Alcoa Inc. posts second quarter net loss in slowing economy

Aluminum manufacturer Alcoa Inc. opened the second-quarter earnings season Monday by posting a $2 million loss. Revenue dropped 9 percent mainly because of weak prices for aluminum in the slowing global economy.

Alcoa posted break-even earnings per share. That compared with 28 cents per share and net income of $322 million a year ago.

The results included one-time items of $63 million. Excluding those, Alcoa earned $61 million, or 6 cents a share. Revenue totaled $5.96 billion, compared with $6.59 billion a year ago.

Analysts surveyed by FactSet expected Alcoa to earn 5 cents per share on revenue of $5.83 billion. Analysts typically exclude one-time items. They have been lowering their expectations for Alcoa in recent weeks because of weaker prices, rising inventories and the sluggish economies of the U.S., Europe and China.

Alcoa said that it was hit by an 18 percent decline in aluminum prices from the second quarter of 2011, but it saw pockets of stronger demand in some industries, and overall shipments were up from a year ago.

“Although aluminum prices are down, the fundamentals of the aluminum market remain sound with strong demand and tight supply, and Alcoa is successfully capitalizing on accelerating demand in high-growth end markets such as aerospace and automotive,” Klaus Kleinfeld, Chairman and CEO, said in a statement.

The company, which operates a smelter off U.S. Highway 52 near Goose Creek in Berkeley County, stuck with its forecast for a 7 percent increase in global demand this year and predicted that there would be a global aluminum supply deficit this year.

Alcoa’s performance reflects broader economic trends because aluminum is used in a wide range of products from automobiles to beverage cans. It is the first company in the Dow Jones industrial average to report earnings, so investors often watch its results for signs of how earnings may unfold for other companies.

A number of companies could join Alcoa in reporting disappointing lower second-quarter results because of the sluggish global economy.

Analysts expect earnings for companies in the Standard & Poor’s 500 index to decline 1 percent in the quarter compared with the year before, according to S&P Capital IQ, the research arm of S&P. If that happens, it would be the first decline since the third quarter of 2009.

Alcoa reported earnings after the market closed. Shares rose 4 cents in after-hours trading to $8.80. In the past 52 weeks, the price has ranged from $8.21 to $16.16 per share.