US aluminium giant Alcoa suffers US$497m loss

    WASHINGTON: US aluminium giant Alcoa said on Tuesday it had posted its second consecutive quarterly loss as aluminium prices plunged amid a sharp global economic downturn. The higher-than-expected 497-million-dollar net loss in the first quarter reflected a decline of 61 cents per share, compared with a net loss for the 2008 fourth quarter of 1.2 billion dollars, or 1.49 dollars per share. Excluding one-time charges, Alcoa posted a loss of 59 cents a share, slightly higher than the 57 cents a share anticipated by most analysts.

     Klaus Kleinfeld, Alcoa chief executive, said the company's financial performance in the quarter was "adversely affected" by the economy-driven drop in demand and "historic drop" in aluminium prices. Alcoa's results kicked off the US corporate earnings reporting season for the January-March period, with analysts expecting a mostly weak performance by companies reeling from prolonged recession stemming from a home mortgage meltdown. Alcoa's revenue for the first quarter slumped to 4.1 billion dollars, down from 5.7 billion dollars in the fourth quarter 2008. "The sharp drop in revenue resulted from the impact of the economic downturn on Alcoa's end markets - automotive, transportation, building and construction and aerospace," the company said.

     "As demand weakened during the quarter in those markets, realised metal prices fell an additional 558 dollars a tonne - a 26 percent price decline - resulting in prices that are now about 60 percent lower than last summer." Kleinfeld said Alcoa was implementing a "holistic programme that dramatically re-positions our balance sheet and operational cost structure." "Besides putting us in a strong position to manage through this downturn, we now have the strategic and operational fundamentals in place for Alcoa to emerge even stronger when the economy recovers," he said. - AFP/de