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Alcoa Corporation Reports Third Quarter 2020 Results

Metal News - Published on Fri, 16 Oct 2020

Image Source: Alcoa
Alcoa Corporation reported third quarter 2020 results that reflect improved pricing for alumina and aluminum, continued operational excellence during the pandemic, and a strong cash position. Alcoa President and CEO Roy Harvey said “Across all of our segments, we are delivering solid results and continuing to improve overall performance. In the third quarter, we captured the gains from better pricing in alumina and aluminum, increased sales of value-add aluminum products, and realized a 54 percent sequential improvement in adjusted EBITDA.”

Third Quarter Highlights

Generated $158 million in cash from operations; $84 million free cash flow

Set new production records for Alcoa operated mines and refineries

Realized an 11 percent sequential increase in sales volume of value-add products due to improving customer demand in the aluminum segment

Completed restart of ABI smelter in Bécancour, Québec and curtailment of Intalco smelter in Washington State

Continued progress in improving safety; managing health risks posed by COVID-19 pandemic; all production sites remain fully operational

Financial Results
M, except per share amounts3Q202Q20QoQ3Q19YoY
Revenue$2,365 $2,148 10%$2,567 -8%
Net loss attributable to Alcoa Corporation($49)($197)-75%($221)-78%
Loss per share attributable to Alcoa Corporation($0.26)($1.06)-75%($1.19)-78%
Adjusted net loss($218)($4)-5550%($82)-166%
Adjusted loss per share($1.17)($0.02)-5750%($0.44)-166%
Adjusted EBITDA excluding special items$284 $185 54%$388 -27%

Production records: In the third quarter of 2020, Alcoa set a year-to-date production record for Alcoa-operated bauxite mines and the Alumina segment surpassed its record rate (metric tons per day) for quarterly production, last set in the second quarter of 2020.

Shipments: In Alumina, third-party shipments increased approximately 6 percent sequentially, primarily due to the timing of shipments and higher overall production. In Aluminum, third-party shipment volume declined approximately 3 percent, primarily related to the curtailment of the Intalco smelter in the third quarter of 2020.

2020 Outlook - The Company’s 2020 shipment outlook for Bauxite and Aluminum remains unchanged from the prior full-year estimates. Total annual bauxite shipments are expected to range between 48.0 and 49.0 million dry metric tons. Aluminum shipments are expected to be between 2.9 and 3.0 million metric tons. The Company expects its 2020 shipment outlook for Alumina to improve by 0.2 million metric tons to between 13.8 to 13.9 million metric tons due to improved production levels. In the fourth quarter of 2020, Alcoa expects flat sequential quarterly results in the Bauxite segment. In the Alumina segment, the Company expects lower sequential quarterly results primarily from higher energy costs and a change in the mix of customer shipments. In the Aluminum segment, the Company expects a sequential decline with anticipated higher power costs in Europe, a full quarter of Section 232 tariffs, and higher maintenance and seasonal labor costs, partially offset by the positive impact of the Intalco curtailment for a full quarter.

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Posted By : Yogender Pancholi on Fri, 16 Oct 2020
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