Alcoa Inc., the largest U.S. aluminum producer, reported first-quarter earnings that exceeded analysts’ estimates as demand from airplane and car manufacturers increased.
Net income rose to $149 million, or 13 cents a share, from $94 million, or 9 cents, a year earlier, the New York-based company said yesterday in a statement. Earnings excluding an income-tax benefit and other one-time items were 11 cents a share, beating the 8-cent average of 18 estimates compiled by Bloomberg.
Alcoa, traditionally the first company in the Dow Jones Industrial Average to report earnings, has been shifting its focus from the production of the lightweight metal to making valued-added aluminum parts for industry. Profit in the engineered products and solutions unit, which supplies the aerospace and automotive industries, rose 10%, Alcoa said in the statement.
“There was clear improvement in engineered products,” Lloyd O’Carroll, an analyst at Davenport & Co. in Richmond, Virginia, said yesterday by phone. “The aerospace market is strong.”
Alcoa rose 0.5% to $8.43 at 9:43 a.m. in New York. The shares have declined 3.4% this year.
Airbus SAS and Boeing Co. are working to meet aircraft orders as U.S. airlines replace the world’s oldest fleets. Airbus yesterday broke ground on a new plant in Mobile, Alabama, which will build the A320neo single-aisle jet.
U.S. light-vehicle sales in March climbed 3.4% to 1.45 million, the best month for the industry since August 2007, according to researcher Autodata Corp. Automakers sold 3.69 million cars and light trucks in the U.S. this year through March, the most in any quarter since the last three months of 2007.
The auto industry is on track to consume 4% more aluminum this year as the average North American car adds 14 pounds of the metal in 2013 compared with last year, according to research by O’Carroll.
Alcoa’s revenue fell 2.9% to $5.83 billion, missing the $5.88 billion average of 11 estimates. The company cited lower metal prices and the impact of smelter curtailments in Spain and Italy for the decline in sales.