Alcoa CEO: Competitive And Transformative Moves Shine Through 'Very Nicely' In Q1

Alcoa Inc (NYSE: AA) came out with better-than-expected quarterly numbers on Wednesday on back of a turnaround in the company's smelting business. The company reported EPS of $0.14 for the quarter, compared to a loss of $0.16 in the same quarter last year. Revenue for the quarter came at $5.82 billion, a 6.7 percent year-over-year increase.

Alcoa chairman and CEO Klaus Kleinfeld was on CNBC recently to discuss the quarterly results.

Strong Operational Performance

"Let's characterize the quarter," Kleinfeld said. "I think you see it's a strong operational performance on the quarter and the transformation is really well on track. Looking at the revenues: revenues year-on-year are up 7 percent, mainly driven by organic growth in the auto – as well as in the aero sector – that's what's happening there."

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Kleinfeld continued, "Then, when you lift the hood on the profit side, you see a record performance on the upstream side again. Super, super good first quarter. And you see a very, very good performance on the downstream side.

"Then you look at the transformation: You see Firth Rixson integration well under way [...] Same thing, RTI going in the right direction and then we transform the upstream portfolio – make it more competitive. And I think this shines through very, very nicely in this first quarter."

Creating Value

On why Alcoa is not spinning off its upstream business, Kleinfeld said, "We have an obligation from our shareholders to make the best value out of the portfolio that we have. And when you look [at] what we are doing, we are creating these two pronged value engines.

"Both of these value engines are helping to create the value, and I think you see it very, very clearly in this quarter," Kleinfeld concluded.

 
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