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Alcoa posts surprise 3rd-quarter profit of $77M; forecasts higher global aluminum demand
By DANIEL LOVERING
AP Manufacturing Writer
(AP) 05:40:45 PM (ET), Wednesday, October 7, 2009 (PITTSBURGH)
Painful cost-cutting and rising sales to automakers and other big manufacturers helped the nation's largest aluminum producer return to profitability for the first time in nine months.

Alcoa Inc. also forecast an 11 percent increase in worldwide aluminum demand for the rest of the year. The lightweight metal is used in everything from airplanes to cars to houses.

Even though Alcoa's third-quarter profit fell 71 percent from a year earlier, the results were a relief after three straight quarterly losses.

"Alcoa is weathering the economic storm," CEO Klaus Kleinfeld said in a statement.

The Pittsburgh-based company said rising demand, particularly from automakers, lifted its revenue compared with the prior three months.

Investors cheered the news, sending Alcoa's shares up 5.2 pct in after-hours trade.

Alcoa earned $77 million, or 8 cents per share, for the three months ended Sept. 30. That compared with profit of $268 million, or 33 cents per share, a year earlier.

Revenue tumbled 34 percent to $4.62 billion from the same period year, but was up 9 percent from the second quarter of 2009.

The latest results partly reflected a campaign of intense cost-cutting by Alcoa. The company was forced to slash thousands of jobs, sell businesses and curb production as aerospace, automotive and construction companies cut their orders late last year amid the global economic downturn. That pushed up stockpiles of the industrial metal and forced down prices.

But just last month, Alcoa boosted its annual forecast for global aluminum consumption, citing stronger demand from China.

Excluding restructuring charges, Alcoa's earnings in the latest quarter amounted to 4 cents per share, easily beating expectations of a loss of 9 cents per share on revenue of $4.55 billion. Wall Street typically excludes one-time charges in its estimates.

Shares of Alcoa climbed 74 cents to $14.94 in after-hours trade.



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