Alcoa reports first quarter profit

Aluminium producer Alcoa has reported strong results for the first quarter.

The company reported income from continuing operations of $94 million in the first quarter of 2012.

Excluding the impact of special items, income from continuing operations was $105 million. Special items in first quarter 2012 included the negative impact of mark-to-market changes on certain energy contracts and restructuring charges primarily related to smelter curtailments.

First quarter 2012 income from continuing operations compares to fourth quarter 2011 loss from continuing operations of $193 million, and first quarter 2011 income from continuing operations of $309 million.

The improvement over fourth quarter 2011 results was driven by strong productivity improvements across all businesses, higher realised prices for aluminium, and improved volume and mix. These were offset somewhat by a lower realised alumina price and higher input costs.

“Performance rebounded strongly this quarter due to our proactive cash sustainability actions, our relentless focus on profitable growth, and stabilising markets,” says Klaus Kleinfeld, Alcoa chairman and CEO.

“We are successfully executing on our aggressive strategy to move down the cost curve in our upstream businesses, and drive to record profitability in our midstream and downstream businesses. Challenges remain in this economy, but we approach them better prepared than ever before.”

Alcoa recorded first quarter 2012 revenue of $6 billion, up slightly over fourth quarter 2011 and first quarter 2011. First quarter 2012 net income was $94 million.

Alcoa recorded revenue growth in the first quarter across global end markets, including industrial products (14%), automotive (13%), packaging (11%), and commercial transportation (11%), compared to fourth quarter 2011.

Alcoa continues to project a global aluminium supply deficit in 2012 and reaffirmed its forecast that global aluminium demand would grow 7% in 2012, on top of the 10% growth seen in 2011.