Alcoa Corporation (NYSE: AA), a leading manufacturer of aluminum products, reported a net loss for the second quarter compared to profit last year, reflecting a sharp fall in revenues amid faltering demand and lower prices. The bottom-line, however, came in above the consensus estimate.
On an adjusted basis, Alcoa reported a net loss of $0.01 per share for the June quarter, compared to earnings of $1.17 per share in the corresponding period of 2018. Analysts were looking for a wider loss. Unadjusted net loss was $402 million or $2.17 per share, compared to a profit of $10 million or $0.05 per share in the second quarter of last year.
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.”
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.
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.
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.