Alcoa profit falls on high energy costs, weak dollar
>>>In normal markets, this would result in a 300 point down day tomorrow. But.............<<<
4:15 PM EDT April 7, 2008
SAN FRANCISCO (MarketWatch) -- Alcoa on Monday kicked off the first earnings season of the year with what will likely become a familiar refrain of falling profit amid poor demand from top industrial customers, surging energy costs and a weak U.S. dollar.
The New York-based aluminum giant handed in a first-quarter profit of $303 million, or 37 cents a share, down from $632 million, or 75 cents a share, in the same period a year ago.
Excluding restructuring and tax-related items, Alcoa posted income from continuing operations of $361 million, or 44 cents a share. When accounting for the currency impact, Alcoa said profit came to 52 cents a share.
Revenue fell to $7.4 billion, down from $7.9 billion a year earlier due to the sale of its packaging and consumer business.
Analysts polled by Thomson Financial were looking for a profit, on average, of 48 cents a share on $7.2 billion in sales.
"Upstream margins were squeezed by higher energy costs and a weaker U.S. dollar, but the global market remains tight and prices are near historic highs, primarily driven by demand in Asia, especially China," Chairman and CEO Alain Belda said in a statement.
Alcoa's report is seen as ushering in another rough period for corporate results, with earnings for S&P 500 companies seen declining 10.9% from the year-ago period, according to Wall Street targets. Still, that's an improvement from the showing they made in the fourth quarter when earnings fell 25.1%, the worse quarterly performance since at least 1991. See full story. |
