Alcoa Corporation Reports Third Quarter 2024 Financial Results
Alcoa Corporation (NYSE:AA, ASX:AAI) has released its financial results for the third quarter ending September 30, 2024. The report indicates significant progress, including the impact of acquiring Alumina Limited, and improvements in key financial metrics compared to previous periods.
Financial Metrics Overview
| Financial Metric | Q3 2024 Actual | Q3 2024 Consensus | Q2 2024 (Previous Quarter) |
|---|---|---|---|
| Total Revenue | $2.9 billion | $2.97 billion | $2.9 billion |
| Earnings Per Share (EPS) | $0.38 | $0.28 | N/A |
| Adjusted Net Income | $135 million | N/A | $104 million |
| Adjusted EBITDA | $455 million | N/A | $325 million |
Interpretation : Alcoa's third quarter revenues remained flat sequentially at $2.9 billion, missing consensus estimates slightly. However, earnings per share surpassed expectations at $0.38 compared to the consensus of $0.28. The substantial increase in adjusted EBITDA to $455 million and adjusted net income reflect higher alumina prices and lower raw material costs.
Segment Revenue Performance
| Segment | Q3 2024 Revenue | Sequential Change |
|---|---|---|
| Alumina | Increased 9% | Decreased 4% in production |
| Aluminum | Decreased 5% | Increased 3% in production |
Interpretation : The Alumina segment showed strength with a 9% increase in third-party revenue driven by a 22% rise in average realized prices. Conversely, the Aluminum segment experienced a 5% decline in third-party revenue due to reduced shipments despite a slight increase in production volume.
Key Developments and Operational Highlights - Acquisition : Completion of Alumina Limited acquisition on August 1, 2024, enhancing Alcoa's market position. - Strategic Sale : Agreement to sell 25.1% interest in Ma'aden joint ventures for approximately $1.1 billion. - Strategic Cooperation : Progress towards a strategic agreement to support San Ciprián operations. - Dividend : Paid a quarterly cash dividend of $0.10 per share. - Cash Position : Ended the quarter with a $1.3 billion cash balance.
Officer Comments William F. Oplinger, Alcoa's President and CEO, highlighted strategic accomplishments during the quarter, including the Alumina Limited acquisition and favorable market conditions. He noted these factors contributed to stronger results and emphasized Alcoa’s commitment to ongoing operational improvements and strategic initiatives.
Dividends and Share Repurchase Programs Alcoa declared a quarterly cash dividend of $0.10 per share, resulting in a total cash outflow of $26 million for dividends, inclusive of shares issued during the Alumina Limited acquisition.
Forward Guidance For the remainder of 2024, Alcoa expects stable production and shipment volumes in both the Alumina and Aluminum segments compared to prior projections. Adjusted EBITDA in the Alumina segment is anticipated to benefit from higher shipments and reduced production costs. However, additional expenses related to Ma'aden equity losses and contributions to the ELYSIS™ project are expected.
Stock Price Movement Post-earnings release, Alcoa’s stock experienced a positive movement with an increase of 1.86%.
Alcoa remains committed to transparency and will communicate future updates via its website and regulatory filings.
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