Alcoa Net Falls 24% Amid Declining Prices
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Alcoa Inc., the world’s largest aluminum company, said second-quarter profit fell 24% as increased production in China helped drive aluminum prices lower.
Earnings fell to $232 million, or 27 cents a share, from $307 million, or 35 cents, a year ago, the Pittsburgh-based company said.
Wall Street’s expectations had been falling over the last several weeks and Alcoa’s earnings came in 1 cent shy of estimates by analysts polled by Thomson First Call.
Analysts said, however, that Alcoa’s cost-reduction program has been respectable given the low prices for aluminum and that the company fell roughly in line with their expectations.
Alcoa said shipments rose 3.2% in the quarter, led by demand from auto makers, builders and packaging companies, and said it was controlling costs and operating expenses.
Revenue was down 12% from a year ago to $5.25 billion but up 5% over the first quarter, the first sequential increase in six quarters.
Shares of Alcoa fell 88 cents to close at $32.50 on the New York Stock Exchange.
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