Alcoa posts narrower loss but misses Street estimate
Alcoa Inc
The top-line numbers are significantly better than expected, but the bottom-line numbers are worse than expected, said Stephen Massocca, managing director of Wedbush Morgan in San Francisco.
The headline number is a little bit disappointing, but as you dig in a little bit deeper it looks as though there is some improvements. It looks like the company is on track to meet many of their (financial) objectives, said Brian Hicks, co-manager of US Global Investors global resources fund.
Alcoa said the net loss was $277 million, or 28 cents per share, compared with a loss of $1.19 billion, or $1.49 per share, in the fourth quarter of 2008.
Excluding charges of 28 cents a share for restructuring, special items and discrete tax items, Alcoa earned 1 cent a share on an operating basis, short of the 6 cents a share expected, on average, by analysts. according to Thomson Reuters I/B/E/S.
Revenue fell to $5.43 billion from $5.68 billion but was 18 percent higher than the third quarter, the Pittsburgh-based company said. Wall Street expected revenue of $4.86 billion
This was a tough year for the aluminum industry -- a price crash, demand destruction, and credit crunch, said President and Chief Executive Klaus Kleinfeld.
We reshaped our cost structure and portfolio for profitable growth. And, we built the cash reserves to weather current economic uncertainties and invest in opportunities for future.
Alcoa said all its markets except aerospace, commercial building and construction, and industrial gas turbines improved from the previous quarter.
The loss followed a narrow profit in the third quarter, which had been preceded by three consecutive quarterly losses for the aluminum company, traditionally the first Dow component to report each quarter.
Aluminum, used in automobile and plane manufacturing, and for kitchen wrap and beverage cans, reached a peak of $3,380 per tonne in July 2008. But it slumped 35 percent later as the global economy went into recession and has only slowly risen. On Monday the metal was selling in London at around $2,330.
Analysts have said a weak dollar and excess warehouse aluminum inventories, as well as tepid demand in some sectors, might limit the metal's rally this year.
The company's shares dipped 6.7 percent to $16.28 in after-market trade after closing on the New York Stock Exchange at $17.45.
(Reporting by Steve James; Editing by Steve Orlofsky)
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