Alcoa Posts First-Quarter Loss of $480 Million on Falling Aluminum Prices and Sales
Alcoa Incorporated (Pittsburgh, PA) has posted a net loss of $480 million for the first quarter of 2009, compared with a profit of $370 million year over year. Industrial Info Resources (Sugar Land, TX) reports that the loss is attributed to falling aluminum prices and a drop in sales. Alcoa's revenues for the quarter totaled $4.15 billion, down 40.7 percent from $7 billion year over year. "The fourth-quarter weakness was followed by an even softer first quarter in almost every end market, as the economic recession continued in its hunt to find a bottom," said Charles McLane Jr., Chief Financial Officer and Executive Vice President. "Prices declined and inventories on the exchange continued to climb."
President and CEO Klaus Kleinfeld said the company is optimistic that the aluminum industry will turn around. He said that although the world's aluminum consumption in 2009 is expected to decline 7 percent, or by about 34.5 million metric tons, aluminum has a "bright" future. He said several mega-trends will drive demand, such as global population growth and urbanization, especially in build and construction and mass transit, which are considered major sectors for aluminum. "Environmental concerns impact all markets where aluminum's light weight and recyclability characteristics are vital," Kleinfeld said. "You can expect to see a major transition from steel to aluminum as a result."
