Alcoa (NYSE:AA) today reported strong operational performance in second quarter 2013 offset by special items primarily for restructuring and a legacy legal matter. As a result, Alcoa reported a net loss of $119 million, or $0.11 per share, in second quarter 2013, which includes $195 million of special items.
Excluding the impact of special items, net income was $76 million, or $0.07 per share, driven by productivity gains across all business segments and record performance in Engineered Products and Solutions. In the first half of 2013, Alcoa’s value-add businesses accounted for 57 percent of total revenues and 80 percent of segment after-tax operating income.
The Company reported solid second quarter 2013 revenue of $5.8 billion, positive free cash flow, and lower debt as strong end-market demand mitigated an 8 percent sequential decline in London Metal Exchange (LME) cash price.
“Our businesses showed remarkable operating performance in the quarter with solid free cash flow,” said Klaus Kleinfeld, Alcoa Chairman and CEO. “In our value-add businesses we reached another milestone with record profitability in our downstream business while acting decisively to defy the headwinds of falling metal prices in our upstream businesses. We improved our competitive position by actively restructuring, curtailing, and closing facilities and made progress addressing legacy legal issues.”Second quarter 2013 net loss of $119 million, or $0.11 per share, compares to net income of $149 million, or $0.13 per share, in first quarter 2013, and a net loss of $2 million, or $0.00 per share, in second quarter 2012. Excluding special items, second quarter 2013 net income of $76 million, or $0.07 per share, compares to $121 million, or $0.11 per share, in first quarter 2013 and $61 million, or $0.06 per share, in second quarter 2012. The $45 million sequential decline was largely due to lower LME prices. Lower prices were partially offset by higher volumes, particularly in the midstream business, productivity savings, and the favorable impact of foreign exchange rates.
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