Post Earnings Coverage as Alcoa Revenue Grew 9%

Upcoming AWS Coverage on Arconic Post-Earnings Results

LONDON, UK / ACCESSWIRE / January 30, 2017 / Active Wall St. announces its post-earnings coverage on Alcoa Corp. (NYSE: AA). The Company announced its financial results for the fourth quarter and full year 2016 on January 24, 2017. In the first reporting period for the aluminium giant as a new, standalone, publicly traded Company, the adjusted numbers came in below market expectations, while sales topped estimates. Register with us now for your free membership at:

http://www.activewallst.com/register/

One of Alcoa’s competitors within the Aluminum space, Arconic Inc. (NYSE: ARNC), announced on January 23, 2017, that it will release its Q4 2016 and full year 2016 financial results on Tuesday, January 31, 2017. AWS will be initiating a research report on Arconic in the coming days.

Today, AWS is promoting its earnings coverage on AA; touching on ARNC. Get our free coverage by signing up to:

http://www.activewallst.com/registration-3/?symbol=AA

http://www.activewallst.com/registration-3/?symbol=ARNC

Earnings Reviewed

For the three months three ended on December 31, 2016, Alcoa reported revenue of $2.5 billion, up 9% sequentially, reflecting higher volume in the Company’s rolled products business, and higher alumina pricing. The Company’s sales number topped analysts’ expectations of $2.39 billion. Alcoa’s revenue in FY16 totaled $9.3 billion, down 17% from FY15, reflecting lower pricing and volumes in alumina and aluminum, and was slightly offset by higher third-party bauxite shipments.

For Q4 2016, Alcoa reported net loss of $125 million, or $0.68 per share, as a result of costs to streamline portfolio. The Company’s earnings results included $151 million of special items primarily related to the permanent closure of Suralco’s refinery and mines in Suriname and the impairment of Alcoa of Australia Limited’s (AofA) interests in a Western Australia (WA) gas field. For Q3 2016, Alcoa reported a net loss of $10 million, or $0.06 per share. Excluding special items, the Company’s adjusted net income was $26 million, or $0.14 per share, for the reported quarter, which was below analysts’ forecast of $0.22 per share.

For FY16, Alcoa reported a net loss of $400 million, or $2.19 per share, compared to net loss of $863 million, or $4.37 per share, for FY15. Excluding special items, the Company reported an adjusted net loss of $227 million, or $1.24 per share, for the year.

Adjusted earnings before interest, tax, depreciation, and amortization (EBITDA), excluding special items of $335 million, was up 18% sequentially on rising alumina pricing. Alcoa’s adjusted EBITDA excluding special items for FY16 was $1.1 billion compared to $1.8 billion in FY15, due to lower alumina and aluminum pricing during the first three quarters and incremental costs to operate the Warrick, Indiana rolling mill as a cold metal plant, but was partially offset by net productivity improvements.

Balance Sheet

As of December 31, 2016, Alcoa had $853 million cash balance and $1.4 billion of debt. Since launching as an independent Company on November 01, 2016, Alcoa has increased its cash position by $198 million and closed Q4 2016 with a cash balance of $853 million. In the reported quarter, the Company achieved a seasonal low of 13 days working capital. In FY16, Alcoa invested in return-seeking capital projects of $82 million, and controlled sustaining capital expenditures to $322 million. Return on capital in FY16 was 5.3%.

Outlook

For FY17, Alcoa is expecting relatively balanced global bauxite and alumina markets and a modest global aluminum surplus of 400 thousand to 800 thousand metric tons. Alcoa is projecting FY17 global aluminum demand growth of 4% over FY16. The Company is estimating pension and OPEB expense to be approximately $175 million for FY17, down from $200 million. Alcoa is projecting transformation costs to be approximately $150 million, plus additional cash from R&D expense remediation and ARO reserves in the range of $150 million to $170 million.

Alcoa is forecasting FY17 capital expenditures to be less than $300 million. The Company stated that it has18 projects totaling $385 million in growth spend. In FY17, it will start 11 of those 18 projects.

Stock Performance

At the closing bell, last Friday, January 27, 2017, Alcoa’s stock climbed 1.02%, ending the trading session at $36.67. A total volume of 3.62 million shares were traded at the end of the day. In the last month and previous three months, shares of the Company have rallied 23.68% and 75.31%, respectively. Moreover, the stock surged 30.59% since the start of the year. As per its last close, the Company’ stock has a market cap of $6.66 billion.

Active Wall Street:

Active Wall Street (AWS) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and micro-cap stocks. AWS has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.

AWS has not been compensated; directly or indirectly; for producing or publishing this document.

PRESS RELEASE PROCEDURES:

The non-sponsored content contained herein has been prepared by a writer (the “Author”) and is fact checked and reviewed by a third party research service company (the “Reviewer”) represented by a credentialed financial analyst, for further information on analyst credentials, please email info@activewallst.com. Rohit Tuli, a CFA® charterholder (the “Sponsor”), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable-effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by AWS. AWS is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.

NO WARRANTY

AWS, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. AWS, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, AWS, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.

NOT AN OFFERING

This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither AWS nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visit http://www.activewallst.com/disclaimer/.

CONTACT

For any questions, inquiries, or comments reach out to us directly. If you’re a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:

Email: info@activewallst.com

Phone number: 1-858-257-3144

Office Address: 3rd floor, 207 Regent Street, London, W1B 3HH, United Kingdom

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

SOURCE: Active Wall Street

ReleaseID: 453780