Alcoa Reports $143M Loss In Q3, Cuts Global Aluminum Demand Growth Outlook

Alcoa Inc. (NYSE: AA), the No. 1 U.S. aluminum producer, opened the third-quarter earnings season Tuesday by posting a $143 million net loss and cutting its outlook for global aluminum demand.

Shares of Alcoa Inc. (NYSE: AA) edged up about 1 percent in after-hours trading after closing at $9.13, up a penny.

“Markets seem to be driven more by headlines than fundamentals right now, but Alcoa remains focused on the things within our control”, CEO Klaus Kleinfeld said.

Pittsburgh-based Alcoa said the loss amounted to 13 cents a share. That compares with net income of $172 million, or 15 cents a share, a year ago.

Excluding special items, Alcoa reported earnings on continuing operations of $32 million, or 3 cents a share, in the third quarter. Revenue fell to $5.83 billion from $6.42 billion, but still topped analysts’ forecast.

Economists polled by Thomson Reuters had forecast earnings of a penny per share on $5.6 billion in revenue. But the consensus estimate has fallen over the past three months, from 12 cents.

Alcoa lowered its 2012 global aluminum demand forecast to 6 percent, down from 7 percent, citing a slowdown in China -- the world’s biggest producer and consumer of aluminum. The aluminum market grew 13 percent in 2010 and 10 percent in 2011.

Alcoa is in the spotlight at the start of every earnings season, since it's generally the first company in the Dow Jones Industrial Index to deliver results. Investors often watch for signs of how earnings may unfold for other companies. The mining giant is seen as a barometer for global manufacturing, because its products are used by construction, aerospace and soft drink companies; automakers and home-appliance manufacturers.

While some see Alcoa’s results as setting the stage for what could turn out to be one of the worst U.S. quarterly earnings season since late 2009, FactSet’s analysis of the recent stock market history found that what’s been a good or bad quarter for Alcoa hasn’t really affected everybody else.

In other words, Wall Street’s downbeat forecast isn’t written in stone, at least not yet.

Earlier Tuesday, Alcoa said it will pay $85 million to settle a long-running lawsuit brought by Bahrain’s state-controlled aluminum company over alleged corruption. Based on the settlement, Alcoa recorded a $40 million charge in the third quarter in addition to the $45 million charge it recorded in the second quarter.