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October 6, 1998
Strong Earnings Despite Continuing Low Metal Prices
PITTSBURGH--October 6, 1998--
Alcoa today announced net income of $217.7 million, or $1.22 per common
share, for the third quarter of 1998.
"We are pleased with the quarter's results," said Paul H. O'Neill,
chairman and chief executive officer. "Despite low aluminum prices -
which are down 14% since the beginning of 1998 - we have maintained
strong earnings while also bringing on board Alumax, the largest
acquisition in Alcoa's history."
Net income for the 1997 third quarter was $228.1 million, or $1.32 per
share, including a special net after-tax gain of $12.3 million ($18.0
million pre-tax), or 7 cents per share.
For the 1998 nine-month period, net income was $634.7 million, or $3.68
per share, compared with $594.8 million, or $3.43 per share, for the
1997 nine-month period. The 1997 period included special net after- tax
gains of $11.2 million ($22.6 million pre-tax), or 6 cents per share.
Revenues for the 1998 third quarter were $4.1 billion compared with $3.4
billion for the 1997 third quarter. Aluminum product shipments were
1,133,000 metric tons (mt) compared with 742,000 mt in the year-ago
Revenues for the first nine months of 1998 were $11.1 billion compared
with $10.0 billion for the first nine months of 1997, while shipments
were 2,777,000 mt compared with 2,222,000 mt. Return on shareholders'
equity for the first nine months of 1998, annualized, was 17.1%,
compared with 16.8% for the year-ago period.
Marking to market certain aluminum commodity contracts resulted in a
loss of $2.7 million, or 2 cents per share, in the 1998 quarter. For the
comparable 1997 quarter, these contracts resulted in a gain of $2.6
million, or 2 cents per share.
Founded in 1888, Alcoa is the world's leading producer of aluminum and
alumina and a major participant in all segments of the industry: mining,
refining, smelting, fabricating and recycling. Alcoa serves customers
worldwide in the packaging, automotive, aerospace, construction and
other markets with a great variety of fabricated and finished products.
The company has 250 operating locations in 30 countries.
Editor's Note: The 1998 third quarter includes results from Alumax
operations for the full quarter.
Financial and operating data for Alcoa and its subsidiaries follow.