Earnings season is off to a good start.
Aluminium giant Alcoa reported second-quarter earnings and revenues that declined year-on-year but beat analysts’ expectations after the closing bell on Monday.
Total alumina production and shipments were down in the second quarter from a year ago. These acted as a drag on the company’s bottom line, although they were offset by gains in other industries such as aerospace.
The company reported $0.15 in adjusted earnings per share (EPS) and revenues of $5.30 billion.
Analysts were expecting a year-over-year drop in profits and revenues. Their median estimate was for adjusted EPS of $0.09, according to Bloomberg, down from 19 cents a year ago. Revenues were forecast at $5.27 billion, down from $5.90 billion a year ago.
Alcoa shares climbed by as much as 4% in after-hours trading.
“In the face of a transforming aerospace market, we moved quickly to bring our costs down while capturing new opportunities,” said Alcoa CEO Klaus Kleinfeld in the earnings statement.
Alcoa sees global aerospace market deliveries growing this year in a range of 0% to 3%, followed by “double-digit growth” in 2017. It projects a global aluminium deficit of 775,000 metric tons, as 5% demand outweighs 2.5% supply.
Investors were looking out for updates on the company’s split into two
public companies announced last September, although no meaningful news was announced. Alcoa noted that it filed an initial registration statement with the Securities and Exchange Commission on June 29.
Alcoa plans to create the Upstream Company, to retain the name Alcoa, focused on extracting from the ground, and Value-Add Company, or Arconic, which would focus on downstream operations that turn the raw material into consumer-friendly products.
As usual, Alcoa unofficially kicked off the busiest reporting season on Wall Street.