year. In the first nine months of the current year, the Alumina segment has generated the highest year-to-date profitability since 2007.
Outlook
- In 4Q15, Alcoa expects production to fall 120,000 metric tons due to curtailment of its Suriname refinery.
- It also expects the ATOI to increase by $10 million in 4Q15, excluding the impact of pricing and currency.
In the next part, we’ll analyze Alcoa’s Primary Metals segment’s 4Q15 financial performance.
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PRODUCTEUR |
CODE : AWC.AX |
ISIN : US0222051080 |
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ProfilIndicateurs de MarchéVALEUR : Projets & res.Communiqués de PresseRapport annuelRISQUE : Profile actifsContactez la cie |
Alumina Ltd. est une société d’exploration minière basée en Australie. Alumina Ltd. est productrice de bauxite au Bresil, au Suriname, en Australie et en Jamaique, et détient divers projets d'exploration au Bresil. Ses principaux projets en production sont HUNTLY / WILLOWDALE en Australie, MOCHO en Jamaique, MOENGO au Suriname et TROMBETAS RIVER au Bresil et son principal projet en exploration est JURUTI au Bresil. Alumina Ltd. est cotée aux Etats-Unis D'Amerique, en Australie et en Allemagne. Sa capitalisation boursière aujourd'hui est 68,8 millions (44,8 millions US$, 41,4 millions €). La valeur de son action a atteint son plus haut niveau récent le 13 juillet 2007 à 5,10 , et son plus bas niveau récent le 13 mars 2009 à 0,54 . Alumina Ltd. possède 47 442 200 actions en circulation. |