Alcoa, Inc. (NYSE: AA), the largest U.S. aluminum increased its outlook for global aluminum demand as markets appear to be strengthening, sending its shares up more than 3 percent in after-hours trading on Thursday.
Alcoa increased its 2010 global aluminum consumption forecast to 13 percent from 12 percent, and noted growing demand for the metal in the BRIC nations (Brazil, Russia, India, and China), among others.
Alcoa boasted third quarter profit of $61 million, or 6 cents per share, compared with $77 million or 8 cents per share in the same quarter last year, citing a drop in the price of aluminum and a weaker dollar. Revenue in the quarter rose 15 percent to $5.3 billion on higher volumes in aerospace and increased market share in the building and construction market.
Analysts on average were expecting earnings of 5 cents per share, according to Thomson Reuters I/B/E/S.
Analyst Charles Bradford of Affiliated Research Group in New York, told Reuters that the results were better than expected because of cost reductions. “But the metal’s price was pretty obvious. The fourth-quarter metals price ought to be a fair bit better,” he told the news agency.
“One thing that’s important to note, even though the aluminum price has gone up in the last weeks, you typically have lag time until it hits our bottom line, which is typically two weeks,” Alcoa CEO, Klaus Kleinfeld said in an interview with Maria Bartiromo. “We didn’t get much — actually almost nothing of that increase into the third quarter. You would see that coming through in the fourth quarter.”
Watch the full interview below: