Summary
- Alcoa to report Q1 Earnings this week.
- Operating Results will largely reflect the Aluminum Market.
- We anticipate better than expected Q1 results.
Alcoa (AA) is scheduled to present their Q1 2019 earnings on 17th April 2019. While F-Stat are anticipating better than expected Q1 results, its more than likely that aluminum market dynamics will prevent FY2019 from ending on a high note.
Price Sensitivity
AA is split into three Business Segments: Bauxite, Alumina and Aluminum. The company mines Bauxite ore which is then refined into alumina. The alumina is sold to internal and external aluminum smelter customers; around 2/3rds of the alumina is sold to external customers who process it into industrial chemical products while the remainder is transferred to the Aluminum Segment. Alcoa’s smelting and casting operations produce primary aluminum products, almost all of which are sold to external customers, however a portion of this aluminum is consumed by the rolling mill.
The firms operations are based around the mining of Bauxite and the production of Aluminum and Alumina. As such, AAs revenues are dependent on the market price of alumina and aluminum.
