Sales Falter
Revenues declined 24% annually to $2.7 billion and came in broadly in line with the estimates. The top line was negatively impacted by lower demand for aluminum and alumina and unfavorable pricing.
Roy Harvey, chief executive officer of Alcoa, said, “In the second quarter, our Aluminum segment rebounded despite weaker metal prices, and we reported a solid cash balance, even after sizeable cash outlays. We also maintained strong operational performance across all of our businesses.”
Looking Ahead
For the current fiscal year, Alcoa predicts annual bauxite shipments to be 47-48million dry metric tons. Total alumina shipments are expected to be between 13.6 million and 13.7 million metric tons, while aluminum shipments are forecast to be between 28 million and 29 million metric tons.
Related: Alcoa Inc. Q1 2019 Earnings Conference Call Transcript
Of late, Alcoa has been facing multiple challenges, including low demand for its products and uncertainties from the US-China trade dispute. The management has predicted that the global demand for aluminum will remain sluggish throughout the year. The oversupply of alumina in the Atlantic Basin is one of the reasons behind the slump.
Stock Performance
Alcoa is one of the worst-performing Wall Street stocks, which has been on a losing streak for the past two years. It lost about 22% in the past six months and 12% since last year. The stock closed Wednesday’s regular session notably lower and continued to lose in the after-hours session.