Alcoa Inc. said Wednesday that third-quarter income soared as higher aluminum prices and lower costs for raw materials boosted its core primary-metals business.
The results beat Wall Street expectations, and the company’s stock rose 2% in after-hours trading.
Alcoa has been pivoting from its traditional role of mining and smelting aluminum to become a more diversified maker of lightweight metal and alloy products for aerospace, autos and other industries, the Associated Press reported, but it was the core metals business that propelled Alcoa in the third quarter.
The primary-metals segment posted operating earnings of $245 million, up from just $8 million a year earlier. The company said that costs for the raw material alumina were lower while the price of aluminum it produced rose 16%. Alcoa said the division also benefited from higher productivity. The company has shuttered plants and taken other steps to cut costs.
The cash price of primary Indian aluminum saw the biggest increase at 1.9%, finishing at INR 121.00 ($1.97) per kilogram for Wednesday, October 8. The cash price of primary aluminum closed at $1,886 per metric ton. Following a couple days of improvement, the metal’s price weakened by 0.6% on the LME. Following two days of rising prices, the 3-month price of aluminum dropped 0.5% on the LME to $1,916 per metric ton.
Chinese aluminum prices closed flat for the day. The price of Chinese aluminum scrap remained essentially flat at CNY 12,250 ($1,995) per metric ton. The price of Chinese aluminum billet was unchanged at CNY 13,590 ($2,213) per metric ton. For the fifth consecutive day, the price of Chinese aluminum bar held flat at CNY 14,200 ($2,312) per metric ton. The cash price of Chinese aluminum continues hovering around CNY 13,960 ($2,273) per metric ton for the fifth day in a row.