updated 10/8/2004 9:14:55 AM ET 2004-10-08T13:14:55

Alcoa Inc. posted a tiny gain in quarterly income on higher aluminum prices, though the company was plagued throughout the third quarter by a fire, a hurricane and labor strife.

Alcoa on Thursday reported net income of $283 million, or 32 cents per share, compared with a profit of $280 million, or 33 cents a share, for the same period last year. Excluding losses from discontinued operations, the company made $298 million, or 34 cents per share.

Third-quarter results were in line with expectations of analysts surveyed by Thomson First Call, who had lowered forecasts by 18 cents to 34 cents because of a profit warning from the world's largest aluminum producer.

Alcoa alerted analysts last month that profits would be dampened by a strike at a Quebec aluminum smelter, a fire at a Pennsylvania packaging plant, and the temporary shutdown of its Jamaican smelter because of Hurricane Ivan.

Alcoa had revenues of $5.97 billion, up 12.5 percent from $5.3 billion during the third quarter last year.

Before the profit report was released, Alcoa shares fell 8 cents to close at $34.08 on the New York Stock Exchange. They lost another 18 cents in the extended session.

Alcoa has benefited from rising aluminum prices, which have jumped a nickel per pound since Sept. 20, said Charles Bradford of Bradford Research/Soleil Securities in New York.

The company said commercial transportation and aerospace markets continue to see improvements.

Not included in the third-quarter report was a previously announced charge for closing its Wenatchee, Wash., smelter. The 400 workers accepted a tentative labor contract that saved the company about $20 million in severance payments.

But a strike that began July 7 by the Syndicat des Employees de l'Aluminerie de Becancour in Canada has shut down two-thirds of the company's smelter in Quebec and cost Alcoa $29 million after taxes.

The company also reported a pretax loss of $17 million due to fluctuations in foreign currency.

The slowdown of shipments because of damage to Jamaica's Rocky Point, plus cleanup costs at the Jamalco refinery, had a total impact of $7 million after taxes. Company officials say damage to the refinery itself was minimal but ports in the country were damaged.

The fire at the KAMA packaging facility in Hazleton, Pa., and charges related to the closure of the Northwood, Ohio, automotive plant cost a total of $7 million after taxes.

Energy prices, especially in Europe and North America, continue to be a drag on earnings, Alcoa said.

Projected full-year capital expenditures were lowered to $1.2 billion, said Alain Belda, Alcoa's chairman and chief executive.

Continued labor problems continue to lower profitability for Alcoa, but Belda said, "We are taking the right approach to ensure competitiveness for the long-term."

Alcoa has 120,000 employees and operates in 41 countries, primarily in North America and Europe.

Copyright 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 1.97%
$30K home equity loan FICO 5.80%
$75K home equity loan FICO 4.54%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.70%
13.70%
Cash Back Cards 17.91%
17.91%
Rewards Cards 17.17%
17.17%
Source: Bankrate.com