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Alcoa Corporation announces Q4 and full year 2017 results

Metal News - Published on Fri, 19 Jan 2018

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Alcoa Corporation , a global leader in bauxite, alumina and aluminum products, reported fourth quarter and full-year 2017 results. The quarter and the full-year reflect ongoing strength in alumina and aluminum pricing as management continued to execute on its strategic priorities to reduce complexity, drive returns and strengthen the balance sheet.

The Company closed the year with USD 1.36 billion cash, up USD 239 million sequentially and USD 505 million year-over-year.

Based on January 2018 market assumptions2, Alcoa is projecting full-year 2018 adjusted EBITDA, excluding special items, to range between USD 2.6 billion and USD 2.8 billion.

Mr Roy Harvey, President and Chief Executive Officer said that “Solid market fundamentals allowed us to deliver our strongest adjusted EBITDA quarter since our launch as an independent, publicly-traded company.” He added that “With a series of operating and asset decisions, we also purposefully delivered against our strategic priorities. Our first full year has been truly remarkable. By continuously focusing on our strategic priorities, and supported by favorable markets, we’ve been able to accelerate our plan to strengthen Alcoa’s foundation for an even brighter tomorrow. As we enter 2018, we will continue to execute on our objectives and look forward to delivering more in the new year.”

Mr Harvey also announced new actions that “In our continuous drive to strengthen the balance sheet, today we informed salaried employees in the United States and Canada of upcoming changes to their retirement benefits. The decisions were difficult and affect current employees who have been part of our Alcoa family the longest. But to reduce our liabilities, change is necessary; it will enable us to better prepare for an uncertain and cyclical environment as we position our Company for the future.”

Fourth Quarter 2017 Results

In fourth quarter 2017, Alcoa reported a net loss of USD 196 million, or USD 1.06 per share, compared to net income of USD 113 million, or USD 0.60 per share, in third quarter 2017. The 2017 fourth quarter results include USD 391 million of special items primarily due to previously announced actions relating to the Rockdale Operations and the Portovesme smelter that are aligned with the Company’s strategic priorities to streamline and strengthen Alcoa.

2017 Full-Year Results

For full year 2017, Alcoa reported net income of USD 217 million, or USD 1.16 per share, compared to a USD 400 million net loss, or USD 2.19 per share, for full-year 2016. Excluding special items, the Company reported adjusted net income of USD 563 million, or USD 3.01 per share, compared to a USD 227 million adjusted net loss, or USD 1.24 per share, in 2016.

Adjusted EBITDA excluding special items was USD 2.35 billion (Company’s projection was approximately USD 2.4 billion3), more than double the USD 1.11 billion earned in 2016. Strong alumina and aluminum pricing drove the increase, which was slightly offset by higher costs for energy and raw materials and unfavorable movements in foreign currency exchange rates.

Revenue in 2017 was USD 11.7 billion, up 25 % from 2016, reflecting higher alumina and aluminum pricing.

Cash from operations in 2017 was USD 1.2 billion and free cash flow was USD 0.8 billion. In 2017, cash used for financing activities and investing activities was USD 506 million and USD 226 million, respectively. Alcoa invested USD 118 million in return-seeking capital projects and controlled sustaining capital expenditures to USD 287 million in 2017.

Market Update
For 2018, the Company projects balanced global bauxite and alumina markets and a global aluminum deficit of 300 thousand to 700 thousand metric tons. Alcoa is projecting 2018 global aluminum demand growth of 4.25 to 5.25 percent, following the Company’s final 2017 global demand growth rate of 5.25 %.

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Posted By : Rabi Wangkhem on Fri, 19 Jan 2018
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