Alumninum producer Alcoa Inc (NYSE:AA) this morning unofficially began earnings season on Wall Street with much weaker-than-expected third quarter results.
The New York City-based company reported Q3 EPS of $0.32, missing analyst estimates of $0.35. Revenue fell 6.5% from last year to $5.21 billion, also falling short of Wall Street’s view of $5.29 billion.
The subpar earnings results come on the heels of AA’s plan to split into two separate publicly-traded entities. Arconic and Aloca Corporation will split and begin separate trading on November 1, with the move already having been approved by its board of directors and shareholders.
Alcoa’s current CEO, Klaus Kleinfeld, will serve as Arconic’s chairman and chief after the break, while Michael Morris will become chairman of Alcoa Corporation, with Roy Harvey taking over as CEO.
From the press release:
”Alcoa steered steady and showed resilience in spite of near-term market challenges,” said Klaus Kleinfeld, Alcoa Chairman and Chief Executive Officer. “Profits grew in the combined Arconic segments, and Alcoa Corporation segments managed successfully to stay profitable in a low pricing environment. Productivity across the portfolio was exceptional, and paired with non-essential asset sales, further strengthened our cash position. Arconic’s results underline its strong position in higher margin markets where innovation, technology, process skills and cost focus pay off even under demanding circumstances, whereas Alcoa Corporation proved to be successful in spite of challenging market conditions. The strength of both future companies is the result of our multi-year strategy and allows us to launch two strong, independent entities.”
Alcoa shares fell $1.48 (-4.70%) to $30.03 in premarket trading Tuesday. Prior to today’s report, AA had gained 6.42% year-to-date, putting it roughly in line with the S&P 500’s performance in the same period.