Alcoa Q1 2019 Earnings Impacted By Dismissal Of Aluminium Plants In Spain

The American multinational company Alcoa Corporation released yesterday first quarter results, reporting a net loss of $199 million. The loss includes the impact of $156 million for special items, stemming from the planned closure of its two smelters in Spain.

In January, Alcoa reached a collective agreement with the workers’ representatives at the Avilés and La Coruña aluminium smelters in Spain. The two smelters with a combined operating capacity of 124,000 metric tonnes per year were curtailed in February and are being maintained in restart condition through June 30 this year in case a new owner acquires the facilities.

Excluding the impact of special items, Alcoa’s adjusted net loss amounted to $43 million primarily attributed to lower alumina and aluminium prices.

Commenting on the results, Alcoa’s President and Chief Executive Officer Roy Harvey said: “We improved our operations in the first quarter, even as alumina and aluminium prices weakened. Our Bauxite and Alumina segments increased their production rates, and we took steps last quarter to restructure our Aluminium portfolio.”

For 2019, Alcoa projects a global aluminium deficit ranging between 1.5 million and 1.9 million tonnes – down from last quarter’s full-year estimate of between 1.7 million and 2.1 million metric tonnes. The company puts global aluminium demand growth for this year at 2 to 3 per cent – down from 3 to 4 per cent in the previous quarter – due to lower demand growth in China.

In March, Alcoa warned that it could shutter its last Spanish aluminium plant in San Ciprián due to rising energy costs.