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Mar 31, 2020
Alcoa Q1 2020 Earnings Report
Alcoa reported first quarter 2020 results, addressing COVID-19 uncertainty while executing strategic actions.
Key Takeaways
Alcoa Corporation reported a net income of $80 million, or $0.43 per share, with revenue of $2.4 billion. The company is taking decisive actions to address the COVID-19 crisis, focusing on workforce safety and financial stability. It is curtailing smelting capacity and implementing cash initiatives to deliver $700 million in savings or deferrals.
Net income of $80 million, or $0.43 per share
Adjusted net loss of $42 million, or $0.23 per share, excluding special items
Adjusted EBITDA excluding special items of $321 million
Revenue of $2.4 billion
Alcoa
Alcoa
Alcoa Revenue by Segment
Revenue by Segment
Third-party bauxite sales Revenue
CapyFin.comThird-party alumina sales Revenue
CapyFin.com Forward Guidance
Alcoa has updated annual Aluminum segment shipments to between 2.9 and 3.0 million metric tons from its earlier outlook of between 3.0 and 3.1 million metric tons, due to the impact of the Intalco curtailment on the second half of 2020. The Company’s 2020 shipment outlook for Bauxite and Alumina remain unchanged from the prior full-year estimates. Total annual bauxite shipments are expected to range between 48.0 and 49.0 million dry metric tons. Total alumina shipments are projected between 13.6 and 13.7 million metric tons.
Positive Outlook
- Company’s 2020 shipment outlook for Bauxite and Alumina remain unchanged from the prior full-year estimates.
- Total annual bauxite shipments are expected to range between 48.0 and 49.0 million dry metric tons.
- Total alumina shipments are projected between 13.6 and 13.7 million metric tons.
- In the Alumina segment, the Company expects benefits from lower costs for raw materials.
- In the Aluminum segment, the Company expects performance to be nearly flat, as improvements from lower alumina costs, smelter power costs and production costs are expected to be offset by lower Brazil Hydro sales prices and lower value add pricing and volumes.
Challenges Ahead
- Alcoa has updated annual Aluminum segment shipments to between 2.9 and 3.0 million metric tons from its earlier outlook of between 3.0 and 3.1 million metric tons, due to the impact of the Intalco curtailment on the second half of 2020.
- In the second quarter of 2020, Alcoa expects lower quarterly results in the Bauxite segment primarily due to the non-recurrence of an annual sales contract true up.
- The Company recognized significant currency benefits related to the strengthening of the U.S. dollar in the first quarter 2020, and it continues to be exposed to impacts of currency rate fluctuations in the second quarter.
- The Company expects its annual operational tax rate will vary with market conditions and jurisdictional profitability and is withdrawing its prior outlook of 70 to 80 percent.
- The extent and duration of the coronavirus COVID-19 pandemic is unknown. The uncertainty around the future impact on the Company’s business, financial condition, operating results, and cash flows could cause actual results to differ from this outlook.
Revenue & Expenses
Visualization of income flow from segment revenue to net income