Solid demand from the aerospace and auto markets has resulted in the company’s net income nearly doubling to $121 million. In announcing the results Alcoa highlighted productivity improvements and higher volumes in its downstream business as factors that help partially offset higher pension and maintenance costs.
With many parts of the global economy still in a state of flux it is the continuing demand for aluminium from the aerospace sector that is most benefitting Alcoa’s operations. While much of the news in recent months has been focused on the problems besetting Boeing’s 787 Dreamliner, orders from the American firm and its European competitor Airbus have continued to roll in at a startling rate. In the auto sector meanwhile, firms such as General Motors, Ford and Toyota have seen sales figures rebound to their highest levels since the financial crisis took hold.
“This was a strong quarter led by record profitability in our downstream business, improved results in our midstream business, and remarkable upstream performance in the face of weak metal prices,” said Klaus Kleinfeld, Alcoa Chairman and Chief Executive Officer. “Our mid and downstream businesses now account for 72 percent of our total after-tax operating income while our upstream business continues to move down the cost curve. We achieved these results by focusing on the things we can control and by pressing Alcoa’s innovation edge, scale, and strength in end markets.”