And so the US second quarter earnings season kicked off with a mixed story from aluminium giant Alcoa. Earnings and revenues beat expectations, with rising shipments giving some reassurance about global demand levels for this key industrial metal.
Although Alcoa lost money in the second quarter with aluminium prices dropping 18% from the same period in 2011 and down 4% from quarter one 2012, shipments rose nearly 3%.
The company’s revenues dropped nearly 10% to $5.96 billion and made a loss of $2 million, 1 cent per share, compared with profit of $322 million, or 28 cents a share. In quarter two 2011. Excluding restructuring charges and other special items, earnings from continuing operations in the latest period were 6 cents a share, down from 32 cents. Expectations were for revenues of $5.81 billion and pre-exceptional earnings of 5 cents per share.
Aluminium prices have been under pressure as global demand has slackened particularly in Europe and costs have been on the up as the raw material alumina has gone up in price. As discussed in a previous piece, commodity companies are increasingly wrestling with rising labour and machinery costs.
Oil giant Chevron reports after the US market close today giving some clues to multi national oil and gas earnings for this quarter.